IRENA Insights - Next-Generation EV Batteries: Innovation, Materials and Supply Chain Resilience

Why It Matters

Accelerating battery innovation and diversifying chemistries will protect the EV rollout from critical‑material shortages, ensuring a resilient, cost‑effective path to decarbonisation.

Key Takeaways

• EV battery demand could quintuple by 2030, stressing materials.
• Innovation can cut critical material use, easing supply bottlenecks.
• Sodium‑ion batteries avoid lithium, nickel, cobalt, enhancing resilience.
• Cost gap remains; sodium‑ion cells still pricier than lithium‑ion.
• Deployment hinges on scaling, pricing, and performance improvements.

Summary

IRENA's latest webinar highlighted the rapid growth of electric‑vehicle (EV) battery demand and its implications for critical material supply chains. The organization’s 2024 report projects a five‑fold increase in battery production by 2030, requiring roughly 4,300 GWh of capacity to meet a 1.5 °C‑aligned scenario. While geological reserves appear sufficient, bottlenecks are expected in mining, refining and processing stages, making a holistic supply‑chain view essential.

The analysis explored three technology pathways: a stagnation scenario dominated by nickel‑rich chemistries, a current‑trend path favoring lithium‑iron‑phosphate (LFP/LMFP), and an aggressive‑innovation scenario where sodium‑ion batteries gain market share. Innovation can dramatically reduce reliance on scarce metals such as cobalt and nickel, easing geopolitical pressures. Sodium‑ion cells, which use abundant sodium compounds, avoid lithium, nickel and cobalt altogether, offering greater resource resilience.

Key data points underscored the trade‑offs: lithium carbonate prices spiked in 2022, prompting interest in alternatives, yet sodium‑ion batteries still cost $80‑100 /kWh versus $52‑81 /kWh for lithium‑ion today. Performance advantages include stable operation across extreme temperatures, making them attractive for stationary storage and certain EV markets in China, India and Southeast Asia. However, lower energy density and higher current costs mean they remain complementary rather than disruptive at present.

For industry and policymakers, the takeaway is clear: accelerating battery‑technology R&D, expanding processing capacity, and fostering recycling will be critical to de‑risk supply chains. Diversifying chemistries, especially toward sodium‑ion and other low‑critical‑material solutions, can safeguard the energy transition against material shortages and price volatility.

Original Description

EV battery demand is set to grow fivefold by 2030 to meet climate goals, putting intense pressure on lithium, cobalt and nickel supply chains. Sodium-ion batteries offer a strategic alternative, as they are built on abundant, widely distributed materials that can diversify supply chains and ease critical mineral constraints. This session examined battery chemistry pathways to 2030, the role of sodium-ion in supporting rapid electrification and the policy actions needed to drive innovation, circularity and supply chain resilience.

To read the full report, click here: https://www.irena.org/Publications/2025/Nov/Sodium-ion-batteries-A-technology-brief

For more on the Insights Webinar series: https://www.irena.org/Events/2020/Jun/IRENA-Insights