Why General Motors Is Betting on Sodium-Ion Batteries

Peak Energy announced last week that it has entered a new partnership with General Motors to manufacture sodium-ion batteries for energy storage systems.

The deal marks a pivotal moment for Peak, a startup founded three years ago, and an opportunity for GM to branch out into a battery technology that is largely limited to China.

I spoke this week with Cameron Dales, Peak’s co-founder and chief commercial officer, and I started by asking him how he would explain a sodium-ion battery to a 10-year-old.

A good place to start, he said, is to understand that the market-leading technology—lithium-ion batteries—gained a foothold in the 1990s because of high energy density. So it has a long track record of success.

“They pack a lot of power into a small package, which is why they’re so great for mobile applications, because you’re carrying this battery around with you in your phone, you’re carrying it around with you in your car, which is a large mobile device,” he said.

But there are downsides. Lithium-ion batteries use rare and expensive materials such as lithium and cobalt, and they are highly flammable.

Sodium-ion is a sister technology, he said. The main difference is that it uses sodium to carry the charge inside the battery, rather than lithium.

“It’s the same raw material that goes into table salt,” Dales said. “It’s an abundant element.”

Also, fire risk is much lower.

The main downside is that a sodium-ion battery has lower energy density than a lithium-ion one, so an energy storage project requires a larger battery or batteries to achieve the same capacity.

But what about the cost?

Right now, sodium-ion batteries cost more than lithium-ion because the latter has economies of scale from being the dominant technology and companies have spent decades honing the manufacturing process. But companies such as Peak are confident that sodium-ion batteries will be less expensive, and eventually much less expensive, as the product moves from the fringes of the market to the mainstream.

The world’s leading battery-maker, CATL of China, has invested in developing sodium-ion batteries for cars and energy storage, citing cost and safety advantages.

In the United States, Peak is one of about a dozen companies working on the technology. One of its peers, Natron Energy, abruptly closed last year when its funding dried up. It had about 100 employees and operations in California and Michigan.

Peak, which is based in Burlingame, California, in the Bay Area, has about 125 employees. It also has a cell engineering center in Broomfield, Colorado, near Denver. The company demonstrated its technology by completing a 3.1-megawatt-hour sodium-ion battery in the Denver area last year.

Cameron Dales is Peak Energy’s co-founder and chief commercial officer.

Peak was founded in 2023 by Landon Mossberg, the CEO, who came from the battery maker Northvolt and had prior experience at Tesla, and Dales, who previously was at the battery maker Enovix.

Under the partnership with GM, the automaker will produce sodium-ion batteries in its Michigan battery lab, and Peak will be able to use them in its energy storage systems.

The agreement helps GM build an energy business that includes electric vehicles, charging and stationary energy storage. Kurt Kelty, GM’s vice president for battery and sustainability, said in a news release that his company believes “sodium-ion will be a defining chemistry for grid-scale energy storage systems.”

GM is one of several automakers branching out into energy storage systems. One reason for this is that the companies built battery manufacturing capacity that exceeds current EV demand, so they are looking to new markets.

Based on manufacturing capacity, sodium-ion battery market share is essentially zero in North America, according to Benchmark Mineral Intelligence. It will still be less than 1 percent in 2030, according to the research firm’s forecast.

In China, sodium-ion’s market share is 1 percent and on track to rise to 3.4 percent by 2030.

“Sodium-ion battery technology has advanced rapidly over the past two years, moving from lab-scale validation to early commercial deployment,” said Anya Sidhu, a battery analyst for Benchmark, in an email.

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Sidhu said sodium-ion batteries are emerging as a complementary technology to lithium-ion rather than a replacement.

“The partnership between GM and Peak Energy signals growing commercial confidence, particularly for stationary energy storage, where cost and supply chain resilience matter more than energy density,” she said.

Dales said the market is large and diverse enough that several, if not many, battery technologies will be major contributors. For example, analysts and battery scientists have long made…