Lithium-ion batteries are a growing technology worldwide in line with the demand for electricity and regulations to lower emissions. IDTechEx's report, "Li-ion Battery Market 2025-2035: Technologies, Players, Applications, Outlooks and Forecasts", explores electric vehicles and stationary energy storage as two of the main applications for Li-ion batteries, and the different characteristics of chemistries and cathodes.
The Li-ion market, EVs, and stationary energy storage
The Li-ion battery market is forecast by IDTechEx to exceed 3500GWh by 2030, largely driven by demand for battery electric vehicles and stationary energy storage. The performance and requirements of some of these applications are likely to shape the trajectory of the Li-ion battery market. While 2024 saw slower than expected growth for the EV market, especially outside of China, and while there is some short-term uncertainty, the long-term growth outlook for battery electric vehicles remains strong as a result of improving technologies, and battery performance and price.
Contrary to the EV market, stationary battery energy storage system (BESS) deployments continued along their strong growth trajectory due to strong policy drivers and the growing implementation of renewable energy sources such as solar and wind. Another key contributor to the strong demand for BESS came from falling system prices, driven in part by strong competition and overproduction.
China and the US have long been leaders in stationary energy storage deployment, with China leading the way due to strong policy and regulatory support, as well as a thriving domestic battery market. Recent shifts in the policy landscape in both China and the US create short-term uncertainty, though demand is expected to continue on its growth trajectory. Other regions can also expect growth within the stationary energy storage sector, with Europe, Chile, and Australia demonstrating high renewable energy targets, and schemes in place worldwide for funding and investments. Visit IDTechEx's report, "Batteries for Stationary Energy Storage 2025-2035: Markets, Forecasts, Players, and Technologies" for more information.
Li-ion chemistry trends and cathode materials
There are two main cathode families for EV and stationary storage applications for Li-ion batteries, including nickel manganese cobalt (NMCs) or nickel cobalt aluminium (NCA) and lithium iron phosphates (LFPs). The battery characteristics needed for specific applications will determine the cathode choice, as they differ in energy density, safety, and cost.
NMCs have a relatively high energy density, though are known to have lower cycle lives while being more expensive than alternatives. LFP technologies, on the other hand, have lower energy densities, which can be a problem for EV applications. However, they have longer lifecycles, are less expensive, and tend to be slightly safer than NMCs, making them particularly favoured option in China. There has also been a recent shift towards LFP uptake in EVs globally, driven by the need to reduce EV costs and prices. Recent improvements to LFP material density and pack designs have also improved the volumetric energy density of LFP battery systems, making them increasingly suitable for global EV markets.
Image: A table highlighting key technology developments within the Li-ion battery sector. Source: IDTechEx.
While the popularity of LFP in global EV markets is growing, the stationary storage sector is already dominated by the use of LFP over other chemistries. It has become the primary choice due its low cost and safety profile, while its lower energy density is a less critical disadvantage.
Recent challenges within the Li-ion sector
In 2024, there were many developments seen within the Li-ion market, as well as some challenges. Concerns arose as a result of the slowed growth rate of EV adoption, and the slowing down of investments. Challenges in some areas of the US and European battery markets also led to pushbacks from automotive makers because of the speed at which they were transitioning to EVs. Some battery manufacturers also expressed difficulties in competing with incumbent companies across Asia. However, according to IDTechEx, the global Li-ion market is still expected to see positive growth going forward, especially in light of improving battery technologies, long-term climate goals, and the growing EV and stationary energy storage markets.
For more information, visit IDTechEx's report, "Li-ion Battery Market 2025-2035: Technologies, Players, Applications, Outlooks and Forecasts", and the portfolio of Batteries & Energy Storage Research Reports and Subscriptions.
