It’s a Lithium-ion World, but Vanadium Batteries Are Catching Up
The discussion around the energy storage space is heating up, with many market participants wondering which metals will be needed to supply increasing demand from this market.
According to Benchmark Mineral Intelligence, the recent success of lithium-ion batteries in increasingly larger systems exceeding 1 GWh has brought to light the huge potential market for all types of battery technologies.
For many years, vanadium-flow batteries have been a favored technology to enter the energy storage space in a serious way, and the London-based firm forecasts that it could become a major player in the market, second to lithium-ion batteries.
But if production of vanadium-flow batteries scales up, Grejtak agrees with Moores that some companies might end up leasing electrolyte, which could potentially be returned, refurbished, and reused — that’s because vanadium is already widely recycled.
For his part, Jaffe said that in the long-term, the cost of the battery will reduce, but the cost of the vanadium should remain steady, due to the much larger rebar industry demand.
“One interesting facet of the Vanadium flow battery is that at the end of its life (20 years or even longer), the vanadium electrolyte will have the same value to the steel industry that it has today, and it’s easy to recycle — that means that the residual value of the electrolyte is greater than any other battery technology. Once that becomes monetized, it will drive the cost of the battery down even further,” he added.
Speaking about vanadium-flow battery costs, Grejtak explained that a trend in the industry is to think more about lifetime system costs for a project rather than just installed costs.
“In that light, vanadium-flow batteries used in large-scale renewable integration projects are already cost competitive not only against lithium-ion, but also against natural gas turbines,” he said.
Grejtak also added that flow batteries, like lithium-ion batteries now, are a fairly mature technology. “I wouldn’t expect any step change in cost reduction, but prices will improve incrementally.”
That said, prices of vanadium pentoxide, the key raw material needed in vanadium-flow batteries, have been on an uptrend in the past few years, increasing from under US$3 per pound less than three years ago to the current price of above US$19 per pound.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
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