Market and product

The lithium-ion battery, after decades of dominance across everything from smartphones to electric vehicles and drones, is showing clear signs of stagnation. Despite countless rounds of refinement to improve energy density and performance, many scientists contend that these gains are approaching their theoretical ceiling. Even the most advanced batteries available today tend to lose performance in cold conditions, shed capacity rapidly, or — in the case of consumer devices — catch fire spontaneously.

Meanwhile, demand for batteries has never been greater. An estimated 30% of all vehicles sold in 2026 are expected to be electric. Last year, American homes and businesses installed a record number of large-scale batteries. According to consultancy Wood Mackenzie, installed capacity could rise by nearly 40% by the end of the decade. The need for next-generation battery technologies has become more urgent than ever.

Solid-State Batteries — The Most Promising Contender

Advances in materials science are gradually bringing viable alternatives within reach. Solid-state batteries are among the most anticipated developments in the field.

In a conventional lithium-ion battery, lithium ions travel through the electrolyte — typically a flammable organic solvent permeating all of the battery's components. In solid-state batteries, the anode, cathode, and electrolyte are compressed into rigid slabs stacked directly against one another. This architecture allows more conductive material to be packed into the same volume, pushing energy density up to 500 Wh/kg, compared with around 300 Wh/kg for liquid-electrolyte batteries. Solid-state batteries also carry a significantly lower risk of combustion.

Although they have been studied for decades, solid-state batteries have so far only been fabricated at small scale, primarily for medical implants. The principal barrier to scaling up production is brittleness. As a battery charges and discharges, ions repeatedly embed themselves in the electrode material, causing the battery to expand and contract cyclically. This generates voids between components, leading to cracking and deformation, which slows ion transport and degrades performance.

In January, researchers at the Shenzhen Institutes of Advanced Technology, part of the Chinese Academy of Sciences, made a significant advance toward solving this problem. They developed a high-performance electrolyte material by alternately stacking ceramic layers 1–100 nm thick with polymer sheets of similar thickness, oriented perpendicularly to the electrode surfaces. Ceramic alone conducts ions well but cracks easily; polymer is flexible but a poor conductor. The combination allowed ions to flow as efficiently as the best existing solid-state electrolytes, while substantially reducing the tendency to crack.

Remaining Challenges

A persistent separate problem is dendrite formation — wire-like crystals that grow on electrode surfaces, leading to cracking and eventually short circuits. The long-held view was that dendrites form when excess lithium ions accumulate on the surface of the anode rather than being absorbed into it. However, a paper published in March by a team led by researchers at the Massachusetts Institute of Technology challenged this understanding. Their findings indicate that dendrites form because chemical reactions alter the properties of the electrode material, causing it to weaken. This points research in a new direction: rather than simply seeking stronger electrode materials, scientists should be looking for electrodes with greater chemical stability.

Materials science is also enabling solid-state batteries to operate faster. In conventional polymer electrolytes, ion movement is constrained by the motion of surrounding polymer segments. A research group at Oak Ridge National Laboratory in Tennessee found a way to decouple these two types of movement by incorporating compounds called zwitterions into polymer segments that would ordinarily be poor conductors. Although zwitterions are electrically neutral molecules, they contain locally charged regions capable of accelerating ion transport. Experimental results showed that this configuration could increase ion travel speed through the electrolyte by as much as ten billion times. Performance in a complete cell will be assessed through further testing.

Sodium-Ion Batteries — A Parallel Path

One notable advantage of solid electrolytes is that they open the door to battery chemistries that do not rely on lithium. Sodium-ion batteries — in which sodium replaces lithium at the cathode — are particularly attractive because sodium is not only cheaper and more chemically stable than lithium, but also approximately 1,000 times more abundant in the Earth's crust. However, because sodium atoms are larger and heavier than lithium atoms, they are difficult to accommodate in conventional graphite electrodes, resulting in heavier batteries with lower energy density. Hard carbon — whose sponge-like structure can absorb sodium ions — outperforms graphite as an electrode material, but no suitable liquid electrolyte has yet been identified.

A solid electrolyte would help resolve this, and would also permit the use of highly reactive sodium metal anodes — previously impractical — given the lower risk of dendrite formation in solid-state systems. This would push energy density from around 175 Wh/kg (achievable with hard carbon anodes) to approximately 500 Wh/kg.

A more ambitious approach under investigation is the complete elimination of the anode, freeing up space for a thicker cathode capable of storing more sodium. During charging, sodium ions would migrate from the cathode to the current collector, accumulating there until discharge. In effect, the anode forms spontaneously during battery operation.

Dry Electrode Manufacturing — Reinventing the Production Process

The rapid pace of progress in this field is the product of a genuinely global competition, according to Shirley Meng, a materials scientist at the University of Chicago. This competition may also fundamentally transform how batteries are manufactured. Current production of liquid-electrolyte batteries involves submerging electrodes in vats of solvent and consuming large amounts of energy to dry them. This process creates micropores on the surfaces of solid-state batteries, increasing the risk of malfunction, while thicker electrodes are more difficult to produce because they dry unevenly.

Dry electrode manufacturing — in which dry powders are pressed together to form solid batteries — is consequently receiving growing attention. Trials have shown that this approach cuts energy consumption by approximately half and manufacturing costs by around one fifth, while improving overall battery performance. A number of companies are competing to be the first to perfect the technology, including Tesla and LG Energy Solution.

Market Outlook

Distinguishing genuine progress from hype is not always straightforward in this field. Nevertheless, recent developments suggest that ambitious commitments have a credible basis. Contemporary Amperex Technology (CATL), the world's largest battery manufacturer, has stated that it will produce solid-state batteries by 2027 and plans to launch the first sodium-ion electric vehicle by mid-year. Samsung has announced plans to mass-produce solid-state batteries by 2027, with Toyota making a similar pledge. Ford Motors established a dedicated battery manufacturing unit this month and plans to supply large-scale batteries for data centres and industrial customers by next year.

For the battery industry, this is a period of profound transformation.