We’re in a pivotal moment in the energy transition, renewables are not reliable enough to meet our net zero emissions targets, but most of the world has already committed to the phasing out of relatively cheap energy from fossil fuels. As a result, we need to develop improved energy storage solutions, and the battery sector is experiencing a revolutionary transformation driven by rapid advancements in technology. Battery technology is fundamental to the functionality and advancement of modern devices and systems, ranging from small-scale consumer electronics to large-scale industrial applications. Traditional lithium-ion batteries have been the cornerstone of this sector due to their balance of energy density, longevity, and cost-effectiveness.
The average battery price is currently approximately US$150 per kWh and the cost of manufacturing battery packs accounted for about 20% of the total battery cost, down from over 30% a decade ago. Over time, pack production costs have consistently decreased. However, cell production costs are rising – this increase can be attributed partly to rising material prices, which significantly impact cell costs, and higher electricity prices affecting manufacturing.
The impact of rising battery material prices varies across different battery chemistries, but prices also vary significantly by region, with China having the lowest average prices globally. This price discrepancy is largely due to China’s significant manufacturing presence, as about 65% of battery cells and nearly 80% of cathodes are produced there.
Apart from fluctuating costs, current battery technology faces critical challenges, including limited energy density, safety risks, and environmental concerns. To address these issues and meet the growing energy demands of advanced technologies, new battery innovations are being developed.
The battery sector is experiencing a period of rapid innovation, with new technologies poised to address the limitations of traditional battery systems and meet the growing energy demands of modern applications.
High interest rates have contributed to depressed valuations for smaller and emerging companies, but with many central banks now starting to indicate that interest rates are set to start falling again, we expect speculative capital to start flowing into smaller and emerging companies which should fuel the opportunity to earn outsized returns for those that invest in those companies at the forefront of the energy transition.
Anadara has produced a document that explores these cutting-edge technologies and their potential to transform the landscape of energy storage and power supply. Our document covers many of the emerging battery technologies that we’re assessing for the Anadara Battery Transition Fund, including:
- Emerging Battery Chemistries (including Atomic Batteries)
- Modular Battery Packs
- Battery Management Systems;
- New charging technologies like Dynamic Inductive Charging; and
- Artificial Intelligence and Batteries.
If you would like a copy of the report, please register your details below and we’ll email a copy to you.
