“Wait-and-See” Fully Activated! Industry Chain Prepares for the Era of Large-Scale Commercialization of Sodium-Ion Batteries

In recent years, China's lithium battery industry, leveraging mature technology systems and well-established industry chain support, has long driven the rapid development of new energy industries in China and even globally, serving as the mainstay in the current battery markets such as energy storage and power batteries.

To further optimize the battery industry structure and diversify new-type battery technology pathways, recent policies in China have specified that a battery consumption tax will be phased in for lithium batteries, while sodium-ion batteries will be exempt from the battery consumption tax from September 1 this year until the end of 2028, in order to further nurture the sodium-ion battery industry, which is still in its early growth stage.

A tax rate differential of 2%–4% over 28 months creates an important window of opportunity for accelerating the large-scale deployment and rapid commercialization of sodium-ion batteries.

Against this backdrop, what real changes are taking place in the sodium-ion battery industry chain? How is the downstream customer selection logic being restructured? Can battery cell, cathode, and anode material enterprises seize the window for industrialisation and volume ramp-up to leap from technology demonstration to large-scale commercial deployment?

Recently, editors from Battery China accompanied a research team from the Power Battery Application Sub-committee on visits to new energy industry clusters in the Yangtze River Delta, Pearl River Delta, and Chengdu-Chongqing regions to survey enterprises along the industry chain, and learned about the front-line industrial layouts from mainstream players in the sodium-ion battery sector, providing a glimpse into the progress and pace of sodium-ion battery industrialisation.

End-Use Demand Heats Up Significantly

Clients Shift from Wait-and-See Testing to Medium and Long-Term Layouts

Battery China observed that around the implementation of the policy, downstream application market sentiment underwent a distinct shift.

Before the new policy was introduced, in the fields of energy storage, light power, and industrial and commercial backup power, most integrators and OEMs adopted a cautious stance toward sodium-ion batteries, conducting only small-batch sample testing; in the vehicle start-stop battery field, lead-acid batteries remained the mainstream. Overall, the implementation pace of most sodium-ion battery supporting projects was slow. However, after the tax exemption policy was clarified, the downstream selection logic is expected to be rewritten.

A relevant official from Zoolnasm stated in an interview, "Before the policy was issued, most downstream clients were cautious about sodium-ion batteries, only conducting small-batch tests, and the implementation pace was slow. After the new policy was released, clients in the fields of complete vehicles, energy storage integration, and light power have shown significantly increased willingness to proactively consult and cooperate. The industry has moved from the technology reserve stage into an accelerated phase of large-scale deployment."

Not just at the battery cell end, the demand boom is already spreading upstream along the industry chain. Rongna New Energy, a sodium-ion battery anode material enterprise, also told Battery China that the positive signals from the downstream are very evident, "The willingness of small and medium-sized clients is relatively strong, and previously wait-and-see clients have also started to take action by initiating evaluations or small-scale trials."

In terms of application scenarios and selection, in addition to disclosing that "there are significantly more clients inquiring about sodium-ion batteries than before," battery cell enterprise Zhaona New Energy also mentioned that consulting activities are active in the start-stop, energy storage, and small power fields, "Clients are placing more emphasis on the high C-rate, low-temperature cold start, high-temperature resistance, and high safety performance of sodium-ion batteries to compensate for the shortcomings of lithium batteries."

"From now until the end of 2028 is a crucial golden window period for the sodium-ion battery industry. Cost-sensitive application scenarios such as energy storage, low-speed transportation, and industrial and commercial backup power will see a relatively large boost from industrialisation," Zoolnasm also stated.

Regarding downstream client selection, Zoolnasm analysed for Battery China, "The new policy clearly delineates the economic watershed between the lithium and sodium routes, directly driving a shift in terminal decision-making logic. The current focus of client communication has shifted from parameter comparison to full-cycle cost accounting and supply chain stability assessment, and proactively connecting with medium and long-term supporting arrangements, joint development, designated certification, and volume-locked cooperation. Previously pent-up wait-and-see demand is now being intensively activated."

It can be seen that in the current sodium-ion battery sector, application scenarios are highly certain, and many top-tier players along the industry chain have already begun to increase their layout efforts.

Capacity Construction Accelerates

Industry Chain Prepares for the Era of Large-Scale Commercialisation of Sodium-Ion Batteries

Data shows that Zoolnasm's 10,000-tonne-level sodium iron sulphate (NFS) cathode material base in Meishan is currently operating at full capacity. It already has over 5,000 mt of orders on hand and nearly 20,000 mt of intended orders. The company expects to reach a capacity of 10,000 mt of sodium iron sulphate cathode material and 2 GWh of sodium-ion battery PACK by the end of this year.

The relevant official of the enterprise told Battery China, "Zoolnasm will continue to deeply cultivate the sodium iron sulphate route, relying on integrated capacity building of cathode material and battery cells, striving to transform the policy dividends into sustainable product competitiveness."

Recently, Zoolnasm officially launched its light power sub-brand – Zhongpai Battery. The related products adopt the NFS technical route and are expected to further promote the commercial application of sodium-ion batteries.

Rongna New Energy also revealed, "Its production line expansion in Zigong is accelerating, and it will continue to push for large-scale cost reduction." According to the introduction, it adopts an industry chain layout model, with flexible technical adjustments and controllable product stability/consistency, which can better meet the industry's development needs. "Price is the stepping stone, but product performance is the cornerstone, and stable supply is the foundation. We will also continue to expand downstream clients and continuously enhance our large-scale stable delivery capabilities."

On the market front, sodium-ion battery market demand is expected to experience a concentrated recovery, putting pressure on the midstream and upstream to accelerate production line construction and capacity ramp-up pace, with cathode and anode materials becoming the focus of expansion. Upstream material enterprises generally judge that the 28-month tax exemption period precisely matches the critical stage for sodium-ion batteries to move from trial production to mass delivery.

However, the industry chain is also maintaining rationality. Many enterprises cautioned that the policy dividend is only a catalyst, not permanent protection. The realization of all dividends depends on stable mass production and continuous cost reduction.

At the same time, it should be mentioned that there are also hard thresholds for sodium-ion batteries to enjoy the tax exemption policy; the relevant products must comply with national standards and possess compliant detection reports. Sodium-ion battery projects that merely rely on concept hype and lack substantial capacity will not be able to benefit from the policy dividend. Industry orders for sodium-ion batteries are expected to see continued improvement in prosperity, but the market will eventually eliminate participants that waver on technological routes or cannot ensure stable delivery.

The new battery consumption tax policy essentially opens up a growth track for new-type battery technologies through market-based means. Enterprises in the sodium-ion battery industry chain still need to rely on their own technological and cost strengths to gain a foothold in the market. The ability to mass-produce and deliver with good product stability is the core threshold for winning over downstream clients.