While it is known that batteries are indispensable for the future energy system dominated by solar PV, they are still seen as a bottleneck technology mostly related to raw material supply. Sodium-ion batteries can resolve this issue. Batteries are more than a stationary storage technology, also with bright prospects for vehicle-to-grid (V2G) and smart charging of electric vehicles within a broad flexibility technology portfolio.
The resolved issue of batteries as bottleneck
Battery technology is often associated with the material bottleneck issue: A stringent transition to highly renewable energy systems in combination with high electrification would require large capacities for battery storage, both stationary and mobile, for which there is not enough Lithium available. Lithium criticality is, indeed, an important topic, while previous research has found that well-established recycling, vehicle-to-grid (V2G), and transport with low Lithium intensity (non-battery electric) would be required.
A recent study took a closer look at one of the most promising alternatives to Lithium-ion batteries (LIB) on the horizon: Sodium-ion batteries (SIB). Contrary to LIBs, SIBs are based on abundant raw materials, also beyond the cathode material: Anodes can be made of hard carbon instead of natural graphite, and copper as a current collector at the anode can be substituted with the more available and cheaper aluminum.
Previous energy system simulations resulted in close to 75 TWhcap stationary battery demand by 2050, while an estimation for mobile batteries revealed a dominating role of moving batteries at up to almost 275 TWhcap by mid-century. Latest findings indicate a ratio of needed battery capacity to installed solar PV capacity of about 0.8 kWhcap/kW in a cost-optimized and flexible global energy system that is run entirely on renewable energy. Adding the niche of electronics and other applications, the total battery demand may reach over 350 TWhcap by 2050.
The bottom-up, cell-level to system-level cost assessment showed that SIBs are already close to cost parity with their Lithium counterpart. In 2025, system-level costs were estimated to be ca. €120 /kWhcap. By applying different learning rates, costs may be reduced until 2050 to a range of €28.5-51.9 /kWhcap. This allows for the conclusion that batteries are ruled out as a bottleneck because of raw material limitations, but also for cost reasons. Furthermore, SIBs as a drop-in technology can be easily produced on existing production lines set up originally for LIBs.
PV prosumers: More than stationary
Solar PV prosumers, an actors who are both producers and consumers of electricity, do not necessarily require batteries to have a secure electricity supply. Using the connection to the electricity grid, surplus electricity from the rooftop PV system can be fed into the grid and reimbursed, and at times of low or no solar PV yield, electricity can be drawn from the grid. Increasing grid electricity prices and decreasing battery costs, however, may make it economically beneficial to equip the prosumer system with a battery to optimize the overall supply cost of energy.
An initial study on the cost-optimization of solar PV prosumers has already shown that PV-battery systems for prosumers are widely beneficial in terms of the total cost of energy supply. Key is the electrification of the heat supply via heating rods or heat pumps. Very low-cost solar PV is no limitation, even though residential rooftop PV yields ca. 18% less electricity than ground-mounted systems. The combination with stationary battery storage enables high demand and heat cover ratios globally. Battery capacity optimization depends on the inclusion of electric vehicles (EV). High benefits have been found for cars that can supply the system with electricity, so-called vehicle-to-home (V2H).
In a follow-up study, it has been investigated whether a seasonal hydrogen storage is beneficial for residential PV prosumer systems. The long-term storage option has been found to play only a niche role for Nordic countries in an off-grid scenario, even with a significant cost reduction potential. With the updated optimization model, it has been shown that most of the regions will reach grid parity by 2035, with more than half of the regions having reached parity already in 2020. The improved optimization model confirmed that batteries play an important role. For the on-grid cases, a maximum battery-to-PV ratio of 1.6-1.8 kWhcap/kW has been found. In off-grid cases, this ratio increases to 3-4 kWhcap/kW.
The case of smart charging and vehicle-to-grid (V2G)
The EV fleet is growing fast around the world, already accumulating battery capacity on the terawatt-hour scale and driving solar PV capacity demand. Using this battery capacity for power system balancing is a promising solution for energy systems with a growing share of variable renewable electricity generation. Smart charging alone provides valuable flexibility by increasing electricity consumption during renewable electricity generation peaks and reducing it during periods of generation deficit. V2G goes a step further, turning EVs into distributed battery storage on wheels that can supply electricity to the grid during deficit periods.
A study analyzing the impact of smart charging and V2G confirmed substantial benefits for the energy system. These technologies allow the system to reduce installed utility-scale battery storage capacity by about 50%, which indirectly reduces critical material use in batteries and also lowers the need for other energy storage technologies. Enabling these two technologies alone may reduce the total annual system costs by about 4%.
However, V2G cannot be free for the system: EV owners must be incentivized to participate and compensated for battery wear. The role and impact of V2G will depend strongly on the cost of this service to the system, but even at €50-100 /MWh, V2G still provides benefits for the system. The main challenge for V2G is the public infrastructure needed for EVs to charge or feed high-quality AC power into the grid whenever they are parked, especially during the midday PV generation peak, when additional storage capacity is most valuable.
A flexibility perspective
Flexibility is needed to mitigate the variability of renewable energy sources arising from their weather-dependent nature. Battery energy storage systems have gained widespread attention as a potential leading technology for this role. Their advantages include high energy density, rapid response, reliable power delivery, sustained discharge capability, and geographical independence.
The continued reduction in battery manufacturing costs has further strengthened the role of battery storage in facilitating renewable energy integration, particularly for solar PV. A comprehensive review of flexibility options in over 1000 research articles found that compared with other storage technologies, including pumped hydro energy storage, thermal energy storage, and e-hydrogen storage, battery technologies currently offer an attractive combination of rapid response, modularity, efficiency, and technological maturity. Nevertheless, one should not regard batteries and pumped hydro energy storage as substitutes but as complements to serve the same need, as also highlighted in the case of India.
A key factor underpinning the attractiveness of battery technology as a flexibility option is the sustained reduction in battery costs, despite fluctuations in raw material prices. Moreover, this cost reduction has been observed across both mobile and stationary applications, highlighting the versatility and improving cost competitiveness of battery technologies across a wide range of applications.
This technological advancement, driven by continued innovation, is expected to play a significant role in accelerating the deployment of solar PV across the global Sunbelt and other regions, such as Africa, and in particular also for off-grid applications. The rise of solar PV would not be thinkable without electricity storage and in particular battery storage, as shown in a recent analysis in major milestones for solar PV in energy transition scenarios which also led a projected primary energy supply share of solar PV of about 61% in energy transition studies on a global average by mid-century. Overall, solar PV is expected to play a major role also outside of the Sunbelt. In smaller and isolated grids, such as islands and off-grid systems, rising diesel fuel costs, combined with the rapid decline in the costs of renewable energy technologies, have increased the competitiveness of renewable energy sources and enhanced the relevance of battery-based energy storage solutions. This trend is driving the increasing adoption of off-grid and decentralized autonomous power systems, including PV-battery and wind-battery configurations.
Authors: Dominik Keiner, Siavash Khalili, Dmitrii Bogdanov, and Christian Breyer
This article is part of a monthly column by the LUT University.
Research at LUT University encompasses various analyses related to power, heat, transport, industry, desalination, and negative CO2 emission options. Power-to-X research is a core topic at the university, integrated into the focus areas of Planetary Resources, Business and Society, Digital Revolution, and Energy Transition. Solar energy plays a key role in all research aspects.
The views and opinions expressed in this article are the author’s own, and do not necessarily reflect those held by pv magazine.
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