The battery market is on the eve of a major shift. The lithium iron phosphate battery, also known as LiFePO 4or LFP, will be dominant around 2030, according to analysts. Not only for EVs, but also for buffer storage, such as with home batteries. At present batteries with an NCA and NMC cathode still reign supreme there, but although LFP has long been regarded as inferior to the nickel cathodes, the tide now seems to be turning. Although LFP has a lower energy density, it is cheaper to produce, requires fewer controversial raw materials, such as cobalt, and thus has a lower environmental impact. Until now, mainly Tesla and BYD have used LFP batteries, but Volkswagen, BMW, Mercedes, Rivian and Ford also seem to have plans to use them in the near future. The rise of LFP could accelerate the process of falling EV prices, as a result of which these types of cars will become cheaper to purchase than fuel cars within a few years. This would offer opportunities especially for the entry-level segment and, according to recent studies, they may even have a longer lifespan than other EV batteries.
Current battery chemistry: NCA and NMC
A battery consists of four components: the cathode, the anode, the electrolyte and a membrane as a separator. The name of a battery’s chemical composition is usually based on the cathode, because the anode is usually made of graphite. At the moment batteries with an NCA or NMC cathode are the most popular. The letters NCA stand for nickel, cobalt and aluminum respectively, and NMC for nickel, manganese and cobalt. Of the two, NMC is currently the most commonly used, with its composition expressed in numbers.
A transition is currently underway from NMC523 to 622 and 811. It is immediately noticeable that the amount of cobalt is being reduced further and further, which is compensated by adding more nickel. As is well known, the extraction of cobalt is under pressure, on the one hand due to increasing scarcity due to the exponential increase in demand and, on the other hand, appalling conditions in some of the copper and cobalt mines in Congo. About 10 to 15 percent of the extraction there takes place without supervision or regulation. Although NCAs and NMC batteries therefore use less and less cobalt per cell, the exponential demand for batteries for cars, trucks and buffer storage threatens a shortage in the long term. In addition, the price of lithium and nickel has risen in recent years, although it has recently started to fall again. These three things: the price, the possible scarcity and controversy about the extraction have led to the advance of an alternative based on iron and phosphate. These raw materials are much cheaper and far from rare.
What is LiFePO 4 (LFP)?
A lithium iron phosphate battery uses a graphite-carbon anode and a lithium, iron, and phosphate cathode. The energy density of LFP batteries is somewhat lower than that of the more common NCA and NMC batteries, which is partly due to the lower voltage. An NMC cell usually operates at 3.6V and an LFP cell at 3.2V. The capacity of an LFP battery ranges from 90 to 160Wh/kg – the average is currently around 125Wh per kilogram compared to 260Wh for an NMC cell. The capacity has continued to increase. The Chinese CATL currently claims to be at 210Wh/kg for its latest LFP cells, but modern NMC cells are already above 300Wh/kg. Except from CATL, most LFP battery packs come from BYD. Most LFP batteries are therefore produced in China; the market share of this chemical is approximately 50 percent there.
Reportedly, 30 percent of current EVs worldwide now contain LFP batteries, but analysts expect its popularity to surpass that of the now widely used NMC cells sometime between 2026 and 2028 . Yet LFP is anything but a new technology. John B. Goodenough, co-inventor of the lithium-ion battery, recognized as far back as 1996 that this chemical composition was interesting, partly because of its low cost, non-toxicity, natural abundance of iron, and thermal stability. Initially, the relatively low electrical conductivity was a bottleneck to commercialize this battery type, but this was solved by reducing the size of the LiFePO.
As mentioned, lithium iron phosphate has several advantages over the more common NCA and NMC cathodes in batteries, including lower cost and more accessible raw materials. Iron is widely available worldwide and is already mined in large quantities. Moreover, it is highly recyclable, which has also been used in practice for many years (see box).
The lower costs are expected to drive the price per kWh down faster, benefiting certain vehicle types. Consider, for example, vans and small and medium-sized passenger cars at the lower end of the market, for a lower price than is currently the case. The practical range can then be somewhat lower than average, think of 200 to 350 km, but is sufficient for many situations. LFP batteries are also interesting for stationary storage, such as home and neighborhood batteries, because of the lower cost price. In mid- 2020, the price for LFP cells in China was US$80 per kWh, which was just over half of the usual NMC cells at the time.
Thermal and chemical stability
LFP cells are also slightly safer due to thermal and chemical stability. The cathode material is more resistant to overheating and short circuiting because the oxygen atoms are released more slowly. So they are less likely to catch fire if the cells break open. There is also no lithium left in the cathode of a fully charged LFP cell and extremely high temperatures are less likely to decompose. The materials used are also less toxic. Solid-state batteries are even safer because they use a non-flammable solid instead of a flammable liquid electrolyte.
Lifetime: more charge cycles
While LFP is often cited for its cost and raw materials, longevity also seems to have better cards. Where NMC cells are good for 1000 to 2300 cycles on average, LFP cells can be recharged and discharged 3000 to 5000 times, with peaks up to 10,000 times. At least that is apparent from lab tests based on commercially available cells. And only on the basis of cycles, not on the basis of age. It is therefore not to say that LFP cells by definition have a longer lifespan.
EVs with LFP batteries are driving around for less time, so practice has yet to show this. In addition, there are many variables, such as different NMC compositions and different grades of graphite for the anode. Thanks to liquid cooling and a sophisticated battery management system, or BMS, that monitors all packs, NMC cells don’t really drop the mark when it comes to ageing. Old Tesla Model S’s with more than 250,000 km on the clock usually have more than 90 percent battery capacity left, so if we continue that line, a lifespan of 500,000 km is quite conceivable. It is therefore possible that LFP batteries last even longer.
An important reason is the mechanical and chemical stability of the positive electrode material. Paul Gasper is a staff scientist at the National Renewable Energy Lab in the US and has expertise in battery life testing and modelling. At our request, he provides more information.
“Perovskite oxide positive electrodes, including LCO, LMO, LNO, NMC, NMA and NCA, expand and contract much more than LFP during discharge and charge. Chemical reactions lead to mechanical damage over time, slowly decreasing capacity With LFP there is virtually no expansion or contraction of the electrodes It is often assumed that LFP has poor chemical stability due to the fact that the particles must be very small, as LFP particles have a diameter of approximately 100nm and with NMC particles is about 10 microns, so LFP electrodes have a lot more surface area for chemical reactions to take place.We know this because you can find iron, dissolved from the LFP cathode, in the graphite electrode after cell aging.This is one of the reasons why LFP cells often have a longer lifespan than NMC cells in laboratory tests,” says Gasper.
He does add that there are many variables and you can’t simply say that LFP always has a better longevity than NMC. “In principle, any type of cell can be designed to increase its lifespan.” It is also a non-issue for cars, says Gasper. “EV life expectancy is good enough across all chemistries. EV battery life is more likely to be limited by poor quality parts, poor thermal management, and poor monitoring and control of the BMS than by battery degradation.”
Charge to 100 percent
A practical advantage is that LFP cells can be charged to 100 percent on a daily basis. This is even recommended by car manufacturers. Discharging to 0 percent is also less problematic. EVs with NMC and NCA cells are usually advised to be charged to a maximum of 80 or 90 percent for everyday use and only to 100 percent if needed for a long trip. In practice, this is usually not a limitation, but it does offer an advantage for an LFP-EV. An example to illustrate this:
The Long Range version of the Tesla Model 3, so with an NMC battery and two electric motors, has a WLTP range of 602 km. The standard version, with LFP cells, comes 491km according to that standard. However, if we take 90 percent of the 602, the WLTP range comes out at 542km. The difference is then about 50 km in favor of the more expensive Model 3 and for the Model Y this is comparable. Although it naturally differs per situation, 50 km of extra range or approximately 10 percent of the whole is negligibly small, especially considering the additional cost.
According to Gasper, more degradation occurs in NMC cells when the charge exceeds 85 percent. This is partly due to the recent addition of extra nickel and less cobalt in the cathode. Therefore, for prolonging the service life, it is better not to charge above that level too often. As described earlier, LFP cells are less affected by this, but the advice to charge them completely has mainly a practical reason.
Gasper: “The recommendation to fully charge LFP is actually based on the estimation of the battery status rather than the service life. To estimate the range of the vehicle, the condition of the battery must be known. For NMC batteries is this ‘easy’ because the voltage keeps decreasing as you discharge the battery so say you discharge from 50 to 30 percent soc, the voltage will decrease continuously. This also creates a voltage gradient across cells connected in parallel for passive balancing. However, LFP has a very flat voltage response. That is, the voltage is basically constant over almost the entire soc range, except for the very low and high ends. Charging to 100 percent soc dramatically improves the accuracy of battery status estimation while creating a voltage gradient for passive balancing.”
As mentioned earlier, the main disadvantage of LFP cells is the lower energy density. Compared to NMC cells, this is about 15 to 35 percent lower. This means that an LFP battery is somewhat heavier than an NMC version with the same number of kWh. This has a negative effect on energy consumption, although this is of course also highly dependent on the body, streamlining and powertrain of an EV. Another factor to consider is that more cells are needed to get to a voltage of 400 or 800V, as an LFP cell operates on average at 3.2V instead of 3.6V.
The higher weight does not have to be a major factor, provided that the battery capacity does not have to be very high and that there is sufficient space available. Thus, the energy density of LFP at the cell level is always lower per gram than that of NMC, but because NMC cells require more safety measures, the difference in energy density at the package level is much smaller. More or larger cells fit in a battery pack, which in turn increases the density there. This is also because LFP cells are often prismatic, or flat, so there is less open space than with cylindrical cells.
The standard version of the Model 3 uses a 60kWh LFP battery of which 57kWh is usable. This car weighs about 1645kg. The Long Range four-wheel drive version has an 82kWh battery of which 77kWh is usable and weighs 1847kg. So despite the relatively heavier cells, the standard Model 3 is lighter and uses less energy. Other car manufacturers may opt for a similar strategy. Car manufacturer BYD already does that and mainly uses LFP batteries. Nio uses a standard 75kWh battery with LFP cells for its models, which can be replaced by a 100kWh variant with NMC cells in the same housing.
Load capacity and curve
The charging curve and the maximum charging capacity deviate somewhat. If we again take the Tesla Model 3 as a practical example plus practical data from Fastned, we see that the standard Model 3 with LFP cells starts slightly below 175kW and quickly drops by a proportional line. With a soc of 60 percent, the charging speed is still around 70kW, while the NMC LR version is still around 110kW. With the LR version, the power starts at around 180kW with a 300kW charger from Fastned and then increases to just under 200kW and a soc of 40 percent. Only then does the power decrease. Even at 80 percent SOC, the charging capacity is still significantly higher: approximately 60 versus 38kW.
Although this charging capacity is above average compared to other EVs in this price segment, charging takes noticeably more time than the Long Range version. For occasional fast charging, this ‘problem’ is negligible. For long journeys, such as on a holiday, it can tap. An LFP battery is slightly less resistant to cold than NMC, which can lead to a lower charging capacity in those conditions. This can be remedied with preconditioning, which preheats the battery.
Analysts and researchers expect LiFePO4 cells to be used more and more in the future, mainly because of the lower production costs, the abundance of materials, the long service life, and the safety provided by better thermal stability. Not only in electric passenger cars and vans but also in stationary energy storage, such as home, neighborhood and company batteries. A high energy density is less important, but costs and a long lifespan are all the more important. Furthermore, LFP batteries are increasingly used in ships, robotics and industrial vehicles.
Still, the biggest growth will come from the EV market, which accounts for 80 percent of demand, according to market researcher Wood Mackenzie. It is expected that there will be more and more policies around the world regarding zero-emission transport and fuel prices will also rise. The total market would be good for a capacity of 3TWh around 2030, of which LFP would then have the largest market share. Analysts from UBS also raised their expectations last year, but come out at around 40 percent. They think that this partly depends on the nickel price. At the time of writing, it was about 28,000 dollars. UBS expects LFP to be more cost-effective above USD 20,000 per ton and that NMC will regain market share if the price falls below that, which is not inconceivable. Production of LFP batteries is also underway in Europe. For example, the Serbian ElevenEs wants to build a European ‘gigafactory’ for LFP cells and the Norwegian start-up Freyr has similar plans.
LPF batteries are also extensively discussed in a recent doctoral thesis on the transition to electric vehicles and the challenges and opportunities from a lifecycle perspective. Chengjian Xu, who obtained his PhD at Leiden University at the end of December 2022, assumes that LFP batteries with 129 Wh/kg at package level and a service life of twenty years will have a market share of 60 percent between 2030 and 2050. The rest of the market will then use new variants of the NMC cells, possibly in combination with new innovations such as silicon anodes and solid state.