Li-ion Battery

In a conventional Li-ion battery, the anode is typically made of graphite, and the cathode is Lithium oxide.  The key to high capacity & superior power delivery lies primarily in the cathode, which has characterized the Li-ion batteries.

  

LFP & Ternary batteries

  

High commodity costs are spurring automakers to adjust their battery strategies and shift toward lower-cost chemistries.  One important approach has been to reduce cobalt content by increasing the use of nickel in ternary (NMC/NCA) cathodes, while another is to move toward lithium iron phosphate (LFP), which eliminates both nickel & cobalt, as shown in Figure 1.  In 2025 in China, lithium iron phosphate (LFP) batteries accounted for about 625.3  GWh (≈ 81.2%) of total power battery installations, compared with 144.1  GWh (~18.7%) for ternary batteries, with LFP volumes up ~52.9% YoY and ternary up ~3.7% YoY, underscoring LFP’s dominant role in balancing cost & performance amid shifting supply dynamics [CNEV, 2025].

  

Both LiFePO₄ (LFP) and ternary lithium batteries have their advantages.  LFP generally offers higher thermal stability, longer cycle life and lower cost, making it particularly attractive for mass-market EVs and stationary EE.  Ternary lithium batteries offer higher energy density & better low-temp. performance, making them advantageous where range, weight and cold-weather operation are critical.  Modern LFP cells can operate at sub-zero temperatures, but their performance generally declines more rapidly at low temperatures [PL, 2023].

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Li2CO3 & LiOH

  

Lithium, specifically in Lithium carbonate (Li2CO3) & Lithium hydroxide (LiOH) compounds, is a crucial ingredient in EV batts and BESS.  Figure 2 shows the Lithium sources, compounds, and primary applications (battery use is highlighted).  Despite ongoing efforts by the U.S. and Europe to develop domestic battery supply chains, significant dependence on China is likely to persist in the short and medium term, particularly in lithium processing, cathode materials and battery manufacturing.  Figure 3 shows China battery manufacturing capacity.  Figure 4 shows that the "battery factor", i.e., higher battery costs, could delay the tipping point for EVs.