Some future thinking from Insurance Edge Editor, Alastair Walker;
Sodium battery tech isn’t new, but it has evolved to a point where large insurance brands need to look at investing in it, and embracing a new generation of sodium battery arrays for energy storage, new sodium battery pack vehicles and consider the ESG benefits of moving away from exploitative supply chains underpinning many lithium battery vehicles from cars to e-scooters. There is also a much reduced fire risk. Plus sodium batteries have salt as a raw material not lithium, which is a cheaper, more evenly spread resource around the world. This is a fundamental shift in the battery market, happening right now and everyone needs to look carefully at our collective future. In fact sodium batteries might just save the EV market from collapse and free millions of us from the stranglehold of Hormuz.
The issues are many, and complex so let’s get started;
ESG and Net Zero
Every insurer in the UK and the EU has to meet compliance regs on ESG targets and Net Zero. So start with this; sodium batteries can last for years longer than existing lithium/cobalt packs inside cars and vans. According to market leading company CATL in China we are looking at 10K cycles and still 80% capacity from the battery pack. In terms of useful cycles – recharges in layman’s terms – that means a sodium battery pack in a car or van can last for years longer and this is important in areas like taxi, delivery or commercial fleets.
On a sidenote a sodium battery vehicle can perform better in extremes of hot and cold temperatures as well, so insurers underwriting fleet use in northern US/Europe can embrace this tech as being inherently greener and safer, since the risk of drivers being stranded in sub zero temperatures is reduced.
These new batteries aren’t heavier than existing packs, in fact CATL claim that their new pack is some 250Kg lighter than the industry standard, so there’s no regulatory issues with tax bands by weight or roads wearing out faster, brake pad dust etc.
So far much of this tech is being developed by CATL in China, who work with leading brands like Tesla, VW, BMW etc so we should see new models later this year with the CATL/Naxtra battery packs installed, according to Chinese media. Then the real world testing begins.
Cutting the Lithium/Cobalt Supply Chain
For insurers, being able to state in annual reports that investments in things like lithium and cobalt mines have been scaled back, or ended, is an important point. As many know, insurers involved in coal, oil and gas have been targeted by activists, so heading off criticism of supporting child mining in Africa or other poor practices in the lithium chain, is an important consideration for the future of your brand reputation.
Data Centers and Battery Arrays UK
For large UK insurers it is worth thinking about two things for the 2030s; data centers and how to power them. Obviously more AI and automation will require more data centers. But where will we build them in the UK? How will they be powered? This is a huge investment opportunity for insurers and they should get involved now.
According to the Faraday Institution the UK is ina good position as regards research and development on array tech. Solar panels can feed sodium battery arrays and in turn, data centers can be powered reliably. We live on a rainy island too, so water supply should be no problem if companies and the government invests. Here are thoughts from the Faraday Institution;
“The UK is already an established leader in the field and home to internationally important development companies. By building on current advantages, the UK can establish large scale domestic manufacturing with additional economic benefits across the supply chain and from downstream applications. In doing so, this new domestic supply chain should give UK companies a foot-in-the-door of the international battery market, opening up substantial new markets, generating jobs and significant economic value for the UK. The Faraday Institution’s NEXGENNA project is working with the leading UK companies to accelerate commercialisation.”
Building and Vehicle Safety
Two trends have emerged in recent years. One is the intensity of EV car fires and tendency of thermal runaway to spread that solo fire across a ferry deck, storage car park etc. Rare events, but serious in terms of threat to life and property damage claims. The good news is that sodium batteries are less likely to explode and resist higher temperatures as regards thermal runaway. There’s research from a German University here if you want to learn more.
The second trend is fires in houses and flats caused by e-bike/scooter batteries. Again China is leading the way with compact sodium batteries instead of more unstable lithium-ion. Backing this new tech, educating clients and public alike, can only be a smart move for insurers. Saves money and lives.
Saving The EV Car Market
Sodium car battery packs are claimed to be both lighter and cheaper to make. That should help make EV cars more affordable, plus the increased real world range from around 150 miles on a cold winter’s day, to something useful like 300 miles, will also persuade many ICE car drivers to finally make the switch. Add on the rapid inroads made by BYD, Chery, Omodo and others in the UK market and we could be looking at a real shift in public attitudes.
There are good reasons why UK drivers are keeping diesel and petrol cars, or buying hybrids. Pure EVs have to do better. This is what the market has been telling VW-Porsche, Jaguar and others since 2021.
In the end cars are both status symbols and domestic appliances. They have to work, on demand, every day, with minimal maintenance or faffing about with charger cables. At present, we just have claims of 900Kms range from China, but if these turn out to be reality and the car itself can be rented for under £300pcm, we have a potentially huge opportunity for motor insurance brands. We should know more by 2028 when there are new sodium battery pack cars on sale and being driven.
Resilience Within a Global Supply Chain
Resilience is a buzzword IE sees often, alnost daily, in insurance industry press releases. What does it mean in reality? Not much when the Iranian regime, or others declare they have armed control of the Straits of Hormuz for oil supply, or perhaps another regime controls bauxite, necessary for aluminium production, or iridium for touchscreens.
The abundance of sodium globally, plus existing tech to convert it into the material required to fill battery cells, is another consideration for insurers. Firstly, as an investment for pensions and life policy funds, yes, time to buy shares in salt mines or desalination plants. Secondly, it is a more flexible and reliable supply chain, which during wars, or natural cat events, really counts for something. Long term planning might be boring, right up until the moment you need it, but then it become part of critical infrastructure.
So let’s not hype sodium battery tech like the Cloud, or Blockchain, from a few years ago. There are no magic bullets. Just progress. But we stand on the brink of a new paradigm in the battery market, mass transport and energy storage. It really is time to get to work on building a future that works for everyone.
Post a comment below if you have some sodium tech insights.
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