The global lithium iron phosphate battery market size is expected to reach USD 15.09 Billion in 2030 and register a revenue CAGR of 5.3% during the forecast period, according to latest report by Reports and Data. Increasing environmental concerns and rising manufacturing capacities for lithium iron phosphate batteries are major factors expected to drive market revenue growth during the forecast period.
Increase in awareness towards maintaining a safe and healthy environment has stimulated demand for renewable energy projects, such as on-grid solar power backup systems, photovoltaic installation, and wind energy projects. All of these require batteries energy storage devices to store and stabilize the energy. For example, Europe will require 14 times more batteries than it currently produces by 2030. Lithium iron phosphate batteries combine the benefits of low cost, long life, and safety, due to which they are gaining a stronger position in the rapidly expanding battery market. Manufacturers are raising their production capacity to meet demand, which is expected to drive revenue growth of the LFP battery market during the forecast period. For example, by 2023, renewable energy semiconductor manufacturing company ElevenEs manufacturing plant in Serbia will be able to produce LFP cells with a total estimated annual capacity of 300 MWh.
LFP batteries have great potential to cut carbon emissions when used in wind and solar power systems. These batteries use more non-toxic materials that can be developed with less energy. Performance and safety of LFP batteries also makes them an ideal choice for electricity storage in zero-emission renewable electricity, wind, and solar power systems. Disposal or recycling of batteries is still a major environmental concern. Every year, over 3 million tons of lead-acid batteries are discarded. LFP batteries, on the other hand, pose far less of an environmental risk than lead-acid batteries. They can also be recycled to recover the materials used in their electrodes, casings, and wiring, which can then be reused in new lithium batteries. Increasing environmental concerns and enviro-friendly nature of lithium iron phosphate batteries are expected to drive the market revenue growth during the forecast period.
However, lack of investment in lithium due to high prices creates a supply shortage. Lithium is a major raw material for batteries that have been used in electric vehicles and energy storage systems. There is a structural deficit between demand and supply in recent years due to less funding for lithium. Some of the companies also struggled to meet their targets. In addition, environmental opposition movements could further halt supply, preventing several projects from coming online. For example, on 21 January 2022, it was reported that Serbia revoked Rio Tinto’s lithium-exploration licenses, caving to protesters who opposed USD 2.4 billion projects on environmental grounds. Lack of investment and shortage of supply of lithium is expected to inhibit the market revenue growth during the forecast period.
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Some Key Highlights from the Report
- The 100,001–540,000 mAh segment is expected to account for a considerably larger revenue share over the forecast period due to rising demand for these batteries in plug-in electric vehicles, hybrid electric vehicles, and other electric vehicles.
- Automotive segment is expected to lead in terms of revenue contribution to the market during the forecast period due to rapid use of lithium iron phosphate batteries in electric vehicles such as hybrid electric vehicles, plug-in electric vehicles, e-bikes, and automated guided vehicles.
- Market in North America is expected to register a steady revenue growth rate over the forecast period due to rising demand for lithium iron phosphate batteries owing to increasing sales of electronics vehicles. In addition, fast growth in renewable energy generation, mainly solar and wind energy has increased demand for energy storage devices, which is expected to drive revenue growth of the market in this region during the forecast period.
- Major companies in the global market report include K2 Energy Solutions, Inc., BYD Company Ltd., A123 Systems, LLC, Electric Vehicle Power System Technology Co., Ltd., RELiON Battery, LLC, OptimumNano Energy Co, Ltd., LiFeBATT, Inc., Lithium Werks B.V., Pihsiang Energy Technology Co., Ltd., Power-Sonic Corporation, Contemporary Amperex Technology Co., Limited, Benergy Tech Co. Ltd., KAYO Battery (Shenzhen) Company Limited, and Bestgo Battery Co., Ltd.
- On 01 September 2021, Brunswick Corporation announced the acquisition of RELiON Battery, LLC, which is a global provider of lithium batteries and related products to multiple industry sectors. Brunswick’s Advanced Systems Group continues to drive widespread adoption of lithium-ion battery and power management systems in both marine and mobile markets. Addition of RELiON to the portfolio reinforces its position as a leading supplier of lithium batteries for RV and recreational boating.
For this report, Reports and Data has segmented the global lithium iron phosphate battery market based on power capacity, application, industry vertical, and region:
- Power Capacity Outlook (Revenue, USD Billion; 2019-2030)
- Up to 16,250 mAh
- 16,251–50,000 mAh
- 50,001–100,000 mAh
- 100,001–540,000 mAh
- Application Outlook (Revenue, USD Billion; 2019-2030)
- Industry Vertical Outlook (Revenue, USD Billion; 2019-2030)
- Power Generation
- Regional Outlook (Revenue, USD Billion; 2019-2030)
- North America
- Rest of Europe
- South Korea
- Rest of APAC
- Latin America
- Rest of LATAM
- Middle East & Africa
- Saudi Arabia
- South Africa
- Rest of MEA
- North America
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