But, he told me, “Don’t let this headline conclude that battery manufacturing in the United States will never work, or that sodium-ion itself is uncompetitive. I think both those statements are naive and lack technological nuance.”
Opinions differ on the primary advantages of sodium-ion compared to lithium-ion, but one frequently cited benefit is the potential to build a U.S.-based supply chain. Sodium is cheaper and more abundant than lithium, and China hasn’t yet secured dominance in this emerging market, though it has taken an early lead. Sodium-ion batteries also perform better at lower temperatures, have the potential to be less flammable, and — under the right market conditions — could eventually become more cost-effective than lithium-ion, which is subject to more price volatility because it’s expensive to extract and concentrated in just a few places.
Yao’s paper didn’t examine Natron’s specific technology, which relied on a cathode material known as “Prussian Blue Analogue,” as the material’s chemical structure resembles that of the pigment Prussian Blue. This formula enabled the company’s batteries to discharge large bursts of power extremely quickly while maintaining a long cycle life, making it promising for a niche — but crucial — domestic market: data center backup power.
Natron’s batteries were designed to bridge the brief gap between a power outage and a generator coming online. Today, that role is often served by lead-acid batteries, which are cheap but bulky, with a lower energy density and shorter cycle life than sodium-ion. Thus, Yao saw this market — though far smaller than that of grid-scale energy storage — as a “technologically pragmatic” opportunity for the company.
“It’s almost like a supercapacitor, not a battery,” one executive in the sodium-ion battery space who wished to remain anonymous told me of Natron’s battery. Supercapacitors are energy storage devices that — like Natron’s tech — can release large amounts of power practically immediately, but store far less total energy than batteries.
“The thing that has been disappointing about the whole story is that people talk about Natron and their products and their journey as if it’s relevant at all to the sodium-ion grid scale storage space,” the executive told me. The grid-scale market, they said, is where most companies are looking to deploy sodium-ion batteries today. “What happened to Natron, I think, is very specific to Natron.”
But what exactly did happen to the once-promising startup, which raised over $363 million in private investment from big name backers such as Khosla Ventures and Prelude Ventures? What we know for sure is that it ran out of money, canceling plans to build a $1.4 billion battery manufacturing facility in North Carolina. The company was waiting on certification from an independent safety body, which would have unleashed $25 million in booked orders, but was forced to fold before that approval came through.
Perhaps seeing the writing on the wall, Natron’s founder, Colin Wessells, stepped down as CEO last December and left the company altogether in June.
“I got bored,” Wessels told The Information of his initial decision to relinquish the CEO role. “I found as I was spending all my time on fundraising and stockholder and board management that it wasn’t all that much fun.”
It’s also worth noting, however, that according to publicly available data, the investor makeup of Natron appears to have changed significantly between the company’s $35 million funding round in 2020 and its subsequent $58 million raise in 2021, which could indicate qualms among early backers about the direction of the company going back years. That said, not all information about who invested and when is publicly known. I reached out to both Wessels and Natron’s PR team for comment but did not receive a reply.
The company submitted a WARN notice — a requirement from employers prior to mass layoffs or plant closures — to the Michigan Department of Labor and Economic Opportunity on August 28. It explained that while Natron had explored various funding avenues including follow-on investment from existing shareholders, a Series B equity round, and debt financing, none of these materialized, leaving the company unable “to cover the required additional working capital and operational expenses of the business.”
Yao told me that the startup could have simply been a victim of bad timing. “While in some ways I think the AI boom was perfect timing for Natron, I also think it might have been a couple years too early — not because it’s not needed, but because of bandwidth,” he explained. “My guess is that the biggest thing on hyperscalers’ minds are currently still just getting connected to the grid, keeping up with continuous improvements to power efficiency, and how to actually operate in an energy efficient manner.” Perhaps in this environment, hyperscalers simply viewed deploying new battery tech for a niche application as too risky, Yao hypothesized, though he doesn’t have personal knowledge of the company’s partnerships or commercial activity.
The sodium-ion executive also thought timing might have been part of the problem. “He had a good team, and the circumstances were just really tough because he was so early,” they said. Wessells founded Natron in 2012, based on his PhD research at Stanford. “Maybe they were too early, and five years from now would have been a better fit,” the executive said. “But, you know, who’s to say?”
The executive also considers it telling that Natron only had $25 million in contracts, calling this “a drop in the bucket” relative to the potential they see for sodium-ion technology in the grid-scale market. While Natron wasn’t chasing the big bucks associated with this larger market opportunity, other domestic sodium-based battery companies such as Inlyte Energy and Peak Energy are looking to deploy grid-scale systems, as are Chinese battery companies such as BYD and HiNa Battery.
But it’s certainly true that manufacturing this tech in the U.S. won’t be easy. While Chinese companies benefit from state support that can prop up the emergent sodium-ion storage industry whether it’s cost-competitive or not, sodium-ion storage companies in the U.S. will need to go head-to-head with LFP batteries on price if they want to gain significant market share. And while a few years ago experts were predicting a lithium shortage, these days, the price of lithium is about 90% off its record high, making it a struggle for sodium-ion systems to match the cost of lithium-ion.
Sodium-ion chemistry still offers certain advantages that could make it a good option in particular geographies, however. It performs better in low-temperature conditions, where lithium-ion suffers notable performance degradation. And — at least in Natron’s case — it offers superior thermal stability, meaning it’s less likely to catch fire.
Some even argue that sodium-ion can still be a cost-effective option once manufacturing ramps up due to the ubiquity of sodium, plus additional savings throughout the batteries’ useful life. Peak Energy, for example, expects its battery systems to be more expensive upfront but cheaper over their entire lifetime, having designed a passive cooling system that eliminates the need for traditional temperature control components such as pumps and fans.
Ultimately, though, Yao thinks U.S. companies should be considering sodium-ion as a “low-temperature, high-power counterpart” — not a replacement — for LFP batteries. That’s how the Chinese battery giants are approaching it, he said, whereas he thinks the U.S. market remains fixated on framing the two technologies as competitors.
“I think the safe assumption is that China will come to dominate sodium-ion battery production,” Yao told me. “They already are far ahead of us.” But that doesn’t mean it’s impossible to build out a domestic supply chain — or at least that it’s not worth trying. “We need to execute with technologically pragmatic solutions and target beachhead markets capable of tolerating cost premiums before we can play in the big leagues of EVs or [battery energy storage systems],” he said.
And that, he affirmed, is exactly what Natron was trying to do. RIP.
REPEAT Project
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