Lithium iron phosphate battery (LiFePO4 batterie) possesses a much longer life cycle than traditional battery technology. BYD’s measured data in 2023 shows its commercial energy storage battery pack still maintains a capacity retention rate of 82% when it has been used for more than 6,000 cycles under an 80% deep discharge rate, which is 1100% higher than that of lead-acid battery (500 cycles). It is 300% higher than Tesla’s NCA ternary lithium battery (1,500 cycles). Statistics provided by the United States’ National Renewable Energy Laboratory (NREL) show that the overall life cycle cost of off-grid systems with the LiFePO4 solution stands at only 0.11 US dollars per kWh, which is 67% lower than lead-acid batteries. It can save 230,000 US dollars per MWh of energy consumption during a 10-year operating cycle.
In terms of safety performance, the thermal runaway temperature of LiFePO4 batterie is as high as 270℃, which is much higher than the critical value of 150℃ of NCM batteries. CATL’s 2024 needle-puncture test proved that the surface temperature of its 280Ah energy cell reached only 58.3℃ after puncture by a 5mm steel needle and without explosion or open flames. The EU Battery safety regulation EC No 1272/2023 defines only LiFePO4 as non-airtight battery technology allowed to be used in residential areas because its likelihood of thermal diffusion is below 0.0017% annually. China Tower Corporation’s 2023 report indicates that since substituting the backup power supply of base stations for LiFePO4, the frequency of fire accidents has dropped from 0.35 times per 10,000 groups per year to 0.002 times.
The energy efficiency advantage is phenomenal. The charge and discharge efficiency of LiFePO4 battery is 95-98%, no less than 15 percentage points greater than lead-acid batteries (70-85%). The test result of Tesla Powerwall 3 shows that its LiFePO4 system still delivers 88% capacity in a low-temperature scenario of -20℃, while the lead-acid battery capacity is lowered to 55% under this condition. Sonnen Company in Germany case shows that the proportion of self-consumed electricity in solar systems using LiFePO4 has gone up from 68% to 92%, reducing the cost of purchasing annual grid electricity by 1,270 euros.
The environmental protection characteristics are good. The proportion of cobalt in LiFePO4 battery is zero, whereas the application of nickel is 80% less than that of NCM batteries. The 2024 Tsinghua University Life Cycle Assessment Report confirms that the lifecycle carbon footprint per kWh of LiFePO4 battery is as low as 62kg of CO2, which is only 51.7% of the worth of NCA batterie (120kg). Redwood Materials’ recycling data in the U.S. reveal that LiFePO4 cathode materials can be recycled to a record high of 98.2%, exceeding ternary batteries by up to 12.5 percentage points. The EU BATTERY 2030+ initiative places LiFePO4 on its strategic technologies list because the standard deviation of the material cost volatility of LiFePO4 (7.3%) is considerably lower than for cobalt-based batteries (23.8%).
The economic reward is considerable. Taking as an example a 100kWh LiFePO4 energy storage system, the initial investment cost is 40% higher than for lead-acid batteries. But over the course of 10 years of operations, due to the cycle life benefit, total holding cost is reduced by 58%. It has been estimated by Japan’s SoftBank Group that since they flipped on the telecom base station switches to LiFePO4 batterie, maintenance cost came down by 72%, while the battery replacement cycle was brought up from 2.3 years to 8.7 years. Figures from China’s 2024 photovoltaic poverty relief programs show that the internal rate of return (IRR) of LiFePO4 energy storage village power stations stood at 14.8%, an increase of 6.3 percentage points from the lead-acid counterpart.
Breakthroughs in technological innovation have persisted. The third-generation LiFePO4 batterie released by CATL in 2024 increased the volume energy density to 450Wh/L with nano-scale carbon coating technology, 42% higher than the 2019 model. StoreDot’s ultra-fast charging technology in Israel enables LiFePO4 batteries to charge to 80% in 10 minutes while keeping the temperature rise within 18℃. Industry projections show that the worldwide production cost of LiFePO4 batteries will fall to $76 /kWh by 2028, reducing the range cost of electric vehicles to $0.08 /km, a decline of 64% from the current operating cost of fuel cars.