The inherent value of LiFePO4 batteries (lithium iron phosphate batteries) applied in solar power storage systems is their superior cycle life and high cost-performance. For example, the lifepo4 battery with a capacity of 10kWh can do 6,000 cycles in 80% deep discharge (DoD) and has a lifespan of 15-20 years, far more than the 500 times of lead-acid batteries (lifespan of about 3 years) and the 2,000 times of terpolymer lithium batteries (NMC) (lifespan of about 8 years). According to Ningde Times statistics in 2023, after being paired with photovoltaic modules and mounted on home energy storage system, the life cycle cost can be reduced to 0.08 yuan /Wh, 52% lower than that of lead-acid battery, and the energy density can come up to 160Wh/kg, while the volume reduces by 40%, which is within the space limit of rooftop photovoltaic installation.
Security is a significant feature of solar energy storage batteries. The thermal runaway temperature of lifepo4 battery is as high as 270 ° C, but NMC battery only 160 ° C, and its olivine crystal structure hardly releases oxygen in overcharge or short circuit, and the chance of thermal runaway is less than 0.001%. In 2021, an energy storage fire investigation on a Tesla Powerwall 2 confirmed that the NMC battery pack failed seven times faster than the LiFePO4 at high temperatures. Apart from this, the LiFePO4 working temperature ranges from -20 ° C to 60 ° C and can maintain 93% charge and discharge capacity under most extreme high temperatures in desert regions (e.g., Saudi NEOM solar power project), while the charge and discharge efficiency of lead-acid batteries reduces to 65% at 50 ° C.
With regard to environmental adaptability, the lifepo4 battery low temperature performance is considerably improved. At -10℃, its retention rate of discharge capacity is up to 88%, whereas that of the lead-acid battery is 30%. The LiFePO4 battery in Huawei Smart Photovoltaic Solutions’ off-grid system deployed in the Arctic Circle of Norway in 2022 achieves 95% of its usable capacity using self-heating technology at -30 ° C, making continuous power supply possible throughout the year. In the meanwhile, its own self-discharging rate is just 3%/ month, able to reduce the loss of energy by 85% against the 20%/ month of lead-acid battery and suitable for rainy season or winter scenery with unstable lighting.
Economic benefits are also doubled by means of policy innovation and technological breakthrough. In California, for example, with a 30% federal tax credit, the total cost of installing a 10kWh LiFePO4 system is around $7,000, saving $3,000 compared to the lead-acid battery program, and the annual income of peak and valley electricity price arbitrage can be as much as $1,200, and the payback time is shortened to 4.8 years. Byd’s “blade battery” technology drives system costs below $100 /kWh by a mode-free architecture, cutting 45% from 2019. According to International Renewable Energy Agency (IRENA) data, in 2023 worldwide photovoltaic storage projects, LiFePO4 batteries occupy 68%, and its market share will be more than 85% in 2030.
Environmental regulation is now an entry barrier to the market. LiFePO4 batteries don’t employ rare metals such as cobalt and nickel, and the production-related carbon emissions account for 40% less than NMC batteries, and recycling efficiency is more than 98%. The New Battery Regulation of the European Union introduced in 2024 requires the power battery carbon footprint to be less than 60kg CO2/kWh, and Ningde LiFePO4 products’ carbon footprint is just 35kg CO2/kWh. In Australia, Australia receives a green subsidy of AU $200 per KWH for domestic lifepo4 battery use, leading to increased household energy storage penetration from 8% in 2020 to 32% in 2023.
The efficiency in charging and discharging enhances the photovoltaic system’s income directly. The charge and discharge efficiency of LiFePO4 batteries is 95-98%, while that of lead-acid batteries is just 70-80%. In the German EON 100MW solar power plant, the supporting LiFePO4 energy storage system has lowered the light abandonment rate from 12% to 3%, and the annual generation revenue has risen by 5.8 million euros. Its 2C fast charging capability allows the storage of photovoltaic daytime excess power within 2 hours, and can seize 1.2 hours more peak light revenue per day than the NMC battery’s 1C charging speed.
Operation and maintenance cost advantages throughout the entire life cycle. LiFePO4 batteries do not require quarterly balanced maintenance of lead-acid batteries, and the yearly maintenance cost is less than $50 / system, 80% less than lead-acid solutions. According to Wood Mackenzie estimates, the worldwide PV energy storage operation and maintenance market will be $7.4 billion in 2025, with 91% incremental share being by LiFePO4 technology. During the Eskom power crisis in South Africa, after the hospital’s adoption of lifepo4 battery instead of diesel generators, fuel cost was reduced by 76%, carbon emissions were reduced by 12 tons/year, and system availability increased from 88% to 99.97%.