The Future of Energy Storage Lies in Manganese Zinc Batteries

As global energy demand surges, governments and corporations should invest in a safer, cheaper, and more sustainable battery storage option to power critical infrastructure

Global energy demand is rising rapidly, with consumption growing faster in recent years than the previous decade. Projections suggest it could increase up to 18 percent by 2050. Electricity demand alone is expected to double over the same period.

This is largely due to rapid advancement in previously undeveloped regions, as well as the exponential rise of artificial intelligence (AI) and its integration into everyday technologies. Data centers account for roughly 2 percent of global electricity consumption, a figure expected to double by 2030.

This strain has exposed the fragility of many national grids, which already were becoming increasingly difficult to manage as more renewable energy sources have come online. From 2015 to 2021, global blackout incidents increased by over 60 percent. In the United States alone, grid disturbances cost an estimated $150 billion per year in lost productivity, equipment damage, and emergency measures. As these demands escalate, major technology companies are investing heavily in securing sustainable energy solutions.

Even so, a critical aspect of energy infrastructure often is overlooked: backup energy systems. These systems are essential for maintaining operations during power outages or grid disruptions, particularly for critical infrastructure like hospitals, data centers, and financial systems where downtime is not an option. Reliable backups are also vital for large companies of all types, as server outages can result in enormous financial losses.

Battery Energy Storage Systems and the Challenges They Face

Battery energy storage systems (BESS) have become an increasingly popular solution for both backup power and renewable energy storage, ensuring power availability during peak demand or grid failures.

Today, most BESS installations rely on lithium-ion battery technology for its high energy density, efficiency, and declining cost. However, drawbacks are becoming increasingly apparent. A primary challenge involves the scarcity of materials required to produce the batteries. The key components—lithium, cobalt, and nickel—are not only expensive but concentrated in specific, geopolitically sensitive regions of the world, including Chile (which supplies ~30 percent of global lithium), Argentina, the Democratic Republic of Congo (responsible for 70 percent of cobalt), and Indonesia. They are refined predominantly in China, which controls more than 60 percent of global lithium processing capacity.

This concentration exposes global supply chains to trade restrictions, labor disruptions, and political volatility. A single regulatory shift or mining disruption in one country can ripple across global markets, driving up prices and delaying production. For example, lithium prices surged more than 400 percent between 2021 and 2022 before easing slightly in 2023.

Safety concerns further complicate the widespread adoption of lithium-ion batteries. They are highly flammable and prone to overheating, posing risks of fire or explosion. Large-scale applications require sophisticated cooling systems to mitigate these risks, which hikes costs and places additional strain on water resources—an increasingly critical concern in a warming world. These safety issues create logistical ones, as lithium-ion batteries have costly and stringent regulations associated with shipping.

Disposal is another major hurdle. At the end of their lifecycle, lithium-ion batteries are difficult to recycle and often require expensive and specialized transportation to safely handle the risk of combustion. Further, these batteries generate hazardous waste that is not biodegradable, creating a long-term environmental burden that undermines their perceived sustainability.

Manganese Zinc Batteries: An Emerging Alternative

In the search for safer, more sustainable, and cost-effective energy storage solutions, manganese zinc batteries are emerging as a promising alternative. Their advantages make them particularly well suited for stationary energy storage applications, including backup systems for critical infrastructure and renewable energy storage facilities.

Key benefits include:

• Safety. Unlike lithium-ion batteries, manganese zinc batteries—part of a class of rechargeable energy storage systems that use zinc as the primary anode material and aqueous electrolytes—are nonflammable, greatly reducing the risk of fires or explosions. This makes them an ideal choice for high-stakes applications such as data centers and hospitals where safety and reliability are paramount. Additionally, the stability of the zinc system eliminates the need for frequent monitoring and recharging of individual cells—a significant cost factor in lithium-ion battery management.
• Manganese zinc batteries can operate efficiently across a wide range of temperatures, eliminating the need for expensive temperature control systems. This reduces maintenance costs and conserves water resources, aligning with global sustainability goals.
• At the end of their lifecycle, manganese zinc batteries are fully decomposable and far easier to recycle than their lithium-ion counterparts. They do not produce toxic waste, making them a clean and environmentally friendly solution for energy storage. What’s more, while lithium-ion batteries can cost between $100 and $200 per kWh to recycle, zinc-based systems are easier and potentially far cheaper to reclaim, with early estimates suggesting costs under $20 per kWh. Components such as the alkaline electrolyte can even be repurposed as agricultural fertilizer, turning battery waste into a valuable resource.
• With lithium, cobalt, and nickel supplies heavily concentrated in a handful of countries, global energy stability is vulnerable to disruption. By contrast, manganese and zinc resources are far more geographically diversified and mined in politically stable nations such as Canada, Australia, the US, and Peru. This shift could therefore help the US, Europe, and emerging markets democratize access to energy storage technologies, reduce dependence on China, ensure alignment with broader industrial policy goals and national security strategies, and stimulate new domestic jobs, innovation, and infrastructure development.
• Manganese zinc batteries offer a scalable solution for decentralized energy storage. They can be deployed easily on farms and in rural communities and isolated facilities, boosting local energy resilience. This both ensures uninterrupted power supply and empowers communities to become less reliant on national grids and imported fuels while developing energy independence.
• Cost-effective. In addition to the cost savings noted above, initial projections suggest that manganese zinc batteries could lower capital costs by 20 to 50 percent compared to lithium-ion systems, with maintenance costs potentially reduced by up to 50 percent. These figures reflect early stage industry estimates, including data from Salient Energy, a company developing zinc-ion technology, which reports their systems may be up to 50 percent cheaper than lithium-ion alternatives—partly due to the absence of expensive raw materials and complex thermal management systems.

Challenges to Adoption: Bridging the Gap Between Innovation and Scale

Despite their many advantages, manganese zinc batteries face substantial barriers to adoption.

1. The supply chain and manufacturing infrastructure for these batteries is underdeveloped. While global lithium-ion battery manufacturing capacity surpassed 1 TWh in 2023, zinc-based systems remain at a fraction of that scale—with leading players producing approximately 1.5 GWh in the US. Developing new manufacturing lines could take three to five years per facility and cost upward of $500 million.
2. These batteries lack widespread commercialization. According to IDTechEx, lithium-ion batteries continued to dominate the stationary energy storage market in 2023, accounting for over 90 percent of global utility-scale installations. Many governments and corporations are cautious in adopting new technologies that lack extensive field data and real-world testing.
3. Regulatory frameworks are not optimized for alternative chemistries. Standards, certifications, and fire codes currently are geared toward lithium-ion systems. Manganese zinc batteries may require updates to energy storage guidelines, slowing their market entry.
4. Fiscal constraints complicate adoption. Many governments are under budgetary stress due to rising debt, healthcare costs, and macroeconomic volatility. In 2024, public debt across OECD countries averaged 113 percent of GDP, leaving little fiscal room for upfront investment in next-generation energy storage. Even if manganese zinc batteries offer lower total cost of ownership, the upfront capital for research and development (R&D), deployment, and integration may be hard to justify without immediate returns. Similarly, companies facing short-term profit pressures may struggle to reallocate budgets toward unproven technologies, even if long-term gains are clear.

To overcome these challenges, public-private partnerships are essential. Governments can provide incentives, fund demonstration projects, and expedite regulatory approvals. Meanwhile, private firms can scale production, innovate further, and absorb initial risk. For example, public cofinancing of pilot programs—such as offering 30 to 50 percent cost-sharing for initial installations—can accelerate adoption while lowering perceived risk.

Shaping the Future of Energy Storage

The transition from lithium-ion to manganese zinc technology could revolutionize the energy storage industry. As global energy demand continues to climb, the limitations of lithium-ion batteries will become increasingly unsustainable. Renewable energy sources like wind and solar are vital to reducing reliance on fossil fuels, but their intermittent nature underscores the need for effective storage systems. Manganese zinc batteries address these challenges while providing a safer, more reliable, and more sustainable alternative.

Tech companies have a significant opportunity to champion this transition, whereas governments and industry leaders could encourage the rollout of manganese zinc batteries across agricultural sectors and local communities, creating distributed storage networks that increase national energy resilience and buffer economies against energy price shocks driven by international instability.

Finally, this transition offers an opportunity to rethink industrial policy. By reducing reliance on lithium—whose supply chains are concentrated and subject to geopolitical and market volatility—countries can improve energy security and build more resilient domestic manufacturing ecosystems. According to the International Energy Agency (IEA), global investment in grid-scale energy storage technologies will need to reach tens of billions of dollars annually by 2030 to support clean energy transitions. While most of this currently flows into lithium-ion systems, increasing attention and R&D funding for alternatives like manganese zinc batteries could help diversify storage technologies and position them as strategic assets in national energy resilience frameworks.

The world’s energy challenges demand bold, innovative solutions. Embracing this next-generation technology can support the continued growth of AI, protect critical infrastructure, and reduce the environmental impact of energy storage.

The future of energy lies in safe, scalable, and environmentally conscious solutions—and manganese zinc batteries are poised to lead the way.

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Magdalena Viktoria Kuyterink is a competition economist based in BRG’s Brussels office.