On a sweltering summer day in Texas in 2022, solar panels across the state absorbed peak sunlight, generating record power as temperatures topped 110 degrees Fahrenheit. Yet as evening descended, air conditioners surged nationwide, demand spiked beyond capacity, and the grid triggered emergency alerts, with rolling brownouts affecting over 2 million customers in Houston alone to avert a full collapse. These blackouts, echoing the chaos of the 2021 winter storm that racked up $80 billion to $130 billion in economic losses from widespread outages, reveal the fragility of current storage systems in handling renewable intermittency. This vulnerability fuels a quiet revolution in energy storage, centered on a fierce competition between established lithium-ion batteries and emerging iron-air technology, led by startups like Form Energy. Their “100-hour batteries” threaten to disrupt the multi-trillion-dollar clean energy sector, compelling leaders like Tesla and CATL to reassess their stronghold.
The Technology Clash: Iron-Air’s Rust-Powered Rise
Long-duration energy storage (LDES) refers to systems that hold power for days, not hours, to smooth out the intermittency of renewables like wind and solar. Lithium-ion batteries, the workhorses of electric vehicles and short-term grid backups, excel in quick bursts but falter for extended periods. They rely on rare materials like lithium and cobalt, packed into cells that deliver high energy density, around 250-300 watt-hours per kilogram, but at a steep price for scaling up duration.
Enter iron-air batteries, a chemistry as simple as it sounds. These systems use abundant iron powder that rusts (oxidizes) when charging with electricity, absorbing oxygen from the air, and then reverses the process to discharge power by de-rusting the iron. Form Energy, founded in 2017 by MIT alumni including former Tesla executive Mateo Jaramillo, has pioneered this approach. Their batteries claim 100 hours of continuous discharge, far surpassing lithium-ion’s typical four to eight hours, all while using materials that cost a fraction of the price. Iron, after all, is the fourth most common element in Earth’s crust, unlike lithium, which faces supply bottlenecks from mining in regions like Australia and South America.
Experts like those at BloombergNEF highlight how iron-air decouples power and energy costs effectively. For instance, extending duration in lithium systems requires stacking more cells and inverters, driving up expenses exponentially. In contrast, iron-air scales by simply adding more iron electrolyte in larger tanks, keeping costs low. Form Energy projects their systems at under $20 per kilowatt-hour for 100-hour storage, compared to lithium-ion’s current $150 to $200 per kWh for shorter durations. This rust-based innovation isn’t just cheaper; it’s designed for grid-scale resilience, powering homes and industries through prolonged weather events or seasonal lulls in renewable output.
Yet, challenges persist. Iron-air batteries charge and discharge more slowly than lithium, with energy densities around 30-50 Wh/kg, making them bulky for portable uses but ideal for stationary grids. Form Energy’s first commercial pilots, like a 1MW/150MWh system with Minnesota’s Great River Energy, demonstrate viability, but full-scale deployment remains in early stages as of 2025.
Challenging the Lithium Throne: Incumbents on Alert
Lithium-ion’s reign is unchallenged in many arenas, powering over 90% of electric vehicle batteries and dominating grid storage with players like Tesla’s Megapack and China’s CATL. CATL, the world’s largest battery maker, held 37% of the global EV battery market share through August 2025, shipping millions of cells annually and expanding into utility-scale projects worldwide. Tesla, through its energy division, deployed over 14 gigawatt-hours of storage in 2024 alone, leveraging economies of scale to drop costs below $100/kWh for four-hour systems.
But iron-air startups are nipping at their heels, particularly for LDES where lithium’s limitations shine through. Form Energy’s tech targets scenarios where lithium falls short, like storing excess summer solar for winter demand. This rivalry isn’t abstract; it’s reshaping supply chains. Lithium prices spiked 400% in 2022 due to demand surges but stabilized by 2025 around $15,000 per ton, yet extraction controversies in places like Serbia highlight environmental risks that iron avoids entirely.
Analysts at MIT Technology Review note that while lithium-ion will likely retain sway in short-duration and mobile applications, iron-air could capture 20-30% of the LDES market by 2030. Incumbents are responding: Tesla has explored alternative chemistries, and CATL invests in sodium-ion as a lithium hedge. The real threat? Iron-air’s potential to slash grid storage costs by 80%, making renewables dispatchable and affordable on a national scale, eroding the need for lithium’s premium performance in bulk applications.
Investor Showdowns: Billions Bet on the Next Big Chemistry
The stakes in this race are staggering, with global energy storage investments topping $20 billion in 2024. Form Energy has emerged as a funding magnet, raising over $1.2 billion by October 2024, including a landmark $405 million Series F round led by T. Rowe Price and GE Vernova. This cash influx supports manufacturing ramps in Weirton, West Virginia, and partnerships like the one with GE Vernova for strategic collaboration on deployments. Backers include heavyweights such as Breakthrough Energy Ventures (backed by Bill Gates) and Energy Impact Partners, drawn to iron-air’s alignment with U.S. energy independence goals under the Inflation Reduction Act.
Lithium-ion giants, meanwhile, command even larger war chests. CATL’s market cap exceeds $100 billion, fueled by Chinese government subsidies and exports, while Tesla’s energy business hit $6 billion in revenue in 2024. Yet, investor sentiment is shifting toward LDES innovators. A 2025 BNEF report shows venture capital flowing to non-lithium tech at twice the rate of prior years, driven by policy pushes for domestic supply chains amid U.S.-China tensions. Political factors amplify this: The Biden-Harris administration’s tax credits favor American-made batteries, giving Form Energy an edge over CATL’s overseas dominance.
European players like Ore Energy, which connected the first grid-tied iron-air battery in the Netherlands in July 2025, add to the momentum. Their 250kW/2.5MWh system underscores international interest, with funding from the EU’s Horizon program. These dynamics create a showdown where iron-air startups bet on abundance and scalability, while lithium incumbents lean on proven infrastructure and rapid iteration.
Grid Stability, Decarbonization, and Energy Sovereignty at Stake
Beyond the tech and money, this rivalry carries profound implications for the planet’s energy future. Grid stability hinges on LDES to handle renewables’ variability; without it, blackouts like California’s 2020 rolling outages become routine. Iron-air’s multi-day endurance could enable “renewables as baseload,” storing wind from stormy weeks or solar from sunny spells to power cities reliably. Lithium, while versatile, struggles with this, often requiring fossil fuel backups that undermine decarbonization goals.
Decarbonization accelerates with cheaper storage: The International Energy Agency projects LDES could cut global emissions by 10 gigatons annually by 2050 if costs drop below $50/kWh. Iron-air fits perfectly here, using recyclable iron to minimize mining impacts, unlike lithium’s water-intensive extraction that strains communities in Latin America. Energy sovereignty follows suit; nations like the U.S. and EU, wary of China’s 70% control over lithium processing, see iron-air as a path to self-reliance, reducing geopolitical vulnerabilities.
Experts like Joseph Fath from T. Rowe Price emphasize how these batteries support commercial and industrial sectors, from data centers to factories, ensuring affordable clean power. In a 2025 ACS Publications analysis, researchers predict iron-air could stabilize grids in renewable-heavy regions like Europe, where wind and solar now exceed 40% of supply, fostering a resilient, low-carbon economy.
Who Claims the Grid’s Future?
In the iron versus lithium showdown, iron-air appears poised to win the long game for grid storage, thanks to its unbeatable economics and alignment with sustainability mandates. While lithium-ion will endure in EVs and short bursts, Form Energy’s trajectory, bolstered by $1.2 billion in funding and real-world pilots, signals a tipping point. By 2030, as costs plummet and deployments scale, iron could democratize clean energy, making blackouts relics and renewables the default. The race isn’t over, but rust might just prove more valuable than rare earths in building tomorrow’s power grid.