Lithium iron phosphate (LFP) has advantages in terms of cost performance and safety, and ternary lithium (NCM) has advantages in terms of high energy density.

　　The main problem in the development of lithium batteries is to increase the energy density of the battery. The improvement space of the technical indicator of ternary lithium battery is currently better than that of iron lithium battery.

　　Ternary lithium materials can be divided into 111, 523, 622 and 811 according to the different proportions of the three elements of nickel, cobalt and manganese. The higher the nickel content, the higher the gram capacity of the material and the higher the energy density of the corresponding battery module. However, the corresponding process difficulty is greater and the safety challenge is higher.

　　Lithium iron phosphate radiates new vitality in the fields of energy storage and pure electric passenger vehicles by virtue of its cost-effective and safety advantages. The olivine structure of lithium iron phosphate is stable, the temperature of thermal runaway is high, the cycle stability is good, and the safety performance is good; at the same time, because lithium iron phosphate does not contain precious metals such as cobalt, the price is low and the cost advantage is significant.

　　In the field of energy storage, the requirements for energy density are relatively low, but it is highly sensitive to safety and cost, and lithium iron phosphate has significant advantages; represented by 5G base station energy storage, public tenders are basically lithium iron phosphate batteries. When the passenger car has a range of 300-400km and below, the energy density of lithium iron phosphate is sufficient, and it will occupy the market share by virtue of its cost performance and safety advantages.

　　From the perspective of the cost structure of the battery pack, the raw material cost of the battery cell accounts for the largest proportion. Further splitting the cost of the battery cell, it is found that the cathode material accounts for the largest proportion. The cathode material cost of ternary batteries accounts for 38%, while the cathode cost of lithium iron phosphate batteries accounts for only 25%. Reducing the cost of the cathode material has the best effect on reducing the cost of the entire battery pack.