QuantumScape Corporation (NYSE: QS), a leader in advanced battery solutions, has made a major breakthrough in electric vehicle (EV) technology. In partnership with PowerCo SE, the battery arm of the Volkswagen Group, the companies showcased the world’s first live demonstration of a solid-state lithium-metal battery powering a motorcycle.
The event took place at the IAA Mobility conference in Munich, where a Ducati motorcycle equipped with QuantumScape’s cutting-edge QSE-5 battery cells made its debut. This demonstration marks a major milestone in the push toward safer, higher-performing energy storage systems for electric vehicles and beyond.
Why QuantumScape’s Solid-State Battery Is a Game-Changer
QuantumScape’s mission is to transform energy storage. The company highlighted that its next-generation solid-state lithium-metal batteries can potentially improve energy density, charging speed, safety, lifespan, and cost-effectiveness—all areas where traditional lithium-ion batteries face limitations.
The live demo used QSE-5 cells, built with QuantumScape’s proprietary Cobra separator manufacturing process. This process, integrated into full-scale production in June 2025, has dramatically improved performance. According to industry experts, it offers a 25-fold upgrade over the earlier model and a 200-fold improvement compared to 2023 methods.
The QSE-5 battery delivered industry-leading results, including:
- 844 Wh/L energy density – enabling longer driving ranges.
- 12-minute fast charging from 10% to 80% capacity.
- 10C continuous discharge, supporting high performance under stress.
This breakthrough addresses key EV challenges, making batteries safer and more efficient for both consumers and manufacturers.
Dr. Siva Sivaram, CEO and president of QS, said,
“Today we’ve crossed the threshold from possibility to reality. We believe that our partnership with PowerCo, together with Ducati as our demonstration launch partner, positions us to scale our transformative technology to gigawatt-hour production. Our world-leading battery innovation, combined with Ducati’s uncompromising craftsmanship and legendary commitment to performance, will help usher in a new era of electrified transportation.”
Real-World Test on the Racetrack
The demonstration featured a Ducati V21L race motorcycle powered by QuantumScape’s technology. The battery pack, developed by specialists from Audi, another Volkswagen Group brand, was tailored to show how these batteries can perform in extreme conditions.
Thomas Schmall, CEO of Volkswagen Group Components, presented the technology at the event. The racetrack setting was chosen to rigorously test the batteries’ limits. QuantumScape’s cells performed reliably under high loads, showcasing how this technology can meet the demands of future high-performance EVs.
From Lab Discovery to Commercial Reality
This event is a major step in taking solid-state batteries out of the lab and into real-world applications. Solid-state batteries use a solid electrolyte instead of liquid ones, which greatly reduces the risk of overheating, fires, or explosions—common concerns with conventional lithium-ion batteries.
The QSE-5’s anode-free design, paired with advanced separators, gives it advantages in safety and efficiency. If scaled successfully, this technology could become a standard for next-generation EVs and other energy storage solutions.
QuantumScape expects to ship sample cells for testing in 2026. Commercial production could begin between 2027 and 2028, depending on regulatory approvals and manufacturing scaling.
Strategic Partnership and Market Expansion
QuantumScape’s partnership with PowerCo is expanding rapidly. In July 2025, the two companies announced an updated collaboration agreement that includes up to $131 million in milestone-based payments over two years.
This will fund the scaling of production and technology transfer needed to bring QSE-5 cells to global markets.
- Significantly, PowerCo plans to produce up to 5 gigawatt-hours of QSE-5 cells annually, serving customers beyond Volkswagen’s ecosystem.
This opens up new commercial opportunities and strengthens QuantumScape’s position in the global battery supply chain.
Frank Blome, CEO of PowerCo, said,
“The EV revolution is the biggest transformation the automotive industry has ever seen. Solid-state batteries will redefine what’s possible for high-performance, premium vehicles, and today’s historic demonstration is just the beginning. We’re combining QuantumScape’s world-class battery scientists with PowerCo’s manufacturing expertise to bring game-changing solid-state battery technology to the world as soon as possible.”
QS Stock Market Reaction: A Speculative Opportunity
Following the announcement, QuantumScape’s (QS) stock jumped 20% to around $9.50, reflecting investor excitement. As of 2025, the company’s market cap stands at around $4.44 billion.
However, analysts warn that investing in QuantumScape carries significant risks. The technology’s success hinges on scaling production, navigating regulatory approvals, and competing with established battery players.
Solid-State Batteries: Unlocking Safer, Smarter Energy Solutions
Solid-state batteries are seen as the next major leap in energy storage. Compared to lithium-ion batteries, they offer:
- Higher energy density for longer ranges.
- Faster charging capabilities.
- Safer designs that lower fire and explosion risks.
- Longer lifespan with fewer degradation issues.
- Potential for lower costs as manufacturing processes improve.
These features make solid-state technology attractive not only for EVs but also for consumer electronics, renewable energy storage, and medical devices
Global Market Outlook: 2025 and Beyond
As per FortuneBusinessInsights, the global solid-state battery market is projected to experience rapid growth over the coming years.
- In 2024, the market size was valued at around $98.96 million, and it is forecasted to reach $119 million by 2025.
- By 2032, the market could surge to $1.36 billion, growing at a compound annual growth rate of 41.61% between 2025 and 2032.
The Asia Pacific region is leading this growth, holding a 43.76% market share in 2024. Rising adoption of solid-state batteries in consumer electronics, electric vehicles, and renewable energy storage is driving this trend. The consumer electronics segment, in particular, dominated the market last year, with applications far ahead of those in EVs and medical devices.
Investment in this technology is accelerating, with companies like Toyota, BMW, QuantumScape, CATL, and BYD increasing research and development efforts. Government support is also playing a key role in the development of solid-state batteries.
Key Drivers for Adoption
The demand for safer, higher-performance batteries is pushing companies and governments to invest heavily. Additionally, solid-state designs reduce fire risks, offer greater energy density, improve charging speeds, and extend battery lifespan.
These improvements are making solid-state batteries a preferred option across multiple industries, including consumer devices, EVs, medical implants, and renewable energy storage.
With governments backing funding initiatives and industry players scaling up manufacturing, the path to widespread adoption is becoming clearer. The global market is on the cusp of a transformation, and solid-state batteries are at the forefront of this change.
All in all, QuantumScape’s demonstration is a breakthrough in EV battery technology, showcasing its potential to overcome industry challenges. While risks persist, strong partnerships, advanced specs, and rising demand position the company as a leader in energy storage. If scaled successfully, its technology could drive safer, faster, and more efficient batteries for the future of electric mobility.
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The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
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