Page 132 - CW E-Magazine (4-3-2025)

Point of View

According to a study of the life-cycle environmental impacts of the three major recycling routes, recycling 1-kg of LIBs can reduce carbon
emissions by 2.7-4.6 kg CO equivalent, with the direct routes showing the greatest benefits.
2
Regulatory framework
Nearly every industrialised economy has or is putting in place a regulatory framework for battery recycling.

Europe’s New Battery Regulations launched in 2023 sets stiff targets for lithium recovery – 50% by the end of 2027 and 80% by the
end of 2031. In addition, it requires battery markers to declare their carbon footprint and, for some to have a digital passport by 2027 that
provides traceability of the battery value chain.

The US has also launched several initiatives for promoting recycling of LIBs, though there is no federal policy. While one may not be
forthcoming under the new administration, some States are expected to create their own mandates and targets.

But the country that has been most proactive in recycling is China – not surprising considering it is not just the world’s biggest market
for EVs, but also the largest producer and consumer of battery systems with tight integration across the supply chain. The country has about
70% of the global capacity for recycling LIBs, partly aided by the fact that the first technical standards for battery recycling and guidelines
for handling waste batteries were framed as far back as 2018.

India has also done fairly well on the policy front, with the Ministry of Environment, Forests and Climate Change having created the
Battery Waste Management Rules in 2022. But installed capacity is still small, though rising.

Market landscape
Global battery recycling capacity, estimated at about 1.6-mtpa, is dominated by Asia, with capacity of about 1.2-mtpa. Of this China
alone accounts for about 1.1-mtpa, spread over 11 plants. An additional seven plants – with a cumulative capacity of 1.22-mtpa – are in
the planning stages.

Capacity in India is presently about 90-ktpa, also spread over 11 plants, albeit of much smaller scale than in China. Investors are expected
to bring on-stream another seven plants with a cumulative capacity of 260-ktpa.

While North America, including the US, has a combined capacity of 144-ktpa, this is far below the requirement given that the US is
the second-largest market for EVs (after China). New investments in expansions and new projects will add another 300-ktpa of capacity.

In Europe, while current capacity is about 200-ktpa, it is expected to be significantly ramped up to 1.12-mtpa.

Globally, battery recycling capacity is expected to reach 3.0-mtpa in coming years.

Collaborations key for profitability
The profitability of recycling operations hinges on three factors: recycling costs; the value of recovered materials; and environmental
benefits.

To achieve financial viability, recyclers need to reduce costs through automation, minimisation of transport expenses, economies of scale,
and adoption of technologies most suitable to the battery system being recycled. Batteries containing high-value critical metals, such as
Nickel Manganese Cobalt Oxide (NMC) cells and Nickel Cobalt Aluminium Oxide (NCA) cells, yield immediate profitability, particularly when
processed using hydrometallurgy to recover cobalt and copper. Conversely, Lithium Iron Phosphate (LFP) cells offer significant long-term
economic and environmental benefits through reuse before recycling.

Designing batteries for easier recycling and to make the disassembly process more efficient and sustainable is vital to improve the economics
of recycling. Tackling this aspect will need collaborations among material suppliers, EV producers, auto brands and recycling companies.

Beyond the value of recovered materials, there are the environmental benefits of battery recycling, which the report estimates at $3-11
per kWh, depending on battery type, carbon pricing, and market conditions. This underscores the dual economic and ecological value that
battery recycling brings.
Ravi Raghavan

132 Chemical Weekly March 4, 2025

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