The Race to Recycle Electric Vehicle Batteries

The growth of electric vehicles (EVs) brings both opportunities and challenges. One key issue is what happens when their batteries reach the end of their usable lives.

Luckily, EV batteries can be recycled to recover valuable materials like lithium, cobalt and nickel for reuse in new batteries. But who will lead this emerging recycling industry?

New Incentives Spark a Battery Recycling Boom in the US

A provision in the US Inflation Reduction Act (IRA) is set to accelerate battery recycling in North America. It gives recycled battery materials the same status as newly mined ones for the purpose of EV subsidies. This immediately makes battery recycling facilities in the US much more viable and attractive investments.

As a result, numerous American companies are rushing to open large-scale battery recycling plants across the country. For example, Redwood Materials recently secured a $2 billion government loan to support their new battery recycling complex in Nevada.

Closed-Loop Recycling to Reduce Reliance on New Mining

One goal of this recycling drive is to create closed-loop battery supply chains. This means recycled materials from old EV batteries are used to manufacture new batteries in the same region. Rather than keep mining more virgin resources, recycled stocks become the primary material source.

Industry experts predict such closed-loop chains could supply up to 40% of the materials for new EV batteries by 2040. This would reduce the environmental impact of battery production.

Challenging China's Global Dominance in Battery Recycling

Another major motivation is undermining China's current dominance of the battery recycling industry. China handles virtually all global EV battery recycling today, processing scrapped batteries shipped from Europe and the US.

By building large-scale recycling domestically, the US aims to become self-sufficient in these critical battery materials. This reduces reliance on imports from China for EV production.

What About Battery Recycling in the UK?

While the US rushes to expand recycling capacity, progress has been slower in the UK and Europe. Regulations here have focused more on mandating minimum recycled content in new batteries by 2030, rather than direct investments.

Currently, old EV batteries in the UK are shredded and shipped overseas, mostly to China, for actual recycling. But new recycling startups are now planning the first European facilities to come online in the next few years.

Building out domestic recycling will be crucial for the UK. Experts predict a more than 10-fold rise in end-of-life EV batteries by 2030 as early models reach their end of service. Having local, high-yield recycling will ensure these valuable resources can be recovered and put back into new British EV batteries.

The Race for Higher Yields

Companies around the world are competing to improve recycling techniques and get the highest yields from scrap batteries. The goal is to recover up to 90-100% of key ingredients like lithium, cobalt and nickel.

Higher yields mean more materials to feed back into future EV production. It also enables profitable recycling operations. Finding affordable ways to recycle will be key as volumes of depleted EV batteries increase dramatically in the coming years.

Keeping a Close Eye on Old EVs

Another challenge is tracking what happens to old EVs. In Europe, up to 30% of petrol and diesel cars disappear abroad when retired, sold on to developing countries.

Losing old EVs means losing access to those batteries for recycling. Some automakers are looking at solutions like leasing batteries to keep control of them. Managing end-of-life EV batteries will ensure the UK can capitalize on this new opportunity.

While the US may be ahead, robust battery recycling capabilities will be crucial for the UK and Europe. As the electric vehicle revolution continues, recycling offers a sustainable way to supply materials for the next generation of batteries. Strong government support can help the UK compete in this rapidly growing global industry.