Dead EV Batteries Turn to Gold With US Incentives

American Recycling of Electric Vehicle Batteries Poses Challenge to China’s Dominance

A little-publicized clause in the U.S. Inflation Reduction Act has companies scrambling to recycle electric vehicle batteries in North America, putting the region at the forefront of a global race to undermine China’s dominance of the field.

Qualification of American-Made EV Battery Materials

The IRA includes a clause that automatically qualifies EV battery materials recycled in the U.S. as American-made for subsidies, regardless of their origin. That is important because it qualifies automakers using U.S.-recycled battery materials for EV production incentives.

Impact on the Industry

Reuters interviewed more than a dozen industry officials and experts who say that is kicking off a U.S. factory building boom, encouraging automakers to research more recyclable batteries, and could eventually make it harder for buyers in developing countries to buy old used EVs.

China’s Dominance in EV Battery Recycling

China handles virtually all EV battery recycling in a global market projected to grow from $11 billion in 2022 to $18 billion by 2028, according to research firm EMR. As more EVs are introduced and age out of the vehicle fleet, that business will grow.

Value of Battery Materials

The minerals in those batteries – primarily lithium, cobalt, and nickel – are worth on average between 1,000 euros ($1,123) to 2,000 euros per car, BMW sustainability chief Thomas Becker told Reuters.

Recycling and Infinite Reusability

Those materials could be in short supply within a few years as automakers boost EV production, but “can be recycled infinity times and not lose their power,” said Louie Diaz, vice president at Canadian battery recycling firm Li-Cycle, which received a $375 million U.S government loan for a New York plant slated to open later this year. That funding helped bring forward the investment decision for the plant, Diaz said.

JB Straubel, CEO of Redwood Materials, which was awarded a $2 billion U.S. government loan in February to build out a battery material recycling and remanufacturing complex in Nevada, said the IRA treats recycled battery materials as locally “urban mined,” or materials recovered from scrap rather than obtained from mining.

Differences with the European Union

That has encouraged U.S. companies to move faster on recycling efforts than their counterparts in the European Union, which has focused instead on mandates, including minimum amounts of recycled materials in future EV batteries.

Global Expansion of Recycling Plants

Recycling firms Ascend Elements, Li-Cycle, and others are planning European plants in the next few years, but access to funding and the made-in-America incentive means several U.S. plants are already being built.

Building Closed-Loop Supply Chains

The race is on to build “closed-loop supply chains” where recycled minerals are put into locally produced new batteries, said Christian Marston, chief technology officer at Altilium Metals, which is building a plant in Bulgaria and plans one in the UK by 2026.

China’s Response and Global Growth

“Everybody wants to control their own supply chain and nobody wants to be reliant on the Chinese,” he said. However, China still leads the race, announcing tougher standards and increased research support for recyclers last month. After passage last year of the U.S. Inflation Reduction Act, Chinese officials described the legislation as “anti-globalization” and accused the U.S. of “unilateral bullying.”

Rapid Growth and Future Projections

Globally, there are at least 80 companies involved in EV recycling, with more than 50 startups attracting at least $2.7 billion, virtually all in the last six years, from corporate investors including automakers, battery makers, and mining giants like Glencore, according to PitchBook.com data.

The volume of EV batteries available for recycling should grow over tenfold by 2030, said consultant Circular Energy Storage. Around 11.3 Gigawatt hours (GWh) of batteries reached end of life in 2022, and that should rise to 138 GWh by 2030 – equivalent to roughly 1.5 million EVs – CES said.

Electric vehicle batteries can last for 10 years or more. Some industry officials anticipate rapid growth means 40% of battery materials used in new EVs could come from recycled stocks by 2040.

There is little existing U.S. recycling capacity today, and virtually none in Europe.

Challenges and Opportunities

At a facility in Poole in southern England, car breaker Charles Trent Ltd has built two lines where workers deconstruct wrecked or old vehicles to recycle everything. It has built special containers for EV batteries, which are sold for research or

SDGs, Targets, and Indicators Relevant to the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 9: Industry, Innovation, and Infrastructure
• SDG 12: Responsible Consumption and Production
• SDG 13: Climate Action
• SDG 17: Partnerships for the Goals

2. What specific targets under those SDGs can be identified based on the article’s content?

• SDG 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes.
• SDG 12.5: By 2030, substantially reduce waste generation through prevention, reduction, recycling, and reuse.
• SDG 13.2: Integrate climate change measures into national policies, strategies, and planning.
• SDG 17.6: Enhance North-South, South-South, and triangular regional and international cooperation on and access to science, technology, and innovation and enhance knowledge sharing on mutually agreed terms.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Indicator for SDG 9.4: Proportion of industries upgraded to sustainable practices
• Indicator for SDG 12.5: Waste generation per capita
• Indicator for SDG 13.2: Number of countries with integrated climate change measures
• Indicator for SDG 17.6: Amount of international cooperation and knowledge sharing on science, technology, and innovation

Table: SDGs, Targets, and Indicators

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Source: voanews.com

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