As consumers’ attention is turned toward the latest electric vehicle technology gracing the automotive industry, interest has been piqued about closed-loop recycling in the EV market. This market involves materials used in manufacturing EV batteries being recycled and reintroduced into the production cycle, creating a sustainable loop.
Connie Prostko-Bell is the ESG and sustainability practice director at ALL4, a nationally recognized consulting company focused on helping shape environmental responsibility.
She said that significant incentives from sources such as the Department of Energy and the Inflation Reduction Act have driven capital investment in the establishment of domestic EV battery recycling infrastructure. OEMs have also invested in partnerships and in-house capacity.
“However, current projections assume recycling capacity will outpace availability of recyclable material supply, at least in the near term,” Prostko-Bell said. “Several EV manufacturers have also established long-term offtake agreements (agreements to buy from) with battery recycling and supply companies, establishing a more stable supply and demand relationship.”
Prostko-Bell said the biggest challenge will be availability of recyclable material. “It’s also important to note that batteries are not standardized, making them increasingly difficult to dismantle,” she said.
Brian Skalovsky, director of recycling for EV battery solutions by Cox Automotive, pointed out that in recent history, the auto recycling and auto manufacturing industries have learned the vital importance of operating in a closed-loop scenario for the supply chain.
“Nickel and cobalt play critical roles in domestic battery production. Reflecting on the lead-acid industry a century ago, we lacked the necessary lead units within our system, so we resorted to mining and importing,” Skalovsky said. “Only after we introduced a sufficient quantity into our system did recycling and self-fed, lead-acid, battery production take hold. Similarly, with nickel and cobalt, we are in the initial stages of both sourcing and recycling these materials. It will take many years before we have enough material within the system to maintain a closed loop.”
Achieving a closed-loop system is not merely a distant dream; it’s an active pursuit. This is evident in the industry exclusively producing items of recycled value, ensuring nothing ends up in landfills.
“The primary challenge lies in sourcing adequate nickel, cobalt and qualified sulfate products for recycling back into battery production,” Skalovsky said. “Despite the absence of P-cam facilities in the United States, we are confident in our ability to overcome this challenge.”
Don Wright is the vice president of engineering at Unico. He has honed his expertise in power electronics control products, focusing on EV battery and powertrain development and testing.
According to Wright, there are quite a few companies that are already working on the recycling process of EV batteries. They bring in the EV batteries and grind them up into “black mass” and then use a chemical and heating process to then separate black mass material to build new batteries.
“This process is still in the very early stages for Li-Ion batteries but it is like the process that has been used for lead acid batteries for years,” Wright said. Two big companies, Redwood Materials and Northvolt, both have battery business models built around the use of recycled EV battery material to build new batteries.
“When the batteries are ‘dead,’ the material is still very valuable and usable for new batteries and helps avoid the need to mine the material for all the batteries required for the EV targets we have in place for 2030 and beyond,” Wright said. The biggest challenge is making the process energy and cost efficient. Just grinding up and then separating out the material at the end works – but if the cost of that is more than mining new, then it will never be a profitable business model, which then means it won’t work (without governmental enforcement).
For auto recyclers, Wright said it means that the batteries will have some value to them, and they would be excited to get EVs into their lots. Right now, many lots won’t even take in EVs due to flammabilty concerns.
“But as soon as they can take out the battery and get money for it, the story will change,” Wright said. “For OEMs, the story is really about the cost of the EV. Right now, the consumer pays full cost for the battery but if the OEM knows that the battery is worth 60 percent (let’s say) at the end of its life for salvage, it could reduce the initial cost, knowing the value could be recouped. Another possibilty; if the battery isn’t part of vehicle ownership, the consumer “leases” the battery and the OEM owns the battery for its entire life. But, as Wright explained, this scenario only affects consumers from a financial perspective…once the recycle business model sorts itself out.
Key Industry Players & Closed-Loop Recycling
So what does closed-loop battery recycling mean for auto recyclers, OEMs and consumers?
John Jaddou, global director business development, Orbia Fluor & Energy Materials, said that by developing a closed-loop recycling process and supporting systems, we can recover the critical minerals and upcycle them back to their original state.
“This urban mining approach is more economical, less energy intensive and therefore produces a lower carbon footprint and creates a more resilient battery materials supply chain,” Jaddou said. “Elements such as lithium, nickel, cobalt, and materials such as graphite are in short supply today but are used in most Li-ion batteries. By enabling closed-loop recycling, battery companies and OEMS can ensure a robust localized, supply chain wherein the prices of the materials are not buffeted by geopolitical issues. For consumers, this means more stable prices.”
According to Prostko-Bell, auto recyclers will have significant incentive to recover EV batteries given that demand will outstrip supply in the near term. However, they will need to establish new recovery and safety processes, protocols to safely harvest and transport the materials, and new partnerships and logistics to connect with buyers.
“Technology will enable safe and efficient extraction, sorting and material handling (such as robotics), as well as management of the resource recovery market, including logistics and transaction management,” Prostko-Bell said.
A closed-loop system provides an additional sourcing option for battery makers. According to Skalovsky, high-quality raw materials yield higher-quality products at potentially lower prices, which is a win-win situation.
Technology is also poised to play a pivotal role in the closed-loop ecosystem, offering improved techniques for producing higher-quality products.
Right now, the industry is focusing on new methods for discharging the batteries for recycling. Wright said that actively removing the energy from the battery before it is recycled is not only safer, but recoups the stored energy and might be able to make the material more valuable after the recycled phase.
“We are working on a few projects to test some of these theories and understand the feasibility of the process, and the time it takes to actively discharge the batteries and will see if this is worth the extra effort – versus just using a salt bath to passively discharge them,” Wright said.
“The ability to track critical minerals from source to destination and back will reassure OEMs that they can repurpose previously recycled batteries,” Skalovsky said. Additionally, technology could aid in making batteries more affordable and prolong their lifespan, offering greater value to end consumers. Relying on technology to minimize fallout from production facilities manufacturing cathode and anode will drive down the overall battery price, aligning with the ongoing trend of declining battery costs per kilowatt-hour.
Prostko-Bell stressed that in the near future, OEMs will need to think about battery components as consumables.
“Batteries should be viewed as a necessary element of the vehicle that does not dictate end of life but will require replacement during the useful life of the vehicle,” Prostko-Bell said. “This might look like a service or leased component rather than a purchased product. By developing a long-term relationship with customers where consumers are compelled to return to the OEM to swap out a spent battery, they not only ensure recovery of the battery material but establish a longer revenue relationship with the customer.”
Wright said if we want to recycle EV batteries, we need to make it affordable and profitable, otherwise it won’t happen. It must be valuable enough to justify the cost of recycling as opposed to securing freshly mined raw material.
“You want to make it valuable enough for consumers and recycler to be motivated, but not so valuable that people start stealing EVs to take out the batteries to recycle them (and get cash for them). Yes, stealing an EV battery isn’t like steaking a catalyst from an ICE car, but the possibility is there,” Wright said. Safety also will be an aspect that needs to be explored and defined. How are batteries removed and shipped to recycling centers safely?
“We are dealing with both high voltage and the potential for fires if batteries are not handled properly or even worse, in the case of damaged batteries from accidents,” Wright said. “We might need certified service centers that are needed to handle these cases, where trained people can properly handle damaged batteries and make them as safe as possible before transporting them to the recycling centers.”
Jaddou added that while the recycling industry has been making progress, there remain a few hurdles. First there are various battery chemistries, formats, and designs, which can pose challenges for recycling.
“Developing standardized recycling processes that accommodate different types of batteries while maximizing material recovery and upcycling is essential,” Jaddou said. “We expect the adoption of EVs to continue to grow over the next decade and as the adoption of EVs continues to grow, there will be a need for battery recycling infrastructure. Scaling up recycling capacity to meet this demand will require significant investment. In addition, fluctuating raw materials prices may negatively impact recycling economics, and lack of regulatory framework may hinder efforts.”