Every challenge presents opportunities for new businesses and business tycoons. E-waste of EV batteries seems to be one such case.
It is well-known that lithium-ion batteries constitute the core of electric vehicles (EVs), but it is equally well-known that the landfills are full. So, where will the batteries be dumped after their use?
Understandably, the calls for circularity, which involves the recovery of resources from the so-called waste, are gaining traction. To figure out the challenges and opportunities presented by this trend, this report, based on some industry events, puts across some facts that need to be considered.
First, let’s look at the prominent trends related to the use of batteries in EVs and their e-waste.
- India is moving toward renewable energy sources rather than relying on the conventional energy sources that are riddled with challenging geographical and geopolitical issues.
- The Indian market is growing at an exponential rate. Also, EVs are trending. So, the demand for lithium-ion batteries is set to boom.
- Before 2017, lithium-ion batteries existed in the market but the quantum of these batteries has vastly increased from the time electric mobility came into the picture.
- The annual lithium-ion battery potential from EVs is likely to reach 130 gigawatt hours (GWh) in India by FY2030, from 5GWh as of FY2022.
- At present, EVs account for a 30% share of the overall lithium-ion batteries’ deployment in India. By 2030, the share is expected to increase to 60%.
- Within EVs, electric 2-wheelers will be the major segment which will hold a majority share of over 80% by 2030. The electric 3-wheelers will also have a substantial share.
- On the basis of this demand for lithium-ion batteries, their recycling market potential in India is expected to cross 48GWh by 2030.
- The lithium-ion batteries can be recycled as well as refurbished for reuse.
- From the perspective of recyclers, the majority of scrap coming out in India is from mobile phone batteries. The electric 2-wheeler batteries have started coming in, but these have NMC (nickel, manganese, and cobalt) cells.
- In the case of electric 2-wheelers and electric 3-wheelers, nearly 75% of such batteries are being recycled and the rest 25% are estimated to be used for a second life, like behind-the-meter (energy production and storage systems that directly supply homes and buildings with electricity) applications.
- In the case of e-cars and e-buses, second-life usage is as high as 60%.
- The battery recycling process entails pre-treatment, which constitutes the thermal process and mechanical processes. Then comes post-treatment, for which two technologies are deployed: pyrometallurgy and hydrometallurgy. In India, hydrometallurgy is the most used. Direct recycling is also possible, which is more favourable for LFP (lithium iron phosphate).
- Lithium nickel manganese cobalt (NMC) oxide batteries’ chemistry provides higher energy density, low weight, etc, while LFP provides higher safety and better cycle life. We are moving more towards LFP but there isn’t much to recover here.
- We are going through this technological evolution. Some other chemistries will also come soon. The suitability for the recycling is going to be determined by the original equipment manufacturers (OEMs) themselves.
Here’s a list of challenges posed by the increasing sale of EV batteries:
- Limited resource availability is a challenge. As the government of India is pushing for local manufacturing of lithium cells, demand for raw materials is expected to grow significantly. But, currently, there are no local resources for such rare metals in India.
- A major challenge is related to the material coming out through the first level of recycling. It is very difficult to check if the black mass generated out of recycling would have the same specifications which are being promoted and provided by these mechanical recycling players.
- The idea of tapping the B2C segment by recyclers is also logistically inconceivable. Only battery manufacturers can tap the market through extended producer requirement norms, if imposed strictly.
- Geopolitical risk, war, and the pandemic are creating additional threats that are disrupting the supply-chain. The global supply-chain, especially China’s, is resulting in a long lead time for raw material deliveries.
- The most important challenge is the high cost, huge upfront costs involved in setting up recycling plants, and high processing costs that are becoming the main deterrents.
- We do not yet have enough batteries that have actually gone through the cycle life to really talk about the critical mass.
- Unlike a traditional lead-acid battery, a lithium-ion battery, if not fully discharged before it goes for black mass, is bound to create problems. Being handled by the informal sector is a disaster in making.
- The process of recycling EV batteries is still in the learning phase. Dismantling and recycling of batteries present a huge task in terms of setting up facilities for the production of the black mass or derivatives, such as cobalt sulphate, nickel sulphate, and lithium carbonate.
- In terms of channelisation, battery recycling is still being handled by the large informal sector, which was earlier handling the e-waste, because significant battery supplies are from smaller devices like smartphones, other gadgets, and power tools.
- There are multiple channels before a battery reaches the end recycler. There are a lot of leakages in the system, which make it an inefficient process.
- There are no guidelines from the government for second-life battery packs. If you make any of these battery packs, they’re still considered first-life packs.
- Not many refiners are available to extract the metals like cobalt, lithium, and graphite, which are not naturally available in India to be mined.
- On the international front, there are restrictions being imposed by the countries where these are available.
- Ensuring that standards are met for collection, and ensuring safe handling and transportation is another challenge.
Here is the list of opportunities that could give rise to new businesses:
- There’s a huge potential for material recycling, which is nascent and will be increasing multi-fold in future.
- Batteries will not just die like that after use in electric vehicles. They will be first used in their second life before going for recycling, because these have high-end, high-purity, and high-material cells.
- Direct recycling, that is, cathode to cathode recycling, is possible and it is most favourable for LFP. So that is a technology on which the recyclers need to work in India jointly.
- India has a huge opportunity for battery-grade refiners, the technology for which is yet to come to India from the countries like Japan, China, and Korea.
- There is a significant market for second-life batteries because 60-80% of energy is left in the cells, which can be used in toys, inverters, etc. This presents a big opportunity for dealers, service centres, and other authorised channels.
- Foreign investors are showing a lot of interest in the recycling sector in India due to India’s huge consumer and increasing consumption of lithium-ion batteries.
- Indian recycling firms have the chance to partner with foreign companies and get exposed to technology as well as entire network of partners.
|Recovery Targets For Batteries|
|Type of battery||Recovery target for the year in percentage|
|2024-25||2025-26||2026-27 and onwards|
|Note. Maximum recovery target is subject to the percentage of non-recoverable hazardous material content in the battery. It would mean the reduction of recovery target by the same percentage of the hazardous material present in the waste battery.
Recovery of minimum percentage target is the percentage of the total weight of all recovered materials out of the dry weight of the battery. Recyclers shall be mandated for minimum recovery of battery materials,
as mentioned in the Table, under Battery Waste Management Rules, 2022.
Here’s the list of things expected from the Central and state governments, as these are all policy-related:
- Skilling the workforce and explaining them the chemistry of lithium-ion is important.
- Lithium-ion battery dismantling and recycling is a different game altogether and requires different regulations in place. Removing lithium is not the same as removing PCB from a mobile phone.
- There needs to be a mechanism to incentivise and ensure that the recycling is done properly and that the customers can return their batteries and collect the money.
- Battery Waste Management Rules, 2022 are a step in the right direction for the recyclers, refurbishers, producers, and importers. They prohibit landfill disposal and incineration of depleted batteries. The efficacy of implementation is going to be the most important factor, however.
- The centralised online portal is crucial to fix end-to-end responsibility. Making sure that there is traceability of the batteries through this online portal is going to be critical.
- There should be some kind of check for not just the kind of extraction and efficiency of the technology, but also for the emissions.
- We have a lot of things to learn from the lead-acid battery market. Lead in batteries had to be handled carefully, but its implementation become very localised, dominated by the recyclers.
- It’s better to make and announce policy beforehand to prevent germination of the unorganised sector in this domain.
- Government should help standardise the procedure and set a benchmark.
Here are some suggestions for the industry:
- Look at the waste as a raw material.
- We don’t manufacture many lithium-ion batteries. So, whatever gets recycled, rather than exporting to foreign refiners, we should refine it within our country and benefit from that.
- We need to have a strong reverse logistic system to develop a supply-chain network and let the aggregators and partners work as collectors.
- The recycling cost will be high, but the benefits will be higher, but for that the scale has to be achieved, and one needs to have over 90% efficiency extraction targets.
- Batteries from electric 2-wheelers and electric 3-wheelers can be used for stationary applications like solar storage stations, or can be directly sold to manufacturers in the toy industry.
- If they are in good shape and are not damaged, 4-wheeler battery cells can be used for electric 2-wheeler and 3-wheeler batteries, which can run well for 18-21 months.
- The recyclers should form an association to fix uniform pricing and to procure the raw materials. The customers, who are the end users, should get a reasonable buyback value so that it becomes an entirely sustainable ecosystem.
- International entities can set up their recycling facilities in India with the help of local partners, which could help introduce the latest techniques here.
- Recyclers should work together instead of competing with each other. That will help in regulating battery prices and increase profitability for the recyclers.
Vaishali Yadav, a journalist at EFY, muses upon clouds, security, sustainability, integration, smartness, machines and learning—both trivially and technologically.