Analyst predicts 2030 bidding war for dead EV batteries


From pv magazine International

The up-to-15-year lifespan of electric vehicle (EV) batteries – and their ability to gain a second life in stationary storage systems – is likely to mean a scramble among the world’s ever growing number of recycling companies in the years ahead.

A potential bidding war for the rest of the decade, in which Chinese recyclers are expected to hold all the cards, has been predicted by U.S.-owned analyst Wood Mackenzie which, in a note issued yesterday, again stressed the importance of North America and Europe establishing their own battery manufacturing supply chains.

With recyclers around the world announcing plans to ramp up their capacities “quite aggressively,” according to Verisk-owned WoodMac, a lack of end-of-life products is likely to see the industry starved of feedstock.

Though EV rates are rising rapidly, the long life of batteries is likely to cause “a scramble” among recyclers for products to work with. In such a scenario, recycling facilities based near battery manufacturing plants will have the upper hand, as Chinese recyclers currently do. At present, said WoodMac in a press release yesterday, “Chinese recyclers benefit from greater integration with nearby cathode production plants, so [they] can regularly bid much higher prices for used batteries than their Western counterparts.”

Unless North America and Europe establish their own EV battery supply chains, warned WoodMac, “China will remain the most appealing location for battery recycling.” If that happens, research analyst Max Reid said, only the biggest of new entrants into the battery recycling sector outside China are likely to survive long enough to reap the longer term rewards of the EV transition.

The expected scramble for dead batteries could at least drive more value into the products. Right now, it is cheaper and faster to manufacture new EV batteries than to recycle them and producers are focusing on ever cheaper raw materials.

The analyst said a new battery cathode plant, for example, can churn out 50 kilotons per year of materials for NMC (nickel-manganese-cobalt) batteries, enough to kit out 400,000 EVs. The typical battery recycling facility, however, only produces 5-10 kilotons per year – the equivalent of 30,000 devices.

With battery companies exploring new technology, such as solid-state devices, the recycling industry could be about to get even more complex, as WoodMac’s Reid pointed out when he said: “This decade will see the [new battery] supply chain further establish itself to be able to supply vast quantities of battery-grade chemicals and cathodes to cell manufacturers whilst recyclers will struggle with the large mass and complexity of EV packs.”

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