Our battery lifecycle chart below shows a range of potential activities that could follow the end of an EV battery’s life:

Given the significant and increasing energy storage opportunities available as the number of EV batteries retiring from “in-car” use increases, and as the power of these batteries increase, the ideas above are only the start of a potential fundamental transformation in the way batteries are used. Many companies in China are concentrating more on the material recycling opportunity rather than the re-use opportunity. This is driven by factors including a desire to reduce dependence on imported lithium (lithium imports being recently estimated to supply 85% of China’s total demand), as well as regulatory developments driving recycling activity. Research suggests that the volume of used batteries in China will “total between 120,000 tons and 200,000 tons in 2018-2020” and will “increase to 350,000 tons in 2025”: a significant commercial growth opportunity.

Legislation in this area is principally focussed on the ‘extended producer responsibility’ or “EPR” concept: i.e., making the producer responsible for the management of waste generated by batteries until they are scrapped. Whilst the development of legislation around disposal or recycling will be of key importance, we anticipate amendments to such legislation to cater for the ‘second life’ of EV batteries.

The EU has already identified that the Batteries Directive will need to be revised to include:

• criteria to identify harmful substances which are not currently regulated (cobalt; organic electrolytes such as lithium hexafluorophosphate) and management measures prescribed;
• targets for battery collection or provisions for national schemes, EPR, financing, labelling or reporting obligations with respect to industrial batteries (which include EV batteries);
• a mechanism to integrate new battery chemistries into the directive (e.g. solid state);
• targets for the recovery of materials that constitute lithium batteries such as cobalt or lithium;
• specific provision around those holding responsibility at the end of the “second life” of batteries (producers currently remain responsible until the battery is eventually scrapped or recycled, independently of the number of intermediate lives it may have had).

In the EU, policy initiatives on battery recovery, reuse and recycling are anticipated by Autumn 2019. The Batteries Directive is also expected to be revised to take EV batteries into account.

Measures introduced in China in 2018 require automobile manufacturers to establish battery recycling channels and recycling service outlets.

There are ongoing efforts at a federal level in the US to facilitate the reuse of EV batteries. Certain states regulate the disposal and recycling of EV batteries while others have placed the responsibility of waste management on battery producers. Several states, including California, Texas and Wisconsin, have battery disposal and recycling laws on the books, and others, including New York, Florida, New Jersey, and Minnesota, have enacted laws requiring extended producer responsibility shifting the cost of waste management and recycling back to the battery producers.

There is no overarching framework regulating the end of life of lithium-ion batteries in Australia, although various environmental and OH&S measures do apply to their storage, transfer, transport and recycling.