Electric Vehicle Battery Recycling Market - US
The Electric Vehicle (EV) recycled battery market in the US is currently unprofitable, which is also driving a low recycling rate. However, all forecasts point to an increasing need to recycle EV batteries, given the predicted rising demand for electric vehicles. Given this need, there are several initiatives from both the public and the private sectors in the US that are seeking to make EV/lithium-ion battery recycling more feasible- whether through developing their own technologies or partnering with others.
Triangulation of the US EV battery recycling market
- The Early Findings showed that about 295,000 to 1.423 million lithium-ion battery packs (LIBs) will be discarded in the U.S. in 2020.
- It was also mentioned that the recycling rate for this type of battery is less than 5%. Using this ratio with the estimated number of LIB discards in 2020 (as seen in the previous bullet) shows that the market size for recycling the batteries of electric vehicles (EVs) in the US in 2020 would be at most 71,150 battery packs. The most conservative estimate would be below 14,750 packs.
- This market is predicted to expand quickly over the next few years, as LIBs are the preferred battery system for commercial electric vehicles worldwide. Bloomberg expects a 25-fold growth in battery demand for EVs by 2030. By 2040, more than 50% of new-car sales (or 559 million cars) will be electric. Zooming in to the US market, while there are significant ups and downs per year, the average year-on-year growth from 2013-2018 was a strong 25%.
- Note that despite this estimated market volume, the value of this market in the US is currently negative. Recycling LIBs costs more money than it is worth with current technologies. Instead, other companies are reusing the batteries for other applications, since a typical LIB from an EV will retain about 50-70% of its power capacity upon removal.
US Programs for Increasing the Feasibility of EV and LIB Recycling
- The Recell Center: Publicly sponsored by the US Department of Energy (DOE), the Center is geared towards finding ways to make LIB recycling competitive and profitable. As a public center, it also serves the national interest by reducing US dependence on imported cobalt or other materials. The entire project includes researchers based at different labs nationwide, as well as manufacturers, supplies, and other industry experts.
- The Battery Recycling Prize is also a public program sponsored by the DOE. It's a phased prize competition aimed at American entrepreneurs, and the goal is to come up with processes that can be scaled and profitable capture 90% of all discarded lithium-based batteries in the country. These will then be processed to recover key materials that can be reintroduced into the US supply chain. The prize is worth $5.5 million.
- Battery Resourcers is a private startup in Massachusetts. They are committed to "changing the dynamics for processing end of life lithium ion batteries" and have innovated a combination of recycling methods that can synthesize new cathode materials from spent lithium-ion cells. They then produce those materials cheaply enough that it makes more sense for companies to purchase these recycled materials rather than mining for more.
- Redwood Materials is a private company led by two ex-Tesla senior leaders, and is focused on using "R&D, engineering and operational excellence" to get more active materials back during the recycling process. While they are not currently doing work with Tesla, and have not made any new announcements yet, they are located very near Tesla's headquarters and have the founders' Tesla experiences to draw on.
- Renewance is a private company based in Chicago that specializes in battery recycling. Their goal is to "drive the cause for sustainability in the battery energy storage industry". They offer a range of services, including a platform that connects battery owners with transporters and recyclers. They have a concept that has passed the first phase of judging for the Battery Recycling Prize run by the DOE, mentioned above.
To triangulate the market size for EV battery recycling in the US, we obtained the number of EV batteries that would be up for recycling in the US in 2020. We then compared that number to the rate of recycling for these batteries in the US, which was below 5%. By obtaining that percentage, we were able to triangulate the market size for recycling EV batteries in the US.
When it came to finding US programs aimed at making EV and LIB recycling more feasible, we looked at recent trade publications, press releases, news articles, and brand assets.