One opening remark at this year’s ICBR hit the nail exactly on the head. “Recycling batteries continues to be a deeply troublesome issue to execute commercially, given that the flow of, for example, EV batteries is still relatively limited. In full flood, it’ll be very different in a decade or so. Most of our issues about profitability are based on our need to receive large enough volumes of the batteries to make the process worthwhile. That’s when scalability turns into profits. But that’s not the case now.”
With the EV world now looking to produce batteries that contain ever less recycling value, the knock-on effect is huge for any ambitions to generate revenue from lithium scrap. This was a key topic at the conference with presentations effortlessly walking the line between technology and commerciality. Other battery conferences don’t have such a challenge as the ICBR. It is easy for some sectors of the business — think of the relative simplicity of dealing with used lead acid batteries — to present to delegates on uncomplicated issues. But discussions around this particular hot potato were, as expected, intense and nuanced. For the last decade speakers have debated ways and means to dispose of the next generation of (mostly) lithium batteries, and the ICBR has become the go-to conference to make any sense of the issue.
Perhaps because of this, as one delegate told this magazine: “The conference atmosphere might appear to be relaxed and casual — there is a general sense of optimism in the air — but there is nevertheless an underlying uncertainty over the future of recycling in Europe. “The lack of demand for EVs creates a problem for lithium battery recyclers that comes from three directions. The first is that demand for their recycled product such as the lithium, nickel, manganese, cobalt and graphite is not there in the scale needed to ramp up demand and help prices. The second is that the ability to ramp up their facilities to meet a surge in supply of used EV batteries means that the benefits of scale are simply not there.”
Ecobat, for example, one of the leading lights in both lead and lithium recycling across Europe, has put back its plans for installing new plant until the early 2030s. The overall impression from delegates was that it would be a foolhardy firm that would invest in tens of millions of euros for a recycling facility that might be unused (and not be generating revenue), for many years.
There was also a third uncertainty hanging over this recycling sector. The shift is from high-power NMC batteries containing nickel, manganese and cobalt to lithium iron phosphate cells. NMC cells have value in their metals. LFP are relatively valueless.
This was picked up in an excellent presentation from Emma Nehrenheim, president of Northvolt Materials who said LFP recycling will continue to remain unprofitable — at least in the near term. “The LFP recycle market is relatively immature, there is no realistic business model yet for low grade chemistries,” she said. However, she anticipated that ‘significant price drops will happen in the short term’ but hoped that eventually a solution will be found. This might, however, be a statement of faith that a suitable technology will emerge but, as she said about the future, “we can’t pick the gold nickel, manganese, cobalt in the black mass and throw away the rest.”
Mark Stevenson, an international lead recycling expert said: “The problem with disposing of LFP batteries as opposed to lead ones is that they contain little of any real value. By comparison, automotive starter batteries, for example, have enough lead metal in them to pay for the cost of putting them in a smelter and making a profit. With LFP the recycling costs far outweigh any value of the metals extracted.”
In the after-presentation discussions, conversations were lively around these issues. Market participants are hesitant to pay a premium for lithium salts of recycled origin, said Claas Hoffend, AMG Lithium project manager for lithium salts. “The key question is whether the customers – the carmakers – are willing to pay a premium on recycled material and if the recycling capacity is not here by 2031, then what do we do?” Hoffend said. “It’s possible that the regulation will be postponed by some years and regarding my understanding [as to] whether carmakers are willing to pay a premium — I don’t think so.”
The 2023 EU Battery Regulation will require at least 6% of recycled lithium and nickel, 16% cobalt and 85% for lead in the new battery rules become effective in August 2031. “Lithium recycling competes with the primary lithium production costs and if the [recycled origin] price is similar [to primary origin] then every- one is in a good shape, but I don’t think someone is willing to pay dollars and dollars more,” Hoffend said.
“Maybe some political direction will be relaxed or postponed depending on the [current] recycled content in Europe […] but I don’t see that a premium will be paid,” a participant from a large EU carmaker said. “We need to ask ourselves if we would pay the extra money.”
“No one in cell manufacturing will accept inferior quality materials so it’s important that at a certain point in production — from the refining or pCAM [pre-cathode active material] — you have to mix recycled lithium with primary material to have a homogenous quality so that there is no difference in primary or secondary material,” another conference participant said.
All excellent food for thought ahead of next year’s meeting.
Batteries International • Autumn 2024 • 84-85
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