Understanding How EV Battery Recycling Can Address Future Mineral Supply Gaps
RMI’s new Battery Circular Economy Initiative Dashboard can help EV battery stakeholders make data-driven planning and investment decisions.
As demand for electric vehicles (EVs) grows, so does demand for the batteries that power them. Many are concerned that today’s EV battery (EVB) supply chain will be unable to meet this increased demand, and for good reason: today, the supply chain is vulnerable to disruption due to geopolitics, changing trade alliances, extreme weather, and a host of other factors. It is also too geographically concentrated; the upstream (mineral extraction), midstream (refining materials into battery cells), and downstream (battery assembly) portions take place in just a few countries. If the upstream or midstream in just one of these countries is disrupted, the effects reverberate globally, hindering EV production.
Of specific concern is the supply chain’s ability to provide enough of the minerals that go into EVBs. And then there’s the question of the domestic midstream capacity: does the United States have the facilities needed to process and refine these minerals into battery-grade materials?
RMI’s Battery Circular Economy Initiative’s (BCEI) Dashboard can help answer these questions and more. The dashboard helps stakeholders understand by how much electric vehicle battery demand will grow and to what extent the domestic supply chain is capable of meeting demand. It reveals what quantities of end-of-life EVB materials will be recoverable, how these materials can meet anticipated supply gaps, and the potential environmental and economic benefits of EVB recycling. The dashboard also provides a Circularity Index (CI), which shows how circular the EVB supply can realistically be, based on the user’s understanding of a region’s recycling ecosystem. Using the dashboard’s comprehensive and detailed data, stakeholders can be more confident in their planning.
The Need for a Circular Battery Economy
In a circular battery economy, end-of-life batteries are reused, repurposed, or recycled. Reused batteries can be refurbished and then placed in an EV; repurposed batteries serve a new, non-EV purpose (e.g., stationary storage). Recycling involves extracting raw minerals from end-of-life batteries and using them in another product.
By recirculating the minerals from end-of-life EVBs, we can reduce our reliance on virgin materials, decrease emissions associated with their extraction, save money, and avoid some of the environmental and social harms associated with mining.
An increasing number of policymakers, private sector actors, and other EV stakeholders recognize the benefits of a circular battery economy and understand the need for significant investment and robust policy to make it a reality. RMI’s BCEI Dashboard helps them get the information they need to make sound, effective investment and policy decisions.
Filling the Data Gap
Existing data and tools have, by and large, provided only piecemeal glimpses of the EVB supply chain and have been unable to give both the big-picture and the granular insights needed to plan strategically. BCEI’s public dashboard fills this data gap by organizing disparate sources of information, databases, forecasts, and perspectives into a central repository that provides a level of insight and analysis unavailable elsewhere.
The dashboard helps stakeholders understand:
- How much EVB demand will grow through 2030
- Predicted EVB supply gaps in 2030 based on current corporate commitments, planned investments, and policies
- To what extent different end-of-life EVB materials will be recoverable
- To what degree these materials can meet projected gaps in supply and demand
- Emissions reductions and economic benefits of recycling all end-of-life EVBs
- How circular the EV battery supply can realistically be, based on the user’s understanding of a region’s recycling ecosystem
Users can reference default scenarios or insert their own inputs to create their own scenario.
Some questions the BCEI Dashboard can answer
The following examples are just a few of many questions the dashboard can help users answer.
In these examples, the following scenario is assumed:
We will need 911 GWh of battery storage in 2030 for private passenger EVs, based on RMI’s projection of the Inflation Reduction Act’s (IRA) level of impact (referred to as “IRA level” in the dashboard) on EV adoption. A “high” level assumes that all EVs sold in the US are IRA compliant and therefore eligible for both available tax credits, totaling $7,500. A “low” level assumes that a minimal number of EVs sold are eligible for half tax credit as it may be difficult to comply with the foreign entity of concern (FEOC) guidance for the sourcing of battery minerals. The “medium” level is an average of the two bookends. In this scenario, a medium IRA level of impact translates to 56 percent EV sales penetration in 2030.
- Battery life: 12 years
- Collection efficiency: 99%
- Recycling capacity: 95%
- Lithium recovery rate: 80%
- Cobalt recovery rate: 95%
- Nickel recovery rate: 95%
For battery recycling, the defaults are based on an optimistic outlook. Collection efficiency and recycling capacity defaults assume a reverse supply chain structure similar to that of lead-acid automotive battery recycling. Strictly enforced regulations played an important part in increasing the recycling rate of lead-acid batteries; today, in the United States, nearly all of these batteries are recycled. The recovery rates are in line with that of the most efficient commercial lithium-ion battery recycling facilities.
Given the burgeoning rate of EV adoption, there’s an urgent need for informed action. Armed with insights like those provided by the BCEI Dashboard, we know we can make a circular battery economy a reality and reap its economic, environmental, and social benefits.
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