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Market participants and analysts agree that the industry is still in its infancy, with innovative ways to gain more efficiency being explored.
The US government also announced investments in the field through the Bipartisan Infrastructure Law, with the Department of Energy declaring nearly $74 million in funding for 10 projects to advance EV battery recycling and reuse. The Energy Department said it was “committed to using a whole-of-government approach to securing a reliable and sustainable supply chain to improve America’s energy independence, strengthen national security and lower costs for working families.”
The limited availability in the US of raw materials used in EVs is one of the main concerns behind the rush for recycling and reusing these materials.
According to the International Energy Agency (IEA), sales of EVs in the US reached 630,000 in 2021, which would require more than 7,560 tonnes of lithium.
At present, there is only one active lithium mine in the country. Silver Peak, owned by Albemarle, produces about 5,000 tonnes of lithium carbonate equivalent (LCE) per year. This is only around two-thirds of the amount needed to power the EVs currently sold in the US.
Meanwhile, the US government announced in August 2021 that it aims for half of the vehicles sold in the country to be EVs by 2030, which would require 90,000 tonnes of lithium by 2030.
This is 1700% more than the lithium currently mined in the US.
While there are a number of lithium mine projects in the country, the fact that it takes between four and 20 years for a lithium mine to begin commercial production after an extractable source is identified is a big challenge in the rush to satisfy the needs of the rapidly growing EV industry.
“We expect the market to be undersupplied with battery raw materials,” Julia Harty, Fastmarkets battery recycling analyst, said.
According to the IEA, China dominates production at every stage of the EV supply chain, including raw materials, refining of raw materials, battery cell production, cathode and anode production, as well as battery and EV production.
The country also accounts for half of the 200,000 tpy global lithium battery recycling capacity, according to the IEA.
“China is an amazing example of recycling because there are recycling regulations and grants. It sets a good template of what can be done in the US and Europe,” Harty said.
She also pointed out that there are different approaches between lithium battery supply chains in China and the rest of the world.
“In China, battery recycling companies are more likely to be vertically integrated compared with Europe and North America, where there are often different companies doing each step of the process; battery collection, black mass production, black mass refining and production of CAM (cathode active material) and batteries,” Harty said.
In the US, many companies are interested in lithium battery recycling to increase the security of supply of the battery raw materials needed to accelerate the energy transition, according to Harty.
Learn how companies are helping to accelerate the energy transition by visiting our dedicated battery materials page.
In North America, there are a handful of companies that are working in lithium battery recycling.
Most of the lithium battery scrap in the US comes not from end-of-life used EV batteries — EV adoption remains fairly new in the country — but in the form of manufacturing scrap from battery producers.
“Today, the biggest source of recyclable lithium battery material is gigafactory manufacturing scrap,” Thomas Frey, director of communications for lithium battery recycler Ascend Elements, told Fastmarkets.
“There is a lag between when EVs are produced and when they reach end-of-life. Generally speaking, each lithium-ion battery gigafactory has an 8-10% scrap rate. That material needs to be recycled now,” he added.
The most prevalent method in the US to extract black mass from lithium batteries is the hydrometallurgical method, which requires aluminium and copper current collectors to be removed before using an acid-rich aqueous solution to extract the battery materials. Once the metals have been extracted into solution, they are then precipitated as salts or extracted using organic solvents.
Ontario, Canada-based Electra uses the hydrometallurgical method in its black mass recycling demonstration plant in Toronto. The company started commissioning the plant, which Electra said could “pave the way toward the buildout of a 5,000 tonne per annum black mass processing facility,” in October.
Another company using the hydrometallurgical process is Surrey, British Columbia-based RecycLiCo, who commissioned its demonstration plant in Vancouver, Canada, in 2022. The company continues to test “feedstock materials such as different cathode production scrap and black mass” at the plant.
RecycLiCo also anticipates expanding its offering of battery-ready cathode precursor and lithium products “to supplement RecycLiCo’s current lineup of unique products, which continue to be shipped to potential partners for advanced product qualification and assembly in battery cells.”
Toronto-based LiCycle currently produces black mass in its spoke facilities in Ontario, New York, Arizona, and Alabama. Combined, these four spokes have the capacity to recycle 30,000 tpy of lithium-ion batteries.
The company’s Ohio Spoke, which will have the capacity to recycle 15,000 tpy of lithium-ion batteries, is expected to become operational in 2023.
LiCycle will also commence commissioning its Rochester Hub in phases in 2023. The Hub will be recovering battery grade materials from black mass, with a capacity to process 35,000 tpy of black mass.
Reno, Nevada-based American Battery Technology Company has started construction of its Fernley, Nevada lithium-ion battery recycling pilot plant and expects to ramp up operations in 2023. The plant is designed to process 20,000 tpy of feedstock.
The company expects to reach 320,000 tonnes of processing capacity in its pilot plant and three additional plants by 2027.
Reno, Nevada-based Aqua Metals announced on December 21 that it has started operations at its pilot recycling plant, extracting battery metals, including lithium, manganese, cobalt, and nickel. Aqua Metals said it “is poised to initiate sales of recycled materials in the first quarter 2023.”
The company uses a version of the hydrometallurgical process that it has named “Li AquaRefining.”
The other commonly used method to recycle lithium batteries is the pyrometallurgical method, which requires a simpler pretreatment consisting mainly of crushing or shredding. It can also be used to recycle a wider range of lithium battery compositions, shapes and sizes.
Elwood City, Pennsylvania-based Inmetco uses the pyrometallurgical method, with the capacity to recycle 6,000 tpy of lithium batteries.
Milford Township, Michigan-based Cirba Solutions uses both the hydrometallurgical and pyrometallurgical methods to extract black mass from various lithium battery chemistries, with the company’s Trail, British Columbia facility recycling lithium-ion, lithium primary and lithium metal batteries.
“We are one of the largest producers of black mass from recycled batteries,” Danielle Spalding, Cirba Solutions vice president of marketing and communications, told Fastmarkets.
Cirba Solutions has two other plants in North America, in Lancaster, Ohio, and Eloy, Arizona — the latter of which the company is expanding to process end-of-life lithium-ion batteries to produce raw materials for new battery cathodes.
“This [facility] is estimated to be operational by the end of 2023,” Spalding said. The company expects to produce enough battery material for 50,000 EVs when the facility reaches full capacity, which the company expects to be able to do “quickly.”
Cirba Solutions was also the recipient of a $75 million grant from the Department of Energy for the expansion of their Lancaster, Ohio facility, which is expected to produce enough battery-grade salts to provide for 200,000 EVs per year when it reaches full capacity in 2026.
Another company using both methods is Redwood Materials, which recycles more than 6 GWh of lithium-ion batteries annually in its Nevada facility.
A third method, called the “direct method,” does separate black mass into its components, but requires the addition of materials to reach the optimum chemistry.
While it is a much faster and more cost-effective way to recycle lithium batteries that requires less energy, the direct method also requires separate disassembly and material separation of lithium batteries.
In North America, the direct method is used by Princeton-based NuEnergy; Westborough, Massachusetts-based Ascend Elements (formerly Battery Resourcers); and Bend, Oregon-based OnTo Technology LLC.
Ascend Elements extracts black mass from lithium nickel manganese cobalt (NMC) batteries at its Covington, Georgia facility, which became operational in August 2022. It is ramping up to full capacity, which is expected to be reached in March 2023.
Instead of extracting metals from black mass, the company’s hydro-to-cathode process extracts the impurities, leaving the metals in the solution as cathode molecules. Ascend Elements then adjusts the metal or elemental composition of the solution, providing a precursor that is ready to be made into cathodes, Frey explained.
The company is applying this process in two demonstration-scale facilities in Massachusetts and Michigan.
“We need to recover critical battery materials used in lithium-ion batteries and gigafactory scrap. As a country, we need to build an extensive lithium battery recycling infrastructure and make cathode material in the US,” Frey said.
The past year also saw companies in the lithium battery recycling field in the US announce investments in the next step of EV battery production: CAM precursor and CAM manufacturing.
At present, there are no facilities in the US that manufacture CAM, which means the product obtained from recycling has to be shipped overseas, and then returned as CAM components.
“Currently, anode and cathode components are not produced in North America, and battery cell manufacturers have to source them via a 50,000+ mile global supply chain,” Redwood Materials said on December 14, announcing that the company will be building their next Battery Materials Campus in South Carolina.
The facility will recycle, refine and manufacture anode and cathode components. Redwood plans to break ground on the facility in the first quarter of 2023 and anticipates the start of operations by the end of the year.
The company expects to produce 100 GWh of cathode and anode components per year when the facility reaches full capacity.
Redwood is not the only recycler to invest in this next step of EV battery manufacturing. Ascend Elements announced in August that it would build a battery cathode manufacturing facility in Hopkinsville, Kentucky.
Frey said the company expects the facility to become operational in the first quarter of 2024, ramping up in the following four quarters to reach full capacity serving 250,000 EVs per year.
Ascend Elements also received two grants from the Department of Energy, totaling $480 million. The company plans to use these funds to support an increased investment — to $1 billion — in the Hopkinsville facility.
“Localizing the production of critical battery components and ensuring these materials are recycled is the only way to drive down costs, emissions and geopolitical risks while meeting US battery and electrification demand,” Redwood said.
Visit our dedicated battery raw materials page to discover more insights on the factors at play in the industry in 2023 and beyond. Find out more about our lithium prices.