IHS Markit expects that over 500,000 tons (57 GWh) of batteries will reach their end-of-life point in 2020. That figure is expected to rise to 1.2 million tons (121 GWh) in 2025 and reach 3.5 million tons (350 GWh) in 2030—a seven-fold increase.
A multitude of supply, demand, cost and sustainability conditions are poised to drive a rapid expansion of the battery recycling industry, more than tripling its capacity by 2030, according to a new analysis by IHS Markit.
End-of-life batteries (batteries at the end of their usable life) are set to begin this year, creating a sizeable repository of recyclable material.
The electrification of the automobile is set to push demand for new batteries to new heights—from 250 GWh in 2020, to over 1,700 GWh in 2030 and nearly 5,000 GWh per year in 2050.
Recycled materials currently make up a small proportion of the battery supply chain. The increasing supply of end-of-life batteries and growing demand will enable up to 15 percent (180 kt) of Lithium, 7.5 percent (450 kt) of Nickel and 43 percent (930 kt) of Cobalt from recycled sources to be used in new batteries by 2030, IHS Markit says.
This would necessitate a more than tripling of global battery recycling capacity, from approximately 1000 kt/year (1 million tons) in 2020 to 3500 kt/year (3.5 million tons) by 2030.
“We are seeing a trend towards greater localization of battery production, as governments look to maximize value creation in this high growth sector. Particularly in Europe, where there are not large deposits of raw materials for battery production, recycling will be key to enabling the development for local supply chains for battery manufacturing facilities,” George Hilton, energy storage senior analyst, IHS Markit.
“Battery recycling is a key enabling technology which will allow electric vehicles to maximize their sustainable credentials. Recycled battery materials will enable EVs to be produced more sustainably, at lower cost and reduced reliance on complex, international raw material supply chains,” George Hilton, energy storage senior analyst, IHS Markit.
The electric vehicle battery recycling market was valued at $138.6 million in 2017, and is projected to reach at $2,272.3 million by 2025, growing at a CAGR of 41.8 percent from 2018 to 2025, according to a report from Allied Market Research.