Development of a robust electric vehicle (EV) battery recycling industry has moved from a net-positive sideline to a necessity as automakers, and their suppliers, transition away from internal combustion. Experts say that global mining operations are simply not on track to produce the virgin raw materials needed to meet the dramatic ramping up of the world’s battery production. Additionally, the sourcing of these materials raises numerous red flags in terms of conditions for workers, site pollution, geopolitical complications and concentration of ownership.
The good news is that the Biden Administration’s recently enacted Inflation Reduction Act provides incentives for automakers to use recycled minerals in their batteries. Startup companies, including one founded by the former longtime CTO at Tesla, are taking on the recycling challenge and partnering with carmakers. Automakers are also concentrating on proven technologies such as—hydrometallurgy (often, leaching, which involves immersing the cells in acid to dissolve the acids into a solution) and pyrometallurgy (burning and smelting) — to efficiently recover a very high percentage of key metals from used lithium-ion (li-ion) EV batteries. But there’s a conundrum: battery companies are working to reduce the amount of problematic, hard-to-source metals in their cells, which has the potential to also reduce their viability for cost-effective recycling.
Another approach, which has drawn federal research funding, is direct recycling or recovery, with the advantage of retaining the intact cathode material. According to Jeffrey Spangenberg, the materials recycling group leader in the applied materials division of Argonne National Laboratory and head of the national ReCell Center R&D initiative, the hydrometallurgy process destroys the cathode. “If we can keep the cathode as a cathode then it can go right back into a battery and save quite a bit of money,” he explained. “But there are a lot of challenges with it. For instance, battery cars are likely to last 20 years, in which time technology doesn’t stand still. We have to figure out how to make old cathodes marketable.”
One key aspect of the looming materials problem is in the need for nickel, which often gets overlooked as the focus is on lithium and, to a lesser extent, on cobalt.
According to Sam Abuelsamid, principal research analyst for e-mobility at Guidehouse Insights, for every 100 kilowatt-hours of battery in an EV, 61 to 66 kilograms of nickel are needed. If EV penetration reached 100% (unlikely until the 2040s) something like 5.8 million metric tons of nickel would be needed annually if we rely solely on nickel-rich batteries, he said. But according to Statista, total global mining of nickel produced only 2.7 metric tons in 2021. The industry would have to more than double worldwide production—unless recycling was a factor.
“Recycling is absolutely essential,” Abuelsamid said. “We don’t want to be dumping batteries with these essential metals into landfills. We need to recapture as much as possible, because we will need way more EV batteries than we currently can build with available virgin materials.”
Complicating the nickel supply is the disruption of the Russia-Ukraine war. Russia is the third-largest global nickel supplier, and in the first quarter of 2022 prices doubled to $100,000 per ton on potential disruption fears. Nickel is only one of the problematic metals that make up today’s li-ion batteries—which are still the state of the art, at least until production-ready solid-state batteries (without liquid electrolyte) are available.
Henry Sanderson, a former Financial Times commodities and mining reporter who now works for Benchmark Mineral Intelligence, is the author of Volt Rush, a new book that focuses on the problematic materials in li-ion batteries. “We have to open our eyes to the supply chain behind the move away from fossil fuels,” Sanderson told SAE Media. “It is hidden, almost opaque, and currently mostly controlled by China. And it involves more than putting up some solar panels—it’s about raw materials and mining.”
Lithium is heavily sourced through evaporation processes in arid basins in Chile, Argentina and Bolivia. And according to the Natural Resources Defense Council, the practice “contributes to the ecological damage of internationally recognized wetlands and protected areas, where water resources are already exhausted for local and indigenous peoples. Many of these communities have no say in — and receive little benefit from — the mining operations.” Chile, a major producer, has debated nationalizing its lithium resource, for both economic and environmental reasons.
More than 70% of the world’s cobalt comes from the Democratic Republic of the Congo, where there are severe child labor issues (up to 40% of the cobalt work force, according to some sources), ongoing human rights abuses and horrendous working conditions with minimal safety.
Like lithium, cobalt is mostly refined in China, and Chinese companies, operating through the massive ‘Belt and Road’ international development initiative, own or have financed major stakes in lithium and cobalt mines—including 80% of the cobalt in the DRC, reports GlobalEDGE. After an international outcry, the leading Chinese companies have made some modest improvements in DRC mining practices. And some crude refining is now done locally, economically benefiting locals in the DRC.
The metal remains a flash point. “Cobalt is a ‘dead man walking’ in lithium-ion batteries,” said Lewis Black, who heads Almonty Partners and has 15-year experience in mining tungsten — another battery metal, with a 50%-recycled supply.
The battery industry — aware of these issues — has steadily reduced the amount of cobalt in its cells, but so far it remains an essential metal. Nickel, also problematic, is often mined in an environmentally destructive way. The massive Chinese-owned Ramu nickel mine in Papua, New Guinea, for instance, was estimated to dump 680,000 tons of waste into Basamuk Bay annually, leading to a $5.2 billion lawsuit from a local coalition.
More sustainable lithium mining, including a U.S. domestic supply, is under development (see sidebar) but recovering the metal from used EVs is a proven process. A ton of battery-grade lithium can be produced from 250 tons of ore and 750 tons of brine, or from just 28 tons of used lithium-ion batteries, the U.S. Dept. of Energy (DoE) said. The only problem is that less than 5% of battery lithium was being recovered in 2019, said DoE. But the industry is growing fast.
The big ramp-up
Kunal Phalpher is the chief strategy officer at Canada-based Li-Cycle, whose stated purpose is to “recover critical materials from lithium-ion batteries and reintroduce them back into the supply chain.” Phalpher said Li-Cycle takes whole packs and shreds them, producing plastic, copper and aluminum that can be sold on to recyclers. Using hydrometallurgy the company develops so-called “black mass,” containing cobalt, lithium and nickel. “At high purity levels, it can go back into the supply chain and help create domestic sources,” Phalpher said.
Li-Cycle, which went public on the NY Stock Exchange in 2021 through a SPAC deal, estimates that approximately 15 million tons of lithium-ion batteries will have reached the end of life by 2030, up from 1.7 million tons by 2020. The company has a “hub and spoke” organization: The spokes create the black mass from scrap batteries, and the hubs separate out the metals and prepare them to reenter the supply chain. Last April, LG Chem and LG Energy Solution chose Li-Cycle as their preferred recycling partner for North American operations—providing black mass to the hubs. Soon after, Glencore said it would supply scrap and end-of-life li-ion batteries to Li-Cycle and like LG Chem, will “offtake” black mass and other materials from the recycler.
Another Li-Cycle partner is General Motors. By 2023, Li-Cycle will launch a recycling center near GM’s Ultium battery-cell plant in Ohio. Li-Cycle opened its third spoke facility in Arizona last May, with the ability to process up to 10,000 tons of battery manufacturing scrap and depleted li-ion batteries annually.
The company’s hub operation in Rochester, New York is being enlarged by more than 40%, increasing its processing capacity from 25,000 tons of black mass to 35,000 annually. That translates to 90,000 tons of EV batteries, Phalpher said. “We think the batteries from 180,000 EVs can be shredded every year,” he said. “The secret sauce is building a system and flow sheet optimized for black mass. It comes out as a wet black powder that is 40% graphite. Keeping it wet prevents the nickel and cobalt dust from becoming airborne.”
Tim Grewe, director of electrification strategy and cell engineering at GM, said the company is pursuing various paths to keep batteries out of landfills and deliver metals at less than the cost of mining them — including the partnership with Li-Cycle in Ohio. “There’s the recycling path, the secondary-use path and the refurbished path,” he said. “We don’t yet know where the market will go.”
Melissa Flaherty, director of sustainable EV battery ecosystem at GM, added that the goal is to “maximize the recycled content of the recyclable materials” in its packs. Since 2013, she said, GM has recycled or reused all of the packs it gets from customers, including those replaced through warranties.
Redwood: full-circle pioneer
Redwood Materials, which said in 2021 that it had raised $775 million from investors and venture firms, is headed by former Tesla CTO JB Straubel. Redwood, which has approximately 500 employees (and intends to hire 500 more), aims to not only capture metals from old batteries, but process those materials into new cathodes and anode copper foils—critical components now mainly made in Asia. Redwood says it can recapture 95% of the elements—including nickel, cobalt, lithium, and copper—from li-ion batteries, then reprocess them into new battery materials for its customers.
The company currently processes six gigawatt-hours of li-ion batteries annually but is expanding rapidly. By 2025, Redwood said it plans to ramp up to annual production of 100 gigawatt-hours of cathode active material and anode copper foil, enough to supply a million EVs. The hope is to expand up to 500 gigawatt-hours of these materials annually by 2030 — sufficient for five million EVs.
The company operates a 175-acre campus in Nevada, close to California’s large EV market. Production of the anode copper foil will begin in Nevada at the end of 2022, with Panasonic’s Gigafactory the first customer. A partnership with Ford was announced in 2022, and the company also has agreements with Volvo, Proterra and Panasonic. In 2022, Redwood linked up with Toyota, initially focusing on end-of-life solutions for the hybrid batteries for vehicles like the Prius.
Also in 2022, Volkswagen Group of America said it was partnering with Redwood to recycle batteries from Volkswagen, Porsche and Audi vehicles. Steven Rufo, VW’s director of group service and technology, said that Redwood has already begun recycling the company’s packs and modules, and that the pickup will be free for its dealer network. “The volume is still very low,” he said. “Our plan was to sign with Redwood before we ramped up so we could learn about what worked and what didn’t. So far, we’re seeing mostly defective modules replaced under warranty. Complete pack replacements are likely to be kind of rare.”
Rufo said VW is looking for more efficient and less-expensive transportation solutions, because battery modules get classified as Class 9 hazardous waste and can’t be moved without special handling. “Maybe we need to be collecting the material at our parts depots until it can be transported in bulk,” he said.
Alexis Georgeson, VP of communications and government relations at Redwood, said that the company is not primarily a recycler. “Our core business is creating anode and cathode material,” she said. “We’re not selling black mass; we’re using it as a feedstock for ourselves.”
Georgeson stresses the need for a closed-loop domestic production process that does not involve shipments to Asia. “We’re not solving the full equation unless we keep our materials in the country and start making cathodes here,” she said. “The average metal atom travels 50,000 miles from the mine before it’s used in an EV battery pack.” She said recycled metals will make up 30% of the materials in the company’s cathodes by 2025, and its cobalt will be 100% recycled.
Scrap from Tesla’s Gigafactory will also be an important feedstock, Georgeson said. “Even if the plant is 95% efficient, it will still produce a lot of scrap,” she said.
Ascend Elements’ recycling technology was spun off as a business from Worcester Polytechnic Institute in 2015, with the intent of creating new cathode-active material from recycled batteries. “The cathode is the single most expensive component of the battery,” said Roger Lin, VP for marketing and government relations at Ascend, based in Westborough, Massachusetts. “And cathodes are now being made only in Asia, with little or no manufacturing capacity in the U.S.”
Ascend says its “hydro-to-cathode” process can recapture 98% of the material in li-ion batteries. The company has pilot projects in Massachusetts and Michigan, and is building a commercial-scale, 154,000-square-foot operation near Atlanta to open in late 2022 that will take in material from SK Battery America’s plant in Commerce, Georgia. Since 2021, Ascend has also had Honda as a partner, with a deal to recycle materials from Honda and Acura vehicles.
“There’s a lot of activity in this space now,” Lin said. “Automakers are realizing that if they want to build EVs at volume they have to think about the end of life. It’s why we’re seeing all these partnerships.”
A key question is: If future EV batteries contain far less cobalt, nickel and other metals than they do now, will recycling still be economically viable? GM’s Grewe said that the batteries in Cadillac’s new Lyriq EV have 70% less cobalt than those in the Chevrolet Bolt. Lin thinks recycling will still be viable as the amount of those metals decline, both because recyclers will be working with older batteries that still contain large amounts of those metals, and because lithium itself — not itself likely to disappear from batteries anytime soon — has skyrocketed in price and value. Sanderson agrees. “With lithium at the prices we’re seeing — it’s up 400 percent in China this year — recycling is still economically viable,” he said.
Georgeson at Redwood Materials explained that because recycling is not the company’s primary business, reductions in certain metals shouldn’t be a big factor. “Everything we recycle gives us a strategic source of metals that makes cathode and anode components,” she said.
It’s likely that manufacturers will be able to reduce, but not eliminate, problematic elements from their batteries in the short term, Lin said. Battery chemistries exist that don’t use any cobalt or nickel, such as lithium-ion phosphate (LiFePO4, or LFP), but lower energy density remains a problem, he said. Solid-state batteries, which can be made without nickel and cobalt and do away with liquid electrolyte, are another technology in development.
Lithium-ion battery recycling does have some skeptics. Almonty’s Black says that some components — including printed circuit boards — can’t be recycled, and that handling cobalt will be very problematic for the industry.
Reusing old batteries
Used EV battery packs don’t have to be reduced to their component metals; they can also be reused. Two of the more promising avenues are stationary backup for intermittent renewable energy generation, and as storage at EV charging sites to offset utilities experiencing peak demand.
Battery packs can be repurposed from EVs that have been in accidents, or that have reached the end of their useful lives. The second-life battery supply for stationary uses could be more than 200 gigawatt-hours by 2030, with the market propelled by 30 to 70% lower cost, said McKinsey and Co. Even after they’re no longer able to power a car efficiently, they may still have 80% of their initial storage capacity, the company’s report said. The Union of Concerned Scientists (UCS) estimates that used EV batteries could continue to be of service for five to eight years in secondary applications.
California has 42% of the world’s EVs, according to the Orange County Register, and a bill enacted in 2018 calls for regulations to ensure that “as close to 100 percent as possible of lithium-ion batteries in the state are reused or recycled at end-of-life.” But getting to that admirable goal is a challenge.
Jigar Shah, head of energy services at Electrify America — the charging company formed out of the Volkswagen diesel settlement — said the company now has 150 “behind the meter” li-ion battery backup installations at its charging sites in the U.S., primarily to offset utility demand charges.
Unfortunately, Shah said recycled battery packs “don’t currently have the performance characteristics we need.” And preparing used batteries for reuse involves more than simply plugging them in, said UCS. “To be used as stationary storage, used batteries must undergo several processes [including testing, full discharge and reconfiguration] that are currently costly and time-intensive,” the company’s report said.
Another challenge is that a robust reuse industry will need a reliable supply of end-of-life batteries. “Most of the batteries are still in the cars,” said GM’s Grewe. “Our first-generation Volts typically have more than 100,000 miles on them and are still going strong,” he said. “There’s not currently a high volume of batteries in the secondary stream.”
VW’s Steven Rufo said that it’s possible that second-life battery reuse — proposed before recycling was a viable option — will never get traction. “It may turn out to be better to put the material back into cathode production,” he said. “But there’s a lot of uncertainty, and we’re still very early in this process.”
The reuse and recycling of EV batteries is indeed still embryonic, but it is gaining momentum, via research and considerable investment.
Ramping Up Domestic Supplies
The race is on to develop U.S. domestic supplies of the metals that go into EV batteries. Currently, three companies are working in California’s Salton Sea to develop lithium as a byproduct of the existing geothermal production there. At one time the industry jettisoned lithium as a waste product but, with international prices for the metal soaring and automakers asking for less-problematic sourcing, the resource is under intensive development. Most EV batteries use lithium from water-intensive processes in dry regions of South America, so California’s supply could be far more environmentally friendly.
The three companies are Controlled Thermal Resources (CTR, with backing from GM and a purchase agreement from Stellantis), Berkshire Hathaway Energy Renewables, and EnergySource Minerals. None currently are producing commercial amounts of lithium, but EnergySource and CTR plan to be operational and delivering lithium hydroxide as early as 2024. EnergySource is based at an existing geothermal operation and is permitted to begin producing lithium. In its first stage, CTR is building a new 49-megawatt baseload geothermal plant with lithium production of 25,000 tons annually; stage two will add an additional 130 megawatts of power and 50,000 tons of lithium by 2025. BHE Renewables is planning for 2026.
“We are working in lock-step with the auto industry to incorporate the entire battery supply chain onsite,” said Rod Colwell, CEO of CTR, which has offices in California and Australia. “Announcing a new Gigafactory is one thing,but securing the raw materials and developing the entire battery eco-system to support it is just as critical.”
Eric Spomer, president and CEO of EnergySource, said the company’s process “works with almost any kind of brine anywhere,” and recovers up to 90% of the available lithium—as compared to just 45% via South American evaporation. The company has four pilot plants, three in the U.S. and one in Argentina. “We haven’t announced our offtake partners yet, but we have them,” Spomer said. “Lithium is not an uncommon element, but the trick is to decarbonize production and mitigate impact while still remaining economically competitive with other extraction approaches. We think this is a robust and attractive project.”
The U.S. is not among the top 10 cobalt producers, according to the U.S. Geological Survey (USGS), though Canada is fifth (producing 4,300 tons in 2021, compared to 120,000 tons in the Democratic Republic of the Congo). Europe has an estimated 151 deposits of cobalt in 12 countries, for a total of 1.3 million tons, but not much actual mining. China is both the world’s leading producer of refined cobalt and its largest consumer, via battery production.
It’s not as if the U.S. doesn’t have any cobalt — reserves are estimated in a report for USGS at a million tons (out of 25 million tons identified around the world), mostly in Minnesota. But production was only 500 tons in 2019. With the exception of the DRC and Morocco, most cobalt is extracted as a byproduct of copper or nickel production, and that’s true of Michigan’s Eagle Mine, which produces both of those metals.
Cobalt is extracted in small amounts, along with palladium, silver and gold. The mine is owned by Lundin, a Canadian company, but it’s the only U.S. primary producer of nickel. Unfortunately, the mine’s resources are limited and, far from ramping up, it’s scheduled to close in 2026 unless further supplies are found.
New mining efforts should be encouraged by President Joe Biden’s April order that the Defense Department is to view five metals used in EVs — cobalt, lithium, graphite, nickel and manganese — as critical to national security. The action will allow federal money to pay for, among other things, studies to determine if a proposed mine is economically viable, or if a mine producing one important mineral could also produce another. Early in 2022, the Biden administration set aside $3.1 billion to support domestic production of batteries and key metals lithium, cobalt and nickel.
Even more important, the Inflation Reduction Act signed by Biden in August strongly encourages automakers to both produce cars and source their batteries and rare earth metals (either from mining or recycling) from North American sources if they want to secure the federal $7,500 tax credit. By 2024, 40% of the minerals must be extracted or processed in the U.S. (or a free-trade agreement country). After 2026, the requirement is 80% percent.
The new law has strongly stimulated domestic production of rare earth metals, and there has been a flurry of announcements. Piedmont Lithium said it plans to build lithium plants in North Carolina and Tennessee. The annual production target for just the Tennessee operation is double the current total U.S. production of lithium hydroxide. According to Keith Phillips, the company’s CEO, “Piedmont wants to be the biggest producer of lithium in North America.” And he said that the federal tax credit is a big driver. “Seventy-five hundred dollars is a lot of money,” he said.
Albemarle, which operates in Nevada the only existing lithium mine in North America, also said the Biden bill’s provisions would encourage it to develop new domestic mines and refining capacity for lithium. Canada’s Snow Lake Lithium has proposed a plant in southern Manitoba that it said would produce enough of the metal (160,000 tons) to power five million EVs over 10 years. Talon Metals has proposed what it said would be a sustainably operated nickel mine in Tamarack, Minnesota, but there has been some environmental pushback.
Also facilitating a shift away from problematic production is the Responsible Minerals Initiative (RMI), which has more than 460 member companies. BMW, a signatory, has signed a long-term deal to buy cobalt from Morocco and Australia to avoid sourcing in the DRC. Other automaker partners include Daimler AG, Ford, GM, Honda North America, Stellantis, Tesla, Volvo and Volkswagen. RMI is also working on improving working conditions for the artisanal cobalt production that’s concentrated in two southern provinces of the DRC.Continue reading »