Battery Recycling Industry to Increase 7-Fold by 2030, says Report

IHS Markit is expecting 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 7-fold increase.

December 10, 2020. By Manu Tayal

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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.

The report further estimated that large waves of 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.

IHS Markit is expecting 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 7-fold increase.

Meanwhile, the continued 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.

The recycled materials currently make up a small proportion of the battery supply chain. However, the increasing supply of end-of-life batteries and growing demand will enable up to 15 per cent (180 kt) of Lithium, 7.5 per cent (450 kt) of Nickel and 43 per cent (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.

Commenting on the report findings, George Hilton, energy storage senior analyst, IHS Markit, said “we are approaching the tipping point for a self-perpetuating cycle where the deluge of end-of-life batteries comes along at just the right time to meet rising demand for these materials to make new batteries. The supply, demand, cost and security of supply motivations are all there.”

Hilton further added that “we are already 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.”

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