Global Recycling Day: What’s Really Happening In India’s Li-ion Battery Recycling Space?

As the world celebrates Global Recycling Day today (March 18), we took upon ourselves the responsibility to mainstream the conversation around the recycling of lithium-ion (Li-ion) batteries and cells, as their use is multiplying at a rapid pace due to the growing adoption of electronic components and electric vehicles (EVs).

At a time when countries across the globe are determined to meet their respective net zero emissions goals, the current state of affairs around a sustainable EV ecosystem seems to be in the doldrums. However, we cannot ignore the fact that there is also a sense of urgency among many nations to fix this once and for all.     

Many industry experts that Inc42 spoke with on Global Recycling Day say that India, too, needs to up the ante and do more when it comes to creating a sustainable infrastructure to support the recycling of Li-ion batteries and strengthen its management.

In August last year, the Indian government notified the Battery Waste Management Rules, 2022, for more eco-friendly management of waste batteries across industries, including EVs. The new rules also made various stakeholders of the EV ecosystem responsible for recycling the batteries.

Based on the concept of Extended Producer Responsibility (EPR), producers, including importers of batteries, are responsible for the collection and recycling/refurbishment of waste batteries and the use of recovered materials from wastes into new batteries.

However, according to industry experts, it is unclear how far these propositions are being implemented on the grass-roots level. 

For instance, the founder and CEO of Lohum, Rajat Verma, believes that the government laying out target-based battery waste management rules is a very healthy development, but there is a need for clear regulations around the safe transport of batteries and upscaling the capacities of battery logistics companies. 

Lohum is a cleantech startup that produces sustainable battery raw materials through recycling, repurposing, and refining. The startup has raised over $20 Mn so far and is backed by the likes of Baring Private Equity Partners.

Echoing a similar concern, the cofounder and MD of battery manufacturing startup Log9 Materials, Pankaj Sharma, says that it is crucial to either penalise or incentivise stakeholders in the EV and battery recycling space, particularly for Li-ion batteries, to create a sustainable recycling ecosystem in the country.

A few startups in the Li-ion battery recycling space include Attero, Metastable Materials, Ziptrax Cleantech, and ACE Green Recycling, among others.

Where’s The Big Gap?

Today, the country is more focused on increasing the number of EVs on Indian roads, and for this, the central and state governments are coming up with newer and better EV policies every now and then. 

It is because of this heightened focus that EV and battery manufacturing startups are getting all the limelight while leaving the stakeholders of battery recycling startups somewhere behind in the race.

Despite everything that is being said and done, the creation of a strong ecosystem to foster the recycling of Li-ion batteries stays imperative in achieving the country’s net zero emissions goals and demoralises its dependence on the import of lithium from China or other lithium-rich nations of the world.

“The world is heading towards the electrification of the transportation sector to fight the climate change crisis and make a sustainable future. But, there is a need for an appropriate recycling process for the Li-ion batteries that power EVs, which will help India to truly achieve the net zero target,” says the cofounder and COO of Metastable Materials, Saurav Goyal. 

“This will also help the country take the lead in EV manufacturing, as it will reduce India’s dependency on the imports of the raw materials needed to make Li-ion batteries,” Goyal adds.

It is pertinent to note here that in Li-ion batteries, which largely comprise lithium, cobalt, nickel, bauxite, manganese, aluminium, and natural graphite, almost 95% of valuable materials can be recovered. However, studies done globally suggest that 95% of Li-ion batteries today end up in landfills, and only 5% are recycled and reused. 

As per a JMK Research report, the annual Li-ion battery market in India is set to reach 132 GWh in 2030. This increase in volume would, in turn, lead to a rise of ‘spent’ batteries in the ecosystem, which, if left unattended, would become a health and environmental hazard. 

Also, except for manganese and graphite, all the other raw materials used in Li-ion batteries are hardly available in India. Moreover, India and most other countries are heavily dependent on China for lithium. 

Although India has recently discovered 5.9 Mn tonne reserves of lithium in the Reasi district of Jammu and Kashmir, it is only an inferred estimate and the actual reserve size may differ. Experts believe that it would take at least 5-10 years for the discovery to have any direct impact on the country’s burgeoning EV ecosystem.

According to Log9 Materials’ Sharma,“By importing Li-ion batteries in huge quantities over the last few years, we have already created a mine of our own, an urban mine, in the country.”

In fact, according to the JMK, the recycling market in India was to gain momentum from 2022 when Li-ion batteries started reaching their end of life. 

But the batteries have not yet started coming back into the system, in the recycling industry, in large volumes, Metastable Materials’ Goyal points out. 

Further, it must also be noted that there are multiple challenges associated with recycling Li-ion batteries, including its high cost and cumbersome process, and the industry has not really taken off in India or globally.

The Problem Statement

As per Sharma, compared to lead-acid batteries, recycling Li-ion batteries is more difficult. In Li-ion batteries, typically the amount of lithium is about 2%, which makes it a challenge to extract lithium from the other materials in the recycling process. Also, lithium is highly flammable if it gets exposed to moisture and air, so the Li-ion batteries need to be extracted for materials in a climate-controlled chamber.

“Recycling in India is done by engaging unskilled workers or labourers, and it is a very unstructured industry. But Li-ion recycling cannot be done that way. It needs sophisticated infrastructure, facilities, engineers, and dedicated resources and capital,” Sharma adds.

Hence, it’s an industry that needs to be built. Besides, the economic variability of this extraction process is also not great. Therefore, India is not leading the show in this area, he believes.

The process of extraction involves three broad steps – breaking the batteries and extracting cells from them, taking the jelly roll and crushing it into a black mass, and purifying the black mass to extract materials. 

“When you add the energy that goes into doing this, it is cheaper right now to buy a new cell than to buy the raw products that come out of recycling,” Sharma observes.

Globally, two main processes are most commonly used for Li-ion battery recycling –  hydrometallurgy and pyrometallurgy. While pyrometallurgy has very low recovery efficiency and the recyclers are left with a very less quantity of minerals like copper, nickel and cobalt, hydrometallurgy comes with higher material costs and complexity due to the use of a technique called leaching.

However, currently, more research is being done globally to make this process easier and more efficient. 

Experts say that this is high time for India to buckle up its research and development in the recycling space and stabilise the market. This is because, in the next three to four years, the volume of EV batteries used by EV OEMs is going to increase sharply, as the life of a Li-ion battery is around two years.

The Road Ahead Seems Charged With Opportunities

Helped by India’s ambitious Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME) scheme, India has been able to increase its EV manufacturing and adoption significantly over the last two years. As per the latest data, India has 21.7 Lakh registered EVs.

The Indian government is aiming at 3 Cr EVs to run on roads by 2024. 

While the problem statements are many, it is also comparatively easier to put the EV batteries back in the recycling system as they are larger compared to the other smaller Li-ion batteries used for various electronic devices. Hence, their chances of ending up in landfills are lower, Goyal opines. 

Further, according to  Lohum’s Verma, given the rising costs of mined battery raw materials, finite natural reserves, and enormous carbon footprint of mining, the widespread adoption of battery recycling and repurposing stands as a key trend to sustain the global transition to battery power. He believes that the battery recycling industry is expected to upscale significantly within the decade.

Going by the battery manufacturing targets set by NITI Aayog under its Energy Storage Mission by 2030, the cumulative li-ion battery recycling market is estimated to be about 160 GWh, notes the JMK research.

While various industry sources have said that these targets are highly ambitious and difficult to achieve, industry experts see a silver lining amid the battery recycling market picking up pace in the next few years.