At the recent COP26 conference, the world’s leaders discussed the need to reduce carbon emissions to reduce the impact of climate change. Unsurprisingly, as transport accounts for 20% of global greenhouse gases, electric vehicles took a central role in both discussions and negotiations. Many European countries have already made firm legislative commitments to enable the electric vehicle revolution, but one aspect is being overlooked: battery recycling.

Although battery-powered electric vehicles will be key in managing a successful climate transition, raw materials are used heavily in their production, especially in the battery. EV batteries are expected to last around 15 years and considering EVs have only really started to take off in the last five years, battery recycling has been neglected because it is not an immediate issue. But building these recycling plants takes time and investment must come now before it is too late.

To produce a standard lithium-ion battery used in an electric vehicle, you need lithium, nickel, cobalt, graphite and manganese. These raw materials are finite by their very nature and the gaps between supply and demand for these metals, especially lithium, graphite and nickel, are set to widen over the next decade, leading to increased prices. This could be offset by using recycled battery materials, but currently, battery recycling companies are few and far between. Furthermore, the process of mining critical battery raw materials is very carbon-intensive. As such, a truly sustainable electric vehicle future will only be possible once we have mastered battery recycling.

Sustainability may be the main reason to boost battery recycling capabilities but understanding the geopolitics of battery supply chains makes the case for building battery recycling plants even more compelling. China controls around 23% of the mining of critical battery metals, but around 66% of the refining and 76% of the battery cell manufacturing streams of the supply chain. Recently, much has been made of the dependencies of Western countries, especially those in North America and Europe, on batteries and critical raw materials. China, for example, will continue to hold 61.4% of the world’s lithium-ion battery capacity by 2026.

This is a geopolitical weakness. Reliance on China for batteries means that Chinese companies will be able to set the prices. This could potentially slow the adoption of EVs around the world as they become more expensive. Since EVs are critical for the climate transition, having control over adoption via pricing means that a country that is dependent on China for lithium-ion batteries is de facto dependent on China for meeting its carbon emission reduction targets too. Furthermore, China will stand to gain economically if it maintains control over the lithium battery supply chain.

Domestic battery recycling would reduce this dependence while ensuring that the lithium-ion economy is sustainable and efficient. More investment must be siphoned off to make this a reality.

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