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Ecosystem play
When I first started researching the rise of used EVs and storage batteries lying unused, the issue looked deceptively simple. With more batteries approaching the end of their life, stricter regulations surrounding transport and storage, and the scarcity of dedicated storage facilities worldwide, the solution seemed obvious: build more recycling capacity closer to home.
But as I dug deeper, the picture grew more complex. What initially appeared to be a straightforward waste management challenge is, in fact, a deeply layered ecosystem shaped by chemistry, design, economics, labour, energy, policy, and technology. And it is this complexity that needs to be understood if we are to embed circularity, secure supply chains, and make battery recycling commercially viable.
Battery recycling
Why battery recycling matters
The growth of electric vehicles and grid-scale energy storage means that lithium-ion batteries are at the heart of the energy transition. But with it comes the pressing question: What happens to these batteries when they reach the end of their useful life?
The stakes are high. Recycling is not only about managing waste – it is about reducing dependence on imported raw materials, securing mineral supply chains, creating local industries and reducing the environmental footprint of mining and production. By 2035, an estimated 3.7 million metric tons of battery material will be available globally for recycling, supplying ~10% of the lithium and 18% of the cobalt and nickel needed for new batteries. In theory, this could significantly reduce pressure on mining and the global supply chain.
The four Rs
When it comes to dealing with used batteries, there are several pathways:
Reuse: Refurbishing a battery that is still in good condition and using it again, typically in vehicles.
Repurpose: Giving batteries a ‘second life’ in less demanding applications like stationary energy storage. This approach works, but it comes with a trade-off: high-specification materials end up in lower-grade applications, delaying their recovery for new batteries.
Recover: Extracting valuable materials and metals from old batteries.
Recycle: Systematic processing of batteries to recover materials for use in new cells.
While all four pathways have potential, each comes with its own downside around cost, material, efficiency, and suitability.
The recycling process goes like this:
Most people imagine the recycling process as a single step, but in reality, it involves three distinct approaches, each with its advantages and limitations.
1. Pyrometallurgy (smelting at high heat)
- Pros: Simple, can process mixed waste streams, not overly sensitive to cell design
- Cons: Highly energy intensive, low lithium recovery, critical minerals like graphite are lost. Typically, only cobalt, nickel, and copper are recovered
2. Hydrometallurgy (using chemicals to leach out metals)
- Pros: High recovery rates (~98% for copper, nickel, lithium), less energy use than smelting
- Cons: Requires careful pretreatment (like removing copper and aluminum foils), involves complex chemical processes and poses significant environmental risks through toxic effluents
3. Direct recycling (restoring functional parts of the battery)
- Pros: Retains cathode structure (where ~50% of battery value lies), preserves economic value, lower environmental impact, fewer processing steps
- Cons: Still at research and pilot stage, requires manual disassembly (skilled, hazardous work), difficult to adapt to varied chemistry and designs and needs extra lithium to restore cathode capacity
The economics
Although the global battery recycling market is expected to reach USD 40.6 billion by 2030, the economics of recycling are fragile. Costs vary depending on:
- Battery chemistry impacts recycling costs
- Process efficiency and recovery rates
- Energy and labour costs
- Commodity prices of recovered materials
- Transport and handling hazardous waste costs
For instance, energy costs account for a substantial proportion of operating expenses in both pyrometallurgy and hydrometallurgy processes.
The transportation of end-of-life batteries, classified as hazardous waste, can account for nearly half of the disposal costs due to safety requirements. Add to this the diversity of battery designs, which makes autonomous dismantling difficult, and the result is a labour-intensive, costly, and inconsistent process.
To date, the focus has been on recovering high-value metals, such as cobalt, nickel, and lithium. Lower-value but essential materials, such as graphite, binders, and separators, are often overlooked, even though they represent lost opportunities for efficiency.
Challenges
Timing: Most EV batteries are expected to last 10-15 years, meaning large-scale recycling volumes won’t be realised until after 2030. Near-term opportunities lie more in production scrap recycling, which can reach anything from 20-30% in the early manufacturing stages.
Chemistry shifts: The rise of sodium-ion batteries, which avoid the use of lithium, cobalt, and nickel, will disrupt the recycling economy. These rely on cheaper materials, such as sodium, manganese, and iron oxides, forcing recyclers to adapt and change their technology.
Design diversity: Each manufacturer uses different pack structures, complicating dismantling and recovery.
Policy uncertainty: Shifts in EV regulation, subsidies, and the adoption curve make it difficult to build a long-term business case.
Role of technology
The debate around battery recycling is often framed narrowly: a waste problem that requires more facilities or stricter rules. But in reality, it’s a systems challenge with global implications. The choice made today will shape the supply chains' security, industrial competitiveness and the pace of the energy transition - it’s about future proofing our energy transition.
Recycling as a Service
Recycling-as-a-Service (RaaS) represents a transformative approach to circular economy goals by leveraging digital technologies to simplify and optimise battery end-of-life management. By integrating IoT for real-time health monitoring, AI for predictive analytics, blockchain for traceability, and cloud-based orchestration, RaaS creates a seamless, transparent, and compliant ecosystem. This model enables businesses to offload complexity—covering collection, logistics, partner coordination, and regulatory reporting—while unlocking value through reuse and material recovery.
RaaS can offer a turnkey digital solution to manage and optimise the entire end-of-life process for EV batteries on behalf of its clients (who might be automakers, fleet operators, battery OEMs, energy firms, or even recycling firms and shift recycling from a fragmented process to a unified, data-driven service that accelerates sustainability and operational efficiency.
1. Battery digital passport - Blockchain technology to create an immutable, shared ledger of battery data accessible to different parties with appropriate permissions. Traceability - by giving batteries a digital identity, it helps make data transparent.
2. IoT sensors and cloud monitoring on used batteries to continuously track their state-of-health and use AI models to predict remaining life and optimal usage. For instance, an AI-driven battery analytics company can forecast how long a retired battery will last in a solar storage installation, guiding whether it’s worth repurposing.
3. AI and data analytics - AI models can predict how a battery’s capacity will degrade over various conditions or estimate remaining useful life based on usage patterns. Data analytics can predict future flows of end-of-life batteries and the output of material recovery. ML-powered analytics can also match a refurbished battery to the best reuse case.
4. Digital twins and robotics - A virtual twin platform can allow companies to simulate battery disassembly and material recovery, and find the most efficient approach, reducing trial and error costs. Robotic systems can help identify and separate battery components.
5. Cloud-based marketplace - Digital marketplace for battery recycling and reuse.
6. Logistics automation - The system automatically arranges a hazmat-certified carrier, provides them with the necessary digital paperwork and handling instructions. The client can view the status of pickups, transit, and delivery in real-time on their dashboard.
7. Regulatory compliance and reporting - Audit trail is built in.
To truly bring the ecosystem together, digital and AI must act as the glue – helping us cut through complexity, build resilience, and unlock circularity at scale. What appears today as a messy, fragmented challenge is, in reality, an opportunity to build a smarter, more self-reliant, and sustainable future.