Recyclers prepare for electric car revolution

Recycling companies are honing processes to extract metals from old batteries more cheaply and efficiently so they can capitalize on an expected shortfall in materials such as cobalt and lithium when sales of electric cars take off. The main obstacle recyclers face now is a shortage of spent batteries to recycle to make their technology cost-effective, but those at the forefront of the industry are confident the supply, and profits, will come.

“The value of lithium carbonate and natural or synthetic graphite has doubled or tripled in the last three or four years, becoming the most valuable materials besides cobalt in the automotive battery,” Albrecht Melber, comanaging director of German recycling firm Accurec, said. “There are big values that can be recycled in the future.” Electric vehicle sales are expected to pass 14 million a year by 2025 from less than a million now, fuelling a surge in the consumption of battery materials.

Data specialist Benchmark Mineral Intelligence predicts the industry will need an extra 30,000 tonnes of cobalt and 81,000 tonnes of lithium a year to meet demand by 2021. Commodity research group CRU expects 11,600 tonnes of cobalt to come from recycling in 2021, up from 7,110 a year now, and 24,900 tonnes by 2026, accounting for 9.7 percent and 17.9 percent of the total market supply respectively. In China, where electric vehicle sales topped half a million last year, recyclers are getting ready to deal with a mountain of battery waste and others also see opportunities. “A 1,000-pound lithium cobalt battery contains about $6,000 worth of cathode material at the top end of the value chain and about $1,700 for a nickel-cobalt-aluminum battery at the low end,” said Larry Reaugh, chief executive of Canadian metals recycler American Manganese. “If this equated to mining you would have a very high grade feedstock,” he said. “We’re mining batteries, you might say.”

Cobalt pressure

Most electric cars are powered by lithium NMC batteries which use a cathode composed of nickel, manganese and cobalt and a graphite anode. Mining enough cobalt to meet demand is a particular concern as most of the world’s supplies come from Democratic Republic of Congo, where mining areas are prone to conflict. The price of cobalt has more than doubled so far this year.

Supplies of lithium, mainly mined in Chile, are under far less pressure at the moment and new production is due to come on stream in Argentina and Australia. But concern the supply of lithium in battery-ready form will struggle to keep pace with electric car sales has pushed prices up more than 30 percent to a record $12,000 a tonne this year. Besides a shortage of old batteries to recycle, companies also face challenges extracting lithium in a reusable form. Most recyclers heat old batteries to high temperatures to retrieve metals, a process known as pyrometallurgy. But this generally only yields cobalt, and sometimes nickel, while lithium is more difficult and expensive to extract. The cost of recycling varies widely, but to be economical, CRU estimates it would need to be transformed back into lithium carbonate at a maximum cost of $7,000 a tonne. For now, lithium usually ends up in waste slag, which can be used as a building material, or is thrown away. But with the price of all these metals rising, that picture may change.

Material matrix Technological advances are key to retrieving more waste metal from batteries and some companies say they have developed ways to get lithium that will come into their own once there’s a steady supply of spent batteries to recycle. Umicore uses a combination of pyrometallurgy and a chemical process known as hydrometallurgy to retrieve lithium and rare earths from slag, as well as extracting cobalt, nickel, and copper. “A battery is a complex material matrix,” Umicore says. “However, our process allows (us) to separate and concentrate the lithium in one process step, and yields alloys with cobalt, nickel and copper.”

Umicore operates a pilot plant with a 7,000-tonne capacity that can process some 35,000 electric vehicle batteries a year. Analysts say the Belgian company, a wellestablished materials recycler, is by far the most developed lithium ion battery processor in Europe. “For investors to play the recycling theme, for now the best way is Umicore,” said Tobias Bischoff, a portfolio manager at de Pury Pictet Turrettini & Cie who advises NSF Wealth Management’s Global New Mobility fund. US company Retriev Technologies has been recycling lithium ion batteries at its plant in Trail, British Columbia, since 2002, recovering cobalt, nickel and copper. It expanded a facility in Ohio to process lithium ion batteries two years ago. —Reuters

Battery recyclers seeking new ways to retrieve metals