1 00:00:00,320 --> 00:00:03,480 Speaker 1: This is Dana Perkins and you're listening to Switched on 2 00:00:03,640 --> 00:00:06,360 Speaker 1: the B and EF podcast. So, electric vehicle sales are 3 00:00:06,400 --> 00:00:09,360 Speaker 1: growing all over the world, and while electric vehicles cut 4 00:00:09,360 --> 00:00:13,240 Speaker 1: tailpipe emissions, there is a further opportunity to reduce the 5 00:00:13,280 --> 00:00:17,160 Speaker 1: emissions associated with the embodied carbon found in the creation 6 00:00:17,280 --> 00:00:20,159 Speaker 1: of the batteries themselves. So that leads us to the 7 00:00:20,239 --> 00:00:23,560 Speaker 1: three point seven million metric tons of end of life 8 00:00:23,640 --> 00:00:27,639 Speaker 1: batteries that could become available for recycling in twenty thirty five. 9 00:00:27,920 --> 00:00:30,880 Speaker 1: That's enough to supply ten to eighteen percent of the 10 00:00:30,960 --> 00:00:34,559 Speaker 1: key metals used for battery manufacturing. But just how well 11 00:00:34,680 --> 00:00:38,920 Speaker 1: established are the existing battery recycling facilities and the policies 12 00:00:38,920 --> 00:00:42,040 Speaker 1: that incentivize the recycling to actually take place. And how 13 00:00:42,040 --> 00:00:45,279 Speaker 1: can we ensure that the recycling of components becomes an 14 00:00:45,400 --> 00:00:49,360 Speaker 1: essential part of battery manufacturing, especially considering it has the 15 00:00:49,360 --> 00:00:54,320 Speaker 1: potential to dramatically reduce the emissions associated with the batteries themselves. 16 00:00:54,520 --> 00:00:57,280 Speaker 1: So to tell us more about battery recycling, I'm joined 17 00:00:57,280 --> 00:01:01,200 Speaker 1: by Andy Leach. He's an associate from BNAFS Energy Storage Team. 18 00:01:01,560 --> 00:01:04,320 Speaker 1: Andy reveals some of his key findings from a recent 19 00:01:04,400 --> 00:01:09,160 Speaker 1: report titled Lithium ion Battery Recycling Market Outlook twenty twenty four, 20 00:01:09,360 --> 00:01:12,360 Speaker 1: and he talks about the evolution of battery chemistries which 21 00:01:12,400 --> 00:01:15,759 Speaker 1: will impact the longer term availability of metals and how 22 00:01:15,760 --> 00:01:18,800 Speaker 1: they can be reclaimed in the recycling process, and why 23 00:01:18,840 --> 00:01:22,240 Speaker 1: production scrap is actually one of the most important feedstocks 24 00:01:22,400 --> 00:01:25,840 Speaker 1: for this space at the moment. To access this report, 25 00:01:25,959 --> 00:01:28,640 Speaker 1: b and EF subscribers can find it on benf dot 26 00:01:28,680 --> 00:01:31,560 Speaker 1: com or at BNOF on the Bloomberg terminal. Subscribe to 27 00:01:31,600 --> 00:01:33,520 Speaker 1: the show for updates, or give us a review to 28 00:01:33,520 --> 00:01:35,720 Speaker 1: share us with others. But right now, let's jump into 29 00:01:35,760 --> 00:01:48,160 Speaker 1: our conversation with Andy. Andy, thank you for joining us 30 00:01:48,160 --> 00:01:49,279 Speaker 1: on Switched on again today. 31 00:01:49,440 --> 00:01:50,920 Speaker 2: Thank you very much for having me, Diana. 32 00:01:51,200 --> 00:01:54,440 Speaker 1: We are here to talk about battery recycling, and, as 33 00:01:54,480 --> 00:01:56,480 Speaker 1: I like to do at the beginning of pretty much 34 00:01:56,560 --> 00:02:00,280 Speaker 1: every show these days, where we're getting into a technical process, 35 00:02:00,480 --> 00:02:04,360 Speaker 1: explain what battery recycling is and how it's done. 36 00:02:04,520 --> 00:02:07,400 Speaker 2: Sure, so, battery recycling is taking batteries which have been 37 00:02:07,680 --> 00:02:11,079 Speaker 2: in electric vehicles and quid scale energy storage projects. These 38 00:02:11,120 --> 00:02:13,560 Speaker 2: batteries can be dismantled, and they can be dismantled in 39 00:02:13,600 --> 00:02:15,480 Speaker 2: a couple of different ways. So they can be taken 40 00:02:15,520 --> 00:02:18,560 Speaker 2: apart and tested potentially for a second life, or they 41 00:02:18,560 --> 00:02:21,120 Speaker 2: can be shredded before this point, or if they don't 42 00:02:21,160 --> 00:02:22,760 Speaker 2: have any sort of use as a second life, they 43 00:02:22,760 --> 00:02:25,640 Speaker 2: can be shredded after this point. Then the material that 44 00:02:25,680 --> 00:02:27,880 Speaker 2: produced from this is called black mass. So this is 45 00:02:27,880 --> 00:02:31,519 Speaker 2: a mixture of all different materials. This has lithium, nickel, 46 00:02:31,600 --> 00:02:34,200 Speaker 2: cobalt depending on the battery chemistry, as well as other 47 00:02:34,240 --> 00:02:36,840 Speaker 2: things like aluminium and copper. And then this black mass 48 00:02:36,880 --> 00:02:40,000 Speaker 2: is processed in similar ways that sort of primary or 49 00:02:40,080 --> 00:02:43,160 Speaker 2: virgin material will be processed to become the commodity salts 50 00:02:43,240 --> 00:02:45,960 Speaker 2: or maybe even precursor materials to make new batteries. 51 00:02:46,240 --> 00:02:48,280 Speaker 1: We're going to spend most of our time talking about 52 00:02:48,280 --> 00:02:50,720 Speaker 1: the recycling end of things, but when you talk about 53 00:02:50,840 --> 00:02:52,800 Speaker 1: second life, I want to know how much of the 54 00:02:52,840 --> 00:02:56,720 Speaker 1: market is actually reused before it becomes recycling. When we're 55 00:02:56,720 --> 00:02:59,200 Speaker 1: talking about vehicles specifically. 56 00:02:58,840 --> 00:03:01,720 Speaker 2: So the second life market is much smaller because if 57 00:03:01,720 --> 00:03:04,040 Speaker 2: a battery has had a full first life, the chances 58 00:03:04,080 --> 00:03:07,239 Speaker 2: of its having sort of usable value and usable capacity 59 00:03:07,280 --> 00:03:09,800 Speaker 2: for a second life is smaller. However, there are some 60 00:03:09,880 --> 00:03:12,400 Speaker 2: exceptions to this, and one of those exceptions can be 61 00:03:12,440 --> 00:03:15,320 Speaker 2: if a car company recalls some cars early because of 62 00:03:15,360 --> 00:03:17,400 Speaker 2: a fault to do with battery packs, but maybe some 63 00:03:17,480 --> 00:03:19,400 Speaker 2: of the cells in the battery packs are still good, 64 00:03:19,680 --> 00:03:22,040 Speaker 2: this can mean that these percentages can be a bit higher. 65 00:03:22,080 --> 00:03:24,240 Speaker 2: A notable example would be a couple of years ago 66 00:03:24,280 --> 00:03:26,560 Speaker 2: GM recalling some of the Chevy Bolts. Some of these 67 00:03:26,639 --> 00:03:28,520 Speaker 2: cars were recalled after any one or two years on 68 00:03:28,520 --> 00:03:30,280 Speaker 2: the road. Now it's very likely that a lot of 69 00:03:30,280 --> 00:03:32,760 Speaker 2: those cells will still have usable life in them. But yeah, 70 00:03:32,880 --> 00:03:35,520 Speaker 2: it's not unheard or for car batteries to come back 71 00:03:35,520 --> 00:03:38,120 Speaker 2: and go back into cars, but also going into energy 72 00:03:38,120 --> 00:03:41,040 Speaker 2: storage projects as a very very sort of viable second 73 00:03:41,040 --> 00:03:41,680 Speaker 2: life for sure. 74 00:03:42,040 --> 00:03:45,200 Speaker 1: One of the reasons that battery recycling is so exciting 75 00:03:45,440 --> 00:03:48,960 Speaker 1: is that it really reduces the emissions of those vehicles 76 00:03:48,960 --> 00:03:51,560 Speaker 1: that actually have a recycled battery in it. There are 77 00:03:51,600 --> 00:03:54,000 Speaker 1: so few things in the world that I think wouldn't 78 00:03:54,040 --> 00:03:57,200 Speaker 1: benefit from recycling in terms of emissions. When you actually 79 00:03:57,240 --> 00:03:59,920 Speaker 1: think about getting virgin materials out of the ground the 80 00:04:00,160 --> 00:04:03,880 Speaker 1: muddles versus taking something that is already extracted and then 81 00:04:04,000 --> 00:04:06,760 Speaker 1: converting it into something else. So when we think about 82 00:04:06,800 --> 00:04:09,040 Speaker 1: how much of this is actually going to be happening 83 00:04:09,080 --> 00:04:12,520 Speaker 1: in the future and potentially a decline in electric vehicle 84 00:04:12,520 --> 00:04:15,400 Speaker 1: emissions overall. When we think of imbodied emissions in their 85 00:04:15,440 --> 00:04:18,600 Speaker 1: second life, how big is the market going to be 86 00:04:18,640 --> 00:04:21,320 Speaker 1: from battery recycling, Like how many batteries are going to 87 00:04:21,320 --> 00:04:23,159 Speaker 1: be coming in? You know what do we see coming 88 00:04:23,200 --> 00:04:23,920 Speaker 1: down the pipe? 89 00:04:24,279 --> 00:04:28,000 Speaker 2: So for sure, if you're recycling a battery, the emissions 90 00:04:28,040 --> 00:04:30,960 Speaker 2: associated with this are likely to be lower. So for 91 00:04:31,000 --> 00:04:34,800 Speaker 2: a very obvious example is supply chain length. Right, So 92 00:04:35,160 --> 00:04:37,640 Speaker 2: virgin materials and mines, they are where they are and 93 00:04:37,640 --> 00:04:39,880 Speaker 2: we can't move them too much. If there's a lot 94 00:04:39,920 --> 00:04:41,640 Speaker 2: of one material in one place, then you need to 95 00:04:41,640 --> 00:04:43,200 Speaker 2: ship this around the world to get it to where 96 00:04:43,240 --> 00:04:45,240 Speaker 2: it needs to be. Now, if you're producing an electric 97 00:04:45,320 --> 00:04:47,760 Speaker 2: vehicle in Europe or North America and you can recycle 98 00:04:47,839 --> 00:04:50,120 Speaker 2: batteries from those vehicles at their end of life in 99 00:04:50,160 --> 00:04:53,880 Speaker 2: those regions, you can significantly reduce the supply chain and 100 00:04:53,920 --> 00:04:56,720 Speaker 2: the sort of logistics there, which has an emissions benefit. 101 00:04:56,800 --> 00:04:58,960 Speaker 2: Now you also have a benefit that you don't need 102 00:04:59,000 --> 00:05:01,040 Speaker 2: to be digging this stuff out to the ground and 103 00:05:01,120 --> 00:05:04,520 Speaker 2: moving a battery from an electric vehicle and shredding it 104 00:05:04,520 --> 00:05:06,920 Speaker 2: has a lower CO two footprint than digging this out 105 00:05:06,960 --> 00:05:10,120 Speaker 2: the ground and moving it around continents, and some some 106 00:05:10,240 --> 00:05:13,479 Speaker 2: battery metals move around the world significant distances before getting 107 00:05:13,520 --> 00:05:14,200 Speaker 2: into batteries. 108 00:05:14,520 --> 00:05:16,640 Speaker 1: Can you give us an idea of the volume batteries 109 00:05:16,640 --> 00:05:19,080 Speaker 1: that are actually going to be recycled in the future 110 00:05:19,160 --> 00:05:22,120 Speaker 1: and essentially how many vehicles are, how big we see 111 00:05:22,120 --> 00:05:25,599 Speaker 1: the electric vehicle space growing to in the near and 112 00:05:25,680 --> 00:05:26,520 Speaker 1: medium term. 113 00:05:26,640 --> 00:05:28,719 Speaker 2: Yeah, in the analysis that we did in this most 114 00:05:28,720 --> 00:05:31,920 Speaker 2: recent report, we see approximately seven hundred and sixty seven 115 00:05:32,000 --> 00:05:35,200 Speaker 2: gig or towers of battery materials available to recycle by 116 00:05:35,279 --> 00:05:38,120 Speaker 2: twenty thirty five. Now in the report, we dig down 117 00:05:38,160 --> 00:05:41,359 Speaker 2: and we compare this to the ratio of new demand 118 00:05:41,400 --> 00:05:44,760 Speaker 2: for these materials. It varies by metals. So between lithium, nickel, 119 00:05:44,760 --> 00:05:47,040 Speaker 2: and cobalt, the ones that we dug into, nickel and 120 00:05:47,120 --> 00:05:50,120 Speaker 2: cobalt can be getting up towards eighteen percent of supply 121 00:05:50,240 --> 00:05:53,599 Speaker 2: of these metals can be produced by recycling used batteries, 122 00:05:53,640 --> 00:05:55,400 Speaker 2: and with lithium it's a little lower due to the 123 00:05:55,400 --> 00:05:58,160 Speaker 2: different chemistries of different batteries that are used, and this 124 00:05:58,240 --> 00:06:00,839 Speaker 2: is more around just below ten percent eight nine percent. 125 00:06:00,800 --> 00:06:04,400 Speaker 1: And different battery chemistries are used for different purposes. What 126 00:06:04,480 --> 00:06:07,920 Speaker 1: impact does the way the battery is used have on 127 00:06:08,160 --> 00:06:12,120 Speaker 1: its life cycle and how often they will end up 128 00:06:12,279 --> 00:06:15,800 Speaker 1: being recycled or does it really come down to the 129 00:06:15,839 --> 00:06:19,080 Speaker 1: battery chemistry and what it is that the battery is 130 00:06:19,120 --> 00:06:22,200 Speaker 1: made of before it then makes its eventual way to 131 00:06:22,560 --> 00:06:23,600 Speaker 1: being recycled. 132 00:06:23,920 --> 00:06:25,880 Speaker 2: Yeah, so there's two key factors as to how long 133 00:06:25,920 --> 00:06:28,679 Speaker 2: it will take battery from going into use to coming 134 00:06:28,680 --> 00:06:30,640 Speaker 2: to its end of life. So it's the use case, 135 00:06:31,000 --> 00:06:33,320 Speaker 2: so how much you're using it, how many times you're 136 00:06:33,400 --> 00:06:35,880 Speaker 2: charging and discharging it, And then it's the battery chemistry. 137 00:06:35,960 --> 00:06:39,360 Speaker 2: For example, we would expect batteries in ebuses and commercial 138 00:06:39,440 --> 00:06:42,280 Speaker 2: vehicles where these vehicles are maybe being used every single day, 139 00:06:42,360 --> 00:06:44,200 Speaker 2: multiple times a day, to come to their end of 140 00:06:44,240 --> 00:06:46,680 Speaker 2: life sooner than maybe in a passenger car where someone 141 00:06:46,760 --> 00:06:48,560 Speaker 2: may use the car maybe only once a day, or 142 00:06:48,600 --> 00:06:50,680 Speaker 2: maybe even less than once a day. The lifetime would 143 00:06:50,720 --> 00:06:53,400 Speaker 2: be much longer. Here within the battery chemistries, the two 144 00:06:53,440 --> 00:06:56,520 Speaker 2: sort of main groups of battery chemistries within litiumine batteries 145 00:06:56,560 --> 00:06:59,919 Speaker 2: are going into cars and stationary storage projects LFP batteries 146 00:07:00,080 --> 00:07:02,760 Speaker 2: Lithium I and phosphate batteries. These batteries don't contain any 147 00:07:02,839 --> 00:07:05,240 Speaker 2: nickel and cobalt and therefore a slightly cheaper and they 148 00:07:05,279 --> 00:07:08,320 Speaker 2: have a lower energy density, so their range in vehicles 149 00:07:08,360 --> 00:07:10,680 Speaker 2: will be lower and compared to the nickel based chemistries, 150 00:07:10,720 --> 00:07:12,360 Speaker 2: but they have a longer life cycle. They can have 151 00:07:12,400 --> 00:07:14,920 Speaker 2: life cycles of six or eight thousand cycles or maybe 152 00:07:14,920 --> 00:07:17,360 Speaker 2: even more. And if you're cycling your battery once a day, 153 00:07:17,480 --> 00:07:20,200 Speaker 2: six or eight thousand cycles is getting close to twenty years. 154 00:07:20,240 --> 00:07:22,480 Speaker 2: So maybe other factors come in there as well. And 155 00:07:22,520 --> 00:07:24,520 Speaker 2: then so the nickel and cobalt based batteries they can 156 00:07:24,560 --> 00:07:27,120 Speaker 2: be cycled maybe two to three thousand times, maybe slightly 157 00:07:27,120 --> 00:07:29,360 Speaker 2: more for some high performance batteries, so this is about 158 00:07:29,360 --> 00:07:32,440 Speaker 2: half that of the LFP or lithium im phosphate batteries. 159 00:07:32,480 --> 00:07:35,320 Speaker 2: So the nmcs and the ncas using sort of higher range, 160 00:07:35,360 --> 00:07:37,840 Speaker 2: higher performance cars, and so these batteries have a slightly 161 00:07:37,880 --> 00:07:40,640 Speaker 2: shorter life cycle. And then again if you're using them 162 00:07:40,680 --> 00:07:42,840 Speaker 2: in an application, maybe in a truck or a bus 163 00:07:42,920 --> 00:07:45,600 Speaker 2: where you're driving around constantly all day every day, this 164 00:07:45,680 --> 00:07:47,600 Speaker 2: can shorten it. So we have a few different assumptions 165 00:07:47,640 --> 00:07:50,520 Speaker 2: in our analysis. Trucks and buses have some of the 166 00:07:50,560 --> 00:07:53,040 Speaker 2: shortest assumed lifetimes around six to eight years. 167 00:07:53,360 --> 00:07:55,320 Speaker 1: The companies that are taking this black mass though, and 168 00:07:55,360 --> 00:07:57,320 Speaker 1: turning it into these new sets of batteries, are they 169 00:07:57,360 --> 00:08:01,560 Speaker 1: the same companies that are actually manufactured the initial batteries 170 00:08:01,720 --> 00:08:04,800 Speaker 1: or are they completely different companies that specialize in recycling. 171 00:08:05,200 --> 00:08:07,840 Speaker 2: So there's a range. There really is a range. There's 172 00:08:07,840 --> 00:08:10,320 Speaker 2: some companies that will take batteries, maybe test them as 173 00:08:10,360 --> 00:08:12,400 Speaker 2: I said, or maybe just shred them straight away and 174 00:08:12,440 --> 00:08:14,960 Speaker 2: produce black mass and that's the whole business. There's some 175 00:08:15,000 --> 00:08:17,520 Speaker 2: companies that will take that black mass, process it into 176 00:08:17,560 --> 00:08:20,960 Speaker 2: commodity metals or maybe precursor materials for other people to 177 00:08:21,000 --> 00:08:23,520 Speaker 2: make the specialist chemicals. And then there's some companies that 178 00:08:23,560 --> 00:08:26,520 Speaker 2: take this whole supply chain. They take batteries, they shred them, 179 00:08:26,560 --> 00:08:28,760 Speaker 2: they turn them into the precursor materials, and then they 180 00:08:28,800 --> 00:08:31,160 Speaker 2: produce cathod at the end, which they can sell to 181 00:08:31,200 --> 00:08:34,520 Speaker 2: somebody making batteries. So there's a range of different business models. 182 00:08:34,640 --> 00:08:36,880 Speaker 2: Some parts of the supply chain, or some parts of 183 00:08:36,880 --> 00:08:39,880 Speaker 2: this processor may be more technical than others. Just shredding 184 00:08:39,920 --> 00:08:43,199 Speaker 2: batteries is potentially maybe easier than producing cathode material, which 185 00:08:43,240 --> 00:08:46,760 Speaker 2: maybe needs to go through qualification processes with battery manufacturers 186 00:08:46,760 --> 00:08:48,480 Speaker 2: and OEMs at the end of this as well. 187 00:08:48,760 --> 00:08:51,000 Speaker 1: So when we think about the parts of the world 188 00:08:51,040 --> 00:08:53,320 Speaker 1: where this is really taking off, I'm thinking about the 189 00:08:53,320 --> 00:08:56,959 Speaker 1: fact that electric vehicles have actually had higher rates of 190 00:08:57,000 --> 00:09:00,959 Speaker 1: adoption in some regions over others. The US, it's started 191 00:09:01,000 --> 00:09:03,440 Speaker 1: to get traction, But really China has been one of 192 00:09:03,480 --> 00:09:07,320 Speaker 1: the earliest adapters of electric vehicles at scale. And what 193 00:09:07,360 --> 00:09:09,280 Speaker 1: I want to know is then on the recycling end 194 00:09:09,280 --> 00:09:12,160 Speaker 1: of things, as the batteries have started to get to 195 00:09:12,200 --> 00:09:14,679 Speaker 1: the end of their useful life, is China then also 196 00:09:15,000 --> 00:09:18,200 Speaker 1: leading the way in terms of battery recycling or is 197 00:09:18,240 --> 00:09:20,240 Speaker 1: it other parts of the world that have decided to 198 00:09:20,360 --> 00:09:23,360 Speaker 1: look at this as an opportunity and perhaps those batteries 199 00:09:23,360 --> 00:09:24,280 Speaker 1: are being shipped to them. 200 00:09:24,600 --> 00:09:27,920 Speaker 2: No, you're completely right. China is leading the way that 201 00:09:28,640 --> 00:09:32,400 Speaker 2: their policy is leading and mandating things which Europe have 202 00:09:32,480 --> 00:09:34,840 Speaker 2: been catching up with. As you mentioned, they also had 203 00:09:35,000 --> 00:09:38,959 Speaker 2: much larger electric vehicle update sooner than Europe and North America, 204 00:09:39,040 --> 00:09:41,319 Speaker 2: the three key regions that we looked at in this analysis. 205 00:09:41,360 --> 00:09:43,880 Speaker 2: So yeah, the volumes in China are higher both on 206 00:09:44,080 --> 00:09:46,800 Speaker 2: new batteries being made but also batteries coming to their 207 00:09:46,880 --> 00:09:49,760 Speaker 2: end of life. The capacity for recycling batteries is larger 208 00:09:49,800 --> 00:09:50,600 Speaker 2: in China as well. 209 00:09:50,800 --> 00:09:53,080 Speaker 1: When I think about the companies that are actually looking 210 00:09:53,120 --> 00:09:55,800 Speaker 1: to recycle these batteries, there are two things that they're 211 00:09:56,040 --> 00:09:58,640 Speaker 1: more than likely thinking about, which is how easy is 212 00:09:58,640 --> 00:10:01,359 Speaker 1: it going to be to get all of that important 213 00:10:01,480 --> 00:10:03,760 Speaker 1: battery metal and then turn it into something else? And 214 00:10:03,760 --> 00:10:07,040 Speaker 1: then also how expensive is it as a virgin material? 215 00:10:07,200 --> 00:10:09,920 Speaker 1: So can you just talk a little bit about what 216 00:10:10,120 --> 00:10:13,160 Speaker 1: are the metals a in a battery? But be that 217 00:10:13,240 --> 00:10:17,240 Speaker 1: these recyclers are most keen to get their hands on 218 00:10:17,360 --> 00:10:18,240 Speaker 1: in this process. 219 00:10:18,600 --> 00:10:21,240 Speaker 2: So the metals that there's three key metals that are 220 00:10:21,240 --> 00:10:23,880 Speaker 2: most most sought after by the recycling companies, and that 221 00:10:24,040 --> 00:10:27,160 Speaker 2: is lithium, cobolt, and nickel. It's due to what you're 222 00:10:27,200 --> 00:10:30,040 Speaker 2: mentioning here the cost of these materials. They are key 223 00:10:30,160 --> 00:10:33,840 Speaker 2: drivers into battery prices. And lithium, for example, recently, we 224 00:10:33,880 --> 00:10:36,400 Speaker 2: saw very high prices a year or two ago and 225 00:10:36,440 --> 00:10:37,920 Speaker 2: this has come down a bit. So this is not 226 00:10:37,960 --> 00:10:40,280 Speaker 2: a great sign of your producing this material. But nickel 227 00:10:40,320 --> 00:10:42,480 Speaker 2: and cobalt that prices are, yeah, they're still some of 228 00:10:42,480 --> 00:10:45,400 Speaker 2: the more expensive materials going into batteries. And these are 229 00:10:45,440 --> 00:10:47,840 Speaker 2: the three key things that There are other metals in batteries, 230 00:10:47,880 --> 00:10:50,880 Speaker 2: as I mentioned earlier, there's copper, there's aluminium, there's iron 231 00:10:50,920 --> 00:10:53,360 Speaker 2: as well, but the ones that most battery recycling companies 232 00:10:53,360 --> 00:10:56,439 Speaker 2: are focusing on are lithium, cobolt, and nickel. And how 233 00:10:56,480 --> 00:10:59,160 Speaker 2: much of the new demand that the recycled material can 234 00:10:59,400 --> 00:11:02,760 Speaker 2: supply is very much due to changing battery chemistries. So 235 00:11:02,840 --> 00:11:05,800 Speaker 2: we've seen recently LFP, lithium I and phosphate which doesn't 236 00:11:05,840 --> 00:11:08,959 Speaker 2: contain nickel and cobalt become more popular, starting in China 237 00:11:09,000 --> 00:11:10,839 Speaker 2: but also around the rest of the world. And this 238 00:11:11,040 --> 00:11:13,640 Speaker 2: is meant that more nickel and cobalt supply can be 239 00:11:13,679 --> 00:11:16,880 Speaker 2: met with recycled material relative to lithium because apart from 240 00:11:16,920 --> 00:11:19,160 Speaker 2: sodium ion, which is a small and grown segment of 241 00:11:19,200 --> 00:11:21,840 Speaker 2: the market, all of the batteries contain lithium that we're 242 00:11:21,840 --> 00:11:25,520 Speaker 2: talking about here for electric vehicles and good scale projects. Therefore, 243 00:11:25,559 --> 00:11:28,840 Speaker 2: this is very much a very key focus for recycling companies. 244 00:11:29,280 --> 00:11:31,280 Speaker 1: So let's talk a little bit about the economics and 245 00:11:31,320 --> 00:11:35,679 Speaker 1: battery recycling, because the companies need to be incentivized either 246 00:11:36,080 --> 00:11:39,480 Speaker 1: by being able to make the batteries more cheaply or 247 00:11:39,679 --> 00:11:43,200 Speaker 1: policy incentives So in this circumstance, what is it. Is 248 00:11:43,200 --> 00:11:45,319 Speaker 1: it policy or is it economics that are driving these 249 00:11:45,320 --> 00:11:47,720 Speaker 1: companies to really grow in this market. 250 00:11:47,920 --> 00:11:50,160 Speaker 2: I think it depends in which region that we're looking at. 251 00:11:50,240 --> 00:11:53,199 Speaker 2: In China, for example, there has been policy since twenty 252 00:11:53,360 --> 00:11:56,760 Speaker 2: eighteen and there are mandates around collecting batteries at their 253 00:11:56,840 --> 00:11:59,280 Speaker 2: end of life and once you collect that battery, how 254 00:11:59,360 --> 00:12:02,120 Speaker 2: much of them materials inside that you recover when you 255 00:12:02,200 --> 00:12:04,560 Speaker 2: recycle it. And this is very much driving the industry 256 00:12:04,720 --> 00:12:06,440 Speaker 2: in China, and as I said, there is a lot 257 00:12:06,480 --> 00:12:08,720 Speaker 2: of capacity there, but there's also a lot of material 258 00:12:08,760 --> 00:12:12,160 Speaker 2: to recycle. Europe has a similar approach. Unfortunately, the incentives 259 00:12:12,160 --> 00:12:15,079 Speaker 2: are coming slightly later, although because the electric vehicle market 260 00:12:15,080 --> 00:12:17,280 Speaker 2: took off slightly later, and maybe this lines up quite 261 00:12:17,320 --> 00:12:19,400 Speaker 2: well here. But yeah, starting in twenty twenty seven and 262 00:12:19,400 --> 00:12:22,760 Speaker 2: twenty twenty eight, there are collection efficiency targets and recovery 263 00:12:22,840 --> 00:12:24,719 Speaker 2: rate targets for sort of collecting the batteries at the 264 00:12:24,800 --> 00:12:26,360 Speaker 2: end of life when they've been in a vehicle and 265 00:12:26,360 --> 00:12:29,320 Speaker 2: then recycling those materials and getting them back out. In 266 00:12:29,360 --> 00:12:31,520 Speaker 2: the US, which is the third region that we looked into, 267 00:12:31,559 --> 00:12:34,040 Speaker 2: there are some benefits via the inflation Reduction Act for 268 00:12:34,080 --> 00:12:37,480 Speaker 2: recycling material although not as significant as the benefits offered 269 00:12:37,480 --> 00:12:40,440 Speaker 2: to producing new batteries and battery packs in the region. 270 00:12:40,800 --> 00:12:43,280 Speaker 1: So, Andy, how does that actually work in practice? What 271 00:12:43,600 --> 00:12:47,280 Speaker 1: part of the battery value chain does the policy target? 272 00:12:47,800 --> 00:12:51,200 Speaker 2: So this is a really good question because the answer 273 00:12:51,240 --> 00:12:54,440 Speaker 2: isn't straightforward. We don't really know at the minute, particularly 274 00:12:54,440 --> 00:12:56,480 Speaker 2: with the policy in the EU. I've had a lot 275 00:12:56,520 --> 00:12:59,440 Speaker 2: of questions from people that I've been working with and 276 00:12:59,480 --> 00:13:01,559 Speaker 2: clients well around is it going to be on the 277 00:13:01,559 --> 00:13:03,560 Speaker 2: battery manufacturer to do this? Is it going to be 278 00:13:03,559 --> 00:13:06,160 Speaker 2: on the car company to do this? The E policy 279 00:13:06,240 --> 00:13:08,120 Speaker 2: isn't clear on this, and we need to wait for 280 00:13:08,160 --> 00:13:11,240 Speaker 2: policy to come. It's likely that it will be related 281 00:13:11,280 --> 00:13:14,360 Speaker 2: to the car company. It makes more sense because they're 282 00:13:14,360 --> 00:13:17,319 Speaker 2: closer to the consumer. However, they need to get the 283 00:13:17,400 --> 00:13:20,400 Speaker 2: vehicle back from the customers who then own it, so 284 00:13:20,559 --> 00:13:22,560 Speaker 2: the process here is not straightforward. 285 00:13:22,800 --> 00:13:25,520 Speaker 1: I know they're using blockchain for some of the virgin 286 00:13:25,640 --> 00:13:28,000 Speaker 1: materials that are being mined. Are they using any sort 287 00:13:28,040 --> 00:13:30,960 Speaker 1: of solutions like that to actually track these batteries to 288 00:13:31,000 --> 00:13:33,000 Speaker 1: make sure that they're getting them back and they are 289 00:13:33,240 --> 00:13:34,040 Speaker 1: being recycled. 290 00:13:34,400 --> 00:13:37,360 Speaker 2: So, again, this is a regional question. I'll start with 291 00:13:37,400 --> 00:13:40,600 Speaker 2: the US because it's straightforward that they're not doing it. No. 292 00:13:41,360 --> 00:13:45,640 Speaker 2: In China, there are requirements to trace and report batteries 293 00:13:45,760 --> 00:13:48,920 Speaker 2: through the sort of manufacture, through their lifetime and seeing 294 00:13:48,920 --> 00:13:50,680 Speaker 2: where they end up at their end of life. And 295 00:13:50,720 --> 00:13:53,080 Speaker 2: then this is something that the EU is planning to 296 00:13:53,080 --> 00:13:55,960 Speaker 2: do but isn't enforced yet. So in twenty twenty six 297 00:13:56,000 --> 00:13:57,800 Speaker 2: this will be required in the EU as. 298 00:13:57,640 --> 00:14:00,520 Speaker 1: Well in every market. For it to be viable on 299 00:14:00,559 --> 00:14:02,840 Speaker 1: its own, from an economic standpoint, you need a bit 300 00:14:02,840 --> 00:14:05,960 Speaker 1: of a supply and demand balance, and in this industry 301 00:14:06,040 --> 00:14:08,840 Speaker 1: there is a bit of an imbalance when we think 302 00:14:08,920 --> 00:14:13,160 Speaker 1: about the number of recycling facilities, in particular in China 303 00:14:13,200 --> 00:14:17,160 Speaker 1: that are scheduled to be built, and with the forecast 304 00:14:17,240 --> 00:14:19,760 Speaker 1: that you've done when looking at this report, are there 305 00:14:19,840 --> 00:14:23,040 Speaker 1: going to be enough batteries to be recycled in order 306 00:14:23,120 --> 00:14:25,520 Speaker 1: to meet this demand? And why or why not? 307 00:14:26,200 --> 00:14:29,800 Speaker 2: There is a bit of an imbalance here. The material 308 00:14:29,840 --> 00:14:34,400 Speaker 2: available to recycle from ESS and EV batteries is significantly 309 00:14:34,440 --> 00:14:37,800 Speaker 2: lower than the capacity that's being built, particularly in the 310 00:14:37,840 --> 00:14:40,600 Speaker 2: Asia Pacific region which is largely dominated by China. But 311 00:14:40,680 --> 00:14:43,200 Speaker 2: also that there is capacity being built in Europe and 312 00:14:43,280 --> 00:14:45,840 Speaker 2: North America. One of the reactions to this that we've 313 00:14:45,880 --> 00:14:49,720 Speaker 2: seen is companies who have recycling facilities also looking to 314 00:14:49,760 --> 00:14:52,760 Speaker 2: process primary material as well. Because some of the processes 315 00:14:52,760 --> 00:14:56,280 Speaker 2: are quite similar, it's possible to process both primary and 316 00:14:56,400 --> 00:14:59,800 Speaker 2: recycled material in some of the same facilities and some companies. 317 00:14:59,840 --> 00:15:01,760 Speaker 2: So so if you're a company going as far as 318 00:15:01,800 --> 00:15:05,200 Speaker 2: making precursor materials to make cathodes from, for example, and 319 00:15:05,240 --> 00:15:08,720 Speaker 2: your recycling material which was maybe NMC sixty two to two, 320 00:15:08,920 --> 00:15:11,200 Speaker 2: which was very popular a few years back, so six 321 00:15:11,360 --> 00:15:13,760 Speaker 2: to two being the ratio of the metals, so sixty 322 00:15:13,760 --> 00:15:17,360 Speaker 2: percent nickel, twenty percent cobalt, twenty percent manganese in the 323 00:15:17,360 --> 00:15:20,240 Speaker 2: cathode there and customers now want NMC eight one to one, 324 00:15:20,240 --> 00:15:23,280 Speaker 2: so eighty percent nickel, ten percent manganese, ten percent cobalt. 325 00:15:23,320 --> 00:15:26,560 Speaker 2: The recycling companies are actually using primary material to add 326 00:15:26,640 --> 00:15:28,600 Speaker 2: nickel to this ratio to make sure that they can 327 00:15:28,640 --> 00:15:30,680 Speaker 2: give the customers what they want. So even in some 328 00:15:30,840 --> 00:15:34,240 Speaker 2: inverted commas ideal scenarios, primary material is being added to 329 00:15:34,240 --> 00:15:36,440 Speaker 2: the recycling mix. But that's also not to say that 330 00:15:36,480 --> 00:15:38,640 Speaker 2: if there is too much capacity in the recycling world 331 00:15:38,640 --> 00:15:40,680 Speaker 2: that some of this couldn't be used to process primary 332 00:15:40,680 --> 00:15:41,440 Speaker 2: material as well. 333 00:15:41,640 --> 00:15:44,600 Speaker 1: And also, what's the degree of overlap with consumer electronics 334 00:15:44,600 --> 00:15:46,280 Speaker 1: which also rely on batteries. 335 00:15:46,640 --> 00:15:49,640 Speaker 2: This is a really good question. So consumer electronics batteries 336 00:15:49,720 --> 00:15:52,880 Speaker 2: are potentially harder to collect because there are many smaller batteries, 337 00:15:52,920 --> 00:15:55,280 Speaker 2: but companies are also looking to process these as well. 338 00:15:55,280 --> 00:15:57,760 Speaker 2: The analysis that we did in this report focuses on 339 00:15:58,000 --> 00:16:00,480 Speaker 2: electric vehicle and energy storage projects, so that's not to 340 00:16:00,480 --> 00:16:03,280 Speaker 2: say that consumer electronics batteries could also end up in 341 00:16:03,320 --> 00:16:06,240 Speaker 2: the mix. However, there are lots of smaller batteries which 342 00:16:06,240 --> 00:16:07,960 Speaker 2: are spread out more in the world. As it were, 343 00:16:08,120 --> 00:16:11,360 Speaker 2: collecting one phone will give you a significantly smaller battery 344 00:16:11,440 --> 00:16:13,840 Speaker 2: to recycle than collecting one car or even one grid 345 00:16:13,840 --> 00:16:17,040 Speaker 2: scale energy storage project. And also the demand of electric 346 00:16:17,160 --> 00:16:19,720 Speaker 2: vehicles and energy storage projects in the future will be 347 00:16:19,760 --> 00:16:22,320 Speaker 2: significantly higher in the near term and then maybe in 348 00:16:22,360 --> 00:16:25,640 Speaker 2: the near future. The consumer electronics market was a bigger 349 00:16:25,680 --> 00:16:28,160 Speaker 2: percentage of global demand of batteries, but that's likely to 350 00:16:28,200 --> 00:16:29,800 Speaker 2: be dwarfed in the very near future. 351 00:16:30,240 --> 00:16:33,680 Speaker 1: So no manufacturing process is fully zero waste. I'm even 352 00:16:33,720 --> 00:16:35,920 Speaker 1: thinking of right now in my mind, like when you're 353 00:16:35,920 --> 00:16:38,720 Speaker 1: baking a apple pie, and you've got all of this 354 00:16:38,880 --> 00:16:41,360 Speaker 1: kind of extra dough around the edge, and then you know, 355 00:16:41,400 --> 00:16:43,320 Speaker 1: if you're my grandmother, you're going to turn it into 356 00:16:43,360 --> 00:16:45,280 Speaker 1: something else and you're going to cover it with cinnamon sugar. 357 00:16:45,320 --> 00:16:49,160 Speaker 1: But the reality is there's going to be some leftover 358 00:16:49,280 --> 00:16:53,800 Speaker 1: materials and metals when it comes to battery manufacturing and 359 00:16:53,840 --> 00:16:56,360 Speaker 1: then the process that goes into it. What happens to 360 00:16:56,400 --> 00:16:59,520 Speaker 1: all of that leftover stuff, which I believe is referred 361 00:16:59,520 --> 00:17:01,000 Speaker 1: to as reduction scrap. 362 00:17:01,480 --> 00:17:03,440 Speaker 2: This is a really great question, and you're right. We 363 00:17:03,720 --> 00:17:05,800 Speaker 2: refer to it in the research as production scrap, and 364 00:17:05,960 --> 00:17:08,520 Speaker 2: this is just sort of one segment that we refer to. 365 00:17:08,600 --> 00:17:10,960 Speaker 2: But actually within this there's loads of different things that 366 00:17:11,000 --> 00:17:13,679 Speaker 2: this can mean. This can mean powders that sort of, 367 00:17:13,680 --> 00:17:16,240 Speaker 2: as you say, maybe they don't make it into the 368 00:17:16,280 --> 00:17:18,879 Speaker 2: apple pie as it were. This can be slurries that 369 00:17:18,920 --> 00:17:21,760 Speaker 2: get left behind on equipment as well. This can be 370 00:17:21,880 --> 00:17:24,639 Speaker 2: cathos which are then coated. But the offcuts of this, 371 00:17:24,640 --> 00:17:27,679 Speaker 2: This can be batteries that get fully made but they 372 00:17:27,680 --> 00:17:30,080 Speaker 2: don't pass the quality controls. So this can come in 373 00:17:30,119 --> 00:17:32,840 Speaker 2: a number of different flavors, and in the near term 374 00:17:33,080 --> 00:17:35,200 Speaker 2: we expect this to be a very significant share. I 375 00:17:35,240 --> 00:17:38,480 Speaker 2: think in twenty twenty four, eighty percent of material available 376 00:17:38,480 --> 00:17:40,440 Speaker 2: to a cycle is to come under this umbrella of 377 00:17:40,520 --> 00:17:43,400 Speaker 2: production scrap due to the very rapid growth that we've 378 00:17:43,440 --> 00:17:46,360 Speaker 2: seen over the past few years of battery demand, and 379 00:17:46,400 --> 00:17:49,120 Speaker 2: that the longer lifetimes that we're seeing. The last time 380 00:17:49,119 --> 00:17:51,600 Speaker 2: we did this analysis, the average lifetime of batteries was 381 00:17:51,640 --> 00:17:54,119 Speaker 2: about two years less when you extend the lifetime of 382 00:17:54,160 --> 00:17:56,000 Speaker 2: batteries in use, and then you have to go back 383 00:17:56,040 --> 00:17:58,520 Speaker 2: another couple of years on that demand curve. So in 384 00:17:58,560 --> 00:18:01,080 Speaker 2: twenty twenty four, if you're saying a ten year lifetime 385 00:18:01,160 --> 00:18:03,800 Speaker 2: for a passenger EV, you're going back to twenty fourteen, 386 00:18:03,840 --> 00:18:05,840 Speaker 2: and there weren't a lot of passenger evs on the 387 00:18:05,880 --> 00:18:08,159 Speaker 2: road in twenty fourteen. Now, if you compare that to 388 00:18:08,359 --> 00:18:11,000 Speaker 2: production scrap for new material, and in this work we 389 00:18:11,040 --> 00:18:14,000 Speaker 2: assumed a ten percent rate of scrap coming off factories, 390 00:18:14,080 --> 00:18:16,119 Speaker 2: this goes down to lower percentages, and we sort of 391 00:18:16,119 --> 00:18:18,600 Speaker 2: split that out by regions, So regions like China where 392 00:18:18,600 --> 00:18:21,600 Speaker 2: there's a more mature battery manufacturing industry getting down to 393 00:18:21,880 --> 00:18:24,800 Speaker 2: lower percentages sooner. But even with a scrap rate of 394 00:18:24,880 --> 00:18:27,840 Speaker 2: ten percent, which tapers off. Eighty percent of current material 395 00:18:27,840 --> 00:18:30,400 Speaker 2: available to recycle is material that never made it into 396 00:18:30,440 --> 00:18:31,920 Speaker 2: a functioning battery in the first place. 397 00:18:32,320 --> 00:18:35,080 Speaker 1: So when we're talking about a potential supply and demand 398 00:18:35,080 --> 00:18:37,840 Speaker 1: imbalance in the future when it comes to battery recycling, 399 00:18:37,880 --> 00:18:41,080 Speaker 1: we need to be thinking more broadly about more than 400 00:18:41,280 --> 00:18:43,200 Speaker 1: just the batteries that are at the end of life, 401 00:18:43,200 --> 00:18:45,480 Speaker 1: but also think about this production scrap to think about 402 00:18:45,480 --> 00:18:48,879 Speaker 1: the whole potential for some of these facilities. As we 403 00:18:48,920 --> 00:18:51,320 Speaker 1: think about the future and we think about the uptake 404 00:18:51,359 --> 00:18:55,080 Speaker 1: for electric vehicles, there will be more demand for recycled batteries, 405 00:18:55,119 --> 00:18:57,480 Speaker 1: and there's going to be more demand for batteries that 406 00:18:57,520 --> 00:19:00,439 Speaker 1: are made from raw materials. Is there any concer on 407 00:19:00,480 --> 00:19:03,200 Speaker 1: the part of a battery manufacturer, is that the recycling 408 00:19:03,240 --> 00:19:05,120 Speaker 1: side of things is going to cannibalize some of their 409 00:19:05,119 --> 00:19:08,000 Speaker 1: business or is this just so much growth in the 410 00:19:08,040 --> 00:19:10,840 Speaker 1: future that nobody's kind of looking at each other. 411 00:19:11,280 --> 00:19:13,720 Speaker 2: I think at the moment, the demand is growing so 412 00:19:13,880 --> 00:19:17,400 Speaker 2: rapidly that I think we need supply from all different directions, 413 00:19:17,480 --> 00:19:20,080 Speaker 2: and ultimately, if we're going to get a sustainable future 414 00:19:20,320 --> 00:19:22,679 Speaker 2: and a greener future, we need to rely more on 415 00:19:22,760 --> 00:19:25,360 Speaker 2: recycling things. Than digging things out of the ground. Now 416 00:19:25,359 --> 00:19:27,080 Speaker 2: that's not to say that we don't need to continue 417 00:19:27,080 --> 00:19:29,200 Speaker 2: digging things out to the ground and being better at 418 00:19:29,200 --> 00:19:31,560 Speaker 2: doing that in a greener way. But in the near term, 419 00:19:31,640 --> 00:19:33,920 Speaker 2: I mean, in this report, for example, I think eighteen 420 00:19:33,960 --> 00:19:36,840 Speaker 2: percent of nickel and cobalt can be supplied from recycled 421 00:19:36,880 --> 00:19:39,520 Speaker 2: material by twenty thirty five. That still means that we 422 00:19:39,560 --> 00:19:42,320 Speaker 2: need eighty two percent of the nickel and cobalt demand 423 00:19:42,359 --> 00:19:43,359 Speaker 2: to be coming from minds. 424 00:19:43,800 --> 00:19:46,960 Speaker 1: So, Andy, last question. We had a great time in 425 00:19:47,040 --> 00:19:49,320 Speaker 1: this show today really getting a lay of the land 426 00:19:49,359 --> 00:19:52,000 Speaker 1: on what's actually happening in battery recycling. But I know 427 00:19:52,040 --> 00:19:54,480 Speaker 1: that you're going to take a closer, deeper look on 428 00:19:54,520 --> 00:19:56,720 Speaker 1: a number of different topics. What's coming up for you 429 00:19:57,040 --> 00:19:59,040 Speaker 1: in digging deeper in battery recycling. 430 00:19:59,359 --> 00:20:02,120 Speaker 2: So this this piece of research looks at the market 431 00:20:02,200 --> 00:20:05,280 Speaker 2: size and the available material to recycle, as well as 432 00:20:05,320 --> 00:20:08,280 Speaker 2: some of the policy driving this in New York, China, 433 00:20:08,320 --> 00:20:10,720 Speaker 2: in the US. Coming up, we'll do a deeper dive 434 00:20:10,800 --> 00:20:13,600 Speaker 2: on some companies and the different technologies to recycle. Main 435 00:20:13,640 --> 00:20:18,639 Speaker 2: technologies being pyrometallurgy and hydrometallurgy. Similar to processing primary material However, 436 00:20:18,680 --> 00:20:23,040 Speaker 2: there are other processes, electrochemical methods and more innovative methods 437 00:20:23,080 --> 00:20:26,040 Speaker 2: and more niche methods for processing material as well, which 438 00:20:26,080 --> 00:20:28,320 Speaker 2: we'll dig into and highlight some of the companies doing 439 00:20:28,320 --> 00:20:28,760 Speaker 2: this work. 440 00:20:29,000 --> 00:20:31,640 Speaker 1: Okay, well, we can find out more about the companies 441 00:20:31,720 --> 00:20:33,800 Speaker 1: that are taking a closer look. Andy, thank you so 442 00:20:33,880 --> 00:20:34,879 Speaker 1: much for joining today. 443 00:20:35,040 --> 00:20:36,200 Speaker 2: Thank you very much for having me. 444 00:20:36,280 --> 00:20:47,760 Speaker 1: Dana Switched On is produced by cam Gray, with production 445 00:20:47,840 --> 00:20:51,920 Speaker 1: assistants from Camela Shelling and Alushi Karunorte. Bloomberg ne EF 446 00:20:52,000 --> 00:20:55,159 Speaker 1: is a service provided by Bloomberg Finance LP and its affiliates. 447 00:20:55,200 --> 00:20:57,920 Speaker 1: This recording does not constitute, nor should it be construed 448 00:20:57,960 --> 00:21:01,840 Speaker 1: as investment advice, investment recommendations, or a recommendation as to 449 00:21:01,920 --> 00:21:04,760 Speaker 1: an investment or other strategy. 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