Peter Cowan, Director at Gigamine, argues that recycling existing materials is a matter of urgency.
“Ambition,” said Elvis Presley, “is a dream with a V8 engine.” I disagree. Ambition is a dream with an EV engine. That dream is fast becoming reality. In 2018 there were about 5.5 million electric cars on the world’s roads. By the end of 2021 this had tripled to 16.5 million. Nearly 500,000 of these are on British roads alone. We are witnessing a technological revolution.
There are snags. The main one is that demand is outpacing supply. The automotive sector’s world battery demand could exceed 2,800 gigawatt-hours (GWh) by 2030, more than double the forecast for 2025. But it faces shortages in lithium, nickel, cobalt and other of the main elements in EV batteries. It is, therefore, vital that the EV automotive sector – which by 2026 will account for half of the demand for cobalt, ahead of phones and computers – secures enough raw materials for the industry to grow.
Shortages are not scarcities. There is no scarcity of the elements themselves. As Elon Musk, the Tony Stark of EV, wrote: “Lithium is almost everywhere on earth, but the pace of extraction and refinement is slow.” Because demand remains high, lithium prices have soared this year to 438% higher than last. The war in Ukraine, which has scuppered supply chains in countless other industries, destabilised the global supply of nickel – Russia being one of its top producers. The same story applies to palladium.
The colourfully-named ‘Mr Nickel’ – mining expert Joe Lowry – said: “In the next two years, even though there will be significant growth in supply, it will be less than demand, so the gap will just continue to grow.” So will the number of competitors for these raw materials. Newcomers enter the market every year. Established players, Musk included, have toyed with entering the mining industry to circumvent the exorbitant price of buying from others. Battery manufacturer CATL has already invested in four mining companies since 2018.
There are some short-term solutions. Companies can invest in more efficient batteries that use less of a given material. The Advanced Propulsion Centre reports that, by 2030, up to 25% of EV cars manufactured in Europe will have LFP – lithium iron phosphate, or LiFePO4 – batteries, which use less nickel. These can take about 2,000 charge cycles, four to seven times as many as lithium-ion or lead acid.
But clearly this is not so much a solution as a trade-off. Using less nickel is no answer to the shortage of lithium – and the supply of both is determined at the moment by capricious market forces. Even if the supply of certain materials picks up, it may still struggle to meet demand. The Cobalt Institute, for example, reported: “From 2024-26 supply growth will average 8% per year, compared to more than 12% for demand.”
An ambitious circle
Such are the pressures on the future of EV battery use. Failure to adapt is not an option. We face a climate crisis which all but necessitates a transition to renewable energy. EVs must play a significant role in our drive to net zero. But for EV to remain viable we must, for all the above reasons, develop a way to recycle and reuse the raw materials upon which it depends.
The ambition is to develop a sustainable model for lithium-ion battery recycling and reuse, and a business that can be scaled globally. The technology exists. As things stand, however, refineries capable of separating and extracting minerals from used batteries are inefficient. Nor are they to be found in the UK.
This last point makes little sense. The UK has the second largest electric car market in Europe, trailing Germany but ahead of France. That market is set to grow. It can take up to 20 years for a new mine (most of them in central Africa) to get up and running. Recycling existing materials is therefore a matter of urgency. It would establish a fine example, right at the heart of the government’s green agenda, of a truly circular economy: the decoupling of economic activity from the consumption of finite resources. It is the best, and perhaps the only, option for making clean energy sources viable long term, as the recycling of raw materials presents an opportunity for second-life applications.
Though in its early stages of development, EV battery recycling is a global business opportunity. Investors in it can be part of a movement to achieve what was once thought impossible – just as Elvis Presley could never have imagined popping his beloved V8 in the green recycling bin.