electric vehicle battery recycling facility

The environmental footprint of an electric vehicle represents a sectorial industrial revolution, including the first lifecycle end of an EV battery.  With existing technologies, 95% of an EV battery can be recycled for inclusion in a new EV battery and/or energy storage.  The remaining 5% can be handled by third party recyclers.  Because the price of mined lithium is rising exponentially, recycled EV battery materials are set to compete with mined content.  With high recycled content, the emissions of a new battery can be reduced by 64%. The result is massive battery recycling investments and recycling agreements with EV manufacturers are underway and planned, especially in China, Europe and the U.S.  In the U.S., the Inflation Reduction Act (IRA) offers tax credits that can be stacked on top of each other for the EV battery supply chain.  An IRA proviso is that the raw materials, including materials derived from battery recycling, be sourced in the U.S.  In addition, the U.S. Bipartisan Infrastructure Act allots US$7 billion for all battery supply chain stages, including battery recycling.  To counterbalance the IRA, the Canadian 2022 Fall Economic Update includes a 30% Investment Tax Credit covering clean technologies.  But the Canadian tax credits may fall short compared to the cumulative eligibility criteria impacts of the two U.S legislative initiatives. The U.S. initiatives, alongside the monumental head start in China and Europe, auger for a colossal challenge for the Canadian national and provincial governments to assure Canada is a major battery recycling player, despite two prominent existing Canadian recycling firms.


With existing technologies, it is now possible to recycle 95% of an electric vehicle (EV) battery, including lithium, cobalt and nickel, for the production of new batteries, with the remaining 5% sent to third party recyclers.

This means that over the life of an EV battery, through to recycling, only 30 kg of raw materials are lost, the size of a soccer ball.   By comparison, for the life span of an average internal combustion engine vehicle (ICEV), the petroleum required is about 17,000 litres of fuel, the volume of a building 25 stories high.  EV battery technological advancements to reduce lithium required will increase this gap.

Now, with lithium prices having increased by 80% since the beginning of 2022, battery recycling has gained in importance.

Consequently, recycled EV battery materials will eventually compete with mined sources.

Recycled EV battery content for new battery production and agreements with vehicle manufacturers on battery recycling are already part of the EV environmental portrait.  The net environmental footprint of new battery with high levels of recycled materials results in 64% lower emissions than that of a battery made exclusively with new content.

Economic and environmental synergies assure that recycled EV battery materials will eventually compete with mined sources.  This may lead to the value of the global lithium recycling industry reaching US$18 billion by 2030.


Three Canadian EV battery recycling firms are well-advanced for the inevitable market.

One is Québec’s Lithion Recycling which hopes to establish 25 recycling plants across the globe by 2035 through licensing arrangements.

In April 2022, construction began for the first Lithion Recycling commercial-scale facility in Montreal to reduce all battery components to black mass, a powder, thus eliminating the need for a dismantling process.  The plant will begin operating in 2023 and have an annual capacity equivalent to EV batteries for 25,000 EVs.

Construction of a second plant will begin in 2023, this one to extract and purify critical metals for new batteries.  The patented technology uses hydrometallurgy which filters, dissolves and purifies battery components.   Plastics will be recycled separately.  Completion is expected in 2025.

Lithion Recycling’s first major breakthrough with a major automaker came with an agreement in March 2021 with Hyundai.

Lithion has since entered into a strategic partnership with GM in September 2022 that includes a GM investment to access Lithion technology.  This partnership will see GM investing in Lithion R & D and collaboration on increasing the recyclability of GM’s Ultium batteries.  The partnership includes testing Lithion materials, including Lithion materials in the designing new batteries cells and monitoring the impacts of such batteries.

Other agreements with Lithion comprise Girardin/BlueBird for its small electric school buses and Nouveau Monde Graphite.

The latter is a Quebec mining company aiming to produce green battery anode material.  The Nouveau Monde Graphite goal is to increase the recycled content in the transformation process.

The other significant Canadian leader in EV battery recycling is the Ontario-based Li-Cycle, North America’s largest lithium-ion recycling company.   It has a novel Spoke and Hub network.

Batteries collection points are the Spokes, where black mass is produced.

Spokes 1, 2 and 3 are currently operating in Kingston, Rochester, New York and Gilbert, Arizona.  Spoke 4 in Tuscaloosa, Alabama began operating in October 2022.  All four spokes collectively have a capacity for up to 30,000 tonnes of lithium-ion battery material per year, enough for 60,000 EV batteries annually.

The Spokes will supply black mass to a Rochester, New York Hub, targeted for commissioning in 2023.  The Li-Cycle $23.3M Rochester facility will apply hydrometallurgically to recover 95% of EV battery materials for up to an equivalent of 225,000 EVs per year, at a lower cost than mined materials.  There will be zero waste.

The first major breakthrough for Li-Cycle was revealed in a May 11, 2021.  This pertains to a joint venture with GM and LG Energy Solution to recycle up to 100% of the scrap generated from the manufacturing of GM’s Ultium batteries at GM’s battery production plant in Lordstown, Ohio.

Another coup is an agreement with Canada’s New Flyer bus manufacturer.

In the Canadian electric mining equipment sector, Li-Cyle has a partnership with Glencore for its 100% electric fleet for its Onaping Depth mine in northern Ontario.

European Li-Cycle Spokes are in the works for Norway and Germany to become operational in 2023.

A Li-Cycle European Hub is in the pipeline in partnership with Morrow Batteries and ECO-STOR.

By 2023, the total global capacity of Li-Cycle is expected to be 65,000 tonnes of battery recycling capacity per year.

Lastly, in March 2022, BASF revealed it will build an EV battery cathode production and recycling facility in Bécancour, Quebec to be completed in 2025.  The plant will produce 100,000 tonnes of cathode material annually.

Notwithstanding the aforementioned Canadian battery recycling sector progress, it is not clear that the federal government November 3, 2022 Fall Economic Statement 30% refundable Investment Tax Credit for zero-emission vehicle technologies is as generous as the cumulative support under the U.S. inflation Reduction Act and the Bipartisan Infrastructure Law.  Refer to the U.S. segment of this piece.


With its incrementally stringent regulations necessitating a rapid and massive transition to zero-emission vehicles, China has at least a 5 year advance over the rest of the world on EVs.

In 2022 alone, EV sales in China accounted for 29% of the light duty vehicle 2022 market up until September.  Should present trends continue, China may achieve battery electric vehicle (fully electric) sales representing 80% to 100% of new vehicle sales by 2025.  This is in addition to the over 400,000 electric buses plus commercial EVs currently on Chinese roads.

This in part explains China’s leadership in EV battery recycling.

China’s EV battery leadership also stems from requirements that EV manufacturers must be responsible for battery recycling and use Made in China batteries.  The policy also directs that the design of batteries facilitates recycling.

To monitor and manage EV battery lifecycles, China is developing a platform on battery pack lifecycle traceability and accountability, including recycling.  Pilot projects have been undertaken.

Against this backdrop, it is estimated that there are currently 47 battery recycling companies in China.

Brunp and GEM account for 50% of this market.  Brunp is a subsidiary of CATL, one of the largest EV battery companies in the world.

In October 2021 CATL and Brunp, divulged a joint venture partnership for the US$4.5 billion EV battery recycling plant in the Hubei province, the Hubei Yihua Chemical Industry.

CATL has a partnership with BASF on recycled cathode materials.  As noted earlier, BASF will have a cathode material recycling plant in Bécancour, Quebec.

As for GEM Co. Ltd., it wants to be the world leader in EV battery recycling.  It has recycling arrangements with over 280 EV manufacturers and battery producers.

Finally, used EV batteries are the backbone of energy storage too.  The Nanjing Jiangbei Energy Storage Power Station in the Jiangsu province is the world’s largest energy storage facility using recycled batteries.

European Union (EU)

During February 2021, the European Commission approved US$3.5 billion from 12 member states to leverage another US$11 billion in support R & D in the battery value chain, from raw materials to recycling, through to 2028.

In March 10, 2022, the EU Parliament adopted a report to regulate the entire lifecycle of batteries from design to consumption and recycling.  Now EU sustainable battery regulations require that the content incrementally increase recycled content, beginning 2026.

Too, the EU Parliament environmental committee wants batteries labelled according to carbon footprints, containing minimum levels of recycled cobalt, lead, lithium and nickel and waste collected.

Initiatives underway in the private sector include Northvolt, a new Swedish company, which hopes to supply 25 percent of European batteries by 2030, with an eventual company-wide annual capacity to 170 gigawatt-hours (GWh) produced by several production plants.  Northvolt battery cells will likely become available in 2024.

The Northvolt 2030 recycling goal is to have 50% of the raw materials for new batteries, coming from recycled batteries.

Northvolt battery recycling initiatives to-date include the recycling facility, the Revolt Ett, under construction, alongside the Northvolt Ett battery production facility in Skellefteå, Sweden.   It will be the world’s first giga-scale recycling facility, recycling 113 tonnes of batteries annually, once completed in 2023.

In Västerås, near Stockholm, the Revolt recycling pilot plant, integrated in the US$750 million expansion of Northvolt Labs, will supply materials for Västerås battery production.  The Labs expansion commenced in Fall 2021.

In collaboration with Volkswagen, a recycling facility will be built next to a Northvolt factory planned for Drei, in Heide, Schleswig-Holstein, Germany, which will begin operating in 2025.  Total Drei site employees will be around 3000.

Northvolt and Volkswagen German teamwork had also included the Zwei 50/50 joint venture battery cell plant in Salzgitter.  In March 2021, Volkswagen bought out Northvolt Zwei shares, a precursor to a Volkswagen battery recycling in Salzgitter.

As of March 2022, among Northvolt partners and customers are ABB, BMW Group, Scania, Siemens, Vattenfall, Vestas and the Volkswagen Group, Volvo Cars and Polestar.

As well, Northvolt plans incorporate diversification into the energy storage market, with a factory for energy storage systems in Gdansk, Poland to go into operation in 2022.

Other Northvolt recycling activities comprise Hydrovolt, a Northvolt joint venture with Hydro which began production in March 2022 at its facility in Fredrikstad, in southern Norway.   Hydrovolt plans to expand across Europe to achieve a company-wide capacity equivalent to 150,000 EV batteries for 2025 and 500,000 for 2030.

Turning to European vehicle manufacturers, as alluded to above, Volkswagen is a leader in battery recycling.

Volkswagen has a pilot recycling process in Salzgitter, Germany.  Full-scale capacity is projected by 2030.  Volkswagen intends to use recycled materials primarily for mobile energy storage.  This is related to a Volkswagen Group Salzgitter battery production initiative.

In Salzgitter too, the Volkswagen Battery Centre of Excellence will address, among other things, battery recycling.

Since Volkswagen has an US$18 billion plan for 6 battery factories across Europe, ultimately, Volkswagen will set up battery recycling facilities elsewhere in the world.

As for BMW, its European batteries presently come from outside suppliers.  But BMW set up a Battery Competence Center in Munich to eventually produce batteries in-house.

To this end, BMW has teamed up with a Belgium company, Umicore, to develop battery recycling and reuse capabilities.

The Volvo Group (trucks) is experimenting with battery recycling options for heavy duty electric vehicles and energy storage.

Northvolt and Volvo automobiles have a joint venture for a new battery plant in Sweden near the main Volvo facility in Gothenburg, with construction to begin in 2023.  The annual capacity will be 50 gigawatt-hours, sufficient for 50,000 EVs annually, for both the Volvo and Polestar brands.

Other European battery recycling companies include Germany’s betteries and Duesenfeld, Snam in France and Fortum Battery Recycling in Harjavalta, Finland.


The July 2022 Congressional approval of the Inflation Reduction Act (IRA) comprises, among other climate-related milestones, a major turning point for the U.S. EV battery sector.  Specifically, the IRA offers tax credits (cash) for all stages of the battery production and supply chain, EV battery recycling included, with the contingent that the raw materials must be sourced from the U.S.

These tax credits are cumulative, stack up on top of each other, from sourcing battery materials, refining them, assembling battery cells and manufacturing battery packs.  And for each battery material, the possibilities for incentives accumulate.  What’s more these credits are calculated yearly.

For battery minerals, the IRA covers 10% of the cost of production.

However, it will take time to assess the order of magnitude of the fall out of the IRA battery incentives.  The automakers are currently exploring the potential to cash in.  Already, there are indications that Tesla will scale down battery investments in Germany to favour the U.S.  GM too is reported to be accelerating sourcing battery materials from the U.S.

This is over and above the Bipartisan Infrastructure Law (BIL) US$7 billion for the U.S. battery supply chain battery recycling, without requirements for new extraction or mining and sourcing materials for domestic battery manufacturing.  From this amount, US$3.1 billion in battery supply chain funding was announced in May 2022.  An additional US$60 million will go to second life applications of used batteries and new processes for recycling materials back into the battery supply chain.

As such, the cumulative tax credit possibilities under the IRA, together with the BIL, when compared with the Canadian Fall Economic Update damage control Investment Tax Credit, appear to maintain the U.S. advantage for attracting North American battery supply chain and production activities.

With regard to U.S. vehicle manufacturers pre-IRA, the developments below are in addition to  the aforementioned information on the Li-Cycle partnership with GM and LG Energy Solution on Ultium batteries.

For Tesla, its recycled batteries will eventually supply 92% of the raw materials for new batteries.  Facilitating Tesla battery recycling, lithium only accounts for 1.5% of a full battery pack weight and their iron phosphate battery packs have no cobalt and no nickel.

Ford will set up a US$185 million battery competence centre, Ford Ion Park, in Southeast Michigan to begin operations in 2022.  The centre will address the battery chain from mining to recycling.

As well, on U.S. battery recycling research, the California Energy Commission (CEC) offers funding for projects to improve and scale-up battery recycling.


Renov South Africa offers a different recycling approach, that of converting used Lithium Iron Phosphate (LFP) batteries for applications for stationary storage.  

Recycled versus mined content

With China and the European Union having requirements that EV manufacturers be responsible for recycling, these two jurisdictions have a head start on the global market.

Concurrently, the U.S. government is pouring billions via the Inflation Reduction Act and the Bipartisan Infrastructure Law to catch up with both China and the EU, thus rendering the U.S. as the preferential North American jurisdiction for new battery recycling facilities.

With EV battery recycled content positioned to be competing with mined material,  Canada has a colossal challenge to develop its recycling capabilities to compare with those of the EU, China and the U.S.  Indeed, Canadian recycling activity has barely gotten started.

Canada risks leaving left behind.


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