Battery recycling is a business as well as a public welfare.
Editor’s note: This article is from the micro-channel public number “into the passenger Tanker” (ID: SQinsight), Author: wandering mage, Editor: Feng Yu.
The rise of pure electric vehicles is giving birth to another 100 billion-level market-power battery recycling.
According to the calculation data of the Orient Securities Research Report, it is estimated that by 2025, the scale of China’s power battery recycling market, including the two major directions of echelon utilization and recycling, is expected to reach 37 billion U.S. dollars. According to data from MarketsandMarkets, an international market research organization, the global power battery recycling industry is expected to reach 12.2 billion U.S. dollars in 2025 and 18.1 billion U.S. dollars by 2030, of which China is one of the largest power battery recycling markets.
The disused power battery can be a “mine” or a “volcano” about to erupt.
According to data from the China Automotive Technology Research Center, the total number of domestic power batteries retired in 2020 will exceed 200,000 tons (about 25GWh). “If these batteries are not properly handled, the polluted water and land resources will be astronomical.” Mo Ke, founder of True Lithium Research, told Tanker Tanker.
As the pure electric vehicle market continues to expand, the issue of battery recycling has also begun to become prominent. On March 5, “Accelerating the construction of a power battery recycling system” appeared in the government work report in 2021. This was the first time that the topic of “power battery recycling” appeared in the government work report.
The ringing of the bell for the scrapping of power batteries is an opportunity and a challenge for OEMs and battery manufacturers.
1, 100 billion-level market
The shortage of lithium and cobalt has stuck the neck of new energy vehicles.
On March 25, according to Tesla’s official website in the United States, Model 3 and Model Y models both increased in price by US$500. The relevant person in charge of Tesla responded that the current round of price increases was caused by the increase in production costs of models.
“Tesla’s rare price increase this time is because the cost of the battery has risen.” Zhou Tao, an auto analyst, said. As the production of new energy vehicles increases sharply, the market’s demand for elements such as lithium and cobalt has pushed up the price of battery raw materials. According to Goldman Sachs’ forecast, the price of cobalt, lithium and other elements will rise sharply in a short time. If the price of lithium returns to a historical high, the cost of power batteries will more than double.
As an important raw material for new energy vehicle power batteries, the total amount of cobalt ore in China is very small. According to data from Gaogong Lithium Grid, the global proven cobalt reserves in 2019 are about7 million tons, while China’s reserves are 80,000 tons, accounting for only 1.14% of the world’s total reserves, and most of them have no mining value. As the world’s second largest new energy vehicle market, almost all of China’s cobalt metal resource supply comes from overseas.
The outbreak of the epidemic in 2020, the serious decline of overseas cobalt mine production capacity, and the limited international logistics, China’s cobalt prices are rising. With the rising trend of battery raw materials, the regeneration value of nickel, cobalt, and manganese in power batteries has been highlighted.
According to the International Energy Agency’s estimates, the global lithium-ion battery recycling market will grow to 20 billion euros (approximately RMB 154.7 billion) around 2030, and China may become a major player in lithium-ion battery recycling in areas such as electric vehicles and energy storage. The largest market.
Driven by policy dividends and market prospects, a large number of car companies and power battery companies have begun to deploy battery recycling businesses. According to the data from Tianyan Check, up to now, there are 242 companies in the country that include “power battery recycling” in their business scope. There will be 85 new ones in 2020, accounting for more than one-third of the increase.
At present, companies such as GEM, Huayou Cycle and Guangdong Bangpu under CATL have become leaders in the field of power battery recycling.
Public information shows that GEM has signed power battery recycling agreements with automakers including BYD, BAIC New Energy, Weilai Automobile, etc.; Huayou Cycle has established recycling outlets in South China, North China, and Southwest China for cascading battery recycling. Research and application; and Guangdong Bangpu, a subsidiary of CATL, has become China’s largest recycling base for used batteries.
In addition, some new energy car companies have already targeted the power battery recycling industry. According to the relevant business person in charge of Weimar Motors, in 2018, due to environmental and commercial considerations, Weimar Motors decided to deploy power battery recycling. At present, Weimar has established a power battery recycling system to open up the battery recycling industry chain to ensure the harmless treatment of power batteries.
“Recycled power batteries are of great significance in reducing pollution, improving the utilization rate of important metal resources and self-sufficiency in my country, etc.,” the Ningde era official told “Tanker Tanker”.
According to Ningde Times, the content of elements such as nickel, cobalt, manganese and lithium in ternary power batteries is relatively high. Although lithium iron phosphate batteries do not contain high-priced rare metals such as cobalt and nickel, lithium is contained in waste lithium batteries. The content reaches 1.10%. When the decommissioned battery enters the regeneration process, the metal elements such as nickel, cobalt, and manganese will be extracted and processed into positive electrode materials that can be used for battery production, realizing the effective recycling of resources. At present, the recovery rate of nickel, cobalt and manganese can reach more than 99%.
At present, the recycling of power batteries in the CATL era is divided into recycling in the use link and recycling in the scrapped link. The recycling of the use link is currently in charge of the 4S shop of the vehicle manufacturer. In the scrapping process, the ownership of the power battery is transferred by the userMove to the automobile scrapping and dismantling enterprise, and then transfer or resell it to the power battery manufacturer or the whitelisted comprehensive utilization enterprise authorized by the supervisory authority, and this type of enterprise will recycle.
2, “Regular Army” cannot receive batteries
However, under favorable policies and the industry, the seemingly infinite power battery recycling market has not yet ushered in the dawn, and the expected battery scrap tide in the industry has not yet arrived.
“Actually, there are not so many batteries that can be recycled through formal channels in the market. There are mixed companies that come in.” Chu Bing, chairman of Xunying New Energy Group Co., Ltd., said.
“Currently, there is no clear pricing mechanism for domestic power battery recycling. Many informal markets use bidding to recycle batteries. Small workshops are willing to give car owners more money, and batteries will naturally not flow into the hands of formal enterprises.” Ke pointed out.
In addition, recycling through formal channels also means paying higher costs. “We need to pay a fee to find a qualified company to come back to recycle. In this way, it is impossible to give scrapped car owners a high price. Therefore, many scrapped cars go to small workshops and the used car market.” A Kai, a battery recycling practitioner, said “Explore Tanker” said.
According to Akai, in the process of recycling batteries, small workshops do not need to issue invoices, and they can also dispose of batteries in the process of disregarding environmental protection, and the benefits will be higher. In contrast, when a formal enterprise recycles batteries, if there is no invoice, the value-added tax cannot be deducted at the time of sales. This not only further weakens the profitability of the formal enterprise, but also raises the cost of car owners seeking to recycle scrap batteries in a disguised manner.
In addition, in the “black market” of power batteries, batteries are generally priced in tonnage, and Akai has seen some batteries filled with cement or lead blocks. This type of battery has almost no value for recycling, and there are many hidden safety hazards in the process of dismantling.
The recycling mechanism needs to be improved, the battery recycling channel is not smooth, and the public’s low awareness of environmental protection has caused the phenomenon of random disposal of power batteries from time to time. According to Akai, nearly 80% of power batteries in the current market have not flowed into formal channels, and the overall recycling volume of digital batteries with greater recycling value and a more mature market is only about 40% of the scrap volume.
In order to standardize the order of the battery recycling market, as early as 2018, the Ministry of Industry and Information Technology announced the first batch of companies that met the “Industry Standards for Comprehensive Utilization of New Energy Vehicle Waste Power Batteries” Among them, five companies including Bangpu Recycling, GEM and Huayou Cobalt were shortlisted. In January this year, the Ministry of Industry and Information Technology announced the second batch of 22 companies.
Businesses that enter the “whitelist” are considered “”Regular army” means that it has a relatively complete system and operational capabilities in terms of the qualifications, channels, technology, and scale of recycling. However, the whitelist is not mandatory and exclusive, and informal companies can still “take loopholes.”
“It seems that many qualified companies have negotiated recycling with car companies, but there are also informal companies that use the qualifications of formal companies to recycle batteries.” Mo Ke said.
In order to establish a sound recycling channel, the Ministry of Industry and Information Technology also issued the “Interim Measures for the Management of Recycling and Utilization of Power Batteries for New Energy Vehicles” in 2018, clarifying that automobile manufacturers should establish power battery recycling channels to be responsible for recycling new energy vehicles used and generated after scrap At the same time, power battery companies should provide support in battery design, production and recycling.
In the face of chaos in the field of battery recycling, some companies choose to code the batteries that are eliminated. According to Weimar Motors, it is trying to establish power battery retrospective coding rules, stipulating the code structure composition, code structure representation method and data carrier of Weimar power batteries, using a unified battery code to ensure that every Weimar power battery has an identity And traceable.
However, as new energy vehicles are pursuing safety and high endurance, the design and manufacture of a new generation of lithium batteries also lays hidden dangers for recycling.
According to Mo Ke, in order to ensure the safety of the battery, most battery manufacturers will choose to use a large number of adhesive processes in the battery manufacturing, which makes the battery need more energy to disassemble when it is scrapped. In the battery recycling industry, someone once joked that “It is more difficult to disassemble a battery than to make a battery.”
3, Battery recycling is difficult to make profits
It is difficult for formal enterprises to collect batteries, and it is difficult for the scale effect of power battery recycling to appear.
According to Akay, the current power battery recycling business is still “dirty and tiring”, requiring a lot of labor costs to spread the recycling chain.
For some car companies and battery manufacturers, recycling batteries is also a burden. Akai said that under the high labor cost and technology cost, some companies with a small amount of recycling are “subsidized” recycling, and car companies rely more on “conscience” to recycle batteries. In addition, the existence of “black market” channels has also increased the cost of recycling batteries for formal enterprises. After the intermediaries are stripped of layers, the old and profitable batteries can’t even be guaranteed.
The ideal mode of power battery recycling and reuse is to first use it in cascades and then dismantle and use. However, the current method of dismantling and recycling power batteries is still the main method.
Gao Gong Li Grid has published data on the cascade utilization and dismantling of discarded lithium batteries nationwide in 2017. In 2017, a total of 83,000 tons of lithium batteries (including digital lithium batteries) were used and dismantled in cascades across the country.Pool dismantling accounted for 95%.
According to Merck’s observations, several years later, the proportion of power battery recycling and echelon utilization is still small. “Many cascades are used to disassemble large battery packs into small pieces. The batteries processed in this way generally flow into the agricultural field, even in the hands of some people in the south of’electric fish’ (discharge fishing). This market is very important. Little can’t digest so many batteries.” Mo Ke said.
The relevant person in charge of Weimar Motors stated that the current recycling technology of power battery recycling is quite mature, and the content of each metal in the power battery has a high recovery efficiency. What the entire industry needs to improve is the echelon utilization technology, and the most difficult point is the screening and evaluation of decommissioned power batteries.
“Not all power batteries are suitable for cascading use. The most important thing is which stage of the full life cycle of the decommissioned power battery, what state, and how to evaluate it in an all-round way.” The person in charge said.
But a critical step in evaluating batteries has also become an obstacle for power battery companies to recycle batteries. “It is difficult for third-party companies to get data from car companies or battery companies, and they cannot use big data to evaluate battery life. They can only perform traditional disassembly tests on batteries.” Bao Wei, general manager of Zhejiang Huayou Recycling Technology Co., Ltd. Said at the forum of the China Electric Vehicle Hundreds Association.
Gao Gong Li Grid believes that the reason why power battery echelon utilization is relatively small includes: 1. Battery manufacturers are unwilling to take battery safety risks and do not want scrap batteries to flow into the market again; 2. In the past, the amount of power battery scrap was relatively small. It is difficult to match old batteries; 3. At present, the power battery cascade utilization technology is still immature and requires continuous technological accumulation; 4. The energy storage market and reuse market space has not yet been released on a large scale.
In Akay’s view, the economic benefits of cascading use are extremely low.
According to Akai, a certain amount of cost is required for retired batteries to meet the echelon utilization standard. There are various designs of power battery packs for different models, and their internal structure, battery module connection method and assembly process are different. After the battery is disassembled, it needs to undergo residual value evaluation, system integration, battery module regrouping, and battery management. And transportation. The cost of a series of renovations is too high for companies to cover their recovery costs.
In the opinion of the relevant person in charge of Weimar Motors, after the retiring of new energy vehicles, the power battery still has a relatively large capacity. Although it cannot meet the power requirements of new energy vehicles, it can be used in other fields to extend its service life. Mining its surplus value. At present, there are few retired power batteries, and most of the echelon utilization is in the experimental demonstration stage, mainly in the fields of low-speed vehicles, backup power and energy storage. In other words, the cascade utilization of power batteries is still in the experimental stage.
“Recycling companies are now more willing to pay for ternary lithium batteries. Lithium iron phosphate batteries have low recycling value.It is equivalent to selling scrap iron, and the recycling price of ternary lithium is more than five times that of lithium iron phosphate. “Akai said.
In addition, according to Mo Ke’s observation, the most popular item in the recycling field is the batteries in the car models produced by car companies that cheated new energy subsidies before 2018. This kind of electric vehicles are produced for subsidies, and the models are piled up if they are not sold. The battery loss is very low, so the recycling value is high. At present, the ternary lithium batteries carried by mainstream models have basically not reached the retirement age, so there are not many batteries with high recycling value on the market.
So for the formal power battery recycling companies, the real dawn has yet to come. In the battery recycling industry that has grown savagely for many years, most of the benefits have been divided among small workshops.
However, in the view of Weimar Motors, the future power battery recycling market still belongs to the regular army. “The future power battery recycling market will be a 100 billion-level market. Everything is only a matter of time. The future power battery market must be multi-participated by vehicle manufacturers and other related companies in the industry chain, and win-win cooperation to jointly promote power battery recycling. A kind of system structure.” Weimar Motors said to “Tanker Tanker”.
The other good news is that with the operation of power exchange models by NIO, SAIC and other auto companies, the entire power battery circulation channel will be healthier, and the echelon utilization model will also be further promoted. After breaking through the darkness, the market with huge potential for power battery recycling will eventually usher in light.