Economic Assessment:

Lithium-ion batteries are the most common type of battery used in electric vehicles [8]. These batteries
contain valuable materials which have great economic importance and some of them faces supply risk.
The manufacture of these batteries requires several different raw materials, some of which have a high
economic importance and face supply risks. Cobalt is one of the materials which is classified as critical
material by European Commission, while lithium, nickel and aluminum are all within the candidate
materials. Therefore, great economic benefits can be obtained by recycling these materials. This is
specially the case for EU, which lacks a strong domestic battery-cell manufacturing base [2]. For
instance, in 2015 the EU imported just over $2,500 million worth of lithium-ion accumulators, while it
only exported a tenth of that amount [1].

There is a high degree of uncertainly beyond 2030, because of technological advancements and material
price fluctuations. Therefore, economic assessment for the year 2030 of the value of recyclable material
with respects to the EU market is given in this study. From available literature it is generally suggested
that EV batteries provide useful life in vehicles until they degrade to around 80% of their original
capacity. The quantity and capacity of the battery at the end of their useful in 2030 will be 1,163,500
and 46,540 MWh respectively. The value of cobalt, nickel, aluminum and lithium per ton are taken as
91000$, 14500$, 2226$ and 16500$ respectively [1]. There are two recycling process in the EU exist on a
large scale which are pyrometallurgical and the hydrometallurgical process. Pyrometallurgical process is
usually combined with hydrometallurgical process. Based on the two different recycling process and
collection rates of spent batteries two scenarios are considered which are given in table 1.

Battery Recycling Scenario 1 Scenario 2

Collection/take back rate for recycling within 65% 85%
the EU
Cobalt recycling efficiency rate 94% 99%
Nickel recycling efficiency rate 95% 97%
Aluminium recycling efficiency rate 98% 98%
Lithium recycling efficiency rate 57% 94%

Value of Recovered Materials for the Year 2030

600
500
400
Million (€)

300
200
100
0
Scenario 1 Scenario 2

Cobalt Nickel Aluminium Lithium

It has been clear from the given analysis that high recycling rate in EU can help to implement circular
economy and to mitigate dependence on imported materials. In short, it is estimated that in 2030
material recycling under scenario 1 could retained €408 million worth of materials and €555 under the
more ambitious scenario 2.

Battery types are currently under investigation due to the supply risk associated with the critical raw
materials. The nickel-cobalt-aluminum (NCA) or nickel-manganese-cobalt (NMC) batteries are typically
used in EV batteries because of their higher energy density. Most R&D efforts are directed towards on
developing nickel-rich, cobalt-free cathodes [3,4]. Tesla, the leading EV manufacture has significantly
reduced cobalt content per battery pack and has plan to build Model 3 vehicles in China equipped with
lithium iron phosphate (LFP) batteries [5]. The business models of Commercial recycling of LIBs batteries
are heavily relying on high cobalt concentration. Therefore, the industries are concerned about less
incentive for recycling of spent batteries in the future [1,6]. Battery producers have the responsibility for
treating, collecting and recycling in Europe according to the extended producer responsibility principle in
Directive 2006/66/EC [7]. Because of strict regulations and efficiency targets sets by EU, recycling
companies accept recycling of batteries that do not contain cobalt because they get incentive in form of
gate fees. Apart from that, recycling of spent batteries can create employment opportunities. It is
estimated that collection, dismantling and recycling of these batteries per thousand tons of battery
waste will create 15 jobs [1].

[11] Drabik, E., & Rizos, V. (2018). Prospects for electric vehicle batteries in a circular economy.
Retrieved
fromhttps://circulareconomy.europa.eu/platform/sites/default/files/circular_economy_impacts_batteri
es_for_evs.pdf

[12]Lebedeva, N., F. Di Persio and L. Boon-Brett (2016), “Lithium ion battery value chain and related
opportunities for Europe”. Retrieved from
https://ec.europa.eu/jrc/sites/jrcsh/files/jrc105010_161214_li-ion_battery_value_chain_jrc105010.pdf

[13]Avicenne Energy. Christopher Pillot. The rechargeable battery market and main trends 2016-2025.
International battery seminar and exhibit. Fort Lauderdale, FL. March 20, 2017

[14]Steward, D., Mayyas, A., & Mann, M. (2019). Economics and Challenges of Li-Ion Battery Recycling
from End-of-Life Vehicles. Procedia Manufacturing, 33, 272–279. doi:10.1016/j.promfg.2019.04.033

[15]FutureCar. Tesla Wins Approval to Use Cobalt-Free Batteries in Its China-Made Model 3. 11 June
2020, www.futurecar.com/3972/Tesla-Wins-Approval-to-Use-Cobalt-Free-Batteries-in-its-China-made-
Model-3.

[16]Chen et al., Recycling End-of-Life Electric Vehicle Lithium-Ion Batteries, Joule (2019),
https://doi.org/10.1016/j.joule.2019.09.014

[17]Elwert T., Römer F., Schneider K., Hua Q., Buchert M. (2018) Recycling of Batteries from Electric
Vehicles. In: Pistoia G., Liaw B. (eds) Behaviour of Lithium-Ion Batteries in Electric Vehicles. Green Energy
and Technology. Springer, Cham

[18] Environmental Agency (EEA) (2016), “Electric vehicles in Europe”