Building Infrastructure for Efficient Battery Recycling

The current state of battery recycling is concerning. While growing pains are expected when transitioning away from something as ingrained into society as fossil fuels, industry professionals must do much more to accelerate electrification adoption. What can they do to lay the groundwork for an adequate recycling infrastructure?

The Current State of Recycling Infrastructure

Batteries have been a critical component of electrification and energy storage for years, helping the United States kick-start its transition from fossil fuels. For instance, experts project electric vehicle sales will reach 18.84 million units by 2029, up from 13.68 million in 2024 — a 37% increase. Renewed interest in renewables necessitates a broader battery infrastructure.

Even as progress on modernizing the country’s outdated energy infrastructure continues, concerns are being raised about the sustainability and efficiency of batteries. For one, there are limited pockets of heavy metals and precious minerals globally, with tariffs, trade deals and geopolitical tension further restricting supply. 

A report from the Natural Resources Defense Council reveals manufacturers in the U.S. have had to import most materials. In 2021, they relied on imports for approximately 100% of manganese, 100% of graphite, 75% of cobalt, 50% of nickel and 25% of lithium. This lack of diversification creates bottlenecks and artificially raises prices, suppressing demand. 

An end-of-life plan is critical for the longevity of a renewable-energy-reliant grid. Almost all valuable materials in used cells can be extracted, refined and reused, mitigating supply chain bottlenecks and reducing costs. 

Research shows that it costs approximately $94.5 to produce a one-kilowatt-hour (kWh) cell in a large-scale manufacturing environment — excluding labor, overhead expenses and maintenance. In comparison, end-of-life recycling ranges from $6.8 to $8.6 per one kWh cell. This is because material use accounts for 69% of production expenses. 

Despite costing less and being more environmentally friendly, recycled cells see no performance losses. For instance, lithium-ion batteries take 11,600 charging cycles to lose 30% of their initial capacity, while their new models need 7,600 cycles. They outperform their counterparts by 50%, underscoring the importance of a robust infrastructure to support adoption.

Key Challenges of Large-Scale Battery Recycling 

Tariffs will soon be a major hurdle. The tariff rate on battery components increased from 7.5% to 25% in 2024. Moreover, the rate on all lithium-ion batteries is set to grow by the same amount by 2026. Even as higher prices drive renewed interest in domestic sourcing and production, the inevitable trade instability could complicate things.

For a circular economy to be effective, the recycled battery supply must outpace the demand for battery-reliant systems. Companies will have to rethink their supply chains. They will have to put more resources into research and development (R&D) — which has largely only been prioritized within pockets of academia. 

Sustainability is another key challenge of large-scale battery recycling. While this system will be more environmentally friendly than its predecessor, it could mimic the environmental threats created by fossil fuel technologies. Decision-makers and policy-makers must carefully avoid this outcome by prioritizing renewable usage and efficiency within supply chains.

Safe, fast transportation may be a significant obstacle. Recycling plants may not outpace fossil fuel usage if they cannot meet demand. Increasing infrastructure resiliency to mitigate supply shortage is crucial for the initial success and longevity of battery recycling. 

The final challenge industry professionals face is material complexity. While manufacturers can reuse 95% of a recycled battery’s minerals in new products, the practicality of reuse depends on the availability of certain battery types. 

Recycling a lithium-ion battery typically produces critical raw materials like lithium, cobalt and nickel. Comparatively, a single recycled lead-acid battery produces 18 pounds of lead, two pounds of plastic and one gallon of acid. Composition variety may complicate sourcing, artificially skewing supply and demand. 

Building an Efficient Recycling Infrastructure at Scale

Building an efficient, large-scale battery recycling infrastructure requires intensive planning. Effectively separating, sorting, refining and reusing components by type is a complex process largely dependent on manual labor. Are there enough processing plants? What pay will entice blue-collar workers? How will fleets transport hazardous cells at scale?

Decentralization may be one practical approach. Spacing facilities out at strategic areas around the country optimizes shipping times and provides greater resilience to supply chain disruptions. Whether buildings should be located near freight hubs depends on the government’s tariff rates and trade restrictions. 

Diversification is crucial even within local supply chain networks limited by a lack of demand. After all, manufacturers typically see a 15% to 30% cost reduction by building subsequent facilities. It gives them a unique opportunity to apply what they learned from the original construction process, enabling them to address pain points and uncover areas of opportunity. 

Whether leaders build new or retrofit existing recycling plants, they should consider automation. Leveraging robotics, robot process automation or artificial intelligence could reduce labor costs and mitigate the effects of skill scarcity, building resilience to supply bottlenecks early on. 

Above all else, builders must prioritize incorporating aspects of sustainability into battery recycling infrastructure. An effective circular economy that borrows from advancements in electronic waste recycling could mitigate environmental damage and reduce greenhouse gas emissions. This could accelerate adoption and drive investments into R&D.

Looking to the Future of Efficient Battery Recycling 

As R&D teams pioneer more efficient technologies and policy-makers introduce new regulations, the recycling sector will evolve. Industry professionals must look ahead to determine how to optimize sorting, handling, transportation and assembly despite likely setbacks — only then can they build a resilient infrastructure.