In recent years, the global shift toward low-carbon transitions and carbon neutrality goals has positioned the new energy vehicle (NEV) sector as one of the fastest-growing and most promising industries. By 2023, sales of NEVs in China had reached 9.495 million units, marking a 37.9% year-on-year increase. Projections indicate that the global NEV market will continue to expand rapidly, with an estimated scale exceeding 40 million units by 2030. This surge in NEV adoption has significantly driven the rapid expansion of the power battery industry. Given that the average lifespan of EV power batteries ranges from 5 to 8 years, the early batches of batteries installed in NEVs are gradually approaching their end-of-life phase, presenting unprecedented market opportunities for the recycling sector. The recycling and reuse of China EV batteries not only alleviate supply pressures on critical resources like lithium and cobalt but also enhance the security and stability of the industrial chain, thereby indirectly advancing carbon neutrality objectives by reducing reliance on mineral extraction.
However, a study released in 2023 by the Development Research Center of the State Council revealed that less than 25% of used EV power batteries in China undergo standardized recycling processes. This not only hampers efficient resource utilization but also poses significant environmental and ecological challenges. Therefore, this article, from my perspective as a researcher, delves into the usage scenarios of EV power batteries in NEVs, analyzes the current state and developmental hurdles of the recycling industry, and explores future trends and countermeasures to foster high-quality and sustainable development of China’s EV power battery recycling sector.
Classification and Recycling Methods of EV Power Batteries
As the heart of NEVs, EV power batteries play a crucial role in determining key performance metrics such as range, power output, and charging time. Currently, lithium-ion batteries dominate the NEV market, with lithium iron phosphate (LFP) batteries favored in areas like buses, logistics vehicles, and low-speed electric vehicles due to their high working voltage, long cycle life, and cost-effectiveness. In the pure electric vehicle segment, ternary lithium batteries prevail owing to their superior energy density.
The effective recycling and reuse of retired China EV batteries are pivotal for promoting a circular economy and mitigating environmental impacts. Based on battery type and condition, recycling primarily involves two methods:
- Echelon Use: This approach is mainly applied to LFP batteries. When EV power batteries are no longer suitable for NEVs, they often retain 70% to 80% of their original capacity. Echelon use involves detecting, screening, disassembling, and reassembling these batteries for secondary applications in sectors with lower performance demands, such as energy storage systems, low-speed electric vehicles, and industrial equipment. It is estimated that echelon use can extend a battery’s lifecycle by up to 30 years.
- Material Regeneration: This method targets ternary lithium batteries, which have shorter cycle lives and poorer thermal stability. After capacity drops below 80%, these batteries exhibit accelerated degradation, making them unsuitable for echelon use. Instead, they undergo preprocessing, physical disassembly, and raw material purification to recover valuable “mineral-rich” resources.
The efficiency of these methods can be modeled using the following formula for resource recovery rate:
$$R = \frac{C_r}{C_t} \times 100\%$$
where \( R \) is the recovery rate, \( C_r \) is the amount of materials successfully recycled, and \( C_t \) is the total materials available in retired EV power batteries. For instance, in material regeneration, nickel and cobalt recovery rates can exceed 98%, while lithium recovery may reach 90%.
| Battery Type | Key Characteristics | Primary Recycling Method | Typical Applications |
|---|---|---|---|
| Lithium Iron Phosphate (LFP) | High safety, long cycle life, low cost | Echelon Use | Energy storage, low-speed vehicles |
| Ternary Lithium | High energy density, shorter lifespan | Material Regeneration | Raw material extraction |
Primary Pathways for EV Power Battery Recycling
Based on the entities involved, the recycling of retired China EV batteries can be categorized into four pathways, each with distinct advantages and disadvantages:
- Vehicle Manufacturers as Core Entities: NEV producers collaborate with scrapping and disassembly companies or leverage existing sales and service networks (e.g., 4S shops) to establish recycling points. This pathway benefits from low costs, high efficiency, and rapid feedback but may be limited by brand specificity and technical constraints.
- Battery Producers as Core Entities: Power battery manufacturers create subsidiaries, acquire recycling firms, or partner with other organizations to form recycling networks. This enables a closed-loop system from production to recycling, facilitating high-purity material recovery. However, it may struggle to achieve economies of scale without external partnerships.
- Third-Party Comprehensive Enterprises: Specialized recycling companies independently build systems to collect batteries from various sources, handling the entire process from recycling to resource regeneration. While they possess extensive experience and stable networks, they face high costs, logistical complexities, and sales channel limitations.
- Industry Alliances: Alliances formed by battery makers, automakers, third-party firms, and leasing companies pool resources to establish recycling networks. This model promotes cost reduction and efficiency through collaboration but may encounter challenges in standardization due to proprietary technology protection.
The economic viability of these pathways can be assessed using a net benefit formula:
$$NB = (P_r \times Q_r) – (C_c + C_t + C_p)$$
where \( NB \) is net benefit, \( P_r \) is the price of recycled materials, \( Q_r \) is the quantity recycled, \( C_c \) is collection cost, \( C_t \) is transportation cost, and \( C_p \) is processing cost. Industry alliances often optimize this equation by sharing resources.
| Recycling Pathway | Key Advantages | Key Disadvantages | Typical Cost Structure |
|---|---|---|---|
| Vehicle Manufacturers | Existing networks, low cost, efficient | Brand-limited, technical constraints | Low collection cost, moderate processing |
| Battery Producers | Technical expertise, closed-loop | Scale challenges, dependency | High R&D, variable collection |
| Third-Party Enterprises | Experience, stable networks | High costs, logistical issues | High overall costs |
| Industry Alliances | Collaboration, cost-sharing | Standardization difficulties | Shared costs, optimized efficiency |
International Development Status and Lessons from Abroad
Globally, the EV power battery market is experiencing robust growth, with total installations reaching 894.4 GW·h in 2024, a 26.4% increase year-on-year. This expansion fuels the resource recovery market, which is projected to grow to $22.8 billion by 2030. Major countries are actively promoting echelon use and material regeneration industries. Recycling networks abroad are typically established by battery manufacturers, industry associations, and alliances, with echelon use led by automakers and material regeneration handled by transformed metallurgical enterprises.
Key international experiences include:
- Germany: The government mandates producer responsibility, requiring enterprises to complete registration and collaborate with dealers to recover batteries. The GRS Foundation, Europe’s largest lithium battery recycling organization, allows manufacturers to share networks by paying fees, achieving significant outcomes.
- Japan: Battery manufacturers are designated as primary responsible entities, utilizing channels like car dealers and retailers for collection. High public environmental awareness supports a reverse logistics model where consumers return retired batteries to retailers or manufacturers, with third-party processors handling disposal.
- United States: Battery manufacturers provide funding, and a consumer deposit system is implemented. The Portable Rechargeable Battery Association (PRBA) establishes voluntary recycling channels, with processed materials supplied to third parties for remanufacturing, forming a closed-loop system sustained by deposits.
| Country | Key Policies | Business Models | Outcomes |
|---|---|---|---|
| Germany | Producer responsibility, registration | GRS Foundation network | High recycling rates, efficiency |
| Japan | Manufacturer-led collection | Reverse logistics, public participation | Effective closed-loop systems |
| United States | Deposit systems, manufacturer funding | PRBA voluntary channels | Sustainable recycling loops |
The recovery efficiency in these models can be expressed as:
$$E = \frac{R_a}{R_t} \times 100\%$$
where \( E \) is efficiency, \( R_a \) is the amount recycled through formal channels, and \( R_t \) is the total retired EV power batteries. In Germany, for example, this approach has led to recycling rates exceeding 50% for certain battery types.
Current Status and Major Issues in China’s EV Power Battery Recycling
In China, the rapid growth of the NEV industry has spurred demand for EV power battery recycling, with over 180,000 related enterprises registered by mid-2024. The Ministry of Industry and Information Technology (MIIT) has released five batches of a “white list” comprising 156 qualified recycling enterprises, including 93 for echelon use, 51 for disassembly, and 12 with both qualifications. A national traceability management platform has been established, integrating data from over 14 million NEVs and 18.6 million battery packs by 2022, with 790 backend enterprises registered. Companies like GEM have built extensive networks, collaborating with 570 entities across the chain.
Technological advancements are accelerating, with innovations in preprocessing (e.g., machine vision, AI disassembly), echelon use (e.g., lifespan prediction, detection), and material regeneration (e.g., crushing, hydrometallurgy). However, several critical issues persist:
- Inadequate Policies and Standards: China lacks a comprehensive, legally binding framework for EV power battery recycling. Standards mainly cover early-stage processes, omitting full lifecycle aspects like carbon footprint accounting. Enforcement is weak, with insufficient penalties for non-compliance, allowing informal operators to flourish.
- Low Actual Recycling Rates and Overcapacity: As of 2023, China’s lithium-ion battery recycling capacity reached 3.793 million tons annually, but only 623,000 tons were actually recycled, resulting in a mere 16.4% capacity utilization rate. This inefficiency increases operational costs and risks losses for formal enterprises.
- Uneven Enterprise Quality and “Bad Money Driving Out Good”: Most recycling firms are small-scale “workshops” with minimal capital and poor technical standards. These informal operators avoid environmental costs, offering higher prices for retired batteries and diverting 75% of the flow away from formal channels, creating unfair competition.
- Technological Bottlenecks: Recycling technologies remain underdeveloped, hindered by the diversity of EV power battery models and types. Key areas like retirement evaluation, detection methods, and disassembly techniques lack maturity, limiting scalability and efficiency.
The capacity utilization issue can be modeled as:
$$U = \frac{Q_a}{C_t} \times 100\%$$
where \( U \) is utilization rate, \( Q_a \) is actual recycling quantity, and \( C_t \) is total capacity. For China EV battery recycling, \( U \) is critically low, indicating significant inefficiencies.
| Challenge | Description | Impact | Current Status |
|---|---|---|---|
| Policy Gaps | No overarching law, weak standards | Regulatory ambiguity, low compliance | Under 25% standardized recycling |
| Overcapacity | High capacity vs. low actual recycling | Increased costs, wasted resources | 16.4% utilization in 2023 |
| Informal Sector | Small workshops dominate | Environmental risks, market distortion | 75% to informal channels |
| Technological Limits | Immature core technologies | Reduced efficiency, safety concerns | Early R&D stage |
Strategies for High-Quality Development of China’s EV Power Battery Recycling
To address these challenges and foster sustainable growth, I propose the following recommendations:
- Strengthen Policy and Regulatory Safeguards: Enact specialized administrative regulations covering the entire lifecycle of EV power batteries, emphasizing extended producer responsibility. Clarify roles for manufacturers, recyclers, and consumers. Introduce incentives such as subsidies and tax benefits for compliant enterprises to narrow cost gaps with informal operators. Enhance law enforcement to crack down on illegal activities like unlicensed recycling and disposal.
- Enhance Traceability Systems and Standardization: Digitalize the national traceability platform by integrating real-time monitoring data from NEV manufacturers, including carbon footprint metrics. Develop comprehensive standards for retirement, echelon use, and material regeneration, incorporating digital technologies to create a smart standard system. Establish carbon footprint standards to drive green transitions.
- Advance Green, Safe, and Efficient Technologies: Prioritize R&D in core technologies and equipment. In preprocessing, shift from manual to automated and intelligent disassembly. For echelon use, support innovations in key areas like communications base stations and energy storage, focusing on battery pack disassembly, residual energy detection, and reassembly. In material regeneration, promote clean and efficient recovery methods for multi-component recycling of valuable materials, including anodes, cathodes, separators, and electrolytes.
- Build a Robust Industrial Ecosystem: Encourage social capital to innovate business models, such as battery-as-a-service, swapping, and leasing. Scale up echelon use applications in energy storage and low-speed vehicles. Guide enterprises in rational layout planning, cultivating leaders with strong networks and technology. Support international collaboration to absorb excess capacity and gain global competitiveness. Foster industry alliances to create a sustainable and standardized ecosystem.
The potential impact of these strategies can be estimated using a sustainability index formula:
$$SI = \alpha R_e + \beta E_f + \gamma C_r$$
where \( SI \) is the sustainability index, \( R_e \) is recycling efficiency, \( E_f \) is environmental friendliness, \( C_r \) is cost reduction, and \( \alpha, \beta, \gamma \) are weighting factors. Implementing these measures could significantly improve \( SI \) for China EV battery recycling.
| Strategic Area | Key Actions | Expected Outcomes |
|---|---|---|
| Policy Reinforcement | Enact laws, provide incentives, strengthen enforcement | Higher compliance, reduced informal sector |
| Traceability and Standards | Digital platform, carbon footprint standards | Better monitoring, greener practices |
| Technology Advancement | Automate disassembly, improve echelon use, innovate regeneration | Higher efficiency, safety, and recovery rates |
| Ecosystem Development | Promote alliances, scale applications, internationalize | Sustainable growth, global competitiveness |
In conclusion, the recycling of China EV batteries is at a critical juncture, with immense potential for resource conservation and environmental protection. By addressing policy, technological, and ecosystem challenges, China can pave the way for a high-quality, sustainable future in the EV power battery recycling industry. As I reflect on this analysis, it is clear that collaborative efforts across government, industry, and research sectors are essential to transform these recommendations into actionable pathways, ensuring that the lifecycle of every EV power battery contributes to a circular economy and a greener planet.