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Cost Components of Recycling Plants:
The direct cost, which includes infrastructure, equipment, installation, etc., accounts for ~58% of the total capital cost. Indirect cost, which includes engineering, project management, insurance, freight and taxes, account for around 32%, and contingency accounts for around 10% of the total capital cost. The operational expenditures majorly includes chemicals and consumables (33%), utilities & services (26%), labor cost (23%), etc.
To develop a robust LIB recycling ecosystem, it is important to identify the possible pathways that ensure business profitability. Transport distances, wages, pack designs, battery chemistries and a selection of suitable recycling technologies determine operating profit/loss, called the Net Recycling Profits (NRP). For example, a comparative analysis of domestic battery recycling in United Kingdom with batteries sent to China and the United States from the UK for recycling shows that transportation accounts for 2% of the total recycling cost for the UK while it is 7-13% for the other two countries.
Further, the disassembly of batteries accounts for 2% of the recycling cost for batteries sent to China, 8–11% for batteries sent to the U.S., and 12–17% for domestic recycling in the UK. For the widely used hydrometallurgy recycling process, the NRP for the different battery chemistries is better in China, as compared to the US and the UK, despite the higher transportation costs, mainly due to lower labour costs in China.
Financial Feasibility: Battery Chemistry and Recycling Technologies:
The value of metals recovered from batteries and the cost-effectiveness of the recycling technologies affect the profitability of battery recycling. NMC and NCA batteries generate higher revenue than LFP and LMO batteries due to the presence of high-value critical metals (cobalt). Copper can be a good revenue source beyond cathode material. For batteries with high-valued material, hydrometallurgy technology can be better as compared to pyrometallurgy for profitability, whereas for batteries without high-valued material, only a direct recycling method can ensure profitability.
The economies of scale analysis for recycling profitability suggest that the breakeven point for the recycling profitability of NCA batteries can be achieved with an annual recycling capacity of 17,000 tons for pyrometallurgy, 7,000 tons for hydrometallurgy, and 3,000 tons for direct recycling technology. The profitable economies of scale for NCA battery recycling without revenue from cobalt increase to an annual capacity of over 50,000 tons for pyrometallurgy, and ~17,000 tons for hydrometallurgy.
Way Forward
Developing decentralized facilities for LIB recycling and meeting the economies of scale will improve financial feasibility and help reduce storage and transportation challenges. Original equipment manufacturers (OEMs) should introduce reuse and recycling-friendly battery pack designs to reduce the cost and complexity of battery disassembly. Also academia-industry-government collaborations can support the R&D requirement for sustainable reuse and recycling processes.
All views expressed by the authors are personal
