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Lithium in short supply, companies now extract it from used EV batteries

Jason ยท Jan 4, 2022 10:00 AM

Lithium in short supply, companies now extract it from used EV batteries 01

  • RM 70 billion industry by 2030
  • Fuelled by shortage in global lithium supply
  • Companies now have technology to extract lithium from used EV batteries

With electric vehicles set to fuel the next decade of personal mobility, many companies including car makers and battery manufacturers are jostling to enter the used battery marketplace. Data has projected that the market size for used batteries to be worth 20 trillion won (~RM 70 billion) in less than 10 years' time. 

Lithium in short supply, companies now extract it from used EV batteries 02

The projections are based on data from SNE Research, a consulting firm based in Korea. It shared that the global market size of used EV batteries is slated to surge to said 20 trillion won (~RM 70 billion) by 2030. It could reach 600 trillion won (~RM 2 trillion) come 2050, according to the data.

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According to experts, the key reason behind the rush to enter the used EV battery market is because lithium, a key raw material for electric vehicle batteries, is in short supply globally. 

Lithium in short supply, companies now extract it from used EV batteries 01

“With the current amount of global lithium reserves, we can only make one EV per person. So the companies are going all out to establish a three-step system to melt the used batteries, selectively extract lithium and examine the performance of the lithium,” said Choi Jae-won, a chemistry professor at Gyeongsang National University.

Lithium in short supply, companies now extract it from used EV batteries 02

Keen not to be left behind and wanting a piece of this lucrative pie, companies are jumping in to invest and enter the used EV battery business. Among them is LG Chem and LG Energy Solution, who recently concluded an equity investment worth 60 billion won (RM 210 billion) in Li-Cycle, a battery recycling firm based in the US.

Li-Cycle owns a technology to extract key raw materials by recycling used batteries. With this investment in Li-Cycle, LG Energy Solution will receive extracted nickel from the firm for 10 years starting from 2030.

Lithium in short supply, companies now extract it from used EV batteries 03

Tesla is also looking into recycling used EV batteries

Additionally, SK Innovation, a battery manufacturer that supplies EV batteries to Hyundai and Ford, has also formed a “Battery Metal Recycle Division” to accelerate its used battery business. Moreover, it has developed a technology that can collect lithium hydroxide from cathode materials in used batteries. 

Even car makers are getting in on it. Hyundai said in a sustainable development report that it will establish a system to retrieve used batteries within the country and expand it worldwide. Other brands such as Tesla, Volkswagen and Daimler, have outlined plans to do so as well.

Lithium in short supply, companies now extract it from used EV batteries 04

Jason

Road Test Editor

Jason's foremost passion is all things automotive, where he spent his formative working years as a Product Planner and Trainer. An Advanced Driving Instructor by training and an all-round enthusiast, Jason loves going into intricate details about driving dynamics. Will drive anything with 4 wheels and a steering.

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