Lithium Battery Recycling is the key to Indian Electric Vehicle's goals

Electric vehicles (EVs) will play a critical part in India’s rapid adoption of sustainable mobility solutions. Because batteries are the most expensive component of an electric vehicle, developing and expanding the battery supply chain is a critical component in achieving long-term EV goals. The high-speed two-wheeler segment alone saw a 425% increase in sales, with 1,42,829 units sold in 2021 against 27,206 units in 2020. Even though battery manufacturing is growing in India, the entire supply chain is still reliant on China or other countries.

Let’s understand why lithium battery recycling is the key to Indian Electric Vehicle’s goals.

Government regulations that support battery manufacturers: Over the last few years, the Indian government has tried to establish a favorable atmosphere for electric vehicle growth by enacting a slew of policies. While assuring a long-term boost to the EV sector through the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME-I and II) programs, the government also recognized that domestic battery cell production would help with the transition to green transportation.

With a substantial commitment of Rs 75,000 Cr for Advance Chemistry Cell (ACC) Batteries and Automobiles & Auto Components, it provided the greatest portion of the PLI scheme outlay to the battery manufacturing industry. Furthermore, in May 2021, the government approved a PLI plan for the battery industry called “National Program on Advance Chemistry Cells (ACC) battery storage,” with a budget of Rs 18,100 crore.

The government hoped to lower the high import bill by reaching a 50 GigaWatt Hour ACC manufacturing capability (GWH). These are critical steps in bringing more of the valuable battery supply chain closer to home. India’s EV objectives could be hampered without indigenous cell production.

Lack of resources and refining capabilities: All of the metals used in Li-ion cell manufacturing, such as lithium, nickel, and cobalt, are concentrated in a few places throughout the world, many of which have unstable political regimes. Furthermore, China controls the supply chain’s processing and refining capacities, accounting for roughly 80% of total chemical output and more than 65% of cathode and anode manufacturing.

Because it is the largest cell manufacturer, it retains a strong position in practically every aspect of the battery supply chain. This current supremacy may provide long-term concerns, particularly in terms of energy security.

Supply chain disruption: The epidemic highlighted the vulnerability of domestic battery producers and industries that rely solely on imports. Imports were hampered by a variety of global reasons, including supply-chain disruptions, international tensions, and price volatility, all of which posed severe resource restrictions for Indian electric vehicle manufacturers.

The need for lithium battery recycling

In the spirit of Atmanirbhar Bharat, the ACC provides additional incentives for improving the local supply chain. Raw materials, chemical refinement, and cathode manufacture are all necessary for cell production upstream. The more local supply chain capability is built, the more self-reliant the country becomes. And these are all high-growth industries that employ tens of thousands of people in vital industries.

However, getting raw resources is the first step. Recycling spent batteries is India’s greatest option for increasing local battery metals production and expanding prospects in other supply chain sectors, especially in the absence of indigenous natural reserves. Through recycling, Indian enterprises can get a competitive advantage in obtaining crucial battery materials and gain a significant footing in the EV ecosystem.

Battery raw material production must be accomplished not just by establishing a large recycling capacity, but also by doing so in the most environmentally friendly and sustainable manner possible.

For all major countries across the world, establishing a large-scale capacity to recover valuable metals from spent batteries has become a vital milestone. Due to supply chain restrictions and raw material scarcity, as well as the opportunity to lower the carbon impact of mining operations, this new focus has emerged. Governments and businesses are rapidly understanding that achieving electrification goals requires a consistent supply of crucial metals. India should adopt this viewpoint and make use of the recycling opportunity to reduce significant supply chain risks.