How Is EV Sector Boosting Second-Life Automotive Lithium-Ion Battery Availability?
Lithium-ion batteries have only 2–7% lithium, and procuring it through recycling is five times more expensive than extracting it from natural sources. Cobalt is the only material in these batteries that can be extracted feasibly. Battery companies are, therefore, focusing on the development of batteries that contain zero or a minimum percentage of cobalt, by replacing it with a cheaper and more-stable material, thereby creating batteries that might not have any cobalt to recycle. The expensive recycling process will also lead to the use of depleted automotive lithium-ion batteries that have around 70% of their initial efficiency for other purposes, globally.
The widening availability of second-life automotive lithium-ion batteries can be owed to the increasing adoption of electric vehicles (EVs) worldwide. The rising sales of EVs can themselves be ascribed to the surging environmental concerns, primarily on account of the accelerating ozone depletion rate. Currently, the automobile sector accounts for nearly 43% of the total greenhouse gas emissions. Thus, the soaring demand for EVs will drive the second-life automotive lithium-ion battery market at a 23.1% CAGR during the forecast period (2020–2030). The market stood at $430.0 million in 2019, and it is projected to reach $7,392.0 million by 2030.
The European second-life automotive lithium-ion battery market is expected to exhibit the fastest growth in the forecast years, primarily on account of the soaring EV sales. Additionally, Europe also adopted a strategic action plan for batteries in 2018 to create a value chain in the region that includes facilities for extracting raw materials, sourcing and processing them, manufacturing the cells and battery systems, and recycling and reusing the discarded batteries. Moreover, the rising investments in battery manufacturing units in the region, owing to the growing EV production, will support the market growth.
Thus, the expensive recycling process and rapid shift toward EVs have accelerated the demand for and availability of second-life automotive lithium-ion battery worldwide, respectively.
Source: P&S Intelligence