Amazon, Panasonic, and recycling start-ups prepare for battery wave tsunami

Inside every smartphone and tablet lies a dense brick with a dark and complex history: its battery. The lithium that ferries charge back and forth likely started out in South American salt flats, where months of evaporation consumes millions of tons of water in some of the world’s driest regions. The cobalt that buffers the material against the ravages of daily recharging probably came from the Democratic Republic of the Congo, where children have allegedly been maimed and killed extracting it from the ground. To gather the assorted atoms and fashion them into a working battery may have required thousands of people from perhaps a dozen countries. Then, after a few years of use, spent devices often end up in landfills and incinerators.

As lithium-ion batteries stand poised to jump from handheld devices into cars, trucks, and homes, entrepreneurs and academics are racing to find a way to reuse the hard-won materials. Investors are betting millions that a Nevada company, Redwood Materials, can mine electronic waste for metals. A competitor, Li-Cycle, aims to crack the logistical puzzle of transporting batteries. Others are developing the technology to rejuvenate dead batteries without breaking them down fully. By attacking the problem on all fronts, the teams work toward one goal: transforming exhausted batteries into a valuable resource.

“We’re spending all of this money making batteries, making chemicals, and then we’re burning them at the end of the cycle,” says Tim Johnston, Li-Cycle co-founder and executive chairman. “That’s not right.”

Industry insiders speak with excitement and trepidation of a looming battery “tsunami.” Globally people already toss out more than 500,000 tons of lithium batteries today, according to Ajay Kochhar, Li-Cycle co-founder and president, mostly in the form of small electronics. But as the world transitions to an electric economy, its appetite for lithium-ion bricks is projected to increase tenfold by 2030. Most of that explosion will be driven by electric vehicles, which carry batteries weighing more than 1,000 pounds. “We’re at the tip of the iceberg,” Kochhar says.

Kochhar and others see that problem as an opportunity to replace today’s fragile and problematic supply chain with a more “circular” system, one that builds the next generation of batteries from the materials of the last generation. And they won’t be recycling just for the sake of recycling. The market for recycling lithium-ion batteries alone could be worth $18 billion annually by 2030, Statista estimates, up from $1.5 billion in 2019.

One start-up leading the U.S. market is Redwood Materials, the latest venture of Tesla co-founder JB Straubel. During the 16 years he spent working as Tesla’s CTO, Straubel realized that there was no plan for processing the cars at the end of their lifespan. And unlike a phone, a half-ton car battery can’t just languish at the back of a junk drawer. Most electric vehicles are currently in their prime (Straubel drives what he believes is the oldest Tesla on the planet — a Roadster prototype from the late 2000s), but the tsunami will begin when early electric cars will start retiring en masse in the next five years.

Since launching in 2017, Redwood Materials has been preparing for that first wave. Located in Carson City, the start-up’s two facilities currently handle all the waste materials and defective batteries coming out of the nearby Tesla Gigafactory, co-owned by Panasonic. Panasonic scrap alone provides about one gigawatt of material annually and a dozen other partners contribute a similar amount, for a total equivalent of about 20,000 tons of material per year. The company also recently partnered with Amazon to dispose of batteries from the retail giant.

After sorting recent arrivals, the company uses proprietary processes involving a combination of burning batteries to melt their contents and submerging them in liquids that leach out desired elements (although the exact procedure is tailored to fit the battery type). In the end, a PR spokesperson said, the techniques recover 95% to 98% of a battery’s nickel, cobalt, aluminum, graphite, and more than 80% of its lithium. Much of those materials are sold back to Panasonic to make new Tesla batteries.

“Redwood Materials has assembled an excellent team that is working collaboratively with us to tackle a wide range of waste streams, and to develop raw materials that we can then use in our cell making processes,” says Celina Mikolajczak, v.p. of battery technology, Panasonic Energy of North America.

The company is currently working on increasing the capacity of its Carson City facilities with the help of $40 million in funding from Capricorn Investment Group and Breakthrough Energy Ventures, an environmental investment fund including Amazon founder Jeff Bezos and Microsoft co-founder Bill Gates.

Johnston and Kochhar came to found Li-Cycle in a similar way, launching it in 2016 after working together at Hatch, a global engineering firm specializing in battery chemicals. They’ve structured their business around a ‘hub and spoke’ model.

Because batteries are fire hazards, they can be expensive to transport safely. To keep distances down, Li-Cycle intends to collect batteries at local “spoke” facilities, which shred the bricks into three components: plastic casings, mixed metals (such as foils), and the active materials like cobalt and nickel at the battery’s heart — a dark dust known as “black mass.”

Li-Cycle can sell these materials directly or ship the black mass to a central “hub” factory and immerse it in liquids at room temperature that Johnston says extract the metals at 90% to 95% efficiency — even lithium, which many processes struggle to capture efficiently.

The company currently has two spokes running, one in Ontario, Canada and one in Rochester, New York, which can break apart a combined 10,000 tons of lithium-ion batteries each year. Li-Cycle recently announced plans to build their first hub, also in Rochester, which will be able to separate 25,000 tons of black mass (from 65,000 tons of batteries) annually into lithium, cobalt, nickel, and other elements starting in late 2022. Like Redwood Materials, the company hopes to expand as quickly as possible, having raised about $50 million in funding so far.

“This is a big space, and we need an army of recyclers,” Kochhar says.

But looking ahead, researchers note that the long-term margins of scavenging batteries for their atomic parts may prove punishingly thin. The chemical structure of batteries shifts from year to year — Panasonic slashed the cobalt content in Tesla batteries by 60% between 2012 and 2018, for instance. These changes may require continuously tweaking the recycling process while also making it less lucrative (Cobalt is the most expensive, and valuable, battery element).

A more efficient route may be to recycle batteries at a higher level, salvaging their larger molecular structure as opposed to their atoms. Steve Sloop, a chemist and founder of a battery research firm called OnTo Technology, likens a battery to an apartment building. Rather than knock it down for wood and brick, why not renovate? “A lot of energy is invested in making [batteries],” he says. “We’re trying to save that investment.”

In the case of lithium-ion batteries, that means replacing the lithium, a little bit of which gets stuck to the battery’s molecular scaffolding during every charge and discharge. When the battery runs out of freely flowing lithium, it dies. In September, Sloop published a case study describing how his lab automatically disassembled and shredded recalled Apple batteries, soaking their active materials in a lithium-rich bath to restore them to pristine condition. The final product marked the first full fuel cell re-assembled from an industrial source.

And OnTo Technology is just one group pursuing this “direct recycling” strategy. The Department of Energy funds a research consortium called the ReCell Center, which supports similar projects. The center is currently organizing an informal competition between several different types of “re-lithiation” to see which performs best, according to Linda Gaines, a transportation systems analyst at Argonne National Laboratory, which is leading the effort.

“Re-lithiation has come a long way,” she says. “It really is at the stage where we can think about scaling up.”

Scaling up will be the major challenge all these initiatives face. In the lab, reducing batteries to atoms, or replacing lithium, is relatively easy. But how to collect, transport, sort, disassemble, process, and redistribute the millions of tons of materials that are coming is anything but.

“This is a new technology that’s coming to market,” says Gavin Harper, a materials scientist at the University of Birmingham who is involved with ReLib, a UK battery recycling project. “We haven’t seen the problems and the challenges and also the opportunities that it’s going to create.”