As battery metals demand surges, activists explore paths with less new mining

As demand for battery metals is surging, a new report commissioned by the environmental- and community-focused organization Earthworks points to strategies to reduce potential risks from mining activities by decreasing the need for new projects.

Recycling battery materials, reusing batteries in second-life applications and discouraging private car ownership could help to reduce adverse social and environmental impacts associated with wider deployment of lithium-ion batteries, the report said. The Institute for Sustainable Futures at the University of Technology Sydney prepared the report for Earthworks, a nonprofit organization focused on mineral and energy development.

"The demand for these metals is projected to increase rapidly in the coming years, which will, in turn, put pressure on communities and ecosystems in places where these minerals are concentrated," Payal Sampat, mining program director at Earthworks, said in an interview. "This new research that we've commissioned shows that we can reap the benefits of these minerals without incurring the impacts of mining them from the earth or from the seabed."

The researchers focused on cobalt, lithium, nickel and copper. According to the report, it is technologically possible to recover all four metals from end-of-life lithium-ion batteries at rates above 90%, but a lack of policy or economic drivers encouraging recycling limits the recovery of the materials.

At a recent conference, Hans Melin, managing director of Circular Energy Storage, noted that the recycling of lithium-ion batteries will surge but said the industry faces a "bumpy road" as capacity and supply will fluctuate. The report prepared for Earthworks suggests recycling could reduce primary demand compared to projected total demand by an estimated 25% for lithium, 35% for cobalt and nickel, and 55% for copper.

Sales of electric vehicles expected to soar

Plug-in electric vehicle sales are on the rise. Earlier this year, S&P Global Market Intelligence reported it expected global lithium-ion battery production capacity to increase from 455 GWh in 2020 to 1,447 GWh in 2025 at a compound annual growth rate of 26%.

That trend could accelerate as major industrial economies begin to recover from the global pandemic. Currently, the U.S. lags while Europe and China are the world's largest electric vehicle markets, Market Intelligence analyst Alice Yu said during an April 27 webinar hosted by Market Intelligence.

"Passenger [plug-in electric vehicle] sales in China totaled nearly a half million units in the first quarter, and penetration rates increased to over 11% in March from an average of 8% in the fourth quarter of last year," Yu said. "At this rate, sales are on track to exceed 2 million units this year, at 80% year-over-year growth. In Europe, passenger [plug-in electric vehicle] sales in Europe's top four markets — that is the U.K., Norway, Germany and France — doubled month over month in March."

Yu said that globally, passenger plug-in electric vehicles are expected to reach 5 million units this year and 11 million units in 2025.

The U.S. has largely been behind China and Europe on electric vehicle deployment due to comparatively weaker policy frameworks supporting electric vehicles, Yu said. However, President Joe Biden's recently announced $2.3 trillion infrastructure plan includes $174 billion to promote the use of electric vehicles and tax credits for clean energy generation and storage.

Encouraging the growth of those technologies could substantially increase the demand for the materials used to create batteries and other energy storage solutions.

"This could be not only a low carbon transition but also a sustainable materials economy transition," Sampat said. "We could find ways to make this a more equitable and just transition. It is an opportunity to remake the system in a way that makes the benefits of these materials and these low-carbon solutions available to more people."

Despite the potential for recycling the materials, Earthworks said in an April 27 news release that reducing demand for private car ownership also "remains an essential part of any strategy to limit new mining."