Vehicle electrification is gathering pace, and it’s going to have an impact on the recycling business sooner than you might think. Simon Price, CEO of Exawatt, provides us with his viewpoint.
COVID-19 hit the automotive industry hard. In the UK, sales of passenger vehicles collapsed in early 2020, and although they recovered somewhat later in the year, the overall trend was sharply downward, with only 1.6 million new cars registered in 2020, nearly 30% fewer than in 2019 and the lowest total since 1992.
Despite this, one sector was almost immune to the downturn: electric vehicles, and in particular, cars powered entirely by batteries, otherwise known as battery electric vehicles (BEVs). BEV registrations in the UK grew by more than 180% in 2020, to 108,000 vehicles, and Exawatt expects sales to double again, to between 200,000 and 250,000 BEVs this year.
The resilience of BEV sales during the Coronavirus pandemic can partly be attributed to the enthusiasm of early adopters. Waiting lists for some BEVs were as much as 12 months long at the start of the pandemic. In contrast, supply of internal combustion engine (ICE) vehicles was plentiful. With travel down sharply, especially during the early months of the pandemic, ICE sales fell off a cliff, while the latent demand for BEVs ensured sales held up.
The appeal of BEVs is now extending rapidly into the mainstream and starting to appeal to a much broader customer base as vehicle range grows, and purchase costs fall. The number of BEV models launched by mainstream manufacturers is growing rapidly, and we believe the BEV industry has hit a turning point in 2021.
So what does this mean for recycling, and why should you care?
Most critically, the amount of batteries used in BEVs is far larger than in the hybrid vehicles that, until recently, have dominated EV sales. Exawatt estimates that in the past 12 months in the UK, about twice as much battery pack mass has been shipped in BEVs as in all forms of hybrid vehicles combined. This gap will continue to grow as BEV sales continue their inexorable rise.
EV battery packs degrade over time, meaning that useable battery capacity – which translates into vehicle range – also declines steadily over the vehicle’s lifetime. BEV manufacturers offer “state of health” guarantees that a battery’s useable capacity will remain above a certain percentage of its original value after a fixed number of years and/or miles driven. A typical guarantee might be for 70%-80% of original capacity after eight years or until 100,000 miles.
Although many of these ageing BEV battery packs are likely to find “second-life” applications in less demanding applications such as energy storage, growing volumes will be destined for scrap yards. And the battery packs in today’s BEVs will not be trivial to handle. Most batteries can be extremely dangerous if not handled carefully. Packs, which typically have voltages of about 400V, but can be upwards of 600V and even 800V must be electrically discharged to ensure safe handling. This process is beyond the scope of almost all UK recycling facilities today. And if packs are punctured accidentally, rapid fires can result, in many cases releasing highly toxic gases, including hydrofluoric acid (HF).
The economic value of these retiring BEV battery packs is likely to be significant. Most packs in today’s BEVs incorporate “high-nickel” chemistries that include – as the name implies – significant amounts of nickel, plus cobalt, copper, aluminium and manganese, among other materials.
Most EVs showing up at auto recyclers today come from auto wrecks, not old vehicles. But this will change soon. One of the oldest mainstream BEVs, the first-generation Nissan Leaf, launched in the UK in 2011 and is now well into its theoretical retirement age (although many early vehicles are going strong on UK roads). Still-older hybrid vehicles, such as the Toyota Prius, are in some cases now more than 20 years old. Since sales volumes for these cars were initially small, the volumes showing up in recycling yards are small too, as are their battery packs. But bigger volumes should be expected soon: from a few thousand BEV per year today, climbing sharply in the mid-late 2020s and surpassing 200,000 cars per year before 2030, plus hundreds of thousands of much smaller packs from hybrid vehicles.
Exawatt provides detailed cost, materials and sales forecasting for EVs and their powertrains, including assessments of potential recycling volumes of critical battery materials. To find out more, please contact Simon Price at firstname.lastname@example.org or via the company’s website at www.exa-watt.com.