Written evidence from Mrs Melissa Venegas, Dr Aristides Matopoulous, and Dr Andrew Greasley (BEV0018)

Business Committee opens UK electric vehicle battery production inquiry

 

        What other domestic end uses for batteries would provide a market for UK battery production?

End-of-Life reverse Electric Vehicle Battery Supply Chain in the UK: Challenges and Opportunities

a PhD Student in Operation Management - Aston Business School, Aston University, Birmingham, United Kingdom

 

b Professor of Supply Chain Design - Cranfield School of Management, Cranfield University Cranfield, United Kingdom

 

c Lecturer in Supply Chain Analytics and Modelling - Aston Logistics & Systems Institute, Aston University, Birmingham, United Kingdom

Introduction

  1. Electric Vehicle (EV) battery production is important for the UK and is one of the catalysts in the journey towards Net Zero. In this report we argue that the topic of EV battery production should not be seen in isolation from the End of Life (EoL) management and reverse supply chain for those batteries that will be reaching their EoL for automotive applications between 8 to 10 years. The supply chain of EV batteries is at imminent risk due to future scarcity and increasing prices of critical raw materials for battery production. For that reason, developing a reverse supply chain for EV batteries is critical to reducing the dependence on raw material extraction. In addition, after reaching the end of their first life (e.g. in automotive applications between 8 to 10 years), depending on the conditions and state of health of the battery pack and components, these batteries could still be used for different EoL applications (e.g. for domestic or commercial energy storage).             
  2. For the last four years, our research has looked into the current situation of the industry EV battery reverse supply chain (i.e. processes, stakeholders and relationships); sustainability strategies and modelling of the EoL reverse supply chain for EV batteries. This research has also explored the drivers and barriers to a reverse supply chain implementation. The research used a mixed methods approach that combined qualitative and quantitative methods. The data was collected from interviews with managers and directors of key stakeholders (e.g. a remanufacturing company, a repurposing company, a material recycling company and a scrap recycling company).
  3. We provide below our thoughts based on the findings of our research.

 

EoL EV battery market opportunities: setting the scene

  1. Recycling, Remanufacturing, and Repurposing are some of the most popular recovery alternatives in the EV batteries reverse supply chain. The decision about the best EoL alternative depends on the battery's design characteristics, the quality of the EoL product and the state of health (SOH) of the battery and cells. Remanufacturing and repurposing are the preferred options to maximise the recovered value from EV batteries and minimise energy consumption after first-life treatment (Canals Casals, Amante García and Cremades, 2017). However, remanufacturing is the most exigent alternative in terms of quality and SOH requirements.
  2. Recycling is the least favourite option from a circular economy perspective because of the loss of remaining energy when the battery can still be used for other applications, the loss of valuable material and the energy consumption of the recycling processes (Ramoni and Zhang, 2013). Through recycling, the valuable material of batteries can return to the EV battery supply chain reducing the extraction of raw material (Chen et al., 2019). Two of the main recyclers in Europe are Umicore and SNAM, which have been working with the most important EV manufacturers. Umicore is a Belgium-based global materials technology and recycling group. Since 2006, Umicore has provided recycling services for lithium-Ion, lithium polymer and Nickel Metal Hydride batteries (NiMH) for diverse applications, including electric cars. On the other hand, SNAM is a French-based company that recycles Nickel-Cadmium, Nickel-Metal-Hydride and Lithium-Ion from portable batteries (e.g. mobiles, computers) and industrial batteries (e.g. trains, hybrid and electrical vehicles, handling equipment).
  3. Remanufacturing is the process by which a product can be rebuilt and its components repaired and replaced to use the whole battery pack in its original automotive application (Chen et al., 2019). The cost of replacing a li-ion battery could be reduced by more than 70% by using remanufactured batteries (Chen et al., 2019). Some examples of companies that have been offering remanufacturing services for EV battery packs along with repairing and refurbishing are Spiers New Technologies and Global Battery Solutions.
  4. The second option after remanufacturing is repurposing EV batteries for different applications such as peak shaving, backup energy storage, renewable energy storage, and EV charging (Canals Casals, Amante García and Cremades, 2017). Nissan, for instance, has built a partnership with Eaton to produce a scalable energy storage system for homes and businesses using EoL lithium-ion batteries from their Nissan vehicles. Volvo is also investing in the company Connected Energy to scale up second-life battery storage systems using Volvo EV EoL batteries.

 

EoL supply chain for EV batteries in the UK: Challenges and Opportunities

  1. The UK EoL supply chain for EV batteries is in its infancy. Some of the few returning batteries currently under warranty are returned through Dealer Service Centres. A Dealer service centre is where car users take their vehicles for maintenance or repair when the vehicle is under the warranty period. Dealers are sending back these batteries to EV manufacturers. A few EV companies are running pilots with remanufacturing companies to evaluate the possibility of remanufacturing and refurbishing their batteries. In the case of the vehicles out of the guarantee period or if the car owner wants to get rid of their EV, EV users can sell their cars to Scrap Car recycling companies that will send the EV to an Authorised Treatment Facility (ATF) for battery removal and dismantling. An ATF is a vehicle dismantler who has proved it follows strict EoL vehicle guidelines that are monitored by the Environment Agency. Some ATFs are reselling these batteries into the market. Other ATFs request scrap car recycling companies to handle the batteries, sending them to Approved Battery Exporter (ABE) with the authorisation to export automotive batteries.
  2. To this date, there are not many established recycling facilities processing electric vehicle batteries in the UK. For this reason, most of the EV batteries that need to be recycled are exported to mainland Europe adding logistic costs. However, the UK scenario is changing, and there is a growing interest in establishing UK-based recycling facilities. Some UK-based recyclers are opening new facilities specialised in recycling lithium-ion batteries from electronic devices and electric vehicles. After recovering the batteries materials, recyclers would sell the recovered material to different recycling companies depending on the material type.
  3. Some of the challenges identified from the interviews with UK companies involved in the EoL of EV batteries are the following:
    1. Lack of information sharing: Limited information is shared with remanufacturing/refurbishing, repurposing and recycling companies about the internal design of batteries, the chemistry of components and the battery's initial performance. According to our research , battery manufacturers do not share any information about how to handle, disassemble, or measure the state of health of batteries.
    2. EoL management legislations: The current legislation is driving EV batteries towards recycling without considering the options of remanufacturing and repurposing for second-life applications. The current legislation does not request battery manufacturers to share information about the design, internal characteristics and content of batteries, which would maximise the value recovered from batteries and make end-of-life management easier, safer and more efficient. Moreover, the legislation is not promoting the use of used EV batteries in second-life applications. The standards of EV battery components used in second-life applications are unclear and lag behind technological advances.
    3. Lack of skilled technical labour: One of the main challenges that companies receiving EVs and EV batteries face is the unfamiliarity of operational labour with EVs and EV batteries. Some ATFs have received some EVs in their yards, and as they do not know how to do safe dismantling and battery removal, they prefer not to touch them. At the same time, material recycling companies do not have staff trained for high-voltage work.
    4. Infrastructure investment: Infrastructure was highlighted as an essential barrier to consider in the following years. The lack of space to manipulate, process and store the batteries will also be an important issue for ATFs, Remanufacturers and Recyclers in the future since handling, discharging, and processing EVs and components demand large spaces for safe operations.
    5. High exporting costs: Since there are not many materials recycling companies for EV batteries in the UK, Scrap car recycling companies need to export the batteries they receive to mainland Europe. Since Brexit, the exporting process of EV batteries has become more complex and expensive.

 

 

References

Canals Casals, L., Amante García, B. and Cremades, L. V. (2017) 'Electric vehicle battery reuse: Preparing for a second life', Journal of Industrial Engineering and Management, 10(Special Issue), pp. 266–285.

Chen, M. et al. (2019) 'Recycling End-of-Life Electric Vehicle Lithium-Ion Batteries', Joule, 3(11), pp. 2622–2646.

Ramoni, M. O. and Zhang, H. C. (2013) 'End-of-life (EOL) issues and options for electric vehicle batteries', Clean Technologies and Environmental Policy, 15(6), pp. 881–891.