The global lithium-ion battery recycling market is estimated to reach an expected value of USD 38 billion by 2030, growing at a CAGR of 36% during the forecast period (2022–2030). Lithium-ion batteries are rechargeable and have a large energy density. These batteries are used in portable electronic gadgets, electric cars, and other industrial energy storage applications. Most lithium-ion batteries are disposed of in landfills once their life cycle has ended. It is critical to recycle them to prevent the pollution generated by these dangerous batteries. However, while battery recycling was once seen as a legislative activity, it is now a more viable way to recover metals by recycling various batteries, including lead-acid, lithium-ion, and nickel-metal hydride.
The global lithium-ion battery market is expected to proliferate in the following years because of the increased use of various automobiles, such as electric and hybrid vehicles. This, in turn, is expected to stimulate the expansion of the lithium-ion battery recycling industry. There are currently established patented recycling technologies available on the market. As a result, battery recycling is carried out using proprietary techniques developed by particular manufacturers or other groups.
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Batteries are composed of metals and other toxic components that cause extreme damage to environmental conditions. Therefore, battery recycling is not only about the second life use of metals but more of a need nowadays. Battery disposal has a potential toxic risk to the aquatic ecosystem as they emit hazardous chemicals. Improper handling and careless battery waste management result in the release of corrosive liquids and dissolved metals that are very dangerous to plants and animals. As a result, battery recycling is not only a way to eliminate these adverse effects but comes with an additional benefit of using recycled metal as their second life applications. Therefore, the high threat of battery disposable is a primary factor creating a need for battery recycling, which ultimately drives the growth of this market.
Lithium-ion batteries are majorly applicable in electric vehicles and plug-in hybrid vehicles, owing to their prolonged service life and high energy density compared to other rechargeable batteries. Production of electric/hybrid vehicles is expected to increase at an exponential rate, which, in turn, would boost the demand for lithium-ion batteries in the years to come.
The abovementioned factors are predicted to boost the demand for lithium-ion batteries in the automotive sector. China is expected to lead the adoption of lithium-ion batteries majorly to curb increasing pollution levels from automobiles in all countries. The Chinese Government is focusing on producing hybrid vehicles with pure electric drives, which can reduce China's dependence on oil, improve environmental pollution status, and increase the international sales of electric cars. In the US, the electrification of delivery vehicles and pickups is expected to increase the demand for lithium-ion batteries.
In the energy storage sector, two battery types are competing against each other, notably lead-acid and lithium-ion batteries. The lead-acid battery is the first commercial battery and is highly recyclable. On the other hand, lithium-ion batteries are the second-largest batteries sold globally due to associated benefits and are transforming the energy storage sector. However, they are relatively costlier compared to other battery types. Lithium-ion battery manufacturers are mainly focused on reducing battery cost and increasing longevity and charge capacity.
Lithium-ion batteries can be recycled, but overall reported recycling of this battery type was only 9% as of 2018. As a result, more than 90% of batteries are landfilled due to disposal and adverse environmental conditions. Therefore, manufacturers chose to lower overall battery cost to enhance battery salability instead of maximizing the recyclability factor. This hampers the battery recycling market and causes a threat to environmental life. Landfilling of 90% of lithium-ion batteries eliminates the possibility of lithium metal recycling and its second life application. Therefore, these factors hinder the growth of the global lithium-ion battery recycling market.
In the current business scenario, technological advancements have added additional features to these gadgets, which have increased battery consumption. Various applications and other features such as games, cameras, music players, and video players require more energy due to the improved processors' utilization. Therefore, the energy requirement in these devices is higher, and they need a high-power battery that can last longer, which fuels the demand for lithium-ion batteries rapidly. Furthermore, an increase in applications in consumer gadgets is expected to create numerous opportunities for the lithium-ion battery recycling market during the forecast period.
Furthermore, an increase in electric vehicle adoption reduces dependence on fuel-based vehicles. This is leading to an increasing percentage of electrification in the automotive sector. Initially, lead-acid batteries powered electric cars due to their cost-effective nature. However, with a rising focus on efficiency factors, lead-acid batteries are gradually replacing lithium-ion batteries in electric vehicles. Growing sales of electric cars fuel the adoption of batteries and, at the same time, is developing the growth of recycling them in the future.
Batteries used in these vehicles are easily accessible for recycling; Government is regulating various policies on collection activities in the automotive sector. Therefore, growing electric vehicle sales are anticipated to offer profitable growth opportunities to the lithium-ion battery recycling market during the forecast period.
The outbreak of COVID-19 has negatively impacted various industries and countries across the globe. Attributed to the lockdown imposed globally, a decrease in industries' growth rate, such as construction and building, transportation, oil and gas, and energy sectors, has been witnessed. This has further declined the need for various critical equipment and appliances having an energy storage section, which, in turn, is expected to hamper the growth of the lithium-ion battery recycling market in the next year.
To prevent the spread of coronavirus, European economies such as Germany, France, Spain, and Italy have implemented strict measures to establish social distance and limit travel, resulting in the closure of production and recycling facilities. Furthermore, consumer spending on electronics and electrical and automobile applications decreased during the pandemic. These factors collectively resulted in sluggish growth of the global lithium-ion battery recycling market in 2020.
The global lithium-ion battery recycling market share is segmented into battery chemistry, source, recycling process, end-user, and region.
Depending on battery chemistry, the market is categorized into lithium-iron-phosphate, lithium-manganese oxide, lithium-nickel-cobalt-aluminum oxide, lithium-nickel-manganese-cobalt, and lithium-titanate oxide. The lithium-manganese oxide segment dominated the market. It is estimated to reach an expected value of USD 12,020 million by 2030 at a CAGR of 40%. Lithium-manganese oxide batteries are increasingly used in the applications such as electricity, gas and water meters, fire and smoke alarms, security devices, and other devices for energy storage applications. Thus, a rise in demand for the applications mentioned above is expected to fuel the demand for lithium-manganese oxide batteries, which is anticipated to propel the growth of the lithium-ion battery recycling market during the forecast period.
In addition, lithium-manganese oxide batteries offer high current rating, fast charging, thermal stability, enhanced safety of the cell, and others, which in turn is projected to escalate the demand for this type of battery and thereby is anticipated to drive the lithium-ion battery recycling market growth from 2022 to 2030.
By source, it is classified into electric vehicles, electronics, power tools, and others. In terms of revenue, the electronics segment held the highest share, which is likely to continue during the forecast period. It is estimated to reach an expected USD 23,415 million by 2030 at a CAGR of 38.8%. The growing popularity of portable devices is the key factor that fuels the adoption of lithium-ion batteries in consumer electronics devices. Lithium-polymer batteries, lithium-cobalt batteries, and others are the critical battery chemistries used in the consumer electronics segment that is further recycled.
In addition, the growing dependence on highly efficient power sources in smartphones, laptops, and digital cameras is expected to be a great source of lithium-ion batteries for recycling during the next ten years. Therefore, this segment is anticipated to offer profitable growth opportunities during the forecast period. Moreover, advantages associated with lithium-ion batteries, such as high energy density, low self-discharge, minimum maintenance, and others, are expected to fuel the growth of the lithium-ion battery recycling market during the forecast period.
By recycling process, it is fragmented into the hydrometallurgical process, physical/mechanical process, and pyrometallurgy process. Based on the recycling process, the hydrometallurgical process segment dominated the market. It is estimated to reach an expected USD 23,830 million by 2030 at a CAGR of 39.7%. The rise in demand for lithium-ion battery recycling for its second life use in various applications such as electric vehicles, consumer electronics, and other industrial applications is expected to fuel the growth of the lithium-ion battery recycling market during the forecast period.
In addition, advantages associated with the hydrometallurgical recycling process compared to other methods, such as low-cost, low temperature, high energy efficiency, and less environmental pollution, are anticipated to fuel the growth of the lithium-ion battery recycling market in the forecast period. Moreover, lithium-ion is recovered with more than an efficiency of 90%, which will further fuel the development of this segment in the market for lithium-ion battery recycling. The hydrometallurgical process segment registered the highest market share of around 64.8% in 2021 and is expected to maintain its dominance during the forecast period.
Based on end-user, it is bifurcated into automotive and non-automotive. The non-automotive fired segment dominated the market. It is estimated to reach an expected value of USD 29,175 million by 2030 at a CAGR of 39.7%. Second-life lithium-ion batteries can be effectively used in data centers in telecommunication industries, forklift batteries, emergency battery backup systems, UPS systems, standalone power backup, and renewable energy integration. This can be attributed to the high purity of recycled metals such as lithium, cobalt, aluminum, nickel, and others representing similar properties in newly produced materials. Thus, the abovementioned factors are anticipated to fuel the growth of the lithium-ion battery recycling market globally in the upcoming years.
By region, the global lithium-ion battery recycling market share is divided into North America, Europe, Asia-Pacific, and LAMEA.
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Europe garnered a dominant market share in 2021 and is anticipated to maintain this trend during the forecast period. It is estimated to reach an expected value of USD 13,360 million by 2030 at a CAGR of 39.9%. This is due to many parameters, including a large consumer base and the presence of significant players in the region. Furthermore, environmental restrictions and the rapid growth of the electric car industry in the region are expected to boost the market for lithium-ion battery recycling in Europe.
Europe ranks first for the significant market share in the lithium-ion battery recycling market, with predominance in the electric vehicles segment. Countries such as Germany, France, the UK, Italy, and Spain, are the major revenue contributors to this region. Lithium-ion batteries are widely used in the automotive and electronic industries in Europe. The demand for lithium-ion batteries in the medical, military, and energy storage sectors is increasing, contributing to the market's growth.
In addition, emerging applications of these batteries across various sectors, such as mining, marine, oil, and gas, are anticipated to boost the market growth in this region. Energy efficiency and environmental safety are the prime concerns among consumers in Europe. This has led to the adoption of lithium-ion battery recycling in the automotive sector. Lithium-ion batteries are expected to further experience increased adoption in the industrial sector due to their ability to supply power at a higher load with optimum power input than other conventional batteries, which is expected to create opportunities for key players operating in the market Lithium-ion battery recycling in the upcoming years.
Asia-Pacific is growing at the highest rate in revenue in the market for lithium-ion battery recycling. It is estimated to reach an expected USD 8,930 million by 2030 at a CAGR of 40.8% during the lithium-ion battery recycling forecast period. China, Japan, India, South Korea, and Australia are the major contributors to the market growth of this region. In addition, the rapid surge in population and rise in the economy of Asia-Pacific propel the development of the lithium-ion battery industry, which will further boost the demand for battery recycling in the region.