The global battery recycling market was valued at USD 1.83 billion in 2023 and is projected to grow at an impressive compound annual growth rate (CAGR) of 37.6% from 2024 to 2030. This rapid growth is driven primarily by the rising popularity of electric vehicles (EVs) and renewable energy storage systems, both of which have significantly increased the demand for batteries. As battery usage escalates, so too does the necessity for recycling to ensure sustainable and environmentally responsible disposal and reuse of valuable materials. Additionally, governments around the world are implementing stringent regulations aimed at promoting battery recycling and reducing the environmental impacts of improper disposal. These regulations are expected to further propel the market's expansion during the forecast period.
In North America, the U.S. emerged as the largest market for battery recycling in 2023. The country’s growing EV market, bolstered by supportive federal policies, has been a key factor in driving battery demand and recycling efforts. One notable policy is the Responsible Battery Recycling Act of 2022 in California, which requires all battery retailers to have a system in place for the collection and recycling of used rechargeable batteries. This legislation not only promotes environmental sustainability but also fosters the growth of battery recycling infrastructure across the state.
The U.S. market has also experienced notable growth in lithium-ion battery recycling, primarily due to the expansion of large-scale recycling facilities. For example, Li-Cycle Corp. inaugurated a new lithium-ion recycling facility covering 120,000 square feet of warehouse space, which has the capacity to process 10,000 tons of battery material annually from electric vehicles. The facility is capable of recycling up to 60,000 EV batteries each year, reinforcing the country’s leadership in battery recycling innovation and infrastructure.
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Chemistry Segmentation Insights
When examining the market by battery chemistry, lead-acid batteries dominated the global battery recycling market, accounting for more than 84.0% of the revenue share in 2023. Lead-acid batteries are more conducive to recycling than many other types, due to the high reusability of lead and plastics in the manufacturing process. Battery recycling companies typically collect used lead-acid batteries from consumers, where the batteries are broken down into component parts. The plastic from these batteries is sent to plastic recyclers and reshaped using extrusion techniques, while the lead components are recovered for reuse in new batteries.
Lithium-ion batteries, on the other hand, are emerging as the fastest-growing segment within the battery recycling market, mainly due to their widespread use in electric vehicles (EVs). According to the International Energy Association (IEA), more than 13% of new cars sold globally in 2023 were electric, which led to a substantial rise in the demand for lithium-ion batteries. As demand for EVs continues to surge, there is an increasing need to recycle lithium-ion batteries to recover valuable materials like cobalt and lithium. Both cobalt and lithium are essential components in the production of batteries for electric vehicles. With the global demand for these materials growing, companies in the battery recycling sector are adopting various strategies to increase their market share, including investing in advanced recycling technologies to efficiently recover these critical materials.
The heightened focus on recovering materials like cobalt and lithium from used batteries is shaping the future of the battery recycling industry, as these resources are crucial for sustainable battery production. With an ever-increasing demand for electric vehicles and renewable energy storage systems, the battery recycling market is poised for substantial growth, providing a critical solution for managing the environmental impact of battery disposal while contributing to the circular economy.
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