Circular Design and Battery Recycling: The Multi-Billion Euro Opportunity Research objective Recent disruptions and bottlenecks in the supply chain have once again highlighted the criticality of building a European circular economy for battery materials. While OEMs are increasingly involved in the upstream value chain for battery materials, European regulations already today make them responsible for end-of-life vehicle and battery recycling. To comply with regulations and ensure access to materials, OEMs are increasingly addressing battery end-of-life and recycling. This puts even more focus on developing batteries and vehicles with circularity in mind, as it directly impacts OEMs’ business and competitiveness. This paper analyzes the potential of battery design-for-circularity measures, including the cell chemistry choice, and their impact on battery end-of-life value. Methodology FEV has collaborated with stakeholders from across the battery recycling value chain – from dismantlers to metal extractors to OEMs. We have integrated our deep technical and economic understanding into a suite of models we call CycleBat, which allow us to make predictions about the future battery recycling industry: • A detailed forecasting model for battery scrap and end-of-life feedstock was created, considering FEV’s own powertrain forecast, OEM-specific technology strategies for battery cell chemistries, and regional shifts from production to sales location to end-of-life. • A sophisticated battery recycling cost model was developed that calculates costs bottom-up for typical recycling routes, considering machine, processing and labor cost, among others. The model aims to accurately describe the powerful scale effects observed in the processing industry, clearly showing the need for industrial recycling. Using FEV’s CycleBat models and vast experience in battery design, various design-for-circularity measures and their impact on the recycling costs and the end-of-life values of batteries were analyzed. Results The impact of a variety of design-for-circularity measures for batteries was assessed over the entire lifecycle with a focus on end-of-life and recycling. The results show significant business potential for automotive OEMs and the related value chain. The cell chemistry choice alone can affect the end-of-life value of the battery by up to 1,700€ for a typical electric passenger vehicle. A modular design of the battery pack can more than triple the potential for battery remanufacturing and reuse during its lifetime. In a subsequent step, various measures for monetizing the additional end-of-life battery value were defined. Limitations The study focuses on the European market. What does the paper offer that is new in the field in comparison to other works of the author? FEV has not yet published any of its research regarding the monetary business potential of battery design-for-circularity, nor has – to the best knowledge of the authors – any other work been published on the topic in such detail. Conclusion The study’s findings highlight the importance of a holistic lifecycle approach to electric vehicle battery development. OEMs need to be aware that end-of-life batteries can be a profitable source of revenue or a significant liability, depending on their battery design and business model choices. The impact can be as high as multiple thousand Euros per electric vehicle and occupy an OEM for over two decades after the start of production.

Mr. Kilian Sagner, Senior Consultant, FEV Consulting