EU lawmakers have passed tough new laws on environmental and due diligence standards for battery manufacturers selling into the European market, including requirements to recover almost all of the nickel and cobalt and half of the lithium in batteries at the end of their useful life.
The European Federation for Transport and Environment (T&E), a peak body for European environmental NGOs, says the new legislation, the Batteries Regulation, will be a game changer for the sourcing, production and recycling of batteries for EVs.
From as early as July 2024, battery makers selling in Europe will have to report the product’s total carbon footprint, from mining through to recycling. That data will then be used to set a maximum CO2 limit for batteries to come into effect as early as July 2027.
“Batteries are already far more sustainable than burning oil in our cars, but they can be much better,” says Alex Keynes, clean vehicles manager at T&E.
“New rules on carbon footprint, recycling and due diligence checks will mean batteries sold in Europe are the most sustainable globally, setting the standard for the rest of the world.”
The rules are not limited to assessing the carbon footprint of a battery. Companies selling batteries in the EU will also have to identify, prevent and address any environmental, human rights or labour issues in their supply chains.
But while these new regulations will only apply to key raw minerals like lithium, nickel, cobalt and graphite, T&E says all raw materials, including fossil fuels, should be held to the same standards under a new due diligence law.
Batteries are already more resource efficient than petrol and diesel, which cannot be reused or recycled once burned. The new targets will extend this advantage further: from 2027 battery-makers must recover 90% of nickel and cobalt used, rising to 95% in 2031. The rules also mean manufacturers must recover 50% of lithium used in 2027, rising to 80% in 2031.
T&E said the new rules will help bolster Europe’s home-grown battery industry. The law will ensure new products made by European companies won’t be undercut by imported batteries made with coal-heavy energy. The NGO said demand for recycling will also spur investments needed to establish a robust recycling industry within Europe.
“The law helps even the playing field between Europe’s battery industry and imports which are subject to minimal standards,” said Keynes. “Global producers can invest in cleaner production processes and new recycling capacity in Europe knowing they will have a guaranteed market for green batteries here.”
But there’s room for caution: T&E warned that the new rules could be circumvented by greenwashing if battery producers are only required to disclose Guarantees of Origin to prove their energy is renewable.
Guarantees of Origin have come under fire in Europe; these financial documents, which are supposed to act as a guarantee that the energy being used by a company or to create a product is renewable, have been plagued by controversy because these GOs can be purchased, and because the source of all electricity used is incredibly hard to trace.
Australia is an underperformer in battery recycling, with most of its battery waste shipped overseas – with the exception of lead-acid batteries, 98% of which are recycled in Australia.
According to CSIRO, lithium battery waste in particular is growing by 20% each year, and could exceed 136,000 tonnes by 2036. But, if recycled, 95% of lithium-ion battery components can actually be turned into new batteries or used in other sectors.
Currently, there are only a handful of companies that recycle lithium batteries around Australia, including Envirostream, Ecobatt and Ecoactiv.