Shulou(Shulou.com)11/24 Report--

"with the rising price of power batteries, battery costs account for more than 40%, or even more than 50%, of a car." Recently, at a forum, Zhu Huarong, chairman of Changan Automobile, made a speech, which triggered extensive discussion in the industry.

Zhu Huarong said that according to various data calculations, the cost per car of different new energy models of Changan Automobile has increased by 5000 yuan to 30,000 yuan. "Guodian has seriously affected the achievement of product benefits, and the increase in battery costs is far greater than the value brought to users by technological advances."

New energy automobile enterprises have been suffering from expensive electricity for a long time. Earlier, Zeng Qinghong, chairman of GAC GROUP, said that the whole car factory was working for the Ningde era. And the Ningde era is also complaining, "I am just struggling on the edge of a little profit."

Behind "Guodian" is the sharp rise in the price of raw materials upstream of power batteries. Since the beginning of this year, the prices of lithium, cobalt and nickel, the main raw materials of power batteries, have all risen sharply, and the price of lithium has continuously reached an all-time high. The average spot price of battery-grade lithium carbonate even reached a high of 590000 yuan / ton, according to data released by Shanghai Iron and Steel Federation recently.

In the face of the continuous high fever of raw material prices, promoting the recycling of waste power batteries and key metal resources may become one of the key ways to crack the "expensive electricity".

According to the report "Power Battery Lifecycle Asset Operation and Management Research" launched by the China Electric vehicle Association, most retired batteries have high residual capacity (70-80% of the rated capacity) and can be used in a variety of scenarios. At the same time, decommissioned batteries contain valuable metals such as lithium, cobalt and nickel, which can be recycled.

But on the other hand, if the waste power battery does not go through professional and large-scale regeneration disposal, its potential pollution sources will be directly exposed to the environment, and organic matter, heavy metals and other components will spread into the environment, which will not only bring harm to human health, but also cause irreversible damage to air, water and soil, and have a greater negative impact on the ecological environment and production and life.

Therefore, power battery recycling is also known as "mine on wheels", which is the last and important part of power battery life cycle asset management. How to recycle retired batteries more scientifically will be a common test for all participants in this industry chain.

Around this topic, this paper attempts to answer the following three questions.

1. What is the development stage of power battery recycling?

2. What are the pain points faced by power battery recycling at present?

3. How to standardize the development of power battery recycling in the next step?

Running in 2019, former Tesla co-founder and CTO Straubel (Jeffrey Brian Straubel)

Decided to give up his job at Tesla and concentrate on a mysterious and complex business-decomposing waste batteries.

What prompted the battery expert to make this decision was the market's indifference to waste power batteries at that time. According to Straubel, unlike mobile phones, half-ton power batteries cannot be left idle in garbage drawers after the new energy vehicles are scrapped. At that time, there were no plans to process these power batteries.

He realized that in the next five years, early electric vehicles will begin to be phased out in large numbers, when there will be a tsunami. So, in 2017, Stroubel founded Redwood Materials, which is engaged in battery recycling. Two years later, Straube announced his departure from Tesla and began to concentrate on the battery recycling business.

Once founded, Redwood Materials quickly attracted the attention of investors. Since 2017, Stroubel and his team have raised nearly $800m, valuing the company at about $3.7 billion.

Among Redwood Materials's customers are Giga Factory, a Panasonic-Tesla superbattery factory, and Vision Power's battery plant in Tennessee, USA. Redwood Materials is also working with Amazon to recycle electric cars and other lithium-ion batteries as well as e-waste from some of their businesses.

Straubel is not the only one who sees such a high utilization and high potential value industry. In the past few years of the development of Redwood Materials, the global power battery recycling industry has gradually grown.

Since the end of 2020, driven by the demand for cathode materials of lithium batteries, upstream metal prices have entered the rising channel, generally showing a large increase, resulting in high cost of power batteries. At the same time, according to the service life of 5-8 years of new energy vehicles (3-5 years of operating vehicles), the first batch of new energy vehicles have gradually entered the stage of large-scale decommissioning of power batteries, and the power battery recycling market has initially formed a scale.

The ferocious rise in the price of raw materials upstream has pushed up the price of waste battery recycling market, coupled with the huge ownership brought about by the explosive development of new energy vehicles in recent years, the power battery recycling industry has rapidly changed from the early period of no one's interest to the "sweet cake" that everyone is fighting for.

In the Chinese market, which has ranked first in the world in terms of sales of new energy vehicles for seven consecutive years, power battery recycling is expected to become a "new blue ocean" of hundreds of billions of levels.

According to the China Automotive Technology Research Center, the total amount of power batteries decommissioned in China in 2021 was about 320000 tons, an increase of 60 per cent over the same period last year. By 2025, that figure will rise to about 780000 tons. Power batteries ushered in a wave of large-scale decommissioning, which will give birth to a hundreds of billions of power battery recycling market.

In the face of huge market capacity, many players run into the stadium. According to enterprise inspection data, the number of new power battery recycling enterprises in China from 2017 to 2021 was 1196, 1424, 1883, 3840 and 24900 respectively. In the first eight months of this year, the number of new power battery recycling enterprises in China was close to 30,000.

In particular, since the second half of 2021, the head companies such as Ningde era, Divine Gift Materials and Green Mei have accelerated their entry, which has added a fire to the power battery recycling track.

Among them, according to the different roles in the upstream and downstream of the industrial chain, players in the power battery recycling market can be divided into four categories: first, vehicle enterprises represented by BYD, Lulai and Dongfeng Motor; second, battery enterprises represented by Ningde era and AVIC Lithium; third, raw material production enterprises represented by Huayou Cobalt Industry and Xiamen Tungsten Industry; fourth, third-party enterprises represented by Greenmei and other third-party enterprises.

A detail worth paying attention to is that with the development of power battery recycling industry, the cooperation between upstream and downstream enterprises in the industrial chain is gradually deepening. Vehicle enterprises, power battery production enterprises and raw material production enterprises all lay out battery recycling business one after another. mainly through equity participation / holding of third-party recycling enterprises (including echelon and recycling enterprises), strategic cooperation and direct layout with enterprises in the upper and lower reaches of the industrial chain.

In this way, upstream and downstream enterprises form industry barriers through business extension, which can reduce the cost of power batteries to a certain extent; by opening up the upstream and downstream of the industrial chain, they can ensure the supply of some cobalt salts and other raw materials, and form a closed loop of power battery supply chain.

Take Ningde era as an example, in 2015, Ningde era acquired Bang Pu Recycling, a waste battery recycling enterprise, and cut into the battery recycling business; in 2018, Ningde Times reached a strategic cooperation with SAIC to jointly promote the recycling of power batteries for new energy vehicles. Wu Kai, chief scientist of the Ningde era, said recently that the Bangpu cycle has built 221 battery recycling outlets, accounting for 50% of the country's waste power battery resources in 2021.

It is worth mentioning that a few days ago, the Ministry of Industry and Information Technology publicly solicited opinions on the list of enterprises (the fourth batch) that meet the "norms and conditions for the comprehensive utilization of waste power batteries for new energy vehicles". There are a total of 41 "whitelist" enterprises in this batch.

If this announcement is passed, coupled with the three batches of lists previously released, there will be more than 80 domestic power battery recycling "whitelist" enterprises, and the power battery recycling industry is expected to accelerate into a new stage of regular military competition.

Although there are many people to break the pain point, at present, there are two main ways to recover power batteries in the industry: echelon utilization and disassembly recycling.

The decommissioned batteries with higher residual capacity can be used in the fields of energy storage and low-speed electric vehicles according to the principle of echelon utilization. For example, the user-side energy storage system of 7.27MWh cascade battery jointly built by Bick Battery and Southern Power Grid adopts the whole package application scheme of decommissioned ternary power battery, which realizes one-to-one battery package management through modular multi-branch energy storage converter, which effectively reduces the cost of battery package disassembly and reorganization.

For the waste battery that does not meet the echelon utilization standard, the waste battery can be disassembled, crushed and screened in accordance with the principle of disassembly, recycling and reuse, and the core raw materials such as nickel, cobalt and lithium in the power battery can be extracted and reused in the production of power battery.

Everbright Securities expects that the recovery of lithium, nickel, cobalt and manganese in ternary lithium batteries will reach 2200 tons, 8000 tons, 4700 tons and 5300 tons respectively in 2022, and predicts that these figures will double in 2025.

Zeng Yuqun, chairman of Ningde Times, also said that the recovery rate of nickel, cobalt and manganese in Ningde era has reached 99.3%, and the recovery rate of lithium has reached more than 90%. He predicts that by 2035, the battery materials obtained through recycling will be able to meet most of the market demand.

A recognized fact in the industry is that the power battery recycling industry has good commercial prospects and social value, but in China, power battery recycling is still in its infancy.

Wang Zhenpo, a professor at Beijing Institute of Technology and director of the National Engineering Research Center for Electric vehicles, said that at present, there are still many pain points to be broken in power battery recycling.

For example, the information asymmetry in the upper and lower reaches of the industrial chain, including real-time access to retirement information, difficult recovery by comprehensive utilization enterprises, opaque transaction price information, etc.; echelon utilization technology urgently needs a breakthrough, including difficult battery health assessment, low efficiency of retired battery detection, lack of consistency detection system, etc.; automation technology and equipment needs to be upgraded, including low battery compatibility, low intelligence level, low green ability and so on.

Take the difficulty of recycling as an example, at present, informal recycling channels and irregular recycling means disturb the order of the industry. There are still recycling "small workshops" in the industry, with backward process equipment, lack of relevant qualifications, safety risks and serious environmental protection problems. Compared with compliance enterprises, the recovery cost of these "small workshops" is low, and through high prices to seize decommissioned power battery resources, it is more difficult for formal third-party recycling enterprises to obtain most of the actual decommissioned battery resources.

From 2018 to 2020, less than 20 per cent of retired batteries were recycled by whitelist companies, according to HGI Lithium data. "according to personal estimates, 90% of the waste power batteries before 2021 went to small workshops." In an interview with the media, Yu Qingjiao, secretary-general of Zhongguancun New Battery Technology Innovation Alliance, said.

Speed up standardization in fact, since 2016, the power battery recycling policy has been introduced intensively and has entered a comprehensive pilot stage. There are many signs that the standardization process of the power battery recycling industry is accelerating.

On the one hand, in recent years, policies such as "interim measures for the Administration of Recycling and Utilization of Power Storage batteries of New Energy vehicles" and "measures for the Management of echelon Utilization of Power batteries of New Energy vehicles" have been issued one after another, and the standardized management of the comprehensive utilization of waste power batteries has landed on the ground. promote the construction of power battery recycling system to be further improved On the other hand, the industry has explored and formed a number of new business models such as "echelon batteries for rent and sale" and "waste for raw materials", promoting the recycling of power batteries to form a commercial closed loop.

In this process, Che Bai think tank believes that there are four paths that can be used for reference.

The first is to integrate the recycling requirements into the battery product design. Strengthen the cooperation among power battery enterprises, vehicle enterprises, echelon utilization enterprises and recycling enterprises, jointly develop and explore plans to integrate echelon and recycling needs into the stage of power battery R & D and production, and launch industry demonstration products.

The second is to promote the construction of standardized recycling networks. Explore the model of industrial chain enterprises to jointly build and share recovery service system, improve responsibility attribution and management system, promote the formation of recycling network construction norms, improve network utilization rate, and share network construction costs. to ensure that industrial chain enterprises can optimize the allocation of resources in various regions.

The third is to improve the transport efficiency of retired batteries. Through the cooperative practice of power battery enterprises, recycling enterprises, logistics and transportation enterprises, explore the best scheme to transport decommissioned batteries, improve transport efficiency, reduce transport costs, and promote the formation of relevant industry standards.

The fourth is the mode of innovative cooperation. Set up an operation center in a certain area, which is jointly funded by all the power battery recycling practitioners involved in the region and the government, to provide basic common services such as decommissioned power battery recovery, logistics, storage, traceability, salvage assessment, disassembly and so on. It can not only save the cost and investment, but also promote the construction of relevant standards in the power battery recycling industry, without affecting the economic benefits created by enterprises giving full play to their respective advantages in the stage of echelon utilization and material recycling.

With the development of intelligent electric vehicles, from the global layout, China will become an important new center in the reform of automobile supply chain. Whether from the perspective of alleviating the high dependence of power battery on upstream resources, or from the perspective of low-carbon development and environmental protection, power battery recycling is an indispensable part of the industrial chain.

Improve the access mechanism, promote system construction, and explore business models. Only by keeping the last link of the whole life cycle of the power battery, the new energy vehicle can really show the green background.

Full-text reference

[1] "the tsunami of battery recycling is coming, and they are ready", Automotive Business Review, Zhu Lin

[2] the trend of "power battery" decommissioning forced recycling "filing", China Youth Daily, Xu Yajie

[3] "at the end of the year, there will be a" wave of recycling "and hundreds of billions of commercial maps of power batteries.

[4] "suggestions and suggestions from the industry directly hit the pain point of power battery recycling", China Automobile News, Zhao Qiong

This article comes from the official account of Wechat: che Bai think Tank (ID:EV100_Plus), author: Cheng Honghe, Research Institute: Yan Yancui, Editor: a Feng, typesetting: fat Tiger

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