In the newly updated market report “Li-ion Battery Recycling Market 2025-2045: Markets, Forecasts, Technologies, and Players”, IDTechEx forecasts the Li-ion battery (LIB) recycling market to grow to US$52 billion in value by 2045, given the increasing availability of retired Li-ion batteries over the coming decades.

Key sources of feedstock will include electric vehicle (EV) batteries, and Li-ion batteries from energy storage systems (ESS), consumer electronics, alongside manufacturing scrap. LIB demand continues to grow significantly, especially across EV and ESS markets. Therefore, the management of these batteries at end-of-life (EOL) will become increasingly important, IDTechEx said.

Recycling LIBs can allow cell manufacturers to domesticate critical battery material supply and reduce reliance on importing materials from China and other overseas countries. This can also allow these manufacturers to shield themselves against supply bottlenecks and volatile raw material prices.

Recycling can also be a profitable business venture for recyclers, as long as certain chemistries are chosen. LFP chemistries do not contain nickel or cobalt in the cathode and are thus less profitable to recycle. Ternary batteries, e.g., NMC and NCA, are instead more profitable to recycle.

Policies and regulations in key regions will also be key drivers for LIB recycling market growth. For example, in the EU, battery manufacturers and automotive OEMs will need to meet minimum recycled content targets of lithium, cobalt, and nickel in their new EV batteries.

Key Li-ion battery recyclers by region and Li-ion battery recycling capacity by region in 2024. Source: IDTechEx

As shown in IDTechEx's market report, only certain scenarios will allow for these targets to be met region-wide, and they will be influenced by the source of recycled feedstock and the collection rate of these feedstocks.

IDTechEx has documented more than 120 key announcements made by LIB recyclers over 2023 and 2024 regarding new recycling facilities, funding, and investments, as well as new strategic and supply agreements made with, e.g., automotive OEMs, cell suppliers, and collection and logistics players.

This hyperactive market is being flooded with funding and investments, with recyclers accumulating more than US$3.1 billion in 2023 and 2024 combined. This will be used to develop technologies as well as establish new commercial-scale recycling facilities. With some new facilities being commissioned in recent years, global LIB recycling capacity stood at ~879 kt EOL LIBs at the end of 2024.