Lithium is running hot and getting hotter. The rise of lithium-ion batteries in everything from headphones, smartphones, electric cars to industrial energy-storage, has compounded the demand for this vital element with prices soaring around 65% this year. The annual growth rate of the battery market is currently at 15% but this is tipped to increase, with analysts predicting that lithium production needs to increase 3000%.
The Lithium-ion market was less than 6 GWh ten years ago, yet by 2016 this market was estimated to have surpassed 70 GWh and is expected to leap to 223 GWh by 2025. China alone, has a target of five million electric vehicles on its roads by 2020, and further annual sales of around seven million vehicles sold annually by 2025.
Australia is currently the largest producer of lithium, with 14,300 tonnes of lithium extracted last year and home to the world’s largest hard-rock lithium mine, the Talison Lithium Greenbust mine, located in Western Australia.
Despite the very clear and growing demand for lithium, very few mining projects globally are shovel ready, although there will be some new hard-rock developments in Australia by 2025. Australia, will for now, continue to be the significant supplier of lithium globally and particularly into China’s conversion industry which relies on hard-rock. However, with new countries such as Argentina now supplying the markets and new technologies with lithium from brine production (which is more cost-effective), where will that leave Australia?
So how can the materials recovery sector participate in these future opportunities?
The proliferation of lithium-ion batteries into products and, by default, the waste and recycling streams is increasing. But often the design of products makes battery removal, let alone recycling, difficult. For example, Apple is going to add an estimated three billion mini lithium-ion batteries to the market with their new AirPod wireless headphones over the next ten years; which have three tiny ‘glued-in’ lithium batteries that makes removal for recycling difficult and shredding risky due to the inherent fire risk. Yet, the sales of these and similar electronic products are increasing, prolificating shorter life-spans as technical obsolescence intensifies.
Lithium is a critical material. Critical materials are just as the name suggest, critical (acknowledging the definitional issues surrounding this word in this context), and there is growing acknowledgement of both supply risks and that society cannot continue to lose these valuable resources from the economy (beyond those which are ‘consumed’, meaning that they cannot be recovered).
It is important to address the misconception of supply risk as simply being about a shortage of supply. It is more likely that supply risks will manifest themselves as price increases and greater price volatility. This poses inherent risks and opportunities for the recycling sector, most notably the links between raw materials, secondary materials supply and reprocessing or remanufacture costs.
There is considerable potential to increase recycling performance to recover more value and environmental benefit from e-wastes and larger devices (car batteries to clean-energy storage devices).
We must ensure that the importance of critical materials, particularly the ‘technology metals’ (rare earths, gallium, indium etc.) are recognised, and policy and regulatory approaches support their domestic recovery and reuse. Expanding recovery efforts to include critical and rare earths will lead to substantial benefits, including the substitution of these valuable and finite primary-resources with secondary-resources.
We need new policy stimulus around the recovery of lithium and other critical metals through improvements in waste management and recovery infrastructure. This must start with the expansion of the current product stewardship scheme to include further e-wastes and better manage the targets which have created a boom-bust culture.
We must also capture new and clean technologies, ranging from end of life electric car batteries through to solar photovoltaics and power storage. We can use the current regulation to ensure the recycling and capture of critical materials and prepare them for reuse in the manufacturing of clean technologies domestically. Work on a product stewardship scheme for photovoltaic cells is already underway.
There is also a role for government to be actively involved with policy tools for the promotion of green design and ‘design for active disassembly’, supported by funding initiatives intended to support the use of secondary resources, through to the development of new and innovative technologies.
Australia needs to recognise and prosper from the economic benefit that closed-loop business models can bring. We lag Europe and the U.S. when it comes to the security of critical materials supply and providing certainty to those industries which (will) use them, and it is at our innovation and economic peril.
Unlike broader metal prices which have fallen over recent years as commodity and energy prices fell, prices for most critical materials have risen or at least remained constant, creating more certainty and reduced risk for e-waste processors and those dealing exclusively with critical metals.
While Lithium-ion is 100% recyclable, histrocially the economics have not stacked up to recycle it with recycled lithium coming in around five times the cost of virgin lithium. Batteries in electronics contain only a small fraction of lithium carbonate as a percent of weight and are inexpensive compared to cobalt or nickel. And the intrinsic value for the Lithium-ion recycling business currently comes from the more-valuable metals such as cobalt and nickel that have been histrocially more expensive than lithium – but that is changing, as is the volume of lithium in larger batteries associated with transport and energy-storage devices.
Currently, none of the lithium used in consumer batteries is completely recycled and this must change. Various overseas projects are currently underway to develop effective and feasible recycling technologies with a complete life-cycle analysis of recycling. Such an approach may be harder for Australia given we do not have a industrial manufacturing-base for electronic goods but we still have opportunties. These opportunities need to commence with standardisation of battery chemistry through to‘ design for active-disasembly‘ approaches to consumer goods. In the absence of any government agenda in this area, I challenge the sector to lead the required change, through robust and profitable commercial enterprises which foster an extended producer responsbility approach.