Europe Union, Lithium recycling fee issue

During recent meetings in Athens, a compelling discussion emerged about North America and Europe's divergent paths toward a green future. While North America is actively advancing towards increased adoption of batteries and renewable energy, Europe appears to be stepping back, introducing additional mandatory fees that challenge the feasibility of renewable projects. This shift is primarily influenced by the EU Regulation (EU) 2023/1542 of the European Parliament and the Council of 12 July 2023, which addresses batteries and waste batteries. It amends Directive 2008/98/EC and Regulation (EU) 2019/1020, while repealing Directive 2006/66/EC.

The New EU Regulation on Batteries and Waste Batteries

This regulation has significant implications, particularly for electric vehicles and rechargeable industrial batteries with a capacity greater than 2 kWh. Below are some key points and quotes from the regulation:

•  Point 101: "Producers should have extended producer responsibility for managing their batteries at the end-of-life stage. Accordingly, they should finance the costs of collecting, treating, and recycling all collected batteries, carrying out compositional surveys of mixed collected municipal waste, reporting on batteries and waste batteries, and of providing information to end-users and waste operators about batteries and appropriate re-use and management of waste batteries."
• Point 101: "Extended producer responsibility should apply also to economic operators placing on the market a battery that results from preparation for re-use, preparation for repurposing, repurposing, or remanufacturing operations. Therefore, the economic operator that originally placed the battery on the market should not bear the additional costs that could result from the waste management arising from the subsequent life of that battery. It should be possible for the economic operators subject to extended producer responsibility to establish a cost-sharing mechanism based on the attribution of the actual waste management costs."
• Article 56, Point 4: The financial contributions to be paid by the producer shall cover the following costs for the products that the producer makes available on the market in the Member State concerned:

a: Costs of separate collection of waste batteries and their subsequent transport and treatment, taking into account any revenues obtained from preparation for re-use or preparation for repurposing or from the value of secondary raw materials recovered from recycled waste batteries;

b: Costs of carrying out a compositional survey of collected mixed municipal waste in accordance with Article 69(5);

c: Costs of providing information on prevention and management of waste batteries in accordance with Article 74;

d: Costs of data gathering and reporting to the competent authorities in accordance with Article 75.

Financial Implications in Greece

In Greece, there is an additional layer of complexity. Batteries must be registered with a non-profit organization, and recycling fees must be paid upon registration. The fees are not so small compared to the battery module's cost. LFP utilization raw fee is 2.4 Euros per kilogram of module. To put this in perspective, let's consider the average cost of a battery module, which is $140 per kWh with a capacity of 150 Wh/kg. This translates to 6.66 kg per kWh.

Consequently, the cost is 16 Euros per kWh, or approximately $17.3 per kWh.

This fee represents around 12% of the module cost of $140 per kWh, or 15% of actual usable energy due to site oversizing to meet required capacity at the end of the life, which is a substantial financial burden that could impact the overall economic feasibility of battery projects in Europe.

Conclusion

The EU's new regulation on batteries and waste batteries aims to address environmental concerns but also introduces significant financial responsibilities for producers, which can present additional challenges for manufacturers. An additional 15% financial burden paid at the moment of battery registration is significant and represents the around 15% decrease in ROI (+1-2 years for the payback period)