Australia, having 12.4% of global identified lithium resources, is the world's largest lithium producer with eight lithium companies located in WA accounting for 43% of global supply.
Global lithium production increased by 23% (excluding U.S. production) last year in response to growing demand for lithium-ion batteries. This trend is forecast to continue, stimulated by initiatives to adopt new energy vehicles including the "Made in China 2025" industrial plan and the European Commission's Connecting Europe Facility budget plan for 2021-2027.
Two lithium hydroxide plants are under construction in Western Australia, the Albemarle Kemerton Plant, Australia's biggest lithium hydroxide project which commenced in March, and the Tianqi Kwinana Plant, expected to be commissioned at the end of 2019.
While Australia exports almost half of the world's lithium, it captures only approximately 0.5% (A$1.1billion) of lithium’s ultimate value. Currently, 90% of the lithium battery production market is shared by three Asian countries, with China accounting for 50% and Japan and South Korea each sharing 20%. These three countries account for 93% of the global market for battery assembly.
The WA government's Future Battery Industry Strategy announced in January identifies pathways for WA to become a world leader in the future battery industry including the recycling of waste at all stages of the lithium-ion battery value chain.
There is a strong economic incentive for recycling lithium batteries given the recoverable materials they contain with significant value, such as cobalt, lithium and graphite. Globally, less than 3% of all lithium-ion batteries are recycled. Before 2018, most waste lithium batteries were exported to China for disposal, where valuable resources were extracted and exploited. China has since banned the import of lithium battery waste, creating opportunities for other markets.
In Australia, used batteries are a growing and complex waste stream creating the potential for the development of strategies and technologies for recycling and domestic processing to avoid losing value to landfill or other economies. With many batteries yet to reach end of life in Australia, the recycling market is undeveloped. ASX-listed Neometals Limited is developing a sustainable technology for the economic recovery of the critical metals from spent lithium-ion batteries and recently released a scoping study in this regard.
If lithium-ion battery waste generation grows to between 100,000 to 180,000 tonnes by 2036, the potential recoverable value based on current commodity prices has been estimated by CSIRO as between A$813 million to A$3 billion.
Life cycle management strategies, stakeholder expectations, sustainability and regulatory requirements will shape demand for battery recycling.
Ultimately, whether lithium-ion battery recycling is economically feasible will depend on factors including the costs for collection and transport, costs of dismantling and sorting of waste prior to processing, extraction technology, the fluctuation of commodity prices, and regulatory developments.
Innovative solutions to these challenges are expected to create competitive opportunities, which, if harnessed, will assist in positioning WA as a leading exporter of future battery materials, technologies and expertise.