Investment in battery recycling continues as Hydrovolt begins commercial recycling operations

In the face of a worsening supply deficit for key battery raw materials including lithium and cobalt, battery producers are seeking new ways to secure raw materials for electric vehicle batteries

Hydrovolt – a joint venture between Norwegian-based aluminium and energy company Hydro and European battery-cell producer Northvolt – has begun commercial recycling operations at its Fredrikstad plant in Norway, the company announced on Monday, May 16.

Hydrovolt is the largest electric vehicle (EV) battery recycling plant in Europe, with the capacity to process 12,000 tonnes of battery packs per year, the equivalent of 25,000 EV batteries, the company has said.

The viability of recycling EV batteries has drawn increasing attention as battery producers seek to secure key raw materials such as lithium, cobalt and nickel in the face of a worsening supply deficit.

Significant investments have been made in the recycling space by companies across the supply chain, including raw material producers such as Glencore, and automotive companies such as Mercedes-Benz, with some in the market calling for further integration.

Hydro also hopes that increased recycling of batteries will directly benefit the sustainability of the battery industry globally, allowing for alternative access to key raw materials outside of traditional raw materials production. There has been growing attention to the environmental, social and governance (ESG) credentials of many key raw materials, including nickel.

“Recycling end-of-life batteries is a cornerstone to ensuring the electric vehicle transition is a true success from an environmental perspective,” Hydro’s chief environmental officer, Emma Nehrenheim, said in the May 16 company announcement.

Hydrovolt’s automated recycling process will enable up to 95% of battery metals to be recovered from battery packs, the company said. This includes copper, aluminium and black mass – a powder containing nickel, manganese, cobalt and lithium.

The company said it expects to produce 2,000 tonnes of black mass annually from the Fredrikstad facility.

This black mass will then be supplied directly to Northvolt for further recycling. All aluminium recovered through the process will be delivered to Hydro for recirculation into its aluminium products.

Hydro said it is exploring an expansion of its recycling operations, with a long-term target to recycle 70,000 tonnes of battery packs by 2025 and 350,000 tonnes by 2030.

“Batteries reaching end-of-life will get a new life through the recovery of black mass and aluminium,” Hydro executive vice president Arvid Moss said, adding that, “aluminium can be recycled with only 5% of the initial energy required to produce primary aluminium, which makes it a perfect material for a circular economy.”

The current tightness in supply has significantly increased spot prices and premiums for key battery raw materials.

Nickel briquette premiums in Europe have soared on tight supply and strong demand within the region and are currently trading at their highest levels since Fastmarkets began assessing the market in 2005. Fastmarkets assessed the nickel briquette premium, in-whs Rotterdam at $2,000-2,500 per tonne on Tuesday May 10.

Briquettes are often used as a precursor product for battery grade nickel sulfate, used in lithium-ion batteries.

Lithium hydroxide prices in Europe have more than doubled over the course of 2022. Fastmarkets assessed the lithium hydroxide monohydrate LiOH.H20 56.5% min, battery grade, spot price ddp Europe and the US at $74.00-78.50 per kg on May 12, up from $35-36 per kg on January 6.

Similarly, cobalt prices have increased steadily over the course of the year amid increased demand and tight supply.

Fastmarkets assessed the price of cobalt standard grade, in-whs Rotterdam at $39.75-40.25 per lb on May 16.

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