In China they have nicknamed them “scavengers”, but the work they do is of great value, economic, social and green: they hunt for used batteries, immensely precious and difficult to find. In fact, each accumulator has valuable elements such as lithium, cobalt and nickel which can be extracted and resold. And with millions of electric vehicles now ready for disposal and thousands of cars already abandoned in cemeteries across the nation, there's a mountain of obsolete batteries waiting to be recycled.
Yes, because all those precious metals, hidden in landfills, car parks and driveways throughout China, are a crucial resource, which would give Chinese car manufacturers a further advantage: they could thus produce electric cars with recycled batteries on a large scale, making them doubly eco-friendly . However, it will be difficult to create a complete supply chain: the sector is expanding, has thousands of small operators and many almost clandestine recycling laboratories. A gray market has emerged alongside a rapidly growing industry that is difficult even to quantify. Politicians are starting to try to regulate the sector but, at the moment, there is still a lot of “black” business, beyond the confines of the official rules.
And China, where one in three new vehicles sold is electric, compared to one in eight in Europe, is a huge market. So much so that the Government says the nation could reach the goal of having electric cars account for 50% of all new sales by 2026, 10 years earlier than expected. For this reason, according to the consultancy Circular Energy Storage, by 2030 China will have almost four times more batteries to recycle than in 2021.
But China's regulation of battery recycling is still in its infancy. And it's no coincidence that battery manufacturers and car manufacturers have difficulty recovering expired cells. This is where traders like small Chinese entrepreneurs come in. The “scavengers”, in fact: they publish ads on social platforms such as Douyin, similar to TikTok, exploit friends and family to find potential sellers. And if the battery is in a distant province, there is no problem: they organize a courier to collect it or they go to collect it themselves: all transactions are always carried out quickly and in cash because the prices of raw materials are so volatile that Recycling rates can change in as little as half a day.
Yang Lin, secretary general of the battery recycling committee established by China's Electronic Energy Saving Technology Association, estimates that unregulated operators currently make up about a fifth of the market. With the cost of installing a single recycling line running at around $15 million, it's easy to see why street cleaners came into being.
However, their illegal work threatens to undermine the credibility of Chinese recycled batteries because these family-run micro-companies do not always respect environmental and safety standards. And because they don't have to invest in such adequate protections, they can offer higher prices to electric vehicle owners and other battery owners, diverting valuable cells to an untraceable supply chain. A chain that works without rules and with often dangerous methods because the most profitable batteries for electric vehicles to recycle are those made up of lithium, nickel, cobalt and manganese: to extract the metals they must be dismantled and shredded into what is known as “mass black,” which is then dissolved in powerful chemicals.
Pan Juntian, a reporter for a local Chinese media outlet, spent two weeks undercover to get a look inside these labs. “Without advanced machinery, dismantling battery packs requires an enormous amount of labor,” she said. Hourly workers, wearing only cloth masks for protection, used crowbars and electric saws to open the boxes.
A big security risk because these labs are dealing with things they don't fully understand. Not to mention the transportation problem: according to the Chinese national standard, trucks carrying old batteries must be equipped with smoke detectors and fireproof and heat-insulating packaging. But many illegal workers turn to Huolala, a provider of on-demand trucking services, said Yu Haijun, vice president of Guangdong Brunp Recycling Technology Co., a subsidiary of Chinese battery giant CATL. “Transportation from point A to point B might cost 40,000 yuan or 4,000 yuan. The difference is enormous.”
The Chinese government is now trying to regulate this jungle but it obviously won't be easy. One possible route could be to collaborate with automakers to have them recycle car batteries, says Hu Feng, vice president of the Shenzhen-based GaoGong Lithium Battery Research Center. But the costs, at the moment, are high. But the benefits to builders could be enormous: Over time, they would build a stable supply of basic materials. And then the carbon footprint of recycled materials for electric vehicles would be far lower than that of traditional mines. In the case of a nickel-rich battery in Europe using the hydrometallurgical method, for example, the carbon footprint could be four to five times smaller, according to McKinsey & Co.
But making the recycling system work properly would also help Chinese automakers better market their cars abroad. This could be the key as the EU has set mandatory minimum levels of recycled content in electric cars sold there, initially at 16% for cobalt, 85% for lead, 6% for lithium and 6%. % for nickel. There is also a requirement to establish an electronic “battery passport” and QR code by 2027 to verify the source of raw materials, along with separate lithium collection targets for used batteries. In the meantime, the “sweepers” continue to work without any safety regulations and in total anonymity.
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