After a decade of dizzying growth, China is now facing the not-so-silent threat of battery retirements. Annual sales of EVs have skyrocketed from around 1 million in 2018 to over 16 million by 2025, with batteries typically lasting eight years. This means that as these batteries near their end-of-life, a challenge looms: managing the waste and recycling it efficiently.

The first wave of battery retirements is already here, with China reporting 400,000 metric tons of EV battery waste in 2023. By 2040, this could grow to an astounding 22.39 million metric tons. Critics say that while the environmental benefits of electric vehicles are clear, their full life-cycle impacts remain questionable, particularly with regard to recycling and disposal.

China has been proactive in developing a formal battery recycling system since 2018, with over 150 companies on its ‘white list.’ However, these certified recyclers struggle to keep up. In 2023, they handled only about 25% of retired batteries, highlighting the gap between nominal capacity and actual operations.

The informal sector is booming, with unlicensed operators often undercutting certified recyclers due to lower costs and more lenient practices. This not only poses significant environmental risks but also jeopardises worker health. Dismantling and recycling processes can still lead to poisoning, fires, and explosions if not done correctly.

While repurposing batteries could be a viable solution, the complexity of testing and grading each cell makes it economically challenging for many operators. Selling used cells for unapproved applications further compounds these risks. As China navigates this challenge, how it manages battery retirement will shape the global industry’s future.