- ithium-ion battery recycling company Li-Cycle said Monday it’s secured a conditional commitment for a loan of $375 million from the Department of Energy.
- The funding will be used to develop a recycling facility for key battery materials near Rochester, New York.
- When fully operational the plant will process batteries from 200,000 electric vehicles annually, according to the company.
Battery recycling company Li-Cycle said Monday it’s secured a conditional $375 million loan from the Department of Energy to develop a recycling facility for key battery materials near Rochester, New York.
For lithium-ion batteries specifically, much of the focus has been on mining. While the U.S. has an abundance of lithium, getting it out of the ground is expensive, and projects frequently face local opposition.
The price of lithium has eased back from record levels hit earlier this year, but in the last three years prices are still up more than 800%. The rapid appreciation comes as some believe there simply won’t be enough supply to meet growing demand from electric vehicles.
The Rochester facility will significantly expand Li-Cycle’s reach. The company currently has four plants in North America where it processes battery materials. But the new plant will be able to take it one step further, turning the recycled product into materials that can be used for future batteries.
When fully operational, the plant will recycle up to 200,000 vehicles’ worth of lithium-ion batteries annually, according to the company. From that, the site will produce 8,500 tonnes of lithium carbonate as well as nickel sulphate and cobalt sulphate.
Monday’s announcement comes amid the United States’ push to develop domestic manufacturing and supply chains for materials and technologies critical to the energy transition. The incentives and credits in the Inflation Reduction have fueled a frenzy of announcements from companies looking to jumpstart operations on U.S. soil.
Earlier this year the Department of Energy announced a conditional loan of up to $700 million for miner Ioneer to develop the Rhyolite Ridge Lithium-Boron Project in Esmeralda County, Nevada.
But Li-Cycle co-founder and CEO Ajay Kochhar said recycling will also play a key role.
“Recycling is an unappreciated, or not as appreciated, alleviator of that supply need,” he told CNBC. “I think of course we need both primary, meaning mine sources, and secondary…every unit counts of lithium, nickel, cobalt. I think with the overlay of the IRA and the overlay of the corporate targets around sourcing for these materials, recycling is going to be very important.”
Kochhar forecasts that in the next 10 years the recycling industry could meet between 10% and 20% of demand for battery-grade lithium, nickel and cobalt. Thirty years down the line he believes recycling will be a “very significant portion of demand,” potentially meeting more than 50%.
“Everybody’s scrambling to get units. Every unit counts. Being an alleviator – a domestic source, a cleaner source, is super helpful to our customers,” he added.
If approved the loan, which is subject to certain conditions, will be made under the DOE’s Advanced Technology Vehicles Manufacturing program. Li-Cycle said it expects the loan to close during the second quarter, with the company planning to initiate commissioning of the Rochester facility late this year.
Li-Cycle was founded in 2016, and went public in August 2021 through a SPAC. The company has received strategic investments from Glencore, Koch Strategic Platforms and LG Chem.
This article was originally published by CBNC.