As the demand for cleaner energy grows, lithium-ion battery recycling becomes crucial. Gaurav Dolwani of LICO Materials discusses its future and the role of black mass with EFY’s Nitisha Dubey.
Q. What is Lico’s primary focus in the lithium-ion battery sector?
A. In the lithium-ion battery industry, we focus on two key business areas: recycling and refurbishment or repurposing. Through recycling, we strive to recover and reuse valuable materials, while refurbishment allows us to extend the life of batteries by repurposing them for other battery energy storage applications.
Q. What is the process for recycling batteries?
A. We collaborate closely with various original equipment manufacturers (OEMs), maintaining a transparent partnership. When we collect batteries, OEMs can track and trace them to our nearest facility. Then, the battery packs are opened and discharged at our facility, as even end-of-life batteries may retain some voltage. After discharging, we conduct tests to determine if the batteries have the potential for a second life, particularly for energy storage. It would be a great outcome if they can be repurposed for this use, as they could power homes or offices for a couple of years. While they may no longer be suitable for mobility, they can still serve other applications. If the batteries are not viable for second-life use, they proceed to recycling, where our goal is to recover critical minerals with the highest possible purity. The current process involves mechanical separation, which includes multiple stages of shredding, crushing, grinding, and screening to remove impurities from the black mass.
Q. What is the next step after the recycling process is completed?
A. We would first place it in an energy storage system for the next two to three years. After it reaches the end of its second life, we recycle it. Following this, we collaborate with our global partners, including those in South Korea and other countries, to build a sustainable battery supply chain. This ensures the material is eventually reused in new batteries rather than diverting to different applications.
Q. How are materials recovered from recycled lithium batteries reused without quality compromise?
A. In typical lithium battery recycling, We recover up to 90% of the original battery, though some process losses occur. One of the main challenges is the recovery of electrolytes. While many companies are working on this, the economics of this process do not make sense due to the lack of global demand for used electrolytes. However, everything else from the battery can be recovered, separated, and sold. We sell the separated plastic to plastic recyclers, and the recovered metals go to metal smelters. The black mass, which consists of anode and cathode materials, is sent to a company outside India that can process it for use in new batteries. These materials can be reused multiple times without compromising quality or performance.
Q. Are you sourcing raw materials within India, or do you also need support from abroad?
A. We consistently request the Ministry of Environment (MoE) to permit the import of materials from abroad, as India currently does not generate enough waste to meet demand. However, future projections look promising. It is likely a matter of a few more years until we establish a sustainable system within the country.
Q. Why is it essential to consider importing batteries from outside India?
A. Batteries are available in Europe, America, and other parts of the world, presenting a valuable opportunity for us to import them. Since these contain critical minerals, which the government has classified as essential, we should be able to bring them into our ecosystem. After all, that is the purpose of designating them as critical. Therefore, we consistently advocate for considering domestic sources and looking beyond India to meet these needs.
Q. What is the current state of battery safety?
A. Incidents such as fires or other exposures have become much less frequent. While occasional incidents still occur, they can often be attributed to factors such as the quality of battery cells, the battery management system (BMS) that monitors those cells, or even user behaviour, such as overcharging or leaving them to charge overnight. Although fires can start for multiple reasons, there has been a noticeable reduction in incidents. Increased government control, vigilance, and compliance with new regulations by industry players have contributed to this improvement, leading to lower insurance rates.
Q. What safety improvements have been made for batteries in India?
A. It is essential to use high-quality cells and a robust BMS. In the past, many incidents in India occurred even when good cells were used, but cost pressures led some companies to compromise on the BMS. This often resulted in fires. However, with the new guidelines, such risksare no longer allowed. All systems must now use smart BMS, which includes auto cut-off features that shut off power if the battery overheats, effectively preventing fires. These safety measures have greatly improved the situation, but gaps remain, particularly in battery transportation, where the government is reportedly drafting guidelines.
Q. What regulations are being considered for the safe transportation of used lithium-ion batteries in India?
A. The type of box to use, the distance between them, and the stacking limits are important considerations. Additionally, the use of fire blankets is also a key factor. In most parts of the world, there are well-defined transportation rules for lithium-ion batteries, primarily used ones. However, in India, these guidelines are still being considered and drafted by the government. Once established, the transportation of used batteries will be conducted more safely and efficiently.
Q. What measures are recommended to ensure the safe handling of lithium-ion batteries in India?
A. Safe transportation guidelines are crucial, but government intervention and policies to prevent lithium-ion batteries from entering the unorganised sector are equally important. We have seen this issue with lead-acid batteries, which often end up in the informal sector, which lacks proper safety measures and protocols, leading to accidents, fires, and even fatalities. Lithium-ion batteries are far more hazardous when mishandled compared to lead-acid batteries. Our recommendation to the government is that, unlike tyres, rubber, or textiles, strict guidelines must be implemented to ensure that only authorised players handle these batteries to avoid dangerous outcomes.
Q. What challenges hinder India’s efficient black mass refining and material reintroduction efforts?
A. We source batteries from various sectors, including electric vehicle manufacturers, battery pack producers, personal device makers, energy storage companies, and lithium-ion battery suppliers. We are in the final stages of developing our technology to set up a refining plant in India, where we plan to process this black mass to recover high-purity lithium, cobalt, and nickel in their metallic forms. However, India’s battery recycling and refining industry is still in its early stages, lacking the maturity, capacity, and scale necessary for the efficient commercial refinement of black mass. Over the next couple of years, we do not expect significant advancements in scale that would allow us to reintroduce battery-grade materials confidently into the supply chain. Achieving this will require advanced technology and successful commercial execution, which we believe the Indian ecosystem lacks.
Q. What is the timeline for building the refining plant, and what are the key considerations?
A. Our refining plant will advance further if we can process black mass to extract lithium carbonate and cobalt sulfate in their purest forms, enabling us to re-enter the battery industry. This step would also contribute to fostering a circular economy. We are currently discussing upon the plant’s location, considering factors such as natural resource availability and potential state government incentives. The process will utilise hydrometallurgy, with water being a critical component. We estimate construction will take around two years, with completion expected in 18 to 24 months, targeting the end of 2026.
Q. Which automotive OEMs are you currently producing battery packs for?
A. Currently, we are producing battery packs for various automotive OEMs, though I can only mention a few. One, which has been publicly announced, is with MG Motors. Some collaborations are still in progress, so I cannot disclose them. We aim to develop versatile energy storage systems to power anything from a single house to a microgrid supporting tall buildings or clusters of smaller ones.
Q. What training methods ensure employees adapt to the recycling industry’s unique demands?
A. The industry is still very young, so we do not have talent with extensive experience in metal recycling coming through the doors. Instead, we seek individuals with backgrounds in electronics, chemicals, and metallurgy—fields with a strong talent pool in India. We train these professionals at our facility, providing machine training, identification, refurbishing, dismantling, and safety instruction. Additionally, we teach them to test and produce products. In the recycling space, we focus on cross-contamination during processing. We conduct monthly training sessions because we believe it is crucial to reinforce these practices, ensuring they become part of the company’s core culture.
Q. What safety measures are prioritised for employees when handling lithium-ion batteries?
A. Safety is our top priority. We adhere to strict SOPs and guidelines, conducting extensive safety training at our facility. We are ISO 9001, 14001, and 45001 certified. Handling lithium-ion batteries is complex and requires careful attention. Personal protective equipment (PPE) is mandatory, and safety audits, fire training, and regular safety drills are key aspects of our operations, with a strong focus on maintaining the highest safety standards.
Q. What types of challenges are impacting the battery recycling industry?
A. Government support and regulation are crucial for us. We consistently advocate for incentives because recycling is a challenging business worldwide, and in many countries, the industry benefits from government incentives. We are asking for the same support we see elsewhere. And also, as I mentioned, discouraging the informal sector is vital to prevent accidents.
Q. How did your last fiscal year’s revenue grow, and what are future expectations?
A. Last year marked our first full year of operations, signifying the initial steps of our journey. This year, we aim to achieve revenue three times that of the previous year. Last year, we generated approximately ₹300 million in revenue, targeting ₹2 billion for this year.