The Energy Transitions Commission predicted last year that global electricity supply will almost quadruple by 2050. At that point, nearly 70% of electricity will be generated by wind and solar PV, contends the International Energy Agency (IEA) in its Net Zero by 2050 report. As clean energy technologies contain CRMs, securing a reliable supply of minerals like lithium, cobalt and nickel is vital. No wonder that the IEA found that in 2023, lithium demand grew by 30%, and demand for nickel, cobalt, graphite and rare earth elements increased between 8% and 15%.

The struggle to ensure a reliable flow of CRMs is compounded by constricted, complicated and volatile supply chains, as Deloitte has pointed out. Just seven countries control around three-quarters of the world’s cobalt, lithium and rare earths output. Reducing demand for CRMs would improve energy security and diminish geopolitical risks. Moreover, mineral extraction involves environmental, social and governance problems, including high carbon emissions, land degradation, biodiversity loss, water stress, and safety and human rights issues.

Despite this, the world wastes increasingly vast amounts of CRMs. The UK is anticipated to produce 235,000 tonnes of battery material waste from electric vehicles (EVs) by 2040, eight times more than in 2030, according to the UK Advanced Propulsion Centre. Meanwhile, China is expected to accumulate between 200,000–1.5mn tonnes in PV panel waste by 2030.

Where to start with circularity?
Circular economy principles need to be embedded at the very start of the value chain. Reducing the material demand for CRMs by redesigning products for durability and longevity minimises the use of toxic materials, facilitates the extraction of CRMs after product utility is exhausted, enables the repair and replacement of components, and creates strategies to bring CRMs back to the production stage.

In 2008, the Chinese government passed the Circular Economy Promotion Law. It demanded that manufacturers ‘give priority in choosing designs and materials that are easy to be recovered, dismantled and degraded, nontoxic and harmless or with low toxic or harm’. Nevertheless, by 2019, EV battery waste was mounting. In response, the Ministry of Industry and Information Technology produced a document which included measures to ensure the ease of inspecting, classifying, disassembling, repairing or reassembling waste batteries so they may be repurposed for use in other fields. It also mandated that EV manufacturers meet traceability management requirements for the recycling and utilisation of batteries. It was updated with new standards in 2024.

To maintain widespread adoption and further develop its EV market, China must ensure it has a continuous and reliable supply of CRMs. China holds about 70% of the total share of global production of clean energy manufacturing. This makes obtaining CRMs crucial. The cumulative primary demand for lithium, cobalt and nickel, 2021 to 2060, could reach 5–7 times, 23–114 times and 4–19 times respectively the corresponding mineral reserves in China. However, 18–30% of the lithium and 20–41% of the cobalt, nickel and manganese needed for the EV industry could be sourced through the reuse and recycling of end-of-life batteries. Repurposing batteries after their first intended life could also provide sufficient capacity for China’s prospective novel energy storage applications, according to one research paper.

There is a growing awareness that the best way to obtain CRMs is to keep those already in products in use for longer and improve their recyclability once product lifespan expires.

What are the different types of circularity?
Remanufacturing recovers value from end-of-life products in order to manufacture like-new products. It contrasts with recycling in which end-of-life products are broken down and the raw material may be used for a different product for a different purpose. In this way, recycling is delayed and fewer critical minerals are needed for new products. The lifespan of a wind turbine can be extended by up to 20 years if it is remanufactured. This provides other benefits: a remanufactured turbine can be delivered in four months and at a reduced cost compared with new turbines that can require up to two years to be installed, says Deloitte.

Remanufacturing can be employed for a variety of energy transition appliances. The majority of emissions can be reduced and a significant proportion of the CRMs contained in solar PV modules recovered through remanufacturing. This can be achieved with a thermally-assisted mechano-chemical approach to remove the encapsulants, the electrode and the perovskite absorber which enables the reuse of the majority of the device parts for remanufacturing perovskite solar cells. Remanufactured perovskite solar cells can recover nearly 90% of their initial performance, according to research.

Reusing or repurposing clean energy technologies is another important solution to slash CRM demand and promote a circular economy. EV batteries typically retire after about 15 years when their capacity declines to 70–80% of the original. A large battery with 80% capacity may, depending on its health, provide storage in other applications for a further five to 15 years, as per a 2023 report. The report’s author, Jordan Brinn, commented to online journal Utility Dive: ‘There’s definitely some potential in the utility sector, especially in terms of grid back-up storage… even though [old EV batteries] have lost, say, 20% of their original capacity… when you’re talking about grid storage that can still be a perfectly usable battery for several more years.’

In addition, second-hand EV batteries may be used for decentralised energy storage in combination with rooftop solar or microgrid systems. Battery storage system designer and manufacturer ECO STOR has created a residential energy storage system that utilises these batteries’ 10–15 years of remaining life. It doesn’t disassemble/reassemble, rewire or change the battery. The company simply adds a control unit and provides a communication link between the battery and the energy system in a house, enabling a household to store energy during the day and distribute it at night. It prevents battery waste and avoids the need to mine more CRMs. It is also cheaper than a new battery, expanding clean energy adoption to a wider market.

Recycling should be the last resort in a circular economy, initiated once the other approaches outlined here have been exhausted. If employed successfully, it can offer a sustainable source of primary minerals, improve security of supply for regions with limited resources, and enhance environmental performance and waste management.

Many CRMs, such as indium, tellurium and gallium for solar PV, and rare earths and lithium for EVs, have had near-zero recycling rates in recent years. But as demand for CRMs mounts, this situation needs to improve. For instance, although the EU has comparatively high recycling rates, less than 1% of selected CRMs are recovered. The EU does not have the technology and industrial processes to recycle CRMs sufficiently to cover its needs, a December 2020 European Parliamentary Research Service report found. Nevertheless, the bloc has announced a new EU Battery Regulation which proposes that all new batteries sold in Europe from 2030 must meet minimum threshold of 4% nickel, 12% cobalt and 4% lithium, by weight, of recycled materials. Higher thresholds are planned from 2035.

Building capacity for recycling energy transition materials and minerals needs to begin now. By the end of this decade, the first generation of EVs will be reaching their end-of-life. It is thought that about 30 GWh of old EV batteries will be available for recycling by 2030. Countries need to invest in recycling facilities to retrieve lithium and nickel from EVs and storage batteries, and rare earth elements from wind turbines and EV motors. If successful, the IEA calculates that recycled copper, lithium, nickel and cobalt from clean energy applications could reduce primary supply requirements for key minerals by 10–30% by 2040.

Industry can also advance recycling rates. Chinese recycling company GEM has developed technology to extract nickel, cobalt and other resources from EV lithium batteries. It transforms them into components for battery producers. GEM has the highest used battery recycling capacity in China. It processes more than 10% of total waste batteries, equal to about 300,000 tonnes of waste batteries annually. It estimates that it has recycled some 5.4mn tonnes of electronic waste, and recovers 5,000 tonnes of cobalt and 10,000 tonnes of nickel per year. One market report predicts that the global battery recycling market will grow from $26.9bn in 2023 to $54.3bn by 2030 at a CAGR of 10.5%.

How can we improve the circularity of the energy industry?
There is a growing awareness that the best way to obtain CRMs is to keep those already in products in use for longer and improve their recyclability once product lifespan expires. For example, the European Commission published a proposal for a European Critical Raw Materials Act (ECRMA) in March 2023. The aim is to diversify the EU’s supply chain of CRMs, including measures to improve circularity. The regulation provides support for access to finance and shorter permitting timeframes, limiting the timeframe for processing and recycling permits to 12 months.

It also demands Member States implement national measures to improve the collection of CRMs rich waste and ensure its recycling into secondary critical raw materials. Both Member States and private operators must investigate the potential for recovery of CRMs from extractive waste in current mining activities and historical mining waste sites. Furthermore, products containing permanent magnets will need to meet circularity requirements and provide information on the recyclability and recycled content.

Besides regulations, individual corporations can successfully create their own circular supply chains. GE implemented a ‘revert, recover, recycle and reduce’ approach to rhenium, a key material in turbines, following a price shock. It redesigned its casting process to enable waste to be reused. It developed a chemical process to recover rhenium from grinding chips produced by turbine machining operations. The company took advantage of opportunities to recover and clean field parts and reuse them. Instead of selling engine turbine blades at their end of life, GE created a process to clean the blades, strip their ceramic thermal coating, identify the specific alloy composition of the blade and then direct it to its own supplier network to be reused directly in the production of new blades. Besides the environmental benefits of reducing the mining of rhenium, GE’s measures used less raw rhenium, resulting in a lower cost for new cast blade assemblies.

Government and industry need policies and business practices to reuse, repair, refurbish, remanufacture and repurpose clean energy products to enhance products’ durability, reusability, repairability, recyclability, upgradability and environmental impact, and ultimately extend their lifecycles. Governments should set minimum recycled content rates and provide incentives for businesses to innovate production methods to increase material efficiencies and product longevity. This can reduce demand and costs of CRMs and limit the environmental impacts of clean energy technologies.

• Further reading: ‘How dirty is clean tech when it comes to the circular economy?’. As renewable energy generation accounts for an increasing share of global power, the environmental impact of these clean energy sources must be carefully considered. Demand for wind turbines, batteries and solar panels is exploding and so creating a circular economy for the new energy system is fundamental to a more sustainable relationship with the environment.
• Pyrolysis oil growth will fundamentally reshape the waste management, chemical, fuel and plastic landscape, according to Mark Victory, Senior Editor of recycling, at ICIS.