As we continue helping our customers navigate the renewable energy supply chain, we’re keenly aware of the growing importance of end-of-life planning – especially for the BESS supply chain.
The Faraday Institution estimates that by 2028, 16,500 tonnes of battery packs will need processing in the UK alone, with volumes rapidly rising to about 150,000 tonnes by 2035. This presents both a significant challenge and opportunity for our industry.
End-of-life considerations are no longer an afterthought either – more so a crucial component of BESS implementation. We’re seeing a shift towards a circular economy approach, where batteries can be reused, repurposed and recycled, potentially supplying at least 10% of EV battery critical mineral requirements by 2035.
For our commercial and industrial customers, this means thinking beyond installation and considering the full lifecycle of their BESS investments.
In this guide, we’ll delve into the challenges of sourcing battery components in today’s global market and explore strategies for effective end-of-life planning. Our goal is to equip you with the knowledge to make informed decisions that not only meet your immediate energy storage needs but also align with long-term sustainability objectives and regulatory compliance.
Sourcing battery components
Several key regions play crucial roles in battery supply, with particular significance for the UK & Europe. China dominates the battery supply chain, accounting for 69% of the world’s battery manufacturing capacity expected by 2027. However, other regions are emerging as important players, including North America, South America, and other parts of Asia.
Critical raw materials impacting the supply chain include lithium, cobalt, nickel, and graphite. The demand for these materials is expected to surge dramatically, with increases of 20x for nickel, 19x for graphite, and 14x for lithium projected by 2040. This growing demand poses significant challenges for sourcing and supply chain management.
The effect of geopolitical tensions
Lithium-ion battery supply chain spans the globe, but crucial inputs and processing capabilities are centralised in a handful of countries. This dynamic of dispersion-and-concentration makes the global supply chain susceptible to geopolitical disruptions and shifts in trade relationships. This issue has been exacerbated in recent years with China’s dominance in lithium-ion manufacturing, including in the processing of most mineral inputs and key end uses like battery storage and electric vehicles.
Mitigation strategies to overcome
By diversifying sources, prioritising sustainable practices and investing in innovation, the industry can better navigate the complex landscape of battery component sourcing and address the challenges posed by geopolitical tensions and environmental concerns.
- Diversification is crucial in building a resilient battery supply chain. Companies are increasingly seeking to diversify their suppliers and production locations to mitigate risks and enhance supply chain resilience.
- Sustainable sourcing is becoming a priority for many companies in the battery industry. Partnering with suppliers committed to sustainable practices not only addresses environmental concerns but also helps meet growing regulatory and consumer demands for responsible sourcing.
- Innovation plays a key role in addressing supply chain challenges. The development of new battery chemistries that rely less on scarce materials is an active area of research. For example, sodium-ion batteries are being developed as an alternative to lithium-ion batteries, potentially reducing reliance on lithium.
End of life planning for BESS
End of life (EOL) management planning for battery energy storage systems (BESS) is critical for sustainability and regulatory compliance. As the demand for lithium-ion batteries continues to rise, so does the need for effective strategies to manage these batteries once they reach the end of their useful life. Proper EOL planning ensures that valuable materials are recovered, environmental impacts are minimised, and regulatory requirements are met.
When it comes to managing the end-of-life of batteries, European-based businesses face two primary options: reuse and recycle. Each approach has its own advantages and challenges, and understanding these can help businesses make informed decisions.
Reuse (second life)
Reuse involves giving batteries a second life in less demanding applications. For instance, batteries that are no longer suitable for electric vehicles (EVs) can still be used in energy storage systems to stabilise grid networks, supporting solar farms or providing backup power for buildings. This approach extends the battery’s useful life and reduces waste, aligning with circular economy principles.
Recycle
Recycling, on the other hand, focuses on recovering valuable materials from spent batteries. This process is essential for minimising environmental impacts and reducing reliance on raw material extraction. Recycling involves these steps:
- Collection & Sorting
Batteries are collected from various sources and sorted based on their chemistry and condition. - Processing
The sorted batteries undergo mechanical and chemical processes to extract valuable materials like lithium, cobalt, and nickel. These materials can then be reused in the production of new batteries.
Recycling not only helps recover critical raw materials but also supports regulatory compliance. The EU’s new Batteries Regulation mandates high recycling rates and the use of recycled content in new batteries, promoting a more sustainable battery life cycle.
Challenges of EOL planning
Despite the benefits, several challenges exist in EOL management for BESS. One significant challenge is the variability in battery pack designs, which complicates the disassembly and recycling process.
Manual labour is often required to disassemble packs safely, increasing costs and requiring skilled workers. Additionally, the premature recycling of batteries before their potential in second-life applications is fully realised can lead to resource wastage.
Environmental concerns also pose challenges, as improper disposal or recycling can lead to the release of hazardous substances. Ensuring that recycling processes are environmentally friendly and efficient is crucial for minimising negative impacts.
EOL future direction
The future of EOL management for the BESS supply chain lies in innovation and improved regulatory frameworks. The Battery Passport initiative, spearheaded by the Global Battery Alliance, aims to provide a digital representation of a battery, including information on its materials, manufacturing, and lifecycle. This initiative will enhance transparency, traceability, and sustainability in the battery supply chain, supporting better EOL management practices.
By focusing on recycling, second life applications, and overcoming challenges through innovation, the industry can ensure that batteries are managed responsibly throughout their lifecycle, contributing to a more sustainable future.
Wattstor’s stringent supply chain management
At Wattstor, we understand the critical importance of maintaining a robust and responsible supply chain in the battery energy storage sector. Our commitment to sustainability and ethical practices extends throughout our operations, including our approach to sourcing components and end-of-life planning for BESS. Here’s how we’re addressing these challenges:
- Sedex Registered Pan-EU Operations
As a Sedex associated partner operating across Europe, we adhere to stringent ethical and environmental standards in our supply chain management.
- Smart energy management systems
Our innovative EMS – Podium – incorporates advanced software and intelligent control mechanisms, dynamically managing energy storage to ensure a stable and reliable power supply. - Maximising onsite solar generation
Wattstor’s pioneering DC coupling technology allows sites to add significantly more Solar PV than grid constraints would lead you to believe. This creates the opportunity to maximise renewable deployment and site sustainability, all within regulations.
By choosing Wattstor for your BESS supply chain needs, you’re not just investing in cutting-edge energy storage technology. You are partnering with a company that prioritises sustainability, ethical sourcing, and responsible end-of-life management.
Speak to an energy price specialist
Our team, here at Wattstor, specialises in offering comprehensive energy management solutions that address the unique needs of your business. From exploring fixed price deals and energy storage systems to considering Corporate Power Purchase Agreements, we’re here to guide you. We’ll advise on the routes that best align with your operational goals and financial objectives.