How Policy Can Advance a Circular Battery Economy

The document outlines five critical policy elements—supply chain traceability, material transport and storage, manufacturing and production, recycling, and reusing—necessary to transition from a linear to a circular EV battery economy. It highlights that current economic conditions often make virgin material extraction cheaper than recycling, necessitating government intervention to catalyze investment and standardize regulations. The brief emphasizes the need for federal guidelines in the US to replace the current piecemeal state-level approach and suggests aligning with global best practices to ensure the economic viability of battery repurposing and recycling.

• The current economic landscape favors linear processes because it is often cheaper to mine new minerals than to recycle used batteries, with recycling efforts primarily focusing on high-value materials like lithium, cobalt, and nickel.
• The United States lacks federal recycling mandates for lithium-ion batteries, resulting in a fragmented approach across different states that hinders the development of a robust circular battery economy.
• Regulatory classifications of used batteries as hazardous waste, regardless of their state of health (SOH), significantly increase costs, with transport and storage accounting for 40–60 percent of total battery recycling costs.
• Effective circularity requires five key policy features: improving supply chain traceability (e.g., through battery passports), refining material transport and storage based on risk profiles, mandating designs for recyclability, setting recycling targets and funding R&D, and implementing extended producer responsibility (EPR) for reuse.
• Recycling could potentially decrease the demand for raw minerals by up to 64 percent by 2050, and the US Inflation Reduction Act of 2022 may indirectly encourage this by requiring battery materials to originate from North America or free-trade agreement partners.

APA

RMI (2023). How Policy Can Advance a Circular Battery Economy. https://rmi.org/resources/how-policy-can-advance-a-circular-battery-economy/

Chicago

RMI. How Policy Can Advance a Circular Battery Economy. 2023. https://rmi.org/resources/how-policy-can-advance-a-circular-battery-economy/.

Wikipedia

{{cite report |author=RMI |title=How Policy Can Advance a Circular Battery Economy |date=21 June 2023 |url=https://rmi.org/resources/how-policy-can-advance-a-circular-battery-economy/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2023how, author = {{RMI}}, title = {{How Policy Can Advance a Circular Battery Economy}}, institution = {RMI}, year = {2023}, month = jun, url = {https://rmi.org/resources/how-policy-can-advance-a-circular-battery-economy/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }