How Policy Can Advance a Circular Battery Economy

This policy brief by RMI argues that a circular battery economy—focused on repurposing and recycling electric vehicle (EV) batteries—is essential to mitigate human rights abuses, environmental degradation, and supply chain vulnerabilities. The document outlines five critical policy areas: supply chain traceability, material transport and storage, manufacturing and production, recycling, and reuse, emphasizing that cohesive national and international policies are required to make these processes economically viable and scalable.

• The current economic landscape favors linear battery production over circularity because mining virgin minerals is often cheaper than recycling. Without regulatory frameworks, the battery recycling market risks mirroring the low success rates of plastic recycling in the United States, which currently stands at 8 percent.
• Regulatory classifications of used batteries as hazardous materials, regardless of their state of health (SOH), create significant financial barriers. Storage and transport currently account for 40–60 percent of battery recycling costs, discouraging private investment in recycling facilities.
• 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.
• The European Union has implemented battery regulations requiring manufacturers to disclose carbon footprints, recycled content, and the ethical status of mining sources, while also requiring third-party audits of mines.
• Recycling and the use of battery scrap could reduce the demand for raw minerals by as much as 64 percent by 2050. In the US, the 2022 Inflation Reduction Act may indirectly encourage recycling investment by requiring specific percentages of battery materials to originate from North America or free-trade agreement (FTA) 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} }