Proposed Policy for Battery Recycling in India: A Step Towards Sustainable Energy
An estimated ₹3,500 crore policy for the recycling of batteries could be revealed in the upcoming budget, showcasing the government’s commitment to reducing carbon emissions by promoting electric vehicle adoption.
The policy is anticipated to concentrate on establishing cluster-based recycling facilities near battery manufacturing plants, incentivized by governmental support.
According to informed sources, the government might allocate approximately ₹3,500 crore over a three-year period for this initiative.
“A substantial initial investment from the government is imperative for the establishment of battery recycling industries due to their capital-intensive nature. The objective is to strategically position these industries in well-established industrial zones, taking into account logistical considerations,” remarked one official.
Following visits to leading battery recycling facilities worldwide, Indian delegations have urged these businesses to invest in Indian recycling facilities. The government is now poised to identify suitable locations for these recycling units.
“The central government will collaborate with state governments to select suitable locations for clusters and determine the incentives required to attract investors,” added another official.
With the rise of electric vehicle mobility and domestic battery production, lithium-ion batteries are expected to become more abundant in the Indian market.
A proposed deposit-refund mechanism is also anticipated, wherein all market participants would contribute to a fund that incentivizes customers to return used batteries.
Queries directed to the Ministries of New and Renewable Energy and Finance remain unanswered.
Nitin Gupta, co-founder and CEO of Attero Recycling, emphasized the significance of recycling lithium-ion batteries for achieving carbon neutrality goals. He highlighted the potential for India to establish a comprehensive battery supply chain, from manufacturing to recycling.
Additionally, battery recycling could alleviate concerns regarding the limited availability of lithium in India.
Gupta noted that lithium and cobalt constitute a significant portion of the value of lithium-ion cells, yet India lacks reserves of these critical materials. Therefore, recycling lithium-ion batteries could enhance India’s self-reliance in key battery components.
According to a report by the NITI Aayog, the cumulative potential of lithium-ion batteries in India is projected to reach 600 GWh between 2022 and 2030, with a recycling volume of 128 GWh expected by 2030.
Electric vehicle batteries typically undergo repurposing or reuse in smaller applications once their capacity reaches 80%. Recycling becomes necessary when only 20% of capacity remains.
India has already earmarked 50 GWh of manufacturing capacity for advanced chemistry cells under its production-linked incentive scheme, aiming for self-reliance in EV batteries by FY25.
The NITI Aayog report also recommends issuing a separate license for handling lithium-ion battery waste and easing entry requirements for recycling operations. Additionally, it suggests outlawing battery disposal in landfills to boost recycling demand.
Amid India’s G20 presidency, the focus on recycling aligns with New Delhi’s ambition to position itself as a global hub for the EV ecosystem.
Rajat Verma, CEO & Founder of Lohum, emphasized the importance of developing self-reliance in energy security and fostering a circular economy for battery raw materials. He anticipates significant government support in the upcoming budget to accelerate this transition.