International policy and regulation shifts
European Union - Battery and End-of-life EV Directive
To target issues surrounding supply chain volatility and climate change, the EU has implemented end-of-life battery requirements including collection and recovery targets, such as doubling the recovery targets for lithium, and doubling the increase in use of recycled materials in future production. Automotive OEMs have also been mandated to accept end-of-life batteries from vehicles owners to incentivise life cycle management by key economic operators. European policymakers have set ambitious recycling collection targets of 70% by 2025 and 80% by 2030.
USA - Inflation Reduction Act Targets
The Act provides monetary incentives for reaching certain thresholds for the extraction, processing or manufacturing of critical minerals and battery components in the US. The subsidies offered to the battery industry by the IRA are not capped in terms of the amount of production, the type of battery produced, or the use of the battery. It is estimated that US$150B of subsidies will be received by battery manufacturers in the USA by the end of 2032, creating significant incentive to invest in battery manufacturing and battery recycling operations.