Li-ion battery recycling Market Size

Li-ion battery recycling Market Size Snapshot

Note – Market size depicts the revenue generated over the financial year

The Lithium-Ion Battery Recycling Market is estimated to reach $28 billion by 2035. This remarkable growth is based on a CAGR of 17.94 percent from 2025 to 2035. The demand for sustainable battery solutions is expected to increase, mainly due to increasing concerns about the environment and rising regulatory pressure. The growth is primarily driven by the increasing use of electric vehicles and the growing need to efficiently recover the raw materials from used batteries. Lithium-ion battery recycling is becoming a priority in the circular economy, as it helps to reduce waste and preserve valuable materials such as lithium, cobalt, and nickel. These companies, such as Umicore, Redwood Materials, and Li-Cycle, are investing in new technologies and forming strategic alliances to improve their processes and expand their operations. Li-Cycle, for example, has developed a proprietary hydrometallurgical process that significantly improves the recovery of lithium-ion batteries while reducing the impact on the environment. Similarly, collaborations between car manufacturers and battery recyclers are becoming more common as companies seek to secure sustainable supply chains and meet regulatory requirements. These strategic initiatives show the potential of the market and the importance of technological developments to drive lithium-ion battery recycling.

Regional Market Size

Regional Deep Dive

The lithium-ion battery recovery market is experiencing significant growth in various regions, driven by the rising demand for electric vehicles, stringent government regulations, and the need for sustainable resource management. The North American, European, and Asian markets are characterized by a wide range of recovery technologies and initiatives aimed at extracting valuable materials from used batteries. The Middle East and Africa and Latin America are also emerging as important markets, albeit at a slower pace, and influenced by local regulations and economic factors. The overall market is shaped by technological developments, regulatory frameworks, and a growing awareness of sustainable development among consumers and industries.

North America

• The American government has taken such steps as the Bipartisan Infrastructure Act, which allocates considerable funds for the battery recovery and encourages companies to invest in the development of a sustainable economy.
• Li-Cycle and Redwood Materials are innovating by developing new recycling techniques which improve material recovery rates and reduce the environmental impact.
• The strict regulations of the State of California on the recovery of lithium-ion batteries have also been a major factor in increasing the number of battery recovery factories, thus increasing the recovery rate of lithium-ion batteries.

Europe

• The European Union’s Battery Directive is to be amended with a view to increasing the quotas for battery recovery and promoting the circular economy.
• Companies such as Umicore and Northvolt are developing advanced techniques for the recovery of critical raw materials such as cobalt and nickel.
• European consumers have a strong preference for sustainable products, which leads to increased investment in battery recycling and in research and development.

Asia-Pacific

• China, which is the world's largest battery producer, is also promoting the establishment of a network of battery recycling plants, and has a long-term plan for battery recovery.
• BYD and CATL have been investing in closed-loop systems, which not only help to ensure the environment, but also to reduce the cost of raw materials.
• The rapid spread of electric vehicles in the region makes it necessary to find effective solutions for their recycling. The need for this has prompted manufacturers and the operators of the plants to cooperate to achieve this.

MEA

• It is now being recognized that the batteries have to be recycled. In the United Arab Emirates, for example, the National Program for Strategic Innovation and Energy Efficiency aims to promote sustainable practices in various sectors, including energy storage.
• Local companies are seeking to establish a partnership with foreign companies to develop a technology tailored to the region’s needs and regulatory environment.
• In the Gulf countries, a major part of the efforts to diversify their economies is based on diversifying into green industries, including the recycling of batteries.

Latin America

• Brazil and Chile are beginning to adopt regulations on the disposal of batteries, which should lead to the development of local batteries recovery.
• The richness of the region's mineral wealth, particularly its lithium, has attracted the attention of large industrial groups who are interested in setting up a sustainable supply chain based on the use of secondary raw materials.
• The batteries of the future are the batteries of the past. The public awareness of the importance of the batteries is increasing, and the governments and the private sector are joining forces to increase the market.

Did You Know?

“Lithium ion batteries can be recycled, and lithium, cobalt, and nickel—critical materials for the manufacture of new batteries—can be recovered.” — International Energy Agency (IEA)

Segmental Market Size

The lithium-ion battery is experiencing considerable growth, driven by the growing demand for the sustainable practices of the production and the disposal of the batteries. The batteries play a key role in addressing the environment's concerns about the batteries. The battery directive in the European Union is driving the need for effective battery solutions and demanding that the manufacturers adhere to strict recovery goals.

The demand for lithium will be driven by the increasing consumer awareness of the environment and the need for raw materials in the manufacture of batteries. A number of companies are now deploying lithium-recycling technology, notably Redwood Materials and Li-Cycle, which have operations in North America and Europe. The current stage of development is now at the stage of large-scale deployment, with notable projects in California and Germany. Companies are concentrating on reusing lithium from EV batteries and the batteries of consumer products, in a process known as closed-loop lithium recovery. The trend towards government regulations on the use of raw materials and the drive towards greater efficiency will accelerate the process.

Future Outlook

The lithium-ion battery market is expected to grow at a CAGR of 19.17% from 2024 to 2035. The increasing demand for electric vehicles and energy storage solutions is largely responsible for this growth. By the year 2030, the global sales of EVs are expected to reach 30 million units. Therefore, the recycling of lithium-ion batteries will become extremely important to ensure sustainable resource management and reduce the impact on the environment. A growing awareness of the circular economy and the need for sustainable practices will also drive the market. By 2035, the share of lithium-ion battery recycling is expected to reach more than 50%, compared to today's five to ten percent.

The lithium-ion battery market will be influenced by the technological developments and policy changes. Lithium, cobalt and nickel extraction processes have been developed in the past few years, and the recovery rate of these valuable materials has been greatly improved. The policy of reducing waste and encouraging the development of lithium-ion batteries will also lead to the trend of lithium-ion batteries becoming more sustainable. The second use of lithium-ion batteries and the use of artificial intelligence in the process of battery regeneration will further improve the efficiency and profits of the industry. The lithium-ion battery industry is changing. The industry must be agile, and seize the opportunity to promote the trend of a sustainable lithium-ion battery industry.