Every reporter: Kong Zesi Every editor: Wei Guanhong
"The lithium iron phosphate battery is recycled about 5 cents and 1 ampere, and this 280 ampere-hour battery takes more than 100 yuan and sells it for 220 yuan. Very marketable. In an inconspicuous industrial park in Dongguan, Guangdong, Manager Liao, who is engaged in power battery recycling, took a reporter who visited him as a partner to visit his factory.
Here, the power battery is given a second life. Workers picked up sledgehammers and flamethrower guns to disassemble and repackage high-quality recycled batteries and deliver them to customers for cascade utilization; Slightly worse ones are sold to other factories for resource extraction.
There may be tens of thousands of similar small factories in the country, and as the price of lithium carbonate takes off in 2021, they have also sprung up everywhere. Compared with the power battery recycling whitelist released by the Ministry of Industry and Information Technology, the "small workshop" has a high degree of freedom and more bids, forming a "prosperous" hidden rivers and lakes.
Hidden battery recycling chain
In the two towns of Tangxia and Qingxi in the east of Dongguan City, factories are dotted, and in many seemingly inconspicuous shops, there are small workshops for power battery recycling and processing.
Recently, the reporter came to the "Dongguan Yuanfeng New Energy Lithium Battery Recycling" factory in Tangxia as a partner (hereinafter referred to as Yuanfeng Company). The company is in a relatively remote industrial park, and there is no sign at the entrance of the park, and one building reads "Sheep Products Wholesale Distribution Center", and some buildings look like they have been idle for a long time, with the occasional truck coming in and out of the park. If you don't contact us in advance, it's hard to imagine that there are still a few power battery recycling factories "hidden" here.
Yuanfeng Company Image source: Photo by reporter Kong Zesi
Under the guidance of Yuanfeng Company, the reporter entered a rolling shutter door, and second-hand prismatic batteries and cylindrical batteries the size of Cihai were stacked in a warehouse of nearly 100 square meters, and several power battery packages were stacked on the wall, as well as dismantled scattered parts. "These are CATL and EVE (batteries), as well as BYD 75 ampere (single batteries), which were removed yesterday." Manager Li, the company's business personnel, said, "Now the capacity is only between 66 Ah and 68 Ah, and we have already assembled it, and the customer can assemble it directly when it is pulled back." ”
"Ningde iron lithium 87 amp, brand new uncirculated... This is the daily advertising copy of Yuanfeng Company's business personnel circle of friends. According to Manager Li, Yuanfeng Company can "wash off" the old welding traces of the collected batteries, reinstall the positive and negative electrode connecting pieces, reassemble them according to customer needs, and finally use them in two-wheeled electric vehicles, energy storage and other fields. The price of second-hand batteries in the field of energy storage can even reach one-tenth of the ex-factory price of regular manufacturers.
Stacked second-hand batteries Image source: Photo by reporter Kong Zesi
Although the reporter did not see the dismantling process at the scene, the "extensive" operation can be seen from Manager Li's description: many power batteries are tightly packaged, and Yuanfeng Company cannot handle them by itself, so they will be sent to the dismantling plant outside, and they will use gas canisters and spray guns to bake the sealing gel. Of course, the company also understands the safety factor of this kind of extensive operation. Manager Li said that the battery is often damaged during the dismantling process, and in order to avoid the risk of assembly and reprocessing, they tend to sell the dismantled single battery directly.
In Qingxi Town, which is more than 10 kilometers away from Tangxia Town, the reporter of "Daily Economic News" came to an industrial park where several small power battery recycling factories gathered, and there was a signboard of "Jushun Shoes" at the entrance of the park.
Image source: Photo by reporter Kong Zesi
Manager Liao, who is engaged in power battery recycling, introduced the situation of the factory, the scale and management of his battery factory are better than that of Yuanfeng Company, and the batteries of Sunwoda, EVE Lithium Energy and China Innovation Aviation are neatly placed in different categories. According to the degree of newness of the battery, the number of cycles, etc., they divided the second-hand battery into the original brand new A product, nearly new slightly defective B product, etc. The type and capacity of the battery will slightly affect the selling price.
Why are new batteries entering the second-hand market? Manager Liao explained that product A is the original factory with a full box sealed, some of which come from the battery factories that have enjoyed subsidies, and some will even flow directly into the recycling channel after assembly; Product B is mainly from the internal test of the battery factory, and it is found that there are slight defects; Again, it is normal to "retire" from the car, which has gone through many cycles.
In Manager Liao's description, there are many ways to use power batteries in echelons, in addition to small energy storage applications such as electric vehicles and lighting, the company can even get commercial energy storage orders, but "a certain channel is required". "The low cost of our secondary use is (the main) cost-effective." Manager Liao said that the company also has its own factory, which can crush and powder batteries that cannot be used in echelons and sell them to enterprises in the resource extraction industry chain.
Some of the regular battery collection points are no longer available
As of 2023, the production and sales of new energy vehicles in mainland China have remained the world's largest for nine consecutive years. While the installed volume of power batteries is growing steadily, its retirement volume is also increasing year by year. The China Business Industry Research Institute predicts that the retired power batteries in the mainland will reach 1.04 million tons in 2025.
Image source: Screenshot of the webpage
In order to meet the retired power battery, the relevant departments have already made a layout. At the end of 2018, the Ministry of Industry and Information Technology announced that it would publish the information of new energy vehicle power battery recycling service outlets, which will be updated quarterly. At present, there are nearly 15,000 new energy vehicle power battery recycling service outlets that have been announced.
According to the analysis of the China Business Industry Research Institute, the above-mentioned outlets can be divided into three categories: official recycling channels of automobile companies, subordinate or professional car dismantling companies of automobile companies, and new energy enterprises with various qualifications such as "Renewable Resources Business License" and "Dangerous Goods Road Transport License".
So, what is the operating model of these service outlets, and how is it operating?
Recently, the reporter visited nearly 20 service outlets in Shenzhen and found that there are many problems. First of all, the addresses of many recycling service points are unknown, some are located on the first floor of the multi-purpose parking lot, some are in the "Poultry Wholesale Market Hall 2", and some are marked as "opposite Walmart supermarket" at an intersection. The reporter asked the merchants near the supermarket, but they did not know about the relevant situation.
Huari Automobile Building on Nigang West Road in Shenzhen has registered a collection point of Shenzhen Huari Toyota Motor Sales and Service Co., Ltd., which is an automobile 4S store, but the store has been temporarily closed and relocated to another location. The recycling service company in the same building, Shenzhen Tefa Huari Automobile Enterprise Co., Ltd., was locked during working hours, and the reporter called the company's industrial and commercial registration number, but it was not connected. In addition, there are many branches that cannot be found at the original address due to changes in the company's registered address.
Image source: Photo by reporter Kong Zesi
In addition to the outlets that are not operating normally for some reason, many more collection points are unaware of the recycling business. Shenzhen Qiwo Automobile Co., Ltd., located on Beihuan Avenue in Luohu District, Shenzhen, which sells GAC Toyota, said its sales and after-sales departments did not know about the battery recycling business. When the reporter went back a few days later and asked a duty manager for a formal interview, he still could not respond to questions about the power battery recycling business.
Shenzhen Yibai Automobile Service Co., Ltd. is located in the multi-functional parking lot of Rundong, Jingtian North 3rd Street, mainly providing automobile maintenance services. The staff told reporters that the company does not maintain new energy vehicles and has never carried out power battery recycling business. As for why the company appeared on the list of recycling outlets, the staff also did not know.
During the several days of visits, most of the sales and after-sales staff of Changan Ford, Porsche, BAIC and many other brand stores said that they had not heard of this business.
In the end, the reporter learned about the operation of recycling outlets in a Toyota 4S store. The staff said that if the battery is repaired or there is a problem recall, the manufacturer will transport the battery over, replace it in the store, and then the supplier will tow the battery for disposal. The disposal of power batteries also requires the store to pay fees to other links, and the company does not carry out special recycling business for individuals. The staff also told reporters that many 4S stores do not know the working principle of recycling outlets, which may be related to business volume. In his store, there was an electric car with more battery problems in the first two years, and the manufacturer replaced the user with a new battery for free after the recall.
There is also a sales person in an automobile 4S store who told reporters that the company can indeed recycle car power batteries, but only for the repair and return of this brand of cars to the factory. As for the recycling service for individual consumers, he bluntly said that it is almost impossible: power batteries are solid waste, Shenzhen's environmental protection requirements are very strict, recycling, transportation need a certain qualification, not only occupy the energy of personnel, the storage conditions of the battery also have requirements, for the company thankless.
What are the "disadvantages" of formal recycling channels?
In the investigation, the reporter noticed that due to the lack of some formal recycling channels, a considerable part of the power battery flowed into small factories. In fact, this is also the embarrassment of today's power battery recycling and secondary use.
According to the research report of Western Securities, the current power battery recycling market is relatively scattered, and there are many small and micro enterprises. In November 2023, the Ministry of Industry and Information Technology (MIIT) released the list of enterprises (the fifth batch) (hereinafter referred to as the white list) of the "Industry Standard Conditions for the Comprehensive Utilization of Waste Power Batteries for New Energy Vehicles" (hereinafter referred to as the white list), adding 68 "white list enterprises" and expanding the industry scale to 156. Tianyancha data shows that as of December 2023, there are more than 100,000 enterprises across the country whose business scope includes "power recovery" content, most of which are small and micro enterprises with a duration of no more than 3 years, and more than 50,000 related enterprises established within 1 year.
According to the statistics of the China Chemical and Physical Power Industry Association, about 75% of the waste batteries are digested by "small workshops" and enterprises that have not yet entered the white list. However, "small workshops" are often highly concealed, difficult to supervise, and have prominent safety risks.
Mo Ke, founder and president of True Lithium Research, said in an interview with the reporter of "Daily Economic News" that due to the cost problem, the enthusiasm of small workshops for battery recycling is higher than that of regular recycling points, and many small recycling programs on the Internet are operated by small workshops. Not only does this lead to safety and environmental issues, but it also creates problems for regulators, "because they are already out of the sight of the authorities."
The relevant person in charge of Hunan Lithium Huitong New Energy Technology Co., Ltd., a power battery recycling platform under China Minmetals, told reporters that the threshold for the formal recycling and treatment of lithium batteries is concentrated on battery identification, classification and dismantling of battery packs. The main costs are concentrated in the purchase price, personnel salary, equipment purchase, production line maintenance, tool purchase, etc. Due to the higher cost of production, environmental protection and safety invested by formal channels and formal enterprises, they will lose certain advantages compared with "small workshops" in terms of recycling prices; Secondly, the "small workshop" generally adopts the cash spot settlement, without the need to sign contracts and issue invoices, and the regular enterprises are relatively complex in invoicing and other operations, which may incur more costs.
Recycling process Image source: Courtesy of the interviewed company
Li Yongshan (pseudonym), an executive at a listed company in the recycling sector in China, agrees. He told reporters that the formal recycling process includes the collection, dismantling and resource treatment of batteries, which requires enterprises to have hydrometallurgical production capacity and high-standard environmental protection facilities, while small workshops are "not harmless, and all aspects may not be so particular".
Li Yongshan said that the current implementation of the white list system makes the battery recycling of automobile retirement relatively standardized, but the amount of scrapped batteries generated by battery cell factories, PACK factories and car companies in the production process cannot be underestimated, even more than the new energy vehicle power batteries that were retired that year, and the processing link also lacks effective control. "If the state also tightens control over these processes, the battery recycling situation will be much better."
As the price of lithium carbonate has fallen from a high point of 600,000 yuan/ton, the cost performance of power battery recycling and lithium extraction has also attracted attention from the outside world.
"The price of lithium carbonate is not the only factor influencing recycling profits, and the type and composition of batteries are equally critical. The economy of lithium iron phosphate battery recycling is directly proportional to the price of lithium carbonate, while ternary lithium batteries contain metal elements such as nickel, cobalt and manganese, and the income from dismantling and recycling is relatively more considerable. Li Yongshan believes that "overall, if the price of lithium carbonate falls to 70,000 yuan a ton, there will be no economy for power battery recycling." Of course, it is not excluded that the cost of some small factories will be higher. ”
National Business Daily