The concept of power battery recycling is rising against the trend, and the market

The market fluctuated widely throughout the day. On the disk, battery recycling, stimulated by the news, became the biggest hot spot in the market today. Nearly 10 stocks in the sector rose by the daily limit, and the hjt direction continued its strong strength yesterday, rising against the trend throughout the day. In terms of decline, semiconductors, human brain engineering, medicine, games and other directions weakened.

Overall, individual stocks fell more or rose less, and more than 2700 individual stocks in the two cities fell. The turnover of the Shanghai and Shenzhen stock exchanges today was 941.4 billion, a decrease of 146.7 billion from the previous trading day.

As of the close, the Shanghai index fell 0.06%, the Shenzhen composite index fell 0.49%, and the gem index fell 0.51%. The net purchase of northbound funds throughout the day was 1.645 billion yuan; Among them, the net purchase of Shanghai connect was 3.202 billion yuan, and the net sale of Shenzhen connect was 1.558 billion yuan.

01 power battery recycling concept goes up against the trend

Today, the concept of power battery recycling rose against the trend. Among individual stocks, surpass technology, deshengli and Tianqi shares rose by the limit, Guanghua technology rose 6.80% and greenmead rose 4.59%.

In terms of news, Zhang Yunming, Vice Minister of the Ministry of industry and information technology, said in his speech at the 2022 World Power Battery Conference on July 21 that we should speed up the cultivation of a number of related enterprises for echelon utilization, recycling and regeneration of power batteries.

Also at this conference, Zeng Yuqun, chairman of Ningde times, said that most of the materials in the battery can be reused. At present, the recovery rate of nickel, cobalt and manganese has reached 99.3%, and the recovery rate of lithium has reached more than 90%.

In this regard, according to the 21st century finance and economics report, relevant people from the investment management department of Tianqi lithium industry said that lithium recycling in lithium batteries can be achieved in theory, but it cannot be recycled on a large scale in commercial applications. For the statement that the recovery rate of Zeng Yuqun lithium has reached more than 90%, the above-mentioned person said, "the laboratory should be able to do it, but I haven't seen it in business.". According to the source, the company now has investment and attempts to participate in downstream (lithium recovery).

In addition, according to the China Securities News, the relevant person in charge of Ningde times responded: "welcome to Guangdong Bangpu to see advanced mass production technology." Statistics show that Guangdong Bangpu Recycling Technology Co., Ltd. was founded in 2005, with Ningde times as the largest shareholder, holding 52.87% of the shares. It is mainly engaged in the research and development of resource recycling technology, energy recovery system, new material technology, etc.

02 great potential of power battery recycling market

Although Tianqi lithium and Ningde times have different judgments on the recovery rate of power batteries, the recovery of power batteries is indeed getting more and more attention.

The rapid rise in sales of new energy vehicles has driven a substantial increase in the demand for power battery installed capacity. And this brings a potential huge market is power battery recycling.

For the potential size of this market, institutions generally predict that it is expected to grow into a market of 100 billion in the future.

Previously, the supply of battery raw materials was in short supply and the price soared, which led to seizing high-quality supply and extending the industrial chain as one of the main lines of industry competition, while power battery recycling is a "economical" and efficient way to obtain resources.

Tianci materials disclosed before that recycling business is one of the measures for the company to increase supply sources and deal with raw material price fluctuations.

GGI data show that in 2021, the theoretical decommissioning of lithium batteries nationwide reached 512000 tons, and in the same year, China actually recycled 299000 tons of waste lithium batteries, of which 25.8 tons were used for recycling, and 41000 tons were used for echelon utilization, further reducing the full life cycle use cost of lithium batteries.

Recently, as nickel and cobalt prices fell, lithium prices remained stable. Soochow securities' tracking data showed that the purchase coefficient of waste batteries increased significantly, and the profit remained stable, higher than the average value in 2021.

However, there are also difficulties in power battery recycling. First, the measurement standard of battery residue is difficult to estimate. At present, there are many definitions of the state of Health (soh) of power batteries, including the definition of capacity attenuation, the definition of residual cycle time based on residual discharge and the definition of internal resistance.

Secondly, the fluctuation of metal price affects the economy of material recycling: the fluctuation of metal price ultimately determines the profit and loss of the power battery recycling market, and the metal price is affected by comprehensive factors such as resource supply, technological progress and downstream market.

03 echelon utilization, disassembly and recycling of power batteries

As for the recycling and utilization of power batteries, there are currently two recognized practices in the industry: one is echelon utilization; The other is disassembly and recycling. There are certain technical barriers in these two approaches.

In the lithium battery industry, there is an unwritten rule that the power battery pack will be eliminated and replaced when its capacity declines to 80%. Although the power battery is no longer suitable for cars at this time, it can also play a "waste heat" in other aspects.

In fact, the recycling mode of echelon utilization is also very easy to understand, just like the old advertisement saying, "if the remote control car is removed, it can still be used on the remote control". This is essentially to extend the service life of the battery by transferring demand.

Generally speaking, when the capacity of the power battery decays below 80% - 70% of the rated capacity, it is no longer applicable to electric vehicles. However, the 80% - 20% range is where the blue ocean of echelon utilization of power batteries lies. It can still meet the energy storage or power demand in many scenarios. It must be scrapped only when the capacity drops to 20%.

Disassembly recycling mainly includes wet recycling and physical recycling. Wet recovery requires less equipment, but requires chemical solvent extraction such as sulfuric acid and ion exchange, so environmental protection requirements are higher. Physical recycling includes automatic disassembly, recycling and remanufacturing, which can obtain valuable products such as cathode powder and cathode powder, and its economic value is relatively high.

However, the actual situation of the power batteries retired from electric vehicles is not unified. Some are ternary lithium batteries, some are lithium iron phosphate, and some are honeycomb batteries. The specific structures are different, so it is often necessary to evaluate and test many factors such as performance and safety, so as to disassemble and reorganize the retired power batteries according to different uses

Finally, it should be pointed out that there is no separation between echelon utilization and disassembly and recycling. There is also a practice of echelon utilization before disassembly and recycling in the industry.