Second-Life Lithium-Ion Battery Market Emerging Opportunities, And Top Key Players By 2030
In recent years, the popularity of second-life automotive lithium-ion batteries has soared massively all over the world. This has been primarily because of the high costs of the lithium-ion battery recycling process. Lithium-ion batteries comprise only 2–7% of lithium and recycling these batteries is generally five times more expensive than getting lithium directly from various natural sources. Moreover, cobalt is the only component worth recycling in the battery. However, with battery manufacturing companies increasingly focusing on developing batteries that omit or mitigate the usage of cobalt, the demand for the recycling of the material is falling rapidly.
This is, in turn, propelling the popularity of second-life lithium-ion batteries. Besides, the mushrooming deployment of electric vehicles (EVs) in several countries is also driving the expansion of the second-life automotive lithium-ion battery market. Owing to the surging concerns being raised over the rapid environmental degradation, on account of the rapid depletion of the ozone layer, the demand for EVs is rising sharply. Currently, the automobile sector accounts for nearly 43% of the total greenhouse gas (GHG) emissions across the globe.
These environmental concerns are encouraging the governments of several countries to launch initiatives, such as those aimed at encouraging the use of electric vehicles, for mitigating the pollution levels. Due to these factors, the revenue of the second-life automotive lithium-ion battery market is predicted to surge from $430.0 million in 2019 to $7,392.0 million by 2030. According to the estimates of the market research company, P&S Intelligence, the market will exhibit a CAGR of 23.1% from 2020 to 2030 (forecast period).
Depending on type, the market is categorized into lithium ferro phosphate (LFP), lithium-ion manganese oxide (LMO), lithium-nickel-manganese-cobalt oxide (NMC), lithium-nickel-cobalt-aluminum oxide (NCA), and lithium-titanate oxide (LTO). Out of these, the NCA category is predicted to demonstrate the highest CAGR in the market in the coming years. This is credited to the fact that the NCA batteries provide greater energy density than others and exhibit rapid charging capabilities. EV charging, low-speed EVs, base stations, and energy storage are the major application areas of second-life automotive lithium-ion batteries.
Amongst these, the requirement for these batteries is predicted to surge in energy storage applications in the coming years. This is credited to the fact that second-life batteries provide a reserve energy capacity to maintain the power reliability of the utilities at optimum cost by replacing less-efficient and more expensive assets. Additionally, these batteries are mitigating the requirement for power distribution and transmission investments, owing to their ability to store renewable power, which can be later used during the periods of energy scarcity or peak demand.
Across the globe, the demand for second-life automotive lithium-ion batteries was found to be the highest in the Asia-Pacific (APAC) region during the last few years. Moreover, the region is predicted to become the largest second-life automotive lithium-ion battery market in the upcoming years. This will be because of the burgeoning sales of EVs, especially in China and India, on account of the implementation of favorable government regulations and policies in these countries.
Hence, it can be safely said that the demand for second-life automotive lithium-ion batteries will surge sharply in the coming years, mainly because of the soaring cost of battery recycling and mushrooming deployment of EVs across the world.