Battery recycling crucial for ESG management: Samjong KPMG

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By Yi Whan-woo

The rapid growth of the electric car market is fostering the recycling of discarded batteries and companies are being urged to capitalize on the market for salvaged cells as part of their environmental, social, and corporate governance (ESG) principles, according to Samjong KPMG.

In a report released on Monday, the auditing company said the battery recycling market will expand 33 percent annually beginning in 2025 and will be worth $57.3 billion by 2040, as the number of such batteries are increasing in accordance with that of electric cars.

“And this means that recycling of the discarded batteries will emerge as a keyword in ESG management,' Samjong KPMG added.

A leading auditor in Korea, Samjong KPMG attributed the explosive demand for dead batteries to an increase in raw material prices due to disrupted supply chains.

The batteries are useful as lithium, cobalt and other rare materials are extracted after disassembling them. The extracted materials will be used again for the battery business or will be up for sale in other industries, thus helping a wide range of sectors secure demand while saving costs.

Samjong KPMG hinted at a growing need to use discarded batteries in a compulsory manner, noting the United States, China and the European Union announced a set of regulations in past years to counter climate change.

The auditor underlined three measures for companies to take the initiative in battery recycling ― setting up an appropriate business model, quickly gaining access to discarded batteries and developing relevant recycling technology.

Some companies have already been outlining strategies to recycle discarded batteries as part of their ESG management, according to Samjong KMPG.

Hyundai Motor has developed a so-called energy storage system (ESS) from used lithium-ion batteries and LG Energy Solution is applying ESS in its secondary battery manufacturing process.