This is no ordinary battery facility.
Inside are piles of used and faulty EV batteries,
many of which will function again
reentering electric vehicles after Spiers New
Technology rebuilds the ones they can and
salvages critical minerals from the rest.
It's fantastic that you can drive an electric
vehicle knowing that the end of the life of that
battery pack, the ingredients will be
reused in a new battery pack and a new electric
car, and that we really want to play a role in.
Dozens of electric vehicles are scheduled to
debut in 2024, and over 300 million EVs are
expected to be on the world's roads by 2030.
Tesla, Volvo and GM are just a few companies
leading the way towards electrification. But with
any new technology comes new problems to tackle.
If you're going to call yourself a green company,
you don't want your batteries piling up in
junkyards.
The volume of recycling is hotly debated right
now. There's been billions and billions of
dollars of venture capital that's gone into
it.
The degradation of an EV battery pack is one of
the biggest questions of the industry.
Every battery will reach end of life, and it's
important that these end of life packs are
recycled so they don't end up where they don't
belong.
CNBC explores how used batteries will play a
role in the future of electrification and what
one Oklahoma company is doing to help with the
millions of used battery packs with nowhere else
to go.
The American EV market is small in comparison to
operations in China and Europe.
In 2021, the U.S.
accounted for less than 10% of new global EV
registrations, while China accounted for 50%
and Europe came in at 35%. When it comes to EV
batteries, China accounts for over 70% of
global production capacity, leaving the U.S
. Heavily dependent on imports from battery
minerals.
The life cycle of an EV battery really starts
when minerals are extracted from the earth
and those minerals are used to produce an EV
battery cell.
The critical minerals that go into EV batteries
include lithium, cobalt, manganese, nickel and
graphite.
It has been clear since 2014 that China had a
plan to lock up the bulk of the world's production
of battery minerals.
The world's largest battery company is now in
China.
Now, under President Biden's Inflation
Reduction Act, EV manufacturers can qualify
for a tax credit if 40% of its critical battery
minerals are sourced domestically or with a
free trade partner like Canada by 2024.
This is industrial policy of a sort that we have
not seen in this country for a very, very long
time. In theory, a certain percentage of the
battery minerals has to come from a small list of
countries. The battery, the cell, the processing,
all of that has to be done onshore and the car
has to be built in the U.S.
Sourcing minerals domestically is necessary
to keep up with new regulations, but opening
minds in the U.S. has been met with opposition
from local communities, concerned about
environmental and health hazards.
Recycling and reusing used battery packs is one
possible long term solution.
It's very early stages.
We're kind of talking about a business that is
just forming now and won't really hit its
stride, at least in the United States or North
America, until like 2030, because that's when
we'll start to see more and more EVs get to end
of life and more and more battery packs.
Both public and private commitments suggest that
EV production will increase in the U.S.,
which means more American companies are
likely to enter this space of EV battery
manufacturing and recycling too.
Companies like Redwood Materials, Life Cycle and
American Battery Technology have already
developed processes to recycle lithium-ion
batteries.
We're building the infrastructure for
something we expect to exist in several years
that isn't really at a big scale yet.
If they can get the cost comparable to newly mined
materials, the demand will be very significant
because nobody really wants to be mining cobalt
and nickel more than they have to.
There are a number of smaller players now who
do this for hybrid batteries and I fully
expect them to expand into battery electric
vehicle batteries.
They're correspondingly more valuable and you can
probably make more money servicing a dead battery
electric vehicle than a dead hybrid.
Repairing, remanufacturing,
repurposing and recycling of EV
batteries. That's what's happening here in
Oklahoma City at Spiers New Technologies.
The number of battery packs we have here are in
the hundreds. We make sure that they are clean
and then they go on the racks to be processed,
taking them apart, testing them, building
them back together, making sure that they are
as good or better than what they replace.
And then they go back on the rack again, waiting
for a dealer to need one of these, and then we
send them out.
Dirk Spiers is the founder and CEO of Spiers
New Technologies.
His company specializes in the life cycle
management of EV battery packs by extending its
first life and reducing the need to mine critical
minerals.
I've been in batteries for almost 15 years now,
hence my gray hair.
We believe that the world is going electric
and we wanted to extend the economic life of
those battery packs and help the OEMs with their
life cycle management.
And we do that all under one roof on the one
campus.
Spiers New Technologies, or SNT, was founded in
2014 with just two employees.
In 2021, it was acquired by Cox Automotive, a
subsidiary of Atlanta-based media
conglomerate Cox Enterprises, which has
other automotive brands like AutoTrader and
Kelley Blue Book.
The company now has over 400 employees and offers
what it calls a one-stop solution for used and
faulty EV batteries.
We are like a diner of battery surfaces, so you
can come to us for a cup of coffee.
But if you want to have a steak or a cup of soup
or apple pie, we serve all these things.
SNT receives batteries directly from the
dealership or original equipment manufacturer,
for example, Toyota or Porsche.
It then puts these batteries through its
diagnosis system named Alfred.
Alfred assesses the health of the battery
pack to determine whether it eventually can
go back into a vehicle.
To get there, it can be repaired to operational
conditions, remanufactured to
original factory standards or refurbished
and upgraded to current factory standards.
Otherwise, SNT can repurpose it for a second
life -- usually energy storage.
And if the pack is truly at its end of life, SNT
will recycle it as a last resort.
The results of our mechanical-shredding
process concludes with byproducts that are
captured in these large super sacks here.
These super sacks contain the byproducts of
plastics, aluminum and copper foils as well as
black mass.
And that black mass consists of critical
minerals, cobalt, magnesium, aluminum,
copper, graphite and, of course, lithium.
In addition to its headquarters in Oklahoma
City, SNT has facilities in Las Vegas and Detroit
with plans to expand to the East Coast.
It also has operations abroad in the Netherlands
and plans to open in the UK soon.
But being centrally located in the U.S.
Is key for its business model.
We need to be where our customers are.
Being bang in the middle of the country helps.
We can reach either coast between 2 and 3
days. We can ship by air.
So if it really needed to be, we can have a
battery pack the next morning by 10:00.
SNT does not work direct-to-consumer.
An EV owner brings their battery pack to a
dealership, which then sends it to SNT to be
serviced. That dealership swaps out the
customer's battery with an operational one
already in stock.
If none are in stock, SNT will send a pack from
its storage. Meanwhile, SNT works on the
customer's battery, then stores it to be sent out
later. SNT also works with battery
manufacturers and carmakers, which can send
faulty batteries to be repaired.
The company says its facilities total over
800,000 square feet of production space and
500,000 of those are for battery storage.
It wouldn't disclose the number of battery packs
it's capable of storing, but says it handles on
average, 15,000 battery packs and modules per
month.
We get anything from, say, 50 to 100 battery
packs per day, 80 to 90% can be refurbished.
And that is good enough to go back into a
vehicle. Recycling is maybe 5 to 10% and the
rest is repurposing second life.
But those numbers will fluctuate.
Repurposed battery packs can be reused in
non-vehicle applications such as energy storage
for solar panels and power grids.
Because the industry is so new, I think we're
squarely focused on providing end-to-end,
life-cycle management for every battery that
comes to our operation.
Since its inception, SNT says it's serviced more
than 240,000 packs and more than 50,000 have
been repaired, refurbished or
remanufactured. It's recycled 3,000 packs.
If you look at the EV market and if you take
Tesla out, we probably have 60, 65, 70% of that
market of the non-Tesla electric vehicle OEMs.
So that's a lot. GM, Ford, Stellantis,
Porsche, Volkswagen, Nissan, Toyota, Volvo.
We keep adding to the list.
And when asked why they don't work with one of
the most recognizable brands in the EV
industry.
No, they always do that.
They like to do their own stuff.
You know, they're a little bit like Apple.
And also their, and maybe this is not
politically correct, their payment terms are
like really bad.
So, I think we owe, the industry owes a lot to
Tesla -- they made electrification sexy.
When I think about the future of EV battery
recycling specifically, I see it as an
increasingly competitive space.
But at the same time there is a bit of a
mismatch of maybe more supply and capacity
around EV battery recycling than demand
because we're just riding this first wave of
electric vehicles who who could be on the road
for ten plus years.
The lifetime for an EV battery is estimated to
be 12 to 15 years in moderate climates.
However, the estimated reuse lifetime of an EV
battery can range anywhere from 5 to 30
years. By 2050, the demand for graphite,
lithium and cobalt is expected to increase by
500%. But extending the life of an EV battery can
reduce the need for critical minerals.
So could battery refurbishment become a
big business and how profitable is it right
now?
A couple of years ago, there was a cost
associated with recycling a lithium ion
battery pack. Now it is a positive.
If you give me a lithium-ion battery pack,
I probably will give you money back for it.
And that's the beauty of it.
The intrinsic value of that battery pack is
higher than the cost of recycling.
The world has a finite amount of minerals
necessary for EV batteries. It's hard not
to speculate. Could indefinite recycling and
reuse be the future?
Absolutely. The circular economy is happening.
It's happening right now.
It's happening here in Oklahoma City.
Why would you get cobalt from Africa or lithium
from South America?
If you can get it here in Oklahoma City,
critical minerals will always be reused and it's
already happening. But, the volume is still
small, but it will get bigger and bigger.
I think we will be mining metals for the balance of
my lifetime. But indeed the hope is as batteries
get more powerful, smaller, lighter and
cheaper, with luck, we will need fewer metals.
We could get to the point where maybe a significant
majority of battery materials are recycled
from old batteries, but we need to hit critical
mass on EV penetration first.
There just aren't enough EVs out there yet, but
maybe 10 or 20 years from now there could be.
Some critics believe the EV battery recycling
business could be booming too quickly and
that the current capacity outpaces demand
for the service at a time when most EV
batteries have yet to reach the end of life.
The idea I think that battery recycling has
boomed too soon or peaked too soon feels
very shortsighted to me.
It's important to point out here that the auto
industry works on 5 to 7 year product cycles.
The cars through 2025 are already locked down.
When we started, everyone thought that we were nuts
and we were, but we made the right call on the
market. We didn't get carried away.
We didn't have a lot of money to waste.
We always had a focus on making the business work
and make it profitable, and that's what we did.
While SNT is one of the pioneers of the space,
like-minded companies like American Battery
Technology are not far behind, developing new
ways to domestically source metals.
We're building an anticipation. I don't
know if it's boomed too soon.
This is all new.
It is an emerging space.
We are all figuring out together how to do it.
Some ideas will be winners, some ideas will
be losers. Some businesses will be
winners, some businesses will be losers.
But progress is happening very rapidly.
Iteration is happening very rapidly.