The Recycling of Spent Power Battery: Economic Benefits and Policy Suggestions

With the rapid development of the electric vehicle industry in China, the number of spent power batteries has increased. Recycling of spent power batteries is necessary not only to eliminate the environment pollution, but also to reduce the resources usage. However, whether it is necessary for the government to take economic incentives in the recycling process has not been clearly analyzed. Combined the existing literatures and the market investigation, this paper estimates the economic profits of recycling spent power batteries, in terms of LiFePO4 (LFP) battery and Li(NiCoMn)O2 (NCM) battery. The results show that the recycling process is profitable, therefore, we suggest the government should not implement additional economic incentives, like subsides or tax reduction, but focus on the establishment of compulsory recycling mechanism and the market permission system.