Investigating circular strategies for a battery-as-a-service case

Other conference contribution, 2023

The circular economy aims to reduce environmental impacts and resource use of production and consumption through resource-life extending strategies like reuse, remanufacturing, and recycling. Circular business models (CBMs) based on service-provisions could enable such strategies at the company level, e.g. by maintaining product and materials within company ownership throughout the product life cycle. However, the potential of CBMs to reduce resource use depends on the supply and demand of materials, components, and products over time, which is therefore important to account for when evaluating what the effects of such solutions could be.

Here, we use dynamic material flow analysis (MFA) to investigate the potential effects on raw material and product flows from implementing a CBM based on multiple reuse and recycling, until 2050. The company manufactures different types of underground mining machines and has recently started to offer lithium-ion traction batteries as-a-service to the customer. The batteries consist of standardised subpack units, which can be combined into battery packs consisting of up to seven subpacks that are sold as-a-service to the customer. The batteries are taken out of use at different levels of degradation depending on the machine they are used in, which means the subpacks can be reused across the different machines. By maintaining ownership of the batteries throughout the lifecycle, the company can manage both reuse and collection for recycling at end-of-life. To investigate how the CBM could affect the need for new batteries and raw materials under different scenarios, the dynamic MFA model traces the inflows, outflows, and stocks of the machines and their batteries over time, by cohort and reuse-stage.

Until 2050, in total 13% of new subpacks are displaced. The supply of reuse batteries is likely to eventually exceed company needs. This limits the displacement of new batteries, but at this point subpacks can be recycled or reused outside the current business model, e.g. through stationary energy storage services to be used on mining sites or by selling batteries through traditional sales. Expanding the CBM can be an important business consideration but would increase raw material demand, which can only be supplied within the CBM to a limited extent. Until 2050, the total primary material reduction is 13-59%. While reuse increases self-sufficiency of batteries, ensuring high recycling-chain efficiencies has a larger potential to reduce primary material demand than what is achieved from reusing subpacks. The effect from reuse on primary material demand is lower in a high-recycling context, but reuse becomes more important if functional recycling is limited or non-existent. For some battery metals, the proposed recycled content targets in the EU Battery Regulation are not reached in time, despite potentially high recycling-chain efficiencies.

The study illustrates how dynamic MFA can be applied at the CBM-level and contributes by pointing to opportunities, limitations, and trade-offs of reuse and recycling over longer time periods. The case is of interest due to the expected increased competition of battery materials and production capacities in coming decades, but also points to more general insights regarding the resource effects of CBMs.