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Battery Recycling And Self-Solving Problems



Certain problems are, in a market economy, self-solving. Another way to put much the same point is that we can leave human greed – sorry, enlightened self-interest – to deal with the issue for us.

So it is with the recycling of these lovely lithium batteries that electric cars use. This being something that the usual worrywarts don’t grasp:

Electric car revolution risks mountain of toxic battery waste
Gigafactories’ green push towards net zero emissions could create millions of tonnes of hazardous junk

Well, toxic and hazardous are a bit strong. Things we might not want to stir into our tea perhaps, but not things that kill merely by our looking at them. If they did that second then we’d not be desiring to power our cars with them, would we?

The raw materials needed to make electric car batteries are scarce. Cobalt, nickel and lithium all have hotly contested supply chains. Recycling these metals could provide a valuable source where there are no local mines.

All economic resources are scarce – that’s a definition. If they’re not scarce then they’re not an economic resource. Recycling could indeed but the important word there is the “could”. Thus we need a decision mechanism to work out whether the could becomes does or doesn’t. Fortunately, in that market economy, we’ve got one of those:

There is also a business opportunity. The market for recycling lithium ion batteries is thought to be in the region of $12bn by 2025.

Actually, what we’re trying to decide is whether that recycling industry will be worth nothing or worth $12 billion. And we do, again, have a method of working this out in a market economy.

Can you make a profit recycling lithium batteries? If you can then yes, they both will and should be recycled. If you can’t then allow them to pile up like the pyramids. Because profit is that proof that you are adding value by recycling. Making a loss is the way of telling that you’re subtracting value.

All of the things involved have other uses. The capital, land and space, labour, energy and so on, all can be used to do other things. The market price of the varied inputs is the – average – value of their use to do those other things. So, if we profit by turning these economic resources to recycling lithium batteries then we are putting these economic resources to a more value additive purpose than those alternative uses. If we make a loss then we’re subtracting.

This is not some weird oddity of right wing economics this is a definition of what’s going on.

This valuation also includes the costs of digging up new lithium of getting it from that ziggurat of batteries. The costs of mining lithium are included in the price of lithium, as are also the alternative uses.

Which leads to a useful conclusion. If it is profitable to recycle lithium batteries then we desire lithium batteries to be recycled. If it’s not profitable then we don’t want it done – why would we want to make society poorer by wasting scarce resources?

Hmm, OK, so, now what do we have to do here? The answer being nothing. For if there’s profit to be made from recycling lithium batteries then people will recycle lithium batteries because human greed – sorry, enlightened self-interest – is one of those attributes of our species that we can rely upon. There’s $12 billion in them thar’ batteries? They’re not going to be left lying around for long, are they?

All most cool. Another problem we’ve not got to do anything about, one of those self-solving ones. Aren’t markets wondrous things?



  1. All cool until the eco-nuts get their hands on the levers of government. Say in the UK something like getting one’s hands on the Prime Minister. Or in the US getting the pudding concession for the disabled President.

    • Back in the good old days when even I was young, there was no problem with newspapers or even such new-fangled stuff as plastic. Everyone in Brissy had an incinerator in their back yard. All the rubbish that could burn was burned.

      Of course in these enlightened times, the horrid polluting smoke of the incinerators is banned. And people whine about where the hell they’re going to dump all that non-recyclable plastic and other inflammable junk.

      At present, with the good old internal combustion engine, the fuel is incinerated to provide the power. The CO2 produced is consumed by the plants, or dissolved in the oceans and eventually subducted down into the mantle and pumped back into the atmosphere by volcanoes. The waste problem is automatically solved as part of the process.

      Perhaps we should forbid the reintroduction of this obsolete electric vehicle technology and stick with the environmentally friendly petrol driven car.

  2. Isn’t this whole milk float basically a soviet style 5 year plan? What has market economics got to do with any aspect of it?

  3. The UK currently consumes 26bn single-use plastic bottles a year, or so say the people who want a deposit return system. The best point these people make is that 8bn of these bottles are wasted so I e-mailed them for more information as that 18/26 recycling rate looked quite high to me without any deposit return system. They accidentally disclosed that the 8bn wastage comprised bottles that went to landfill, incinerators and was littered. So even that wastage figure was dubious as what gets incinerated gets converted to electricity or heat or both, the incinerator businesses not being stupid, and most of what goes to litter gets picked by litter pickers or biodegraded so goes back into the soil or the 18/26 recycling system they mentioned. So the wastage figure claimed was an exaggeration and just doesn’t reflect what is being wasted at all. And on that bad data they wanted a DRS which would waste our time compared to kerbside collections.


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