The Lithium-ion battery market is huge, but how big? Express Mobility spoke to Rajat Verma, the Founder and CEO of Lohum, a comapny that reuses and recycles Lithium-ion batteries to give them a new lease of life for various applications.
Please explain how did you come about forming this company, the net worth, investors and the backing?
Justin and I were seeing two key trends starting around 2015 – tons of li-ion batteries moving into the waste stream combined with the early signs of how battery power could radically change two of the largest global industries – energy and mobility. Though these trends were positive in our view, there were also many parallels to fossil fuels – few countries with critical battery raw material reserves, supply chain dominance by only a few companies and countries, cost premiums that limited accessibility, particularly in the developed world and significant mining and energy requirements. If we only trade one problem for another then we have failed. Our view was that with the right technology we could make batteries last forever in one form or another and, by doing so, greatly reduce costs and the environmental impact. So that’s what we set out to do.
Lohum was founded in 2018, as the only integrated lithium-ion battery manufacturer and recycler to lower costs of electrification – economically and environmentally. Over the last three years, we have been able to create the technology and infrastructure to manufacture, reuse and recycle Li-ion batteries with a capacity of 300 MWh per annum.
Our first-life battery manufacturing is by far our leading business unit, but we are already the global leader in battery reuse for mobility applications with over two million operational miles so far. We have also raised a $7mn investment from institutional investors led by Baring PE Partners India earlier this year. The company grew 7x over the last year, even amid a pandemic, and we have been profitable for the last two years.
How much battery-making material is obtained from outside India? How big is the facility and who are the clients?
The key raw materials required for manufacturing a Li-ion cell are Lithium, Cobalt, Nickel and Graphite. Barring Graphite, these resources are almost non-existent in India. India, like most of the world, relies on other countries such as Chile, Congo, China and Australia for sourcing these key materials.
Looking at the faster adoption of EVs, there will be an exponential increase in demand for Li-ion batteries. Early forecasts project the demand for its raw materials to grow by 13X for Lithium and Nickel, about 12X for Graphite and 6X for Cobalt by 2028. Through the recycling processes and repurposing Li-ion batteries for their second life, Lohum is working towards providing solutions to the challenges of burgeoning demand for batteries and their raw materials.
We operate two facilities in Delhi NCR, with a total capacity of 300 MWh across li-ion battery manufacturing for2W, 3W and stationary ESS. And due to demand, we have a third factory in progress. Our customers on the mobility side are the leading EV players in the 2W and 3W space for battery manufacturing, as well as large global OEMs for re-use and recycling.
How do you manage to recycle or disposing of the old batteries? We believe you have the required clearances for the same from the government; How difficult is it to get the approval?
The world is moving towards the adoption of cleaner forms of energy, and we need to explore the possibilities of acceleration of electrification through sustainability. Li-ion has become the mainstay of energy storage solutions in all forms of electrification, be it electronics or powering machines in the telecom sector to EVs across the globe.
With the massive adoption of Li-ion batteries, there is a dire need for a new vision for sustainable production, consumption, and retirement of lithium-ion batteries, thus becoming part of the circular economy instead of becoming waste. The best option for the environment and reducing battery costs with used batteries is to re-use the battery and then recycle it when it has reached its end of life. Our goal is to keep the battery operating as long as possible and then recycle the materials.
Our process ensures 100% of the battery has multiple lives in one form or another. As a first step to build the Li-ion circular ecosystem, Lohum has a dedicated battery collection centre that gets a continuous supply of end-of-life batteries from a network of responsible suppliers. We minimize risk during this step by ensuring all regulatory standards and safety protocols are meticulously followed.
During the next step, these batteries are carefully segregated according to form factors and chemistries to prepare them for cell and module testing. These cells are rigorously tested to help sort useable cells from non-useable cells.
Finally, the extraction process begins with shredding, where the non-useable battery cells are shredded to separate plastics, copper, and aluminium foil from the black mass. The extraction process includes a mechanical shredding process combined with a hydrometallurgical process that produces lithium, cobalt, nickel, manganese, and graphite to be re-used in new batteries or other industrial applications.
Contrary to the view that recycling requires tolling fees to be profitable, especially at smaller scales, our process is profitable without a tolling fee and at smaller footprints. Lohum holds five provisional patents on this process. The extraction of these materials forms the pivot to Lohum’s circular economy proposition, as they are recycled and reused for multiple lifetimes for enhancing the
lifespan of finite resources. The government has numerous compliance and regulatory requirements that we have completed. The government sees the value in recycling and is working to develop policies that help ensure it develops a domestic capability for generating speciality battery materials when no resources exist otherwise.
How big is the battery disposing sector considering that not many want to talk about it?
Forecasts estimate almost 200GWh of used batteries will be available for re-use or recycling by 2027, representing a market greater than $11Bn. This will continue to grow exponentially as the transformation to battery accelerates. This is a testament to the size of the challenge being faced by the industry, and the possible impact on the environment, if these are left untreated.
These batteries, though unusable in their current form, hold valuable materials i.e. Lithium, Cobalt, Nickel, Manganese, and Graphite. Repurpose and recycle processes offer the opportunity to bring about multiple lifecycles out of the materials they hold. It is reuse and recycling that hold the key to bring down the carbon footprint of the industry, and the dependence on mining for these valuable materials to fuel sustainable electrification goals.
At Lohum, we have the proprietary technology to bring about this change as we look forward to building India as the hub for the generation of these valuable finite materials, without an ounce of mining.
What do you feel about the EV growth in India? Will you be interested in building a ground-up EV sometime in the future?
India is poised for exceptional EV growth, especially the 2W and 3W spaces. It will be one of the top 5 global markets within the next decade. With a trillion-dollar opportunity in the EV space, India must move fast to gain a foothold in this segment, by augmenting supply-chain and domestic reuse and recycling capabilities.
We don’t have any plans to develop a ground-up EV. We are focused on designing and manufacturing the best products possible for our customers and ensure EV adoption accelerates even faster.
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