Panasonic Energy and Japanese raw materials firm Sumitomo Metal Mining have launched a recycling initiative to recover nickel from lithium-ion battery production waste for reuse in new batteries, the companies said.
The project, which marks Panasonic Energy’s first closed-loop recycling effort in automotive battery production, will extract nickel from battery scraps generated at its factory in Osaka, Japan. The recovered material will then be reprocessed into cathode material for new batteries produced at the same facility.
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“Building a sustainable recycling scheme for end-of-life lithium-ion batteries is crucial for the future expansion of EVs,” said Kazuo Tadanobu, CEO of Panasonic Energy. “We are advancing initiatives in both Japan and the U.S., and through the partnership with Sumitomo Metal Mining, with its deep expertise in non-ferrous metal recycling, we are accelerating our efforts toward realizing a circular economy. This collaboration supports our mission of fostering a sustainable society.”
Panasonic Energy stated that it aims to achieve 20% recycled cathode material content in its automotive batteries by 2030. The initiative may expand to include other key raw materials, such as lithium and cobalt, beyond 2026.
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The recycling process will be carried out at Sumitomo Metal Mining’s Toyo Smelter & Refinery and its Niihama Nickel Refinery in Japan’s Ehime prefecture. Sumitomo invested 47 billion yen (about 358 million euros) in 2021 to expand cathode production at the Niihama facility.
Panasonic previously signed a similar agreement with U.S.-based Redwood Materials in 2022 to source recycled cathode materials and copper foil for use at the Nevada Gigafactory it operates with Tesla. However, unlike the deal with Sumitomo, the Redwood-supplied materials are not exclusively sourced from Panasonic batteries, making the new initiative the company’s first fully closed-loop recycling program.
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The move comes as battery manufacturers and automakers seek to secure raw materials through sustainable supply chains amid growing demand for electric vehicles. Recycling initiatives are viewed as a key strategy to reduce reliance on mining and mitigate environmental impacts.