with Commencement of Construction for a “Pretreatment Plant” Marking the Onset of Global Waste Battery Market
SK ecoplant, an environmental and energy firm, along with its subsidiary TES, will collaborate with Ascend Elements, an innovative U.S. waste battery recycling company, to establish a waste battery recycling joint venture (JV) in the U.S. and commence the construction of a pre-treatment facility.
On September 26, a “joint venture agreement (JVA)” ceremony for the U.S. battery recycling venture was held at the SK ecoplant headquarters in Jongno-gu, Seoul, involving the participation of three companies: SK ecoplant, TES, and Ascend Elements.
Approximately 10 dignitaries including Kyung-il Park, CEO of SK ecoplant, and Michael O’kronley, CEO of Ascend Elements, attended the event, while TES Chairman Terence Ng joined remotely via video conferencing.
This collaborative business marks the inception of the first Korean-American waste battery recycling company in the U.S. with ownership stakes of 64% held by SK ecoplant, 11% by TES, and 25% by Ascend Elements.
The newly constructed pre-treatment facility will engage in the physical and secure disassembly and shredding of scrap, a byproduct generated during the electric vehicle battery manufacturing process. Furthermore, it will handle the extraction of black mass, a precursor to obtaining battery raw materials.
In Hopkinsville, Kentucky, a factory spanning 9,290 m2, will soon take shape. An estimated $65.8 million will be invested in this project with an annual production capacity of 12,000 tons of black mass. Construction is scheduled to begin in November, with full operations slated to kick off in January 2025.
In the vicinity, Ascend Elements is in the process of constructing North America's first cathode material precursor plant, capable of supplying 750,000 electric vehicles annually, backed by a $480 million grants from the U.S. government. A robust synergy is expected to emerge from the collaboration of these three companies, encompassing both pre- and post-processing of waste battery recycling.
Kentucky, the chosen location for this factory, is rapidly gaining prominence as a “battery belt” for battery production in the U.S., the world's largest battery market. Situated within the battery hub, where global battery manufacturers have concentrated their production facilities, Kentucky is strategically positioned to ensure a steady supply of scrap materials.
Ascend Elements is a waste battery recycling company established in Massachusetts in 2015. It has an innovative technology that not only individually extracts rare metals from waste batteries but also even has a innovative technology that removes impurities from waste batteries and then directly produces precursors for cathode materials through coprecipitation. It is evaluated to have not only technological competitiveness but also cost competitiveness as the individual metal extraction process has been simplified. This June, a contract was signed with an undisclosed U.S. company to supply precursors for cathode materials worth $1 billion, and the supply scale could be expanded to $5 billion depending on customer requests in the future.
SK ecoplant early paid attention to Ascend Elements’ innovative technology and growth potential. It invested a total of $60.84 million through two investments including $50 million in August last year and $10.84 million in April this year, and is participating in management activities by serving one seat on the board of directors. Recently, Temasek, Decarbonization Partners (a joint venture of Blackrock and Temasek) and Qatar Investment Authority led a $460 million Series D investment in Ascend Elements increasing its corporate value to around 2 trillion won.
The joint venture and pretreatment plant established by SK ecoplant, TES, and Ascend Elements hold significant implications for the global waste battery recycling market. By establishing preprocessing facilities at the core of the electric vehicle battery value chain in the U.S., recognized as the world's largest market, these companies have positioned themselves at the forefront of the U.S. “battery belt” where battery manufacturers are concentrated. Furthermore, their collaboration has laid the groundwork for expanding their business, utilizing Ascend Elements' strong market position in the U.S. and expanding their presence across the North American market.
Currently, SK ecoplant and TES offer comprehensive solutions that include all aspects of waste battery management, ranging from battery recovery to the extraction of rare metals and recycling. With 46 facilities spread across 23 countries worldwide, they have established a global network for collecting waste batteries and are well-prepared to comply with regulations such as the U.S. Inflation Reduction Act (IRA) and the European Critical Raw Materials Act (CRMA).
Of particular note, they have strategically established regional facilities in key areas within the battery industry as well as in regions with high electric vehicle adoption rates, including Europe, the U.S., and Asia. Employing a hub-and-spoke (a system that centralizes goods from each branch at a central point and then redistribute it back to the individual branches) strategy, they are securing a consistent supply of feedstock for the recycling of scrapped and waste batteries.
According to the Basel Convention guidelines, the transportation of collected waste across borders to a recycling facility requires a Basel Permit. TES has proactively obtained Basel permits in more than 30 countries, ensuring compliance with these regulations.
Furthermore, they are maintaining collaborative efforts in the realm of waste battery recycling with prominent entities such as GALP, Portugal's largest general energy company, and EcoPro, a leading battery materials company in Korea. In the forthcoming expansion of the waste battery market, SK ecoplant and TES are poised to serve as key players in securing supplies and facilitating connections between major hub bases.
Kyung-il Park, CEO of SK ecoplant, said, "We have invested substantial efforts in internalizing technology across the entire waste battery recycling process and establishing major facilities worldwide.” He added, “With the formation of this joint venture and the construction of the factory, we have now achieved a competitive edge in the waste battery sector. Building upon this foundation, we are prepared to assert our dominance in the global waste battery market.”