A used electric vehicle battery can contain valuable materials and still cost money to recycle. The metal has to be found inside a complicated product, collected safely, separated and turned into something another factory will buy. Its value is therefore a starting point for the business calculation, not the answer.
This matters for India because a recycling plant can serve two customers: the buyer of its recovered materials and the producer responsible for managing batteries after use. Understanding which customer pays for which job helps explain why recovery percentages and announced capacity tell only part of the story.
The idea in nine frames
Swipe through the visual explanation, or use the arrow controls. The full story continues below.
The Breakdown: follow the material
A common recycling route separates a battery into several material streams. One is black mass, the mixture containing shredded electrode materials. It is an intermediate product, not a finished new battery. Further processing can recover useful metals; making new battery components requires additional work.
Imagine a business that sells black mass to a specialist refiner. It has performed a useful stage, but its selling price must leave room for the buyer’s processing costs and risks. Another business may carry out both stages. Comparing their revenue per tonne without checking what each actually sells could be misleading.
India’s July 2026 recycling guidelines distinguish facilities that stop at black mass, refiners that process it, and integrated operations. They also specify pollution controls and wastewater management. Those requirements make clear that the business includes managing the process’s unwanted outputs as well as selling its useful ones.
The chemistry changes the shopping list
Lithium iron phosphate, or LFP, and nickel manganese cobalt, or NMC, describe different cathode chemistries. LFP does not offer the same nickel and cobalt recovery opportunity as NMC. Its lower material value makes a recycling model based on selling recovered metals more difficult.
That does not mean an LFP battery has no recoverable value, or that every NMC batch is profitable. The buying price of the waste, the recovered products and the cost of processing all matter. A facility designed around one incoming mixture cannot be assessed simply by multiplying every future tonne by the same expected income.
A recovery rate answers a physical question: how much of a specified material was recovered? It does not state the price received, the cost incurred or the quality a customer accepted. Before comparing two advertised percentages, check the material being measured and the starting quantity used as the denominator.
A small example makes the economics visible
Consider an invented batch, with every amount expressed in thousands of rupees. The recycler receives 100 from selling recovered products. Buying the waste costs 55; collection and transport cost 15; processing costs 30; other operating costs allocated to the batch cost 15. Total operating cost is 115, leaving a shortfall of 15. These are teaching numbers, not Indian market prices or a company’s accounts.
Now suppose the producer also pays a separate service fee of 20 for that same job, while the recycler retains the material sales. Total receipts become 120, leaving 5 after the stated operating costs. The materials, recovery rate and processing route have not changed. The contract has changed who helps pay for the work. This example excludes financing, tax and the return needed on the plant investment.
This is different from toll processing. In a toll model, the customer retains ownership of the materials and pays the recycler for processing. The recycler therefore cannot count both the customer’s material sales and its own processing fee as its revenue.
Neither contract removes execution risk. A fixed fee that ignores a difficult batch can still be inadequate. A material buyer can reject output outside specification. The useful questions are what the contract covers, who owns the recovered product, and who bears changes in input quality or selling prices.
India has a second reason for the work
Extended Producer Responsibility, or EPR, places collection and recycling obligations on battery producers. Registered recyclers and refurbishers participate through the central portal. The rules provide for certificates based on processing that producers can use towards their obligations. A compliance certificate and a consignment of recovered material are different things.
For the business, this creates two questions that should be kept separate: what is the recovered output worth to a manufacturer, and what is the recycling service worth to a producer meeting its obligations? The answers may support the same operation, but they should not be silently combined or counted twice.
There is a concrete Indian example of the relationship. In December 2023, Mahindra Last Mile Mobility announced Attero as a preferred partner for disposal of its lithium ion batteries. The collaboration covered recycling and reuse. That dated announcement establishes a partnership, not today’s processed tonnage, profitability or the payment terms between them.
The plant still needs batteries to arrive
Selling more electric vehicles does not immediately supply more retired batteries. The Global EV Outlook 2026 describes a substantial lag before recently installed batteries reach recycling, while production scrap supplies recyclers sooner. This is global context, not a forecast of the available waste at a particular Indian facility.
Imagine two plants with identical equipment. One has dependable agreements for suitable incoming material and buyers for the output. The other relies on occasional purchases at whatever price is available. Their stated annual capacity may be the same, but the amount of work they can profitably complete need not be.
For an Indian fleet operator or battery producer, the practical comparison is therefore broader than the highest scrap offer. Ask what the receiving facility is authorised to do, which stage it performs, what records accompany the handover and who pays for transport. Safe handling belongs in the commercial arrangement, not as an afterthought once the battery has left the depot.
The Crunch
A battery recycler earns its place by connecting usable waste to a saleable output and an accountable service. Read the chemistry, the process boundary and the contract together. Valuable metals create an opportunity; dependable supply, accepted products and a workable payment model determine whether the business can keep doing the job.
Explore more in Makhanas Unpacked, including why a sale can leave a distributor short of cash.
Related categories: Business & Brands
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