Importance Of Metal Recycling
Mineral resources are inherently limited, and their extraction is energy-consuming and environmentally destructive. The mining industry is a major consumer of fresh water, an emitter of greenhouse gases, causing deforestation and pollution that can last decades if not centuries.
In theory, metals should be the most recyclable materials, as they are made of pure elements, contrary to complex organic molecules like plastics.
In practice, this is far from true, with recycling of metals often imperfect, or too energy-consuming. This is especially true for electronic components, mixing together at the atomic level complex mixes of exotic elements like rare metals, cadmium, titanium, tungsten, etc.
So, it is big news that researchers from Rice University (USA) and Tsinghua University (China) have developed an entirely novel way of recycling metals using intense electric currents. Their results were published in Nature Chemical Engineering on September 25th, 2024 under the title “Flash separation of metals by electrothermal chlorination”.
Metal Recycling Methods
Current Metal Recycling
Currently, metal recycling mostly relies on liquid hydrometallurgy, or the dissolution of metals in liquid or alkaline water. However, this technique involves substantial water and chemical consumption with problematic secondary waste streams.
Source: MEAB
Another option is pyrometallurgy, which essentially melts all the mixed metals together and then re-purifies them according to their physical properties (melting point, etc.). The issue is that this method lacks selectivity, so often, the result is still a mix of different metals. It also requires significant energy inputs, reducing its environmental profile.
Flash Joule Heating (FJH)
Flash Joule Heating is a method that the research team leader, James M. Tour, has previous experience with for graphene synthesis and waste disposal.
Source: India Education Diary
FJH consists of passing an electric current through a material to rapidly heat it to extremely high temperatures. The speed of the heating process transforms the material into different substances.
They discovered that the method could be applied to metal extraction. And it seems that it could be widely applied to a variety of electronic wastes. Notably, the method was proven to be able to separate:
- Tantalum from capacitors.
- Gallium from LEDs.
- Indium from used solar films.
The method achieved these results without using any water, acid, or other solvent, drastically reducing the resulting pollution. Not only this can work on many metals, but it also achieves a purity of 95% for the end result, by precisely controlling the reaction conditions. In total, the yield was a very satisfying 85%.
So even if it would not recover all the metal, this method could drastically reduce the portion of waste that needs to be processed with hydro- or pyrometallurgy.
Future FJH Prospects
Universal Electronic Recycling
This method was here studied for recycling only some types of electronic waste. More work will be needed to assess it for other types of electronics in dire need of more efficient and environmentally friendly options, like for example batteries.
We are trying to adapt this method for recovery of other critical metals from waste streams.”
Dr. Bing Deng – Assistant professor at Tsinghua University and co-first author of the study.
It is also likely that more refinement on the method can be developed, like testing it in combination with a smaller amount of acid to find ways to increase the total yield.
“This breakthrough addresses the pressing issue of critical metal shortages and negative environmental impacts while economically incentivizing recycling industries on a global scale with a more efficient recovery process,”
Dr. Shichen Xu – Postdoctoral researcher at Rice / co-first author of the study
Mineral Extraction
Conceptually, there is very little difference between metal recycling and mineral extraction from natural ore. In both cases, the metal is embedded with other elements and needs to be forcefully separated to be purified and made usable by the industries needing it.
In mining too, refining is often achieved through the use of water + acids, or extreme heat, both at a massive scale. This is a key part of what makes mining so controversial and environmentally destructive.
So the method could also hold promises for the extraction of lithium and rare Earth elements, according to Dr. Shichen Xu.
Investing In Metal Recycling
While some metals like steel and aluminum are recycled well, other more complex materials like electronic waste are still mostly unrecycled, or processed in unsanitary and polluting conditions in poor countries.
Meanwhile, EVs, solar panels, batteries, heat pumps, and small electronic devices are produced in ever larger quantities, accumulating the stockpile of material needing to be recycled in a mere few years.
You can invest in recycling companies through many brokers, and you can find here, on securities.io, our recommendations for the best brokers in the USA, Canada, Australia, the UK, as well as many other countries.
If you are not interested in picking specific companies, you can also look into ETFs like the Mast Global Battery Recycling & Production ETF (EV), the VanEck Circular Economy UCITS ETF (REUS), or the WisdomTree Recycling Decarbonisation UCITS ETF – USD Acc (WRCY) which will provide a more diversified exposure to capitalize on the recycling industry.
Metal Recycling Companies
1. Li-Cycle Holdings Corp (LICY -3.2%)
Li-Cycle Holdings Corp. (LICY -3.2%)
Among all types of electronic waste, batteries may be the most problematic one.
This is because not only are they extremely complex devices containing many different polluting metals, but also because they are always potentially a safety risk due to the risk of fire or explosion of charged batteries. So while batteries are mostly safe in normal conditions, getting shredded or melted for recycling is obviously perfect for creating such danger.
And the volume of batteries needing recycling is going to explode 6x by 2030 in North America alone.
Source: Li-Cycle
It is a crucial selling point of Li-Cycle that their method can process fully charged full battery packs, without the need to dismantle or discharge.
This is also a “battery form Agnostic” process, meaning that it can work on any type of lithium-ion battery, regardless of the manufacturer or status of the battery. As the industry is still far from having consolidated around a specific design, and innovation is happening very fast, it is crucial for a recycler to stay able to work efficiently in the long run.
Overall, the company achieves a 95% recovery rate and can produce high-quality materials like battery-grade lithium carbonate from the used batteries.
Source: Li-Cycle
In 2023 and early 2024, the company hit an obstacle with massive cost overruns for the building of an important processing facility in Rochester, NY. This came after a very quick expansion with facilities built across North America, Europe, and Asia.
If finished and running at full speed, the Rochester Hub could process up to 35,000 tons of so-called black mass (essentially crushed batteries) per year.
This would be a massive step up from the only 1,394 tons of black mass produced in Q2 2024.
Source: Li-Cycle
To get enough money to finish Rochester, Li-Cycle secured in Mach 2024 a $75M investment from mining giant Glencore. It is also looking for a $375M loan from the US government as part of the push for green policies and re-industrialization in the of the U.S. IRA and Bipartisan Infrastructure Law.
The DoE Loan process is now quite advanced, having reached step 5 out of 6 in total. Construction at Rochester is expected to restart if the loan is approved.
Source: Li-Cycle
Another headwind for the company has been low material prices, which have hit the whole supply chain, including lithium miners. In response, the company has reduced its headcount and cut costs where possible.
If Rochester Hub is successful, the company is aiming to build three additional third-generation hubs (Rochester is second-generation) in Alabama, Arizona, and Germany.
Source: Li-Cycle
2. Enviri
Enviri Corporation (NVRI -0.97%)
Formerly known as Harsco, the company is a giant in waste recycling, with a focus on industrial and mining waste, including metals (40% of its total sales).
The company is split into 3 parts:
- Harsco Environmental: Processing 20 million tons of slag yearly to produce asphalt, paving blocks, abrasives, roofing shingles, and fertilizers.
- Clean Earth: specialized in handling hazardous wastes, including a yearly 5.6 million lamps, 5.3 million pounds of batteries, 5.000 tons of electronics, 3.4 million of contaminated soil, and 71 million gallons of wastewater.
- Rail: providing rail maintenance and construction solutions.
Source: Enviri
Overall, the recycling/cleaning segment makes up the majority of the business, with 62% of total revenues coming from North America. Clean Earth has been growing quickly, moving from just a few percent of the company’s revenues in 2019 to almost a third in 2024.
Source: Enviri
The company sees a large growth opportunity in the treatment of PFAS (Per- and polyfluoroalkyl substances), or “forever chemicals” which are increasingly a concern and in need of better processing. The market for PFAS disposal that could be addressed by Enviri’sClean Earth is expected to grow to 3-5B.
The company also continues to focus on identifying additional methods that can destroy PFAS, rather than landfilling it or using deep well injection treatments.
We believe destruction to be a superior technology to reduce long-term risks and liabilities.”
Elizabeth Peterson – Chief Commercial Officer of Clean Earth
As more and more regulations are tackling the problem of unaddressed pollution (like PFAS), it is likely that companies like Enviri will benefit from it. Other opportunities can be found in green steel and carbon-negative asphalt.
In the long-term the company is considering selling its rail assets, to finalize its transformation from an industrial group to a green economy company. But it might take time, due to regulations and threats to long-term contracts in Europe in case of a sale, leading to the sale of the rail segment being paused for now.