A bill essential to the reuse of spent batteries is expected to be actively discussed in the National Assembly soon to achieve the government's goal of a 20% core mineral re-resourcing rate by 2030. The key question is whether to mandate reuse for corporations or merely set a target.
If reuse is mandated, a stable institutional demand is secured, making it advantageous to achieve the re-resourcing target. However, for manufacturing corporations such as finished carmakers that use batteries, there is the burden of being required to use more expensive recycled raw materials.
Conversely, a target-based system leaves it to corporate discretion, but if a competitive market price does not form, expansion of reuse could stall.
According to political circles and the government on the 26th, the National Assembly's Trade. Industry Energy. SMEs. and Startups Committee placed on the subcommittee's agenda on the 9th the Establishment Act on Fostering the Spent Battery Industry and Supporting Supply Chain Stabilization (hereinafter the Spent Battery Industry Promotion Act).
The Spent Battery Industry Promotion Act is a bill being pursued to establish an institutional foundation, including legal grounds for battery reuse standards and related operators. Rather than simply discarding batteries that contain large amounts of strategic minerals such as lithium, nickel, and cobalt, the aim is to recover and recycle them to reduce supply chain risks and promote a circular economy.
The government set a goal of raising the re-resourcing rate for critical minerals to 20% by 2030. To that end, it announced in succession ▲ Feb. 2023 the Critical Minerals Securing Strategy ▲ Feb. 2024 the Special Act on Resource Security ▲ Mar. this year the Promotion Direction for Vitalizing Critical Mineral Re-resourcing.
As of last year, the average re-resourcing rate stood at only 7%. According to data submitted by the Korea Mine Rehabilitation and Mineral Resources Corporation (KOMIR) to the office of Lee Jong-bae of the People Power Party, the re-resourcing rates by mineral are 3.12% for lithium, 10.17% for nickel, 21.27% for cobalt, and 7.4% for manganese.
Battery reuse is essential to meet the target. The Korea Environment Institute (KEI) and the Environment Ministry expect the number of spent batteries generated, driven by increased electric vehicle production, to surge from 8,321 this year to 107,500 in 2030.
For these reasons, there is reportedly no disagreement between the ruling and opposition parties on the urgency of enacting the law. However, whether to mandate "reuse" is expected to become a point of contention during National Assembly deliberations.
The bills submitted to the National Assembly are divided into a mandatory system that compels reuse above a certain ratio (a bill by Song Jae-bong of the Democratic Party of Korea) and a target-based system that only sets a goal (a bill by Park Hyung-soo of the People Power Party). Song's bill is based on a proposal the battery industry submitted to the government at the end of 2023. Park's bill is a de facto government bill that incorporates improvements following government consultations based on that draft.
The problem is that there are conflicting interests. From the government's perspective, mandating reuse would make it easier to meet the re-resourcing target, but it has the drawback of infringing on market autonomy.
It is also understood that positions in the market are split. For battery manufacturing and using corporations, mandating reuse becomes a burden because recycled raw materials are more expensive than new raw materials, increasing expense. On the other hand, for operators that produce and sell recycled batteries, there is the advantage that if large corporations are required to purchase a certain proportion of products, a stable sales channel opens.
However, if only targets are presented, success—such as achieving the government's goals and revitalizing the market—will depend on how competitive domestic spent batteries are in terms of efficiency and price.
The government is currently deliberating without having determined a clear position on whether to mandate reuse. A government official said, "Whether it will be a mandatory system or a target system will be addressed in the National Assembly, and the specifics are expected to be decided through an enforcement decree afterward."