It was learned on the 4th that LG Electronics will be able to run a business for two years to extract and recycle rare earths from discarded home appliances such as air conditioners. For now, strict local government requirements for recycling permits have effectively made it impossible. The government is expected to select LG Electronics as a regulatory sandbox operator that can recycle permanent magnets in discarded home appliances without local government approval.
According to reporting by ChosunBiz, the Ministry of Climate, Energy and Environment is said to be set to convene the Circular Economy New Technology and Services Review Committee on the 6th and submit an agenda item to select LG Electronics as the pilot operator for a regulatory exemption project in the circular economy for discarded permanent magnets.
A permanent magnet is a magnet that retains magnetism even when power is cut. It is used in air conditioner outdoor units, refrigerators, and electric vehicle motors. It is known that rare earths such as neodymium (Nd) and dysprosium (Dy) account for about 30% of the magnet's composition.
Since 2006 through the end of 2024, LG Electronics has collected nearly 5 million tons of discarded home appliances worldwide. It crushes, grinds, and sorts discarded appliances through outside contractors or its own centers to extract more than 40 types of raw materials, including plastic, iron, and nonferrous metals, which are then used as materials and supplies for parts in monitors, washing machines, and refrigerators.
However, among the raw materials in discarded home appliances, permanent magnets have been difficult to recycle. To recycle them, companies must obtain local government permits, which have been granted only to operators with recycling facilities above a certain scale. If LG Electronics is selected as the pilot operator under the regulatory sandbox, it will be able to run the special project for two years without local government approval.
The government's push for resource recycling aims to strengthen economic security. Korea relies entirely on imports for rare earths. But as China has weaponized resources—such as by halting rare earth exports to Japan—resource security risks have grown. If the approach of extracting rare earths from discarded electronics and reusing them proves successful, even if imports are cut off, a significant portion could be sourced domestically.