A review of Australia’s battery stewardship program has built a platform to successfully address battery waste.
The ability to adjust how Australia’s battery stewardship scheme operates is vital to future-proof the national battery recycling industry.
Libby Chaplin, Chief Executive Officer of the Battery Stewardship Council (BSC), is confident changes proposed for B-cycle – Australia’s official battery stewardship scheme – will improve the viability of the program and make it more attractive for future entrants.
In March, the BSC announced an overhaul of the scheme to address pressures facing participants and key partners. Libby says the proposed changes, following six months of what she calls “constructive consultation” are significant, but provide an invaluable opportunity to get the scheme right.
Throughout the process, BSC held more than 20 face-to-face meetings with industry, engaged more than 370 people in virtual sessions, and received close to 50 written submissions.
“This has provided us with a strong framework to drive both immediate and long-term outcomes,” Libby says.
“The feedback we received indicates that the model we’re putting forward is robust. It will improve the viability of the program and make it more attractive for future entrants.
“That’s important because while we have a strong participation, we’re still a small market and we need diversity to ensure there’s no single point of failure.”
Launched in 2022, B-cycle has led to the creation of more than 5000 community drop-off points, the recycling of 4.5 million kilograms of batteries and the injection of more than $22 million into the domestic battery recycling industry.
This success has been made possible through accredited partners, who provide vital on-the-ground services to communities across Australia.
However, it was acknowledged that the scheme faces limitations in fully achieving a circular economy for batteries, given its voluntary nature and the evolving market dynamics and risk profile of batteries.
A main driving factor behind the review was Australia’s fluctuating economic environment.
Cost of living has increased 19.8 per cent since the scheme rebates were set in 2019, impacting battery sales and resulting in a reduction of revenue from the levy imposed on imports.
At the same time, collectors have faced rising fuel and labour costs, while recyclers have experienced a decline in commodity prices. Libby highlights that the value of certain battery materials has dropped significantly. For example, lithium black mass (containing cobalt, nickel, lithium and other valuable metals recovered from recycling lithium-ion batteries) has reduced by about 62 per cent since rebate levels were set.
Alongside these financial pressures, there has been an increase in battery fires across the country that need to be addressed, Libby says. A report from the Australian Council of Recycling (ACOR) indicates that up to 12,000 fires a year are being caused by discarded batteries in Australia.
“B-cycle accredited recyclers are facing pressures on both sides,” she says. “The challenge we have as a static model is that we’re unable to raise additional funds to respond to changes recyclers are experiencing.
“It’s causing significant stress across the sector. We can’t afford to go slowly and wait until things pick up.”
The scheme is moving to an eco-modulation program, which recognises the sustainability outcomes of different chemistries, risks and costs associated with each battery type.
For each battery type there will be differences in the levy rate, investment in sustainability outcomes and processing rebates considering the size of the market, the collection rate of batteries, the cost of processing and the fire and health risks.
As new battery chemistries come to the market BSC will consider the risks, costs and sustainability outcomes independently and determine if there is a need for a new battery category to be introduced.
Libby says the scheme will better reflect the true cost of collecting end-of-life batteries for recycling. The new approach will enable BSC to conduct annual reviews so levy rates can be based on changing market conditions and the expected battery collection for that year.
At the Environment Ministers meeting in June 2024, there was recognition of the need to accelerate battery stewardship in Australia. The work is being led by the New South Wales, Victoria and Queensland governments, in consultation with other jurisdictions.
Libby says BSC has long advocated for regulations that compel importers, manufacturers, distributors and users of battery products to take responsibility for their end-of-life management.
But why is battery stewardship important? According to Libby, it’s multi-faceted.
She explains that the way we use batteries has changed radically in the past five years, yet our understanding of batteries is still rooted in older, lower-risk technologies. Additionally, batteries play a vital role in combating climate change, making proper stewardship essential.
“There will be significant increase in the demand for battery materials in the next 15 years and there is no doubt that recycled content will be an important component of that in order to secure adequate resources to power energy renewables,” Libby says.
“Materials such as lithium and nickel are anticipated to be at critical supply levels as soon as 2025 but the economics of recycling batteries is challenging. The value of the materials in alkaline, lithium and other consumer batteries is not sufficient to cover the cost of collection, sorting and processing those materials back into those products.
“Stewardship is essential for responsible resource management and the energy security of this country. It’s too easy to think of it as a tomorrow problem.”
BSC will seek reauthorisation by the Australian Competition and Consumer Commission in 2024 and aims to implement scheme changes 1 July 2025.
B-cycle 2.0 at a glance
Eco-modulated levies:
Eco-modulated levies designed to enhance circularity outcomes over time. While the levy rates for FY 2026 are still the subject of ongoing consultation the concept of eco-modulation was strongly supported and as such will form part of B-cycle’s re-authorisation.
Recognising that systems changes take time, importers and retailers are being asked to begin preparing their systems as soon as possible to report on different battery chemistries. This change is expected to take effect on July 1, 2025.
Full cost recovery:
A full cost recovery model will be pursued, meaning the levy will be designed to fully cover the cost of managing end-of-life for all battery types, apart from facility infrastructure. The BSC will advocate for government investment to support infrastructure development. The intent of a full cost recovery model aims to be free of charge to battery consumers.
Collection and sorting rebates: Adjustments include increasing the incidental receiver rebate to allow it to compete with landfill costs and clarifying that collection rebates do not include containers. Instead, participants will be able to access a dedicated container grant.
Network diversification:
Encourage network diversity, with a role for government regarding investment in innovation, recycling infrastructure, and tax incentives for the recycling sector.
Regulatory reform:
A clear message emerging from the consultation is the importance of regulation for the success of B-cycle 2.0. BSC has prepared draft rules for consideration by governments, focused on compelling participation in voluntary accredited schemes, targeting free riders.
For more information, visit: www.bcycle.com.au
