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The term battery scrap implies the material is something that should be disposed of, however battery scrap is not waste; it is fueling the transition to electric vehicles. Under the layers of casing and components is a hidden source of critical minerals such as lithium, cobalt, and nickel, all of which are in high demand as the electric vehicle market expands. As battery scrap recycling rises in Canada, materials that were once discarded can now drive a stable economy and a sustainable future.

What Is Battery Scrap and Why It Matters

As demand for critical minerals continues to rise, it is critical to understand battery scraps and its strategic value in a circular supply chain.

The term battery scrap refers to lithium-ion batteries that are either rejected during manufacturing or collected after being used. During production, not all batteries make it to the final stage; quality checks are performed, and faulty batteries or leftover material are classified as manufacturing scrap. End-of-life (EOL) batteries are batteries that have reached the end of their life, meaning that they are no longer safe or capable of holding a charge. Both manufacturing scrap and EOL batteries are a valuable feedstock for critical minerals recovery.

Once the outer casing and other components are removed, other components are shredded and a fine black powder known as black mass remains. That powder contains lithium, cobalt, nickel, manganese, and graphite — minerals that recyclers can process, separate, and reuse in new batteries. Because EV batteries are essential for the vehicle's function, recovering these materials is critical for building a secure and sustainable supply chain.

How Aki and Electra Are Closing the Loop

In North America, companies are already using battery scrap as a resource. One example is the partnership between Three Fires Group and Electra Battery Materials, which created a joint venture called Aki Battery Recycling. In southwestern Ontario, the Aki pre-treatment facility will be where scrap batteries are shredded and processed into black mass. That powder is then sent to Electra’s refinery, where the team separates the minerals and prepares them for reuse.

This entire process, from collection to refining, can happen within 600 km of the US boarder, in the province of Ontario, meaning there is a reduced reliance on overseas processing, fewer emissions from transportation, and more economic value staying close to home. As more EVs are built, partnerships such as Aki will keep critical minerals circulating domestically and enhance supply chain resilience.

The ESG Advantage

In addition to serving as an alternative source for critical minerals, processing battery scrap provides economic and social benefits.

Recovering critical minerals to meet the demand of the EV industry reduces pressure on the mining industry. Since critical minerals are a finite resource, recycling black mass allows conservation towards building a sustainable future.

Transporting these minerals along the current Chinese-dominated supply chain is energy intensive and releases carbon dioxide into the atmosphere. Aki and Electra’s proximity to one another, and battery manufacturers, meaning the re-supply chain length is reduced, leading to a lower carbon and footprint.

Building shredding and recycling facilities also supports economic growth and creates job opportunities for proximal communities. Guided by the Three Fires Group, Aki plans to develop shredding facilities on or near Indigenous territories, supporting local communities’ active participating in this rapidly growing industry.

A New Strategic Resource for Canada

In recent years, Canada has positioned itself as a critical minerals hub, staking a claim in this rapidly growing industry.

Both the provincial and federal levels of the Canadian government have indicated mining, refining, and recycling are all priorities to boost independence and secure Canada's role in the EV supply chain.

Experts estimate that by 2030, 40% of cars purchased globally will be electric. There will be more end-of-life and manufacturing scrap batteries available for recycling, and there is an opportunity for Canada to establish a presence in this rapidly growing market.

Battery scrap is no longer waste, but a valuable market opportunity that will drive a sustainable future. Recovering minerals through battery recycling helps shorten the supply chain, reduce environmental impacts, and fosters partnerships with local communities. Battery recycling turns waste into a strategic feedstock, unlocking opportunities for clean growth, mineral independence, and circular innovation in Canada.