Electric vehicles (EVs) are seen as an environmentally friendly alternative to the traditional combustion engine vehicles and Town Mining Corporation has the technology to ensure the proper recycling and disposal of EV batteries, thus responding to one of the main issues surrounding these vehicles.
What are the strengths of Town Mining Corporation that allowed you to compete in the global market and attract big companies such as Maxell or Murata for your recycling services?
Currently, many recycling companies are actually traders or brokers. They collect scraps in Japan and sell them to China or Korea. They do not process the materials in Japan. Our company takes a holistic approach, we collect scraps, inspect, sort and determine whether a particular scrap is good for batteries or stainless recycling. We sort scraps based on how they are going to be used. In recycling batteries, we produce lithium carbonate in our Toyama factory. We are focusing on lithium carbonate because even though lithium is a limited resource, it can be recycled. Nowadays, everybody is talking about carbon neutrality and SDGs (Sustainable Development Goals), but our company needs batteries to maintain our existing infrastructure and pursue carbon neutrality. When we recycle to produce battery-grade lithium, some pass the criteria and some are SOS (short of specification). Lithium batteries from lithium ores have a very low level of impurity. Recycled lithium is costly, and it has more impurities, but it can reach up to level one functionality. We need to use recycled lithium to work towards carbon neutrality. With this in mind, our company’s goals are to recycle resources and work with the government in terms of regulations so that companies can use recycled resources. We need to collaborate with lawmakers and the government to modify existing rules.
Can you please tell us your company’s method and strategy to maximize your recycling yield?
First, we sort the raw materials and separate what will be used for battery production and stainless production. This is either done manually, with machines or with chemicals. We determine the purpose for each material and then conduct the processing required for each. When we recycle lithium, we first extract lithium from the batteries. After extraction, we refine it to become lithium carbonate, which is battery powder. We have minimal waste and our ratio for recycling is more than 90%. We also extract lithium nickel, cobalt, manganese and iron. After extracting all these raw materials, we have an additional waste separator. Then, the waste is burned in a special environmentally friendly incinerator. The processed waste is non-toxic and environmentally friendly.
Currently, there is a big concern about disposing lithium batteries used in EVs (electric vehicles) because of their toxic chemicals. Some journalists even claim that EVs pollute the environment more than combustion engines because of their batteries. Your company has developed the technology that allows you to recycle 90% of the battery components. What do you think are the challenges left before we can fully recycle batteries?
The most important issue is the proper disposal and handling of used batteries. We need to implement a system where both manufacturers and the local government can safely collect used batteries and be recycled by companies approved by both the manufacturers and the government. These batteries have to be safely and correctly processed. Batteries in diesel, gas and hybrid cars have no such system in place right now. Used batteries are shredded and sent to the steel mill as waste. With EVs, however, the batteries can be recycled and reused. The frames can be recycled and reused. The rubber part can be incinerated, so there are no toxic emissions. Establishing a system cannot be done by a single recycling company. Automotive manufacturers and the government have to take the lead in setting up a scheme or framework.
Earlier, you mentioned your twofold purpose of recycling and petitioning the government and policy organizations to take an active role in material recycling in Japan. From an outside perspective, Japan seems to be very pro-recycling, carbon-neutral and focused when it comes to environmentalism. What are the main obstacles in establishing or implementing your idea of having a secure collection system in Japan?
Japanese Industrial Standards (JIS) are for products produced from original and pure materials. There are no set standards or specifications for recycled products. The purity level for recycled products is lower by 1-2% only. This does not mean that the battery cannot operate at the same level or pass the required specifications as the ones produced from non-recycled materials. Recycled batteries are safe and fully functional. It has been a hundred years since the industrial revolution and we have been spending a lot of our natural resources. Eventually, these resources will be depleted. That is why a raw material recycling system is absolutely necessary. This is a challenge not only to Japan, but also to the world.
The purity of recycled materials depends on the quality of scrap. In the recycling business, there is the aspect of selling recycled materials and also securing a good supply of scrap. How do you ensure a steady supply of scrap that allows you to recycle profitable materials?
We only handle production scrap from manufacturers. The advantage for us is having a clear source of origin for our scraps. If we were to collect our scraps from collection boxes on the street, the content would be a mixture of many materials. It can be very time-consuming and costly to sort them all out. By focusing on production scraps from manufacturers, we can easily and efficiently recycle because we know the materials we are dealing with. We can also increase the percentage of recycling this way.
Mr. Yukita from Asaka Riken also mentioned how he wants to make the LiB to LiB the global standard on lithium-ion battery manufacturing. They are looking to introduce a new kind of consortium or a group of international partners to put pressure on policymakers and governments. Are you also looking for similar kinds of partnerships or opportunities to work with international recycling firms?
In Japan, there is a recycling organization. We once asked them if it was possible for our company to become a member, but we were not accepted as a member because our company is not known. We really want to urge the government and manufacturers to collaborate and come up with a system. Just like when one wants to get a driver's license, there are training and manuals available. If there is a well-established system and there are clear standards for membership, it will be an attainable goal for a company like ours to join such an association. Sadly, there is no such thing available at the moment. The recycling association in Japan activities appear quite vague to us; we are uncertain about the kind of work they do. Many companies have excellent recycling technologies, but they do not have resources. They are able to conduct table tests, however, full recycling facilities require a big capital. Even if they want to introduce their technology to the government or manufacturers, there are no opportunities to do so. It is such a shame that many companies' excellent technologies go to waste because of a lack of resources and capital. The recycling companies, manufacturers and the government have to establish a system. Right now, the burden is on recycling companies. Fortunately, we were able to source our lithium-ion batteries from manufacturers and we are able to recycle and sell battery powders after extracting lithium. Our mission is to be able to continue to do so.
Your company goes beyond Japan. You have operations in Korea and China as well. What role does the international market play in your business? Do you have an interest in seeking new opportunities and new markets? What is your international business strategy?
Currently, the prices for rare metals are rising, so many brokers and traders are buying them from the source at a very high price. Recycling is costly. If this pattern continues, the market could collapse. This is where manufacturers can come in. We understand that price competitiveness is part of capitalism, but sometimes it is not just about selling at a higher price. There are also sustainability and moral issues to consider. TMC's buying price might be lower, but we can safely process and handle the materials. This is our approach to source material manufacturers. We want to appeal to their goodness and their moral obligation towards society. The reason why I am not wearing the SDG badge is that I am not completely satisfied with where we are right now in terms of recycling. I am going to wear it when I feel that we have achieved the proper level of recycling I am hoping for.
Looking toward the future, do you have any plans to expand your business internationally and directly sell your recycled products to international firms? If so, which markets are you looking at?
We would like to. Currently, we source, process and sell in Japan to domestic consumers and other customers in Asia. We face many challenges such as high freight costs. We provide a good recycling process and produce good products domestically for our client portfolio at the moment. When it gets firmly established, we can enter overseas markets. If there are like-minded battery manufacturers, we would like to collaborate with them and leverage the technologies we have.
If we come back in five years to do this interview all over again, what goals and dreams for the company would you like to have achieved by then?
Because TMC is focusing on battery recycling, we would like to reach the point where battery manufacturers are using our recycled lithium. We hope for a collaboration between manufacturers, recycling companies and policymakers. We also need funding, so we will continue to work hard and work with others to achieve this goal.