As large numbers of early-stage energy storage and EV batteries reach the end of their service lives, lithium battery recycling has emerged as a high-growth sector. Materials such as lithium, iron, and phosphorus can be recovered and reused, thereby reducing the consumption of mineral resources and mitigating the environmental pollution caused by spent batteries.

Overseas markets are imposing increasingly stringent requirements regarding battery carbon footprints, traceability, and recycling responsibilities; consequently, full-lifecycle battery traceability is set to become a critical market access criterion for future energy storage exports. Beyond manufacturing, energy storage companies must also implement battery recycling solutions to meet the ESG procurement standards of international clients.

There is a growing industry consensus that energy storage battery design should incorporate "second-life" (cascaded) utilization; retired cells can be repurposed for low-demand energy storage applications, thereby maximizing their value.