India’s EV boom drives the need for sustainable battery management, addressed by the Battery Waste Management Rules, 2022, promoting recycling and a circular economy, writes Venkatesh Raman Prasad, Partner, JSA Advocates & Solicitors.
India’s electric vehicle sector has experienced substantial growth in 2024 with increased sales of ~1.94 million units (which is a ~27% increase from the sales in 2023). As the adoption of EVs accelerates, the demand for batteries, and consequently their lifecycle management (which includes disposal of these batteries once they reach the end of their life) becomes a pivotal aspect of achieving sustainability. While the adoption of EVs is widely regarded as a key component in reducing carbon emissions and transitioning towards a greener future, their sustainability can only be realized if the entire value chain, from production to disposal, is addressed in an environmentally responsible way. This is where the concept of a circular economy plays a vital role. EV batteries rely on certain key raw materials including those based on mineral resources. By adopting a circular approach which entails recycling used batteries, we can not only recover these materials but can also create a resilient supply chain. Such an approach with recycling and refurbishment processes would reduce the carbon footprint and also reduce the need for new mining activities.
In order to incorporate robust recycling, refurbishment and disposal processes, minimize environmental impact and create a sustainable and closed-loop system for EV batteries, the Government of India introduced the Battery Waste Management Rules, 2022 (“BWM Rules”) in 2022. Prior to the BWM Rules, in 2001, the Batteries (Management and Handling) Rules, 2001 (“2001 Rules”) were introduced to regulate the collection and recycling of used lead acid batteries. The 2001 Rules required consumers to ensure that used batteries are deposited to specified entities such as registered recyclers or collection centres, and also placed the responsibility on manufacturers, assemblers, reconditioners, and importers to collect used batteries in prescribed manner and ensure that the collected used batteries are sent to recyclers. While the 2001 Rules were effective at the time, the evolving landscape necessitated a more comprehensive framework for battery waste management. Therefore, the 2001 Rules were replaced by the BWM Rules, with increased scope and applicability, marking a significant step towards advancing the circular economy. The BWM Rules include an expanded scope of batteries to encompass electric vehicle batteries, portable batteries, automotive batteries, and industrial batteries. Notably, the rules also provide for an expansive definition of ‘Producers’ to include manufacturers, importers, and assemblers and incorporate Extended Producer Responsibility (“EPR”) as being applicable to such Producers.
Focus on Producer Responsibilities
The BWM Rules introduced extensive responsibilities and obligations for the Producers. As mentioned above, Producers are not just manufacturers under BWM Rules but include entities who engage in (i) the manufacture and sale of batteries including refurbished batteries, in equipment, under its own brand; (ii) the sale of batteries including refurbished batteries, including in equipment, under its own brand produced by other manufacturers or suppliers. (iii) import of battery as well as equipment containing battery; and (iv) manufacturers or assemblers of batteries or refurbished batteries including in equipment for sale to Producer (which may further sell such batteries) without its brand name. In the context of the EV industry, this would therefore include manufacturers developing in-house batteries, sellers of batteries for an EV, and importers of EV batteries. Further, as per FAQs issued by the Central Pollution Control Board, if a manufacturer is using a battery provided by another battery manufacturer/producer (under such battery manufacturers’/ producers’ brand name), then it will not have any EPR obligations. As per the newly introduced EPR framework, Producers are held accountable for managing the waste generated by their products. This responsibility includes the collection, recycling, or refurbishment of waste batteries.
The BWM Rules have set specific year-on-year collection targets for Producers, which vary depending on the type of battery that is placed by them in the markets. The compliance cycle for two-wheeler and three-wheeler EVs has been provided as commencing from 2026-27, while for four-wheelers, the cycle commences from 2029-30.
Additionally, the BWM Rules have also introduced the obligation whereby a Producer must ensure that a minimum set out quantity of domestically recycled material is used in a new battery. This means that battery Producers must include a minimum percentage of materials that have already been used and recycled in new batteries, helping reduce waste and environmental impact. This is a step towards achieving a sustainable circular economy by ensuring that more recycled materials are being reused, rather than depleting fresh resources. The minimum percentage of recycled material out of the total dry weight of the battery to be used in a financial year differs for each type of battery. For e.g., for EV batteries, the obligation commences from FY 2027-28 and the percentage use is set at 5%. For the same financial year, for automotive batteries, such a percentage is set to be 35%. In case a Producer imports a battery, the Producer shall have to meet such obligation by way of getting such quantity of recycled materials utilized by other businesses or by exporting such quantity of recycled materials.
Furthermore, Producers are required to ensure the ‘environmentally sound management’ of pre-consumer waste batteries. This refers to the waste generated during the manufacturing, assembly, or importation processes of a battery or battery pack. Additionally, the BWM Rules prohibit Producers from disposing of waste batteries in landfills or incinerators, underscoring the commitment to reducing environmental harm.
Extended Producer Responsibility Certificates
To help meet their EPR obligations, Producers can also engage with entities involved in recycling or refurbishment of the batteries. Such entities undertaking recycling or refurbishment activities will be issued EPR certificates by the Central Pollution Control Board based on the quantum of recycled or refurbished batteries. The Producers can also purchase these certificates from such entities, (i.e. those undertaking recycling or refurbishment activities), to fulfil their EPR responsibilities. This system not only facilitates a flexible marketplace for EPR certificates, where Producers can procure certificates for waste batteries but also ensures that the overall waste management process is both efficient and compliant with environmental regulations.
Way forward
While the adoption of the BWM Rules marks a significant advancement in promoting a circular economy and improving waste management practices, it is crucial for legislation to adapt to the rapid pace of technological developments, particularly in the growing electric vehicle sector. To facilitate the recycling/ refurbishment processes, regulations may also include provisions for battery design standardizations. Further, standards/ criteria can evolve to estimate the useful life of used batteries, evaluate repurposed batteries and set out specified targets for specific critical materials. Specific standards and operating procedures for the recycling/ refurbishment processes can be provided. Given that India lacks critical material reserves which are required for the development of the battery technology, it is critical for regulations to evolve and adapt, to ensure that the materials are repurposed and the useful life of the materials is evaluated in order to make the maximum utilization of scarce critical resources, which in turn will help India to expand the EV ecosystem in a sustainable way.
Venkatesh Raman Prasad
Partner
JSA Advocates & Solicitors