New Jersey Sets the Stage as the First State to Mandate Recycling of EV Batteries

On January 8, 2024, New Jersey passed the Electric and Hybrid Vehicle Management Act making it illegal to dispose of electric vehicle (EV) batteries in landfills and instead mandating the reuse and recycling of EV batteries. Beginning in January 2027, the Act will explicitly prohibit unauthorized persons from disposing of EV batteries and their subcomponents as solid waste. On that same date, “no solid waste facility” in New Jersey “shall knowingly accept for disposal” an EV battery unless authorized by the state.

Beginning in January 2025, New Jersey EV battery producers will be required to register with New Jersey’s Department of Environmental Protection (DEP), and in January 2026 they must annually report to the DEP the quantity of EV batteries they sold, offered for sale, or distributed in New Jersey. Primarily, however, the Act provides for the DEP to develop and provide the EV battery-producing industry with a framework of “standards and criteria” covering the entire recycling process that includes the collection, transportation, recycling, reuse, repurposing, or ultimate disposal of EV batteries.[1] Once the DEP finalizes this framework, each New Jersey battery producer[2] must develop a written management plan that addresses its EV battery recycling system and specifically provides for “take-back” programs for the collection of used EV batteries the producers sold within the state. Such programs “may include a complete vehicle take-back program, a battery take-back program, or any other [DEP-approved] program.” Producers are required to fund their management plans. In addition, all entities authorized to manage used EV batteries as part of a producer’s management plan, including repair facilities, authorized propulsion battery recyclers, scrap yards, dealerships, showrooms, or used car lots, are required to manage the used EV batteries according to the approved plan.[3]

New Jersey’s Bold Plan to Foster an EV Battery Recycling Industry

The Act’s recycling mandate may seem drastic, but New Jersey intends for it to be a game changer for the growing recycling industry. Electric and hybrid vehicle sales are on the rise, leading to the growing need for the valuable lithium-ion batteries. Inevitably, a significant wave of those EV batteries will soon reach their end-of-life, estimated to be ten to twenty years or between 100,000 to 200,000 miles. However, not all of an EV battery’s components degrade beyond use, especially its valuable metals, mainly lithium, nickel, and cobalt.

Recognizing this opportunity, New Jersey’s legislature moved to not only ensure these batteries do not end up in landfills, but also require industry management plans to recycle and reuse EV battery materials that have not reached their end-of-life, preferably using existing battery recycling infrastructure. In addition to reducing the inherent risks of improper EV battery disposal—including ignitability and reactivity of lithium-ion—this legislation aims to reuse the raw materials to manufacture new batteries, ultimately reducing reliance on mining for the metals.

New Jersey’s Infrastructure Plan

Before the DEP adopts rules and regulations establishing standards and criteria for the management plans, the Act requires the DEP to conduct a “needs assessment” to determine the availability of authorized propulsion battery recyclers and related infrastructure necessary for the Act’s implementation. The Act requires this needs assessment to be completed by the summer of 2025. Senator Bob Smith, the bill’s sponsor and Chairman of the New Jersey Senate Environment and Energy Committee, refers to the Act’s framework and needs assessment as an opportunity for a growing recycling industry “that will support innovation, job creation and environmental stewardship from reusing materials and parts.”

The Future of Extended Producer Responsibility (EPR) is Here

New Jersey’s Act is the first of its kind and may serve as a template for similar legislative initiatives around the country. This regulatory framework or policy approach—referred to as the extended producer responsibility—involves placing greater recycling responsibility on the producers or manufacturers of EV batteries than on EV consumers. There is, as of now, no federal regulation directly addressing the collection or disposal of EV batteries, although some states, including California, Washington State, and the District of Columbia, enacted various battery-related EPR policies. New Jersey, however, is the only state to create a comprehensive, industry-wide set of rules covering the whole recycling process. By allowing for time to conduct a needs assessment, consult with industry and other stakeholders at various stages of rule-making and implementation, New Jersey aims to work towards a healthy and sustainable EV battery recycling program.