China is confronting its first major wave of electric-vehicle (EV) battery retirements, with a new report highlighting systemic failures in the country's ability to safely recycle millions of tonnes of used lithium-ion cells. The scale of the challenge is set to grow dramatically over the coming decades, posing serious environmental and public health risks.

The Scale of the Problem

China generated 4 lakh metric tonnes of EV battery waste last year, according to a joint China-US study cited by Inside Climate News, a US-based publication. That figure is projected to surge to 1.69 million tonnes by 2030 and reach 22.39 million tonnes by 2040, making this one of the most consequential waste-management challenges in modern industrial history.

The surge is a direct consequence of China's EV boom. Annual sales of battery-powered vehicles in China skyrocketed from nearly 1 million units in 2018 to over 16 million in 2025. With EV batteries typically lasting around eight years, the first generation of mass-market batteries is now reaching end-of-life simultaneously — creating a retirement wave that the country's recycling infrastructure was not built to absorb.

Formal Recycling System Falls Short

China began constructing a formal battery recycling framework in 2018. By 2023, the government had placed more than 150 companies on an official 'white list' of certified recyclers, with a combined annual processing capacity of 6,23,000 tonnes — more than 1.5 times the volume of batteries retired that year.

Despite that apparent surplus capacity, certified recyclers handled only around 25% of retired batteries, according to the report. The remaining three-quarters flowed to informal, uncertified operators — a structural gap that undermines the entire regulatory architecture.

White List Companies Found Non-Operational

An investigation published in 2026 by Yicai, a Chinese financial news outlet, added a troubling dimension: reporters who attempted to contact every company on the government white list found that 100 of them were either no longer operating or could not be reached. The findings raise serious questions about the credibility of China's certified recycling capacity figures.

Environmental Damage on the Ground

The consequences of informal battery dismantling are already visible. In a case announced in Jiangxi Province in 2024, an uncertified operator was found to have improperly dismantled 364 metric tonnes of waste lithium iron phosphate batteries. The resulting contamination caused vegetation to die across six acres of forest and killed more than 420 cubic feet of standing timber, according to the report.

China's used-battery supply largely flows through uncertified recyclers, creating serious risks of soil and water contamination, fire hazards, and toxic chemical exposure linked to improper handling and disposal of battery materials.

What Comes Next

With retirement volumes set to multiply more than fiftyfold between now and 2040, analysts and environmental groups argue that China faces a narrowing window to reform its recycling enforcement before the problem becomes unmanageable. The gap between certified capacity and actual certified throughput — and the apparent collapse of a significant portion of the white-list network — suggests that regulatory oversight has not kept pace with the speed of China's EV transition. How Beijing responds in the next few years will have global implications, given China's dominant position in both EV manufacturing and lithium-ion battery supply chains.