A Billion-Dollar Market Revolution Begins! Management Regulations Take Effect April 1, How Battery Recycling Companies Can Seize the "Compliance Advantage"

Special Plastics VisionObservation on February 26th,On April 1, 2026, the "Interim Measures for the Administration of Recycling and Comprehensive Utilization of Waste Power Batteries of New Energy Vehicles" (hereinafter referred to as the "Measures") will officially come into effect. This regulation, jointly issued by the Ministry of Industry and Information Technology and five other departments, marks the formal entry of China's waste power battery recycling and utilization sector into a new phase of legal and standardized management.

As the number of electric vehicles in use exceedsBy 2030, the market for comprehensive utilization of spent power batteries is expected to exceed RMB 100 billion, driven by 60 million vehicles. How to seize opportunities and mitigate risks under new policy regulations has become a core question that participants in the new energy aftermarket must address.

Core Framework of the New Regulation: Full-Chain Traceability and Clear Definition of Responsibility

Specialized Plastic Vision DiscoveryManagement Measures "Whole channel, whole chain, whole lifecycle" management as the concept, a closed-loop management system covering the production, sales, use, recycling, and regeneration of power batteries has been established.System. In terms of the definition of waste power batteries, the new regulations for the first time include batteries that are scrapped during the research and development, production, testing, and installation stages, as well as defective cells from power battery manufacturers, expanding the previous narrow understanding that only focused on batteries replaced or scrapped during maintenance and use.

In addition, translate the above content into English, output the translation result directly without any explanation.Traceability management is a major breakthrough in the new regulations.，The Ministry of Industry and Information Technology will establish a national new energy vehicle power battery traceability information platform, requiring that power battery cells, modules, and battery packs must adopt a unique, clear, and durable coding identification. ThroughDigital Identity CertificateThe platform will link information across the entire process, including production, sales, maintenance, replacement, disassembly, and recycling., enabling full lifecycle tracking from production to recycling. This digital traceability mechanism effectively addresses the long-standing issues of unclear battery flow and ambiguous accountability.

Image source: Battery Recycling Guide

Regarding the extended producer responsibility, the new regulations require that power battery manufacturers establish recycling service outlets in the provincial administrative regions where they sell, while new energy vehicle manufacturers need to set up outlets in prefectural-level administrative regions. These outlets will assume the main recycling functions and must hand over the collected used power batteries to qualified comprehensive utilization enterprises for processing. At the same time, the new regulations have abolishedThe traditional principle of "cascade utilization followed by recycling" explicitly prohibits the use of spent power batteries in prohibited applications such as electric bicycles, thereby regulating their use scenarios at the source.

How will the new regulations reshape the battery recycling industry?

Currently, the comprehensive utilization volume of retired power batteries from new energy vehicles in China has exceeded400,000 tons, representing a year-on-year growth of 32.9%. Yet, behind the industry’s rapid development, issues such as fragmented growth, disorderly competition, and frequent safety accidents have emerged. Over the past several years, the power battery recycling industry has presented a contradictory and tense picture: on one hand, a promising billion-yuan market prospect; on the other, the harsh reality of being “small-scale, scattered, and chaotic.” A large number of unlicensed, environmentally irresponsible “backyard workshops,” leveraging their cost advantages, aggressively bid up prices to secure supplies of used power batteries. In contrast, legitimate enterprises on the official “white list” often face the dilemma of “having no raw materials to process.”

"Whitelist" companies refer to those listed in the Ministry of Industry and Information Technology's "Regulations for the Comprehensive Utilization of Scrap Power Batteries in the New Energy Vehicle Industry." However, the "whitelist" does not have mandatory exclusivity, and small workshops not on the "whitelist" can also recycle scrap power batteries. According to Tianyancha data, there are currently about 200,000 existing power battery recycling-related enterprises in China, but the five batches of "whitelist" companies published by the Ministry of Industry and Information Technology have only 156 companies, meaning that the proportion of regular forces is less than one in a thousand.The phenomenon of "bad money driving out good" is severe, with the standardized recovery rate in 2023 being less than 25%, and a large number of retired batteries flowing into informal channels. Although CATL has established a global recycling network with an annual processing capacity of 270,000 tons of used batteries, the average profit margin of the industry is only around 10%. Issues such as high environmental costs and the risk of choosing technical routes still stand out.

GEM’s strategic transformation serves as a typical case: the company has divested its e-waste recycling and plastic regeneration businesses to concentrate resources on the power battery recycling sector. According to a recent report by Plastics Vision, in the first three quarters of 2025, GEM recycled and dismantled 36,600 tons of power batteries, representing a nearly 60% year-on-year increase; its nickel and cobalt recovery rates exceeded 99.5%, and its lithium recovery rate surpassed 96.5%, with technical metrics leading the industry.

Image source: GEM

In terms of technological strategy, leading enterprises are building competitive advantages through ecosystem-based closed loops.，BASF, in collaboration with Hefei Guoxuan High-Tech, China Gas, and BASF-Sunrise, has launched"The new energy industry chain ecological loop" covers the entire value chain from material production to recycling and regeneration. The recycling network established by BYD and FAW Group through the integration of 4S store resources across the country, the "lifetime file" system cooperated between Tianneng and Didi, and the complex of photovoltaic, energy storage, charging, and battery recycling center jointly built by CATL and GCL, all embody the trend of collaborative innovation in the industry chain.

Practical Operation Guide: Upgrade and Enterprise Transformation Path

Power Battery Repair EnterpriseFor the new regulations, their implementation is not only a compliance constraint but also an opportunity for transformation. It is recommended Building the comprehensive service capability of power batteries from three dimensions: First, establishIntegrated "Inspection-Maintenance-Recycling" service capabilities, achieved by training technicians in power battery maintenance, inspection, and dismantling techniques to cultivate professionals skilled in both conventional and electric vehicle technologies. Qualified service centers can apply to become authorized recycling service points, thereby entering high-value-added segments.

In terms of compliance operations, It is necessary to include new energy business items in the business scope to ensure compliance with operational qualifications. Technical operators must hold the “Special Operations Operator Certificate.”— Qualification certificates such as “Low-Voltage Electrical Work Operation.” Work areas must be independently designated and equipped with leak-proofing, fire prevention, and emergency fire-fighting facilities; emergency response plans must be established and regular drills conducted. When purchasing power batteries, batteries without coding, with abnormal labeling, or of unknown origin must be rejected. When disposing of spent batteries, it must be ensured that downstream recycling enterprises possess legitimate qualifications.

Source: Battery Network

For power battery recycling companies, technological innovation is the core competitiveness. GEM, through two decades of accumulation, has cumulatively applied for over5,000 patents, participating in the formulation of 18 national standards, building a complete industry chain closed-loop capability. CATL has established recycling bases in Indonesia, Europe, and other regions through global layout, forming an internal cycle of "recycling to repurposing." In the face of potential overcapacity in the industry, companies need to continue making breakthroughs in new technologies such as bioleaching, automated disassembly, and efficient extraction of black mass, to improve recycling efficiency and metal recovery rate.

At the policy level, the EU’s new battery regulation requiresBy 2030, recycled cobalt must account for at least 12% of new battery production, while recycled lithium and nickel must each account for 4%. The U.S. Inflation Reduction Act promotes the development of the recycling industry through tax credits. China’s “Action Plan for Improving the Recycling and Utilization System for New Energy Vehicle Power Batteries” mandates full-chain digital traceability; enterprises failing to connect to this system will be ineligible for inclusion on the official whitelist. These policies compel enterprises to establish standardized recycling systems and ensure full lifecycle data traceability.

Epilogue: Translate the above content into English, output the translation directly, without any explanation.

Standing at the inflection point of the circular economy era, battery recycling is no longer merely an environmental issue—it has become the convergence of resource strategy, industrial competition, and technological innovation. Only when every retired battery is reborn through precise industrial processes can humanity truly achieve a closed-loop transition toward a sustainable energy future. For participants in the new energy aftermarket, seizing the transformative opportunities presented by new policies and building a standardized, efficient, and sustainable recycling system is not only an inevitable response to challenges but also the key to capturing a trillion-yuan market opportunity.