Recharged: EPA Rule Could Supercharge Battery Recycling

New EPA rule may fast-track safer, smarter EV battery recycling, rewarding early movers like Redwood and Ascend.

10 Jul 2025

The US Environmental Protection Agency is preparing to reclassify lithium batteries, including those from electric vehicles, under a new “Universal Waste” category, a move set to streamline recycling efforts across the country.

The planned regulation would replace a patchwork of state-level rules with a federal standard, offering long-awaited clarity for automakers, recyclers, and environmental groups. It is designed to simplify hazardous waste classifications while introducing stricter safety measures for the storage, transport, and disposal of used lithium batteries.

Companies such as Redwood Materials and Ascend Elements are viewed as early beneficiaries of the shift. Both operate facilities already aligned with stringent safety protocols and could be better prepared to absorb the cost and complexity of compliance. “This is the clarity we’ve needed,” said a national policy advisor. “It sets a federal baseline and rewards companies committed to doing things right.”

The proposed rule is expected to mandate standardised labelling, employee training, and flame-resistant packaging, while also limiting battery storage durations and tightening rules for cross-state transport. Though smaller operators may face higher costs, the sector largely sees the measures as necessary for long-term safety and scalability.

The changes could also encourage innovation. Analysts expect increased investment in fire-resistant infrastructure and the development of battery designs that are easier to dismantle and recycle. Automakers may need to adapt battery architecture in favour of more circular manufacturing strategies.

Several states have already begun adopting similar frameworks in anticipation of the federal rule. While the proposal has yet to be finalised, the signal to industry is clear: prepare early or risk being left behind. If enacted as expected, the classification would mark a critical step toward a more unified and sustainable EV battery lifecycle in the US.