Solutions to informal recycling of Used Lead Acid Batteries
SMEP is supporting Pure Earth, working in close collaboration with Georgetown University, with research funding to develop practical solutions for lead acid battery recycling in Bangladesh. The SMEP funding enables the delivery of empirical research and testing of the business model that enables a more efficient battery return and recycling model. Once user and business willingness to work with this system is tested, a policy brief will inform engagement with relevant ministries. The delivery team includes several local institutions including the Bangladesh University of Engineering and Technology (BUET) and local micro-finance solution providers.
The lead acid battery is among the oldest and cheapest battery technologies available today, which makes them very suitable for use in developing countries such as Bangladesh. The use is growing in Bangladesh, driven by growth in the three-wheeler e-rickshaw and renewable energy generation sectors, in turn leading to a growing demand for refined lead to recondition batteries. This provides a small industry opportunity for informal recyclers, of which there are estimated to be well over 1000 operations in the country. Smelting of battery lead parts takes place in an open fire pits in the soil without any environmental protection, which results in direct exposure to lead. Health and safety issues are numerous and child labour is prevalent in the breaking, sorting and furnace-preparing activities.
Lead is a potent neurotoxin and environmental contaminant. Bangladesh is one of the countries most affected by this pollution worldwide. Initial stakeholder outreach and consultations funded by SMEP have confirmed public sector concern on both the seriousness of the threat to the environment and public health, and the substantial challenges facing the battery manufacturing and recycling industry in Bangladesh to reform the industry to address these issues. Please refer to a synopsis of evaluations on this issue undertaken by the and Pure Earth in 2021.
Given the nature of the informal sector and the unsuitability of the practice of lead recycling in uncontrolled environments, the objective of the research is ultimately to divert battery recycling from the informal to the formal sector. The researchers will be testing a business model amongst the garages that rent out the 3-wheeler easy bikes – a primary user group of the lead batteries – and vehicle owners. The model is designed to encourage the uptake of good quality batteries, promote practices to ensure better battery lifespan and strengthen formal buy-back systems. The business model is to be tested through randomised control trials and will be supported by a model for policy interventions. For successful uptake, the business model would require policy support and dialogues with relevant government departments.
To achieve the objectives of the project, the following phases of work is planned:
- Exploratory work and development of economic models: Data will be collected on the existing new and used battery supply chains, including price points for batteries and lead at different parts of the supply chain, the manufacturing and marketing process of counterfeit brands and the lead inputs in them, the existing tax environment for formal businesses in the supply chain and so on. The research team will develop theory-based economic models (supported by this data) for feasible private sector incentives and policy changes to reduce informal battery recycling and create a circular economy for batteries.
- Piloting the business model to extend battery life and reduce informal recycling: This will be done as part of an ongoing randomized control trial (RCT) study through the provision of microfinance loans for the purchase of quality-assured batteries for credit-worthy garage owners (who rent their vehicles) and a programme to incentivise best practices in prolonging battery life. As part of the business model, batteries will be collected through a formal buy-back process, and diverted to formal recyclers. Better battery performance and longer battery life will lower the long-run cost associated with using the batteries, which in turn will reduce liquidity constraints faced by battery users in the future.
- Dissemination of findings from the research to broader stakeholder groups and select most promising solutions for further development. This phase of work is expected to inform policy decisions and the development of government-led projects, development of technology-based solutions, and adoption of solutions by businesses.
The research project identify measures to improve the recycling practices of ULAB within the informal sector, which will be supported by suitable training. The research will furthermore evaluate potential social impacts and risks associated with the economic model, including the potential livelihood impacts (of diverting recycling business away from the informal sector) on the people who secure income from informal battery recycling activity. In addition, opportunities to mitigate and manage the livelihood consequences will be identified.
Photo Credit: PureEarth
The team is preparing to conduct a market assessment to identify and characterise the EZ bike battery market in Bangladesh. They have also launched a Request for Proposals for identifying battery manufacturers to participate in the business model innovation process.
Fieldwork is ongoing to meet with different stakeholders to understand the financial and tax incentives that can increase formal smelting of batteries and improve the market for high quality batteries.