This article first appeared in Digital Edge, The Edge Malaysia Weekly on October 28, 2024 - November 3, 2024

As Malaysia positions itself to become a leader in the automotive sector, the conversation around sustainability has never been more critical — and it is something that hits close to home for me. In my previous discussions, I brought up the importance of lifecycle thinking, whether it is cradle-to-cradle or cradle-to-grave, as a powerful way to reduce environmental impact. It is not just a theoretical concept, it is something I have personally thought about as I watched the automotive industry evolve, and it has become clear that we need more sustainable environmental solutions.

A lot of people have voiced concerns about switching to electric vehicles (EVs), and I get it. One of the biggest worries I hear is that the electricity powering these vehicles is not always renewable. But Malaysia’s National Energy Transition Roadmap (NETR) is actively addressing this issue, taking strides toward greener energy sources. Still, there is another critical piece of the puzzle that we need to tackle — the lifecycle of EV batteries themselves.

Let me elaborate as to why that is so important. EV batteries are not like traditional car parts that can easily be swapped out and forgotten. What happens to them after they are used have a huge impact on the environment.

This is where the Battery Passport comes in. Think of it as a digital passport for each EV battery, keeping track of every detail — where the raw materials came from, how the battery was made, how it was used and, eventually, how it was either recycled, repurposed or responsibly disposed of.

Starting in February 2027, every new EV battery in the European Union, along with two-wheeler and industrial batteries, will need to come with one Battery Passport respectively. It is all about making the battery value chain more transparent and sustainable, helping reduce environmental damage while encouraging more reuse and recycling.

This is not just a European initiative, it is a global movement that will undoubtedly influence us here in Malaysia as well.

To put things in perspective, the Global Battery Alliance estimates that these passports could cut battery-related emissions by up to 30% and increase recycling by 25%.

For someone like me, who has spent years thinking about how we can make the automotive industry more sustainable, this is a huge step forward. It is more than just meeting regulations. It is about changing the way we think about the lifecycle of the products we rely on every day.

Imagine being able to check exactly where your car’s battery comes from, how well it is performing and how long it will last — all with just a few clicks. This kind of transparency gives consumers peace of mind, knowing they are making informed choices. For manufacturers, it is a game changer too. With a complete digital record, they can keep quality in check and stay on top of environmental regulations.

A study by the International Energy Agency (IEA) even shows that such transparency could significantly boost consumer confidence in EVs, potentially increasing adoption rates by 20%, which means more people might feel comfortable making the switch.

Most EVs today run on lithium-ion batteries, which are more efficient than the older lead-acid ones, storing more energy in the same space. But here is the catch: while 99% of lead-acid batteries are recycled in the US, only about 5% of lithium-ion batteries make it to recycling.

That is a missed opportunity, especially since these batteries contain valuable metals that can be reused. Recycling them isn’t easy — it can use up a lot of water or create air pollution, which is where the Battery Passport comes in.

The Battery Passport is a road map for a cleaner, more sustainable future. By tracking the entire life of each battery, the transport and energy sectors can do their part to meet global climate goals, like the Paris Agreement’s target of net zero emissions by 2050. And the impact is huge, where research has shown that creating a circular value chain for batteries could cut emissions in these sectors by nearly 30%.

Introducing battery passports will require a whole new level of teamwork across the automotive industry. From the folks mining raw materials to the battery makers, car manufacturers and even the recyclers, where everyone has a part to play — and something to gain.

It is all about working together to create a more sustainable and transparent future for electric vehicles. By sharing information and collaborating, each step of the value chain can ensure we are not just building better batteries but also protecting the environment for generations to come.

The adoption of battery passports is not just an environmental necessity, it is a game-changing economic opportunity.

For Malaysia, this initiative could be the key to positioning ourselves as a global leader in sustainable automotive practices. By setting high standards and embracing innovative solutions, we have the potential to attract significant investments, create high-quality jobs and boost our global competitiveness.

The concept of an EV Battery Passport is already on the radar screen of Malaysia Automotive, Robotics and IoT Institute (MARii). Personally, it is exciting to think about how this initiative aligns with my passion for fostering an eco-friendly automotive sector. MARii plans to focus on implementing life cycle assessments (LCA), particularly for battery technology.

A battery passport is a digital record that contains detailed information about a battery, including its composition, origin and life cycle. By providing transparency and traceability, a battery passport can facilitate the efficient recycling and reuse of lithium-ion batteries, thereby creating a more circular economy for this essential technology.

The battery passport is a crucial tool within the LCA framework, tracking the environmental impact of batteries from production to disposal.

I believe that full transparency is essential. This system empowers both manufacturers and consumers by providing insights into energy use, resource consumption and emissions throughout a vehicle’s life cycle. It not only aids eco-design and policymaking but also encourages sustainable consumption patterns — something I hope will become second nature for all of us.

Under this idea, each EV battery would have a unique ID, making it easier to track and recycle when it reaches the end of its life. While there is palpable excitement around promoting EVs and enhancing sustainability in our automotive sector, we are still in the process of developing the frameworks and regulations needed for battery passports.

The benefits of a battery passport extend beyond the environmental impact. Recycling and reusing lithium-ion batteries can also have significant economic advantages as the recovery of valuable materials such as cobalt, lithium and nickel can offset the costs of battery production.

Moreover, the development of a robust battery recycling and reuse infrastructure can create new job opportunities and contribute to the growth of the green economy.

Key stakeholders — including government bodies, industry leaders and research institutions — are actively engaging in discussions on how to implement these systems in line with global trends.

Volvo’s recent launch of the world’s first EV Battery Passport ahead of EU regulations highlights the growing momentum for transparency and accountability in battery management. Such initiatives set the benchmark for the industry, and adopting similar practices in Malaysia could position us at the forefront of this shift.

There are plans to improve recycling rates and ensure that we can trace batteries throughout their life cycle. After all, experts have pointed out that spent batteries contain valuable materials.

It is fascinating to think about the valuable materials hidden in spent batteries — there is so much potential there. To make the most of this innovative system and meet our global sustainability goals, we will need to put strong policies and infrastructure in place.

I genuinely believe that by working together, we can create a greener automotive landscape for Malaysia. The future feels bright.

Azrul Reza Aziz is CEO of Malaysia Automotive, Robotics and IoT Institute (MARii), an agency under the Ministry of Investment, Trade and Industry tasked with enhancing the competitiveness of the Malaysian automotive industry

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