Policy Implications for Electric Vehicle Battery End-of-Life Management: Balancing Economic Viability and Environmental Sustainability in Southeast Asia: A Review

© The Author(s) 2025. Published by AMO Publisher. This is an Open Access article distributed under the terms of the Creative Commons Attribution License (https:// creativecommons.org/licenses/by/4.0/), which permits unrestricted reuse, distribution, and reproduction in any medium, provided the original work is properly cited. Policy Implications for Electric Vehicle Battery End-of-Life Management: Balancing Economic Viability and Environmental Sustainability in Southeast Asia: A Review Zar Chi Hla Than  College of Environmental Science and Engineering, Institute of Environment and Sustainable Development (IESD), Tongji University,1239 Siping Road, Shanghai 200092, China Shaban H. Nyika College of Environmental Science and Engineering, Institute of Environment and Sustainable Development (ESD), Tongji University, 1239 Siping Road, Shanghai 200092, China Abstract The rapid acceleration of electric vehicle (EV) adoption in Southeast Asia, driven by national economic ambitions and climate commitments, presents a looming waste management crisis: end-of-life (EOL) lithium-ion batteries. This review article synthesizes current literature to analyze the dual challenge of managing this waste stream harnessing its economic potential through a circular economy while mitigating its significant environmental risks. We find that the Southeast Asian region is critically underprepared, with fragmented regulatory frameworks, nascent infrastructure, and a lack of specialized capacity for recycling and repurposing. The economic viability of recycling is hampered by volatile material prices, high processing costs, and the logistical complexities of the region's archipelagic geography. Conversely, a purely environmental focus that mandates stringent recycling without economic support risks fostering informal, polluting sectors or creating stranded assets. This article argues that a synergistic policy approach is essential. We propose a multi-pronged strategy centered on Extended Producer Responsibility (EPR) as a core policy mechanism, integrated with harmonized regulations, targeted economic incentives for formal recycling, investment in R&D for second-life applications, and robust capacity building. By proactively designing policies that align economic incentives with environmental imperatives, Southeast Asian nations can transform the impending EOL battery challenge into a strategic opportunity for sustainable growth, resource security, and regional leadership in the green economy. Keywords: electric vehicle batteries, end-of-life management, circular economy, recycling policy, extended producer responsibility, Southeast Asia, sustainability, lithium-ion battery. Suggested citation: Than, Z.C.H., & Nyika, S.H. (2025). Policy Implications for Electric Vehicle Battery End-of-Life Management. Balancing Economic Viability and Environmental Sustainability in Southeast Asia: A Review. European Journal of Innovative Studies and Sustainability, 1(5), 54-61. https://doi.org/10.59324/ejiss.2025.1(5).06 Introduction The global transition to electric mobility is no longer a distant prospect but a present-day reality. In Southeast Asia (SEA), nations are aggressively promoting Electric Vehicle (EV) adoption through ambitious national plans, such as Thailand’s ambition to become the "Detroit of Asia" for EVs (International Energy Agency [IEA], 2023), Indonesia’s leveraging of its nickel reserves for battery production (Suhandi & Fattah, 2022), and Singapore’s comprehensive measures to phase out internal combustion engines by 2040 (Land Transport Authority, 2020). This transition is central to regional strategies for reducing urban air pollution, enhancing energy security, and fulfilling Nationally Determined Contributions (NDCs) under the Paris Agreement. While the environmental benefits of EVs during their use phase are clear, a significant challenge lies at the end of the road: the management of millions of lithium-ion batteries (LIBs) that will eventually reach their end-of-life (EOL). An EV battery is typically considered at EOL when its capacity degrades to 7080% of its original value, rendering it unsuitable for traction but potentially valuable for other, less demanding applications (Ahmadi et al., 2017). The volume of this impending waste stream is substantial. The IEA (2023) projects that the global stock of EV batteries reaching EOL will surpass 3.5 million units by 2030, with SEA representing a rapidly growing segment. These EOL batteries constitute both a critical environmental threat and a considerable economic opportunity. They contain hazardous heavy metals (e.g., nickel, cobalt) and flammable electrolytes, which can lead to soil and water contamination and present fire risks if disposed of in landfills or processed by informal sectors using primitive methods (Harper et al., 2019). Conversely, they are a rich source of valuable critical minerals like lithium, cobalt, nickel, and manganese. Given SEA’s general reliance on mineral imports, efficient recovery of these materials is a matter of strategic resource security and economic opportunity within a circular economy framework (Winans et al., 2017). This review article explores the intricate policy landscape required to manage EOL EV batteries in Southeast Asia. It argues that success hinges on designing policies that deliberately and effectively balance economic viability with environmental sustainability. A systematic review was conducted, focusing exclusively on literature published from the year 2000 up to the year of 2025. This involved searching primary academic databases such as Scopus, Web of Science, and Google Scholar, ScienceDirect as well as targeted scans of grey literature from leading international bodies including the ASEAN Secretariat, IEA, World Bank, OECD, and GIZ in addition to both backward and forward citation analysis. Failure to create economically attractive systems will result in low formal recycling rates and the growth of a hazardous informal sector. Conversely, policies focused solely on environmental mandates without enabling economic conditions will be ineffective and unenforceable. This article reviews the current state of EOL management, identifies key barriers, and proposes an integrated policy framework to guide Southeast Asian policymakers in navigating this complex challenge. The Growing Tide of EOL Batteries in Southeast Asia The ASEAN region has set a target for EVs to represent over 30% of all vehicle sales by 2030 (ASEAN Secretariat, 2021). This push is creating a rapidly expanding fleet. For instance, Thailand, the region's largest automotive producer, saw EV sales surge by over 600% in 2022 alone (Nikkei Asia, 2023). Indonesia aims for 2 million electric motorcycles and 400,000 electric cars on its roads by 2025 (Ministry of Industry of Indonesia, 2019). Assuming an average battery lifespan of 8-10 years, the first major wave of EOL EV batteries in SEA is expected to hit in the early 2030s. Projecting the exact volume is complex, dependent on adoption rates, battery chemistry, and usage patterns. However, a study by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) estimated that by 2035, Indonesia, Malaysia, Thailand, and Vietnam could collectively generate over 130,000 tonnes of EOL EV battery waste annually (GIZ, 2021). This volume is illustrated in Figure 1. The region's diverse geography, comprising mainland and archipelagic nations, adds a layer of logistical complexity to collecting and transporting heavy and potentially hazardous EOL batteries to centralized recycling facilities, influencing the economic calculus of recycling operations. Figure 1. Project Growth of EOL Battery Waste in Major ASEAN Automotive Markets (2030-2035) Source: Adapted from GIZ (2021) Economic Viability and the Circular Economy The value embedded in EOL batteries is significant. Cathodes in modern LIBs contain high-grade minerals. The concentration of metals like cobalt and nickel in a tonne of battery waste is often far higher than in primary ores, making urban mining an attractive proposition (Zeng et al., 2022). Economic activities can be structured around two primary pathways are Direct Reuse and Repurposing (SecondLife) and Recycling. Under the Direct Reuse and Repurposing (Second-Life) Batteries retired from EVs can be refurbished and used in less demanding stationary energy storage applications, such as for renewable energy integration, backup power for telecommunications, or residential solar storage. This extends their useful life, deferring recycling and creating a new revenue stream. McKinsey & Company (2019) estimated the global second-life battery market could be worth over $30 billion by 2030. For Recycling, through pyrometallurgical (smelting), hydrometallurgical (chemical leaching), or direct physical recycling processes, valuable metals can be recovered and fed back into the manufacturing of new batteries, reducing the need for virgin mining and insulating regional supply chains from geopolitical volatility. Economic viability in the context of battery recycling is not guaranteed; it hinges on several key factors. Firstly, the type of battery chemistry plays a significant role. For instance, nickel-cobalt-manganese (NCM) batteries tend to be more lucrative for recycling due to their cobalt content, whereas lithium-ironphosphate (LFP) batteries, although increasingly favored for their lower cost and enhanced safety, do not hold the same recycling value (Tsiropoulos et al., 2023).Secondly, fluctuations in commodity prices can greatly impact profitability. The market prices for essential materials such as cobalt, nickel, and lithium are crucial in determining the feasibility of recycling efforts. Additionally, logistics and transportation costs pose significant challenges. Collecting, sorting, and moving heavy batteries from various, often remote, locations can result in prohibitive expenses.Finally, the technology used in recycling and the scale of operations are also critical. High-yield recycling facilities that leverage advanced technologies require substantial capital investments and rely on a steady, large supply of feedstock to remain financially viable. Environmental and Social Sustainability The pursuit of economic value from end-of-life (EOL) electric vehicle (EV) batteries is inextricably linked to profound environmental and social sustainability challenges. If managed improperly, the very technologies heralded for decarbonizing transport can generate significant negative externalities, primarily through two channels: the informal recycling sector and energy-intensive formal recycling processes. In the context of Southeast Asia, where informal e-waste processing is already a widespread and entrenched practice, the risks are particularly acute. Rudimentary and unregulated methods, such as manual dismantling without protective equipment, open-acid leaching to recover valuable metals, and uncontrolled burning to isolate materials, are commonplace in informal recycling (Kiddee, Naidu, & Wong, 2013). These primitive techniques release a cocktail of persistent toxic substances including heavy metals (e.g., cobalt, nickel, lead) and hazardous fluorinated compounds (e.g., from electrolytes) into the environment. These pollutants contaminate soil and water sources, bioaccumulate in local ecosystems, and pose severe health risks to unprotected workers and surrounding communities, leading to respiratory ailments, neurological damage, and other chronic health conditions (Battery Council International, 2021). Furthermore, the environmental burden is not limited to the informal sector. Even within formal, industrialized recycling frameworks, significant sustainability trade-offs exist. Pyrometallurgical processing, which involves smelting battery cells in high-temperature furnaces, is highly energy-intensive. Its associated carbon footprint can be substantial, potentially offsetting a portion of the greenhouse gas (GHG) emission savings gained from driving an EV if the process is powered by fossil fuel-based energy grids (Dunn, Adwek, & Wang, 2022). This creates a critical lifecycle assessment (LCA) dilemma, where the end-of-life phase could erode the overall environmental benefits of electrification. Therefore, the primary environmental policy goals must be multi-faceted: first, to prevent pollution and protect human health by ensuring safe handling, storage, and pre-processing through stringent regulations; second, to maximize resource efficiency and critical material recovery rates through high-yield, advanced recycling technologies that support a circular economy; and third, to minimize the overall lifecycle carbon footprint of battery management by integrating renewable energy sources into recycling operations and promoting less energy-intensive methods like hydrometallurgy or direct recycling. Figure 2. This Chart Illustrates the Primary Negative Externalities Generated by Two Common Management Scenarios Source: Author Table 1. Comparing Environmental and Social Impacts of Recycling Sectors Aspect Informal Recycling Sector Formal Recycling Sector (with fossil fuels) Primary Pollution Localized, acute soil/water/air contamination Diffuse, greenhouse gas emissions Social Impact Severe immediate health risks to unprotected workers Broader, global impact from climate change Resource Efficiency Low; poor recovery rates, material loss High; optimized material recovery Key Challenge Lack of regulation, poverty-driven High energy demand, carbon footprint Source: Kiddee et al., 2013; Dunn et al., 2022. Current Policy Landscape and Critical Gaps in Southeast Asia Most Southeast Asian nations are in the early stages of developing policies specifically for EOL EV batteries. Current approaches are fragmented and often rely on broader solid waste or hazardous waste management frameworks that are ill-suited to the unique challenges of this waste stream.Thailand has developed a National EV Policy Committee and is beginning to discuss EPR regulations, but specific mandates for batteries are still in draft stages (Phromphat et al., 2023). Indonesia has regulations on waste management (Law No. 18/2008) and is drafting a specific regulation for battery waste management, aiming to leverage its nickel industry to create a closed-loop battery ecosystem (Suhandi & Fattah, 2022).Vietnam has a decree on solid waste management but lacks specific guidelines for collecting and recycling EV batteries.The Philippines and Malaysia,Myanmar have general e-waste policies but no targeted legislation for the coming wave of automotive batteries. The region faces several critical policy gaps regarding the management of electric vehicle (EV) battery waste. First, there is a lack of specific legislation tailored to address the scale, complexity, and value of the EV battery waste stream. Additionally, even where regulations are in place, weak enforcement mechanisms limit their effectiveness, which can lead to the proliferation of informal markets. Moreover, the absence of Extended Producer Responsibility (EPR) frameworks means that manufacturers are not consistently held accountable for the end-of-life (EOL) management of their products, including batteries (Nnorom & Odeyingbo, 2020). Furthermore, unclear legal definitions surrounding "waste" can obstruct the cross-border transportation of batteries intended for repurposing or recycling, stifling the development of regional recycling hubs. Finally, there is a significant deficiency in certified collection networks, efficient transportation systems, and advanced recycling facilities. Proposed Integrated Policy Framework To address the existing policy gaps, we advocate for an integrated policy framework based on five key pillars, aimed at simultaneously stimulating economic activity and ensuring environmental integrity. Extended Producer Responsibility (EPR) as the Cornerstone EPR is the most vital policy tool in this framework. A well-structured EPR scheme requires that EV and battery importers and manufacturers take responsibility for managing the end-of-life (EOL) phase of their products. The policy design should include clear mandatory collection and recycling targets, which set escalating goals for both collection rates and recycling efficiency (such as the percentage of material recovered), thus providing certainty for industry investment. Additionally, flexibility in compliance is essential; producers should have the option to establish Producer Responsibility Organizations (PROs) to collectively handle the logistics and financing of collection and recycling, allowing them to achieve economies of scale. Finally, the eco-modulation of fees is crucial; the recycling fees paid by producers into the EPR scheme should be adjusted based on the recyclability and environmental footprint of the battery design, incentivizing greener design practices from the outset (OECD, 2016).advanced recycling facilities, which further complicates the management of battery waste. Harmonized Regional Standards and Regulations ASEAN should prioritize the harmonization of policies to foster a larger, more efficient market. This effort includes several key initiatives. First, there is a need to standardize battery design and labeling, which would encourage common designs that simplify the processes of dismantling and recycling. Additionally, aligning definitions is essential; creating a unified legal definition for end-of-life (EOL) batteries and "waste" will facilitate the transboundary movement of materials for recycling within ASEAN, in accordance with Basel Convention guidelines. Lastly, establishing shared safety and environmental standards for the transportation, storage, and recycling of batteries is crucial to ensure compliance and promote best practices across the region. Economic and Fiscal Instruments Harmonizing regional standards and regulations within ASEAN is crucial for creating a larger and more efficient market for electric vehicle (EV) batteries. To achieve this, several key initiatives should be prioritized. First, standardizing battery design and labeling can encourage common designs, thereby simplifying the processes of dismantling and recycling. Additionally, aligning definitions is essential; establishing a unified legal definition for end-of-life (EOL) batteries and "waste" will facilitate the transboundary movement of materials for recycling across ASEAN, in accordance with the guidelines set by the Basel Convention. Finally, developing shared safety and environmental standards for the transportation, storage, and recycling of batteries will further enhance the region's ability to manage battery waste effectively. Infrastructure Development and Technology Transfer Governments should actively participate in facilitating the development of necessary infrastructure for battery recycling. This can be achieved by supporting pilot projects through funding or forming publicprivate partnerships to establish collection schemes and recycling facilities. Additionally, developing robust collection networks is essential; this includes integrating battery take-back programs into existing automotive service centers and creating convenient drop-off points for consumers. Furthermore, encouraging technology transfer is vital for advancing recycling capabilities. To attract foreign direct investment from leading international recycling firms, governments should implement favorable investment policies and establish clear regulations. Capacity Building and Stakeholder Engagement A successful battery recycling system hinges on the involvement of skilled actors across the sector. One crucial step is the formalization of the informal sector; this involves implementing programs aimed at training and integrating existing informal e-waste workers into the formal collection and pre-processing chain, which ultimately enhances their safety and livelihood opportunities. In addition, the establishment of training and certification programs for technicians is essential, focusing on skills in battery handling, diagnostics, dismantling, and repurposing. Furthermore, raising consumer awareness is vital; launching public campaigns to educate electric vehicle (EV) owners on the importance of returning their end-oflife batteries to official take-back points will encourage responsible disposal and recycling practices. The interplay of these policies is summarized in Table 2. Table 2. The Integrated Policy Framework for EOL EV Battery Management in Southeast Asia Policy Pillar Key Instruments Economic Objective Environmental Objective EPR Mandatory targets, PROs, eco-modulated fees Create a stable funding stream, incentivize recyclable design Ensure proper management, internalize EOL costs Harmonization Standardized design, aligned definitions Create regional market efficiency, attract investment Ensure high environmental standards across borders Economic Incentives Subsidies, tax credits, green procurement Bridge viability gap, create demand for second-life Support high-recovery, low-carbon recycling Infrastructure Pilot projects, collection networks, FDI Build necessary physical and industrial capacity Ensure safe handling and processing Capacity Building Training, formalization, awareness Develop skilled workforce, efficient operations Ensure safety, maximize recovery, prevent leakage Source: OECD, 2016; GIZ, 2021. Conclusion The electric vehicle revolution in Southeast Asia promises immense benefits for economic development and environmental health. However, this promise will be incomplete if the lifecycle of the vehicle is not fully considered. The management of end-of-life batteries is a critical test of the region's commitment to a truly sustainable and circular economy. Ignoring this challenge risks creating a new wave of toxic electronic waste, undermining the very environmental goals that EVs are meant to achieve. As this review has outlined, the path forward requires proactive, intelligent, and synergistic policymaking. The window of opportunity is still open, but it is closing rapidly as the EV fleet expands. Policymakers must act now to establish the rules of the game. By implementing strong EPR frameworks as a cornerstone, supported by economic incentives, regional cooperation, and strategic investments in infrastructure and human capital, Southeast Asian nations can create a system where managing EOL batteries is not a cost burden but a value-generating activity. This will ensure that the electric future of Southeast Asia is not only clean on the road but also sustainable from cradle to grave. Recommendations To effectively manage end-of-life (EOL) batteries in the ASEAN region, a series of strategic recommendations are essential. First, immediate action is necessary; each ASEAN member state should establish a multi-stakeholder task force tasked with drafting specific EOL battery regulations within the next 1-2 years. Second, prioritizing well-designed mandatory Extended Producer Responsibility (EPR) legislation is crucial, as it will lay the financial and logistical groundwork for subsequent initiatives. Additionally, ASEAN bodies should facilitate working groups to harmonize key definitions, standards, and protocols essential for the cross-border movement of EOL batteries for recycling. Governments should also collaborate with industry and academic partners to launch pilot collection and recycling projects, which will help build practical experience and demonstrate feasibility. Moreover, policies need to specifically prioritize a just transition; they should incorporate strategies to train, certify, and incorporate informal waste workers into the newly established formal value chain, guaranteeing a fair transition for all parties involved. By adopting this comprehensive approach, Southeast Asia can successfully reconcile economic viability with environmental sustainability, turning a potential crisis into a foundational element of its green economic future. References Ahmadi, L., Young, S. B., Fowler, M., Fraser, R. A., & Achachlouei, M. A. (2017). 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