The country’s lead-acid battery manufacturers are seeking a couple of suitable amendments soon to the existing regulations to make dealers and retailers partly responsible for collecting and recycling end-of-life batteries.
According to the Indian Battery Manufacturers Association (IBMA), the continued dominance of an informal collection and recycling network, run by scrap dealers and unorganized smelters, is a key hurdle to compliance with existing rules.
The Battery Waste Management Rules (BWMR), 2022, place responsibility for the collection and environmentally sound recycling of used batteries entirely on producers under the Extended Producer Responsibility (EPR) framework. Battery manufacturers and brand owners are required to ensure that used batteries are collected and recycled through authorized recycling facilities.
Under the rules, authorised recyclers are to take back end-of-life batteries, extract Lead, and supply it to lead-acid battery manufacturers. “But a substantial proportion of used lead-acid batteries, around 35-40 per cent or even more, continues to flow into the informal sector through cash-based transactions with scrap dealers, bypassing the formal collection system,” a senior IBMA official told businessline.
The problem is compounded by an 18 per cent GST on used lead batteries, which incentivises tax evasion and fraudulent input tax credit claims.
Safe collection
“Manufacturers sell batteries to dealers or distributors or franchisees. Then there are retailers and certain channel partners through which it is sold to the end consumers. We are asking that in the Battery Waste Management Rules, there has to be some mention of responsibility of dealers and distributors. They should also be responsible for safe collection and giving back the used batteries to either the manufacturers or to any authorized recyclers,” the official said.
Notably, the lead-acid battery industry is one of India’s most established manufacturing sectors, generating annual revenues exceeding $5 billion. It has developed one of the world’s most diverse product portfolios and exports to more than 70 countries.
Under the Battery Waste Management Rules (BWMR), EPR Certificate mechanism provides a transparent framework for measuring compliance. But, the prescribed minimum price for EPR certificates, fixed arbitrarily at 30 per cent of the Environmental Compensation (EC), further increases compliance costs for organized manufacturers, according to IBMA.
The Environmental Compensation for Lead too is fixed at ₹18/ kg including processing costs of ₹15/ kg under the alleged erroneous assumption that the Lead Recycling industry needs to be further compensated for costs of operation.
“This fails to recognize that battery manufacturers source 85 per cent of their Lead metal needs from Lead recyclers paying full cost of processing any way. This creates an arbitrary pricing band of between . ₹5.40/ kg (30 per cent of EC) and ₹18/ kg for EPR certificates,” the official added.
The Indian Battery Manufacturers Association has engaged with the Ministry of Environment, Forest and Climate Change (MoEFCC) and the Central Pollution Control Board (CPCB), and submitted detailed technical representations and practical recommendations for improving implementation of rules.