BATTERY RECYCLING A common question we hear is, “What happens to Tesla vehicle battery packs once they reach their end of life?” An important distinction between fossil fuels and lithium-ion batteries as an energy source is that while fossil fuels are extracted and used once, the materials in a lithium-ion battery are recyclable. When petroleum is pumped out of the ground, chemically refined and then burned, it releases harmful emissions into the atmosphere that are not recovered for reuse. Battery materials, in contrast, are refined and put into a cell, and will still remain at the end of their life, when they can be recycled to recover its valuable materials for reuse over and over again. Since Tesla battery packs are made to last many years, we are only just starting to receive these batteries back from the field. Currently, most of the batteries for recycling come to us through R&D, manufacturing, quality control and service operations. Today, we work with third-party recyclers around the world to process all scrap and end-of-life batteries to recover valuable metals. Our recycling partners work with us to ensure that non-valuable or non-recoverable materials from the batteries are disposed of responsibly. At Gigafactory 1, Tesla is developing a unique battery recycling system that will process both battery manufacturing scrap and end-of-life batteries. Through this system, the recovery of critical minerals such as lithium and cobalt will be maximized along with the recovery of all metals used in the battery cell, such as copper, aluminum and steel. All of these materials will be recovered in forms optimized for new battery material production. The closed-loop battery recycling process at Gigafactory 1 presents a compelling solution to move energy supply away from the fossil-fuel based practice of take, make and burn, to a more circular model of recycling end-of-life batteries for reuse over and over again. From an economic perspective, we expect to recognize significant savings over the long term, as the costs associated with large-scale battery material recovery and recycling will be far lower than purchasing and transporting new materials. 26