German battery recycling company cylib has secured a €63.4 million grant from the German Federal Ministry for Economic Affairs and Energy to finance the second build-out stage of its Dormagen facility. This funding will enable the construction of Europe’s first dedicated industrial-scale LFP (Lithium Iron Phosphate) recycling line, doubling the facility’s total planned capacity to 60,000 tonnes per year-equivalent to around 140,000 electric vehicle batteries.
For C-suite leaders in automotive, energy storage, mining, and industrial policy, this move marks a turning point in Europe’s strategy to reduce its dependency on imported battery raw materials and build a resilient, circular battery value chain.
Scaling from Pilot to Industrial-Scale Operations
Founded in 2022, cylib has rapidly scaled from laboratory development to proven pilot-scale operations. It now employs over 120 people and is preparing for full industrialization at Chempark Dormagen, with production scheduled to begin in 2027.
To date, cylib has secured over €140 million in funding, combining non-dilutive grants and Series A equity financing. This strong backing from both public and private investors reflects growing confidence in its technology, market positioning, and ability to deliver at scale.
The Dormagen facility will operate with closed-loop water systems, minimal waste generation, and full compliance with the EU Battery Regulation, setting a high standard for environmental performance and regulatory alignment.
Europe’s First Dedicated LFP Recycling Line
The €63.4 million grant will finance a dedicated 30,000-tonne LFP recycling line, complementing the facility’s planned 30,000-tonne capacity for NMC (Nickel Manganese Cobalt) batteries. This expansion positions cylib as Europe’s first industrial operator capable of processing all major battery chemistries-NMC and LFP-from end-of-life batteries, production scrap, and black mass at scale.
This comprehensive capability directly addresses a critical gap in Europe’s battery ecosystem:
- LFP batteries now account for nearly 50% of the global EV battery market and dominate stationary energy storage systems.
- Yet Europe currently lacks dedicated, industrial-scale LFP recycling infrastructure, creating both a strategic vulnerability and a major market opportunity for domestic material recovery.
By closing this gap, the Dormagen facility will play a central role in strengthening Europe’s raw material resilience and reducing reliance on imported battery materials, particularly from Asia.
A Strategic Response to Shifting Market Dynamics
The decision by cylib to prioritise LFP recycling reflects the rapid evolution of the battery market:
- LFP’s lower cost, longer cycle life, and improved safety have driven its adoption in mass-market EVs and grid-scale storage.
- At the same time, Europe’s existing recycling efforts have historically focused on high-value NMC chemistries, leaving LFP largely underserved.
Cylib’s pilot projects with partners across Europe have confirmed a clear message: LFP recycling capacity is needed now. The grant supports the transition from pilot success to full-scale industrial operations, enabling cylib to deliver the LFP recycling infrastructure that Europe urgently needs.
For executives, this highlights the importance of aligning recycling strategies with evolving battery chemistry trends, not just current high-value streams.
Strengthening Europe’s Battery Independence
The expansion led by cylib advances multiple strategic objectives for Europe’s battery and industrial policy:
- Regional economic development
The project will create around 180 new jobs in a structurally transitioning region, supporting the economic transformation of former coal and heavy-industry areas. - Technology leadership
By establishing industrial-scale LFP recycling capabilities new to Europe, cylib is positioning the continent as a leader in next-generation battery recycling technology. - High material recovery rates
cylib’s proprietary water-based recycling process achieves over 90% material recovery for both LFP and NMC chemistries, using a “lithium first” approach to maximize the value of recovered materials. - Climate impact
Recycling reduces greenhouse gas emissions by around 80% compared to primary extraction, making it a key lever for decarbonizing the battery supply chain. - Supply chain resilience
cylib is building partnerships across the complete battery value chain, from automakers and battery producers to raw material suppliers, to ensure that recovered materials are reintegrated into new batteries.
Proprietary Technology and Circular Economy Model
cylib’s proprietary water-based recycling technology efficiently recovers raw materials from battery packs, black mass, and production scrap. The closed-loop process recovers:
- For NMC batteries: lithium, nickel, cobalt, manganese, and graphite.
- For LFP batteries: lithium and iron phosphate compounds.
These recovered materials are then reintegrated into the battery supply chain with an 80% reduced carbon footprint compared to primary extraction, enabling a true circular economy for batteries.
The technology has been validated at cylib’s pilot facility, which serves as an R&D hub for advancing battery recycling innovation. This combination of proven technology and scalable industrial design gives investors and partners confidence in the project’s technical and commercial viability.
What C-Suite Leaders Should Do Next
For executives in automotive, energy storage, mining, and industrial policy, the launch of Europe’s first dedicated LFP recycling line by cylib calls for:
- Reassess battery chemistry and recycling strategies
Align recycling and sourcing strategies with the growing share of LFP in EVs and stationary storage, not just high-value NMC. - Secure long-term offtake and partnership agreements
Engage early with recyclers like cylib to secure offtake for end-of-life batteries and production scrap, and to lock in supply of recovered materials. - Integrate recycling into ESG and net-zero plans
Position battery recycling as a core component of decarbonization, circular economy, and supply chain resilience strategies. - Monitor policy and regulatory developments
Track national and EU-level support programmes, battery regulations, and circular economy initiatives to identify funding, compliance, and partnership opportunities. - Support regional industrial transformation
For companies with operations in transitioning regions, consider how battery recycling and related industries can support local economic development and workforce transition.
Looking Ahead
The €63.4 million grant awarded to cylib to build Europe’s first dedicated industrial-scale LFP battery recycling line is more than a project milestone-it is a strategic enabler for the continent’s battery independence. By processing all major battery chemistries at scale, the Dormagen facility will reduce Europe’s reliance on imported raw materials, strengthen its circular economy, and support the long-term competitiveness of its automotive and energy storage industries.
For C-suite leaders, this is a clear signal: the future of batteries is not just about performance and cost, but also about resilience, circularity, and sovereignty. Those who act now to integrate advanced recycling into their strategies will be best positioned to lead in the next era of the battery economy.
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