Core commercial clauses
Battery values move with metal prices and with demand for second-life modules, so a fixed price per pack soon becomes unfair to one side or the other. A better approach defines the pricing method: a second-life value per kilowatt-hour for graded modules, black mass payables linked to a published index for material sent to refining, and transparent deductions for logistics or damaged units. Scheduled review periods keep the formula aligned with markets.
The contract should also define when title transfers, how settlement is calculated and when payment falls due. A binding quote within 48 hours of receiving complete pack details, followed by a clear settlement statement after grading, makes the process predictable for procurement and finance teams alike. Settlement statements should show the grade and value of each module so that the owner can reconcile them against their own asset records.
- Pricing formula, index references and review period
- Title transfer point and payment terms
- Collection response time, coverage and surge capacity
- Damaged-unit declaration, packaging and charges
- Certificates, chain of custody and data handling
Technical and grading terms
State of health drives value, so the contract should specify how it is measured: test rate, temperature, rest periods, whether measurement happens at pack or module level and how results are reported. Grade definitions should be explicit rather than implied. On our benches Grade A means at least 85% retained capacity, Grade B covers 75% to 85%, Grade C covers 65% to 75%, and lower grades or defective units are routed to refining.
A dispute route protects both parties. The contract can allow the owner to request a retest, to witness testing in person or to appoint an independent laboratory for a sample of modules, with clear rules on who pays in each case. Agreeing that process in advance is far easier than negotiating it after a disappointing grading result, when both sides already have a financial stake in the outcome.
Service, compliance and exit terms
Service levels should cover collection response time, coverage area, surge capacity for recalls and the handling of damaged or defective units. Collection within five working days of an approved manifest is a reasonable baseline for routine volumes, with faster response for damaged units. Service credits or penalties give these clauses real weight and encourage both parties to report problems early rather than let them accumulate.
Compliance terms should require processing at registered facilities, recovery certificates for every consignment, disclosure of downstream vendors and audit rights. Exit clauses should allow either party to terminate for sustained non-performance and should explain how stock in transit or awaiting grading will be handled if the agreement ends, so that no batteries are left in limbo between two organisations. A short handover schedule attached to the contract makes this practical.