A new study by the Montreal-based Commission for Environmental Cooperation shows a sharp rise in U.S. exports of spent lead-acid automobile batteries, or SLABs, to Mexico for recycling. The spike follows U.S. implementation in 2008 of ambient air-quality standards that have made it costlier to extract lead from used batteries, prompting criticism that companies are recycling more batteries in Mexico to take advantage of weaker standards there.

The authors of the study, issued this month, say they cannot state definitively whether looser standards in Mexico accounted for the export increase. They did conclude, however, that the gap in recycling costs between Mexico and the United States would likely widen as stricter U.S. lead-emissions standards take effect next year.

“It is hard to make a strong link between the increase in exports and the provisions applicable to secondary lead smelting in Mexico,” says Irasema Coronado, executive director of the CEC Secretariat.

The trilateral CEC was set up by Canada, Mexico and the United States in conjunction with the North American Free Trade Agreement to address common environmental concerns.

Though the new CEC report doesn’t directly link spent-battery recycling standards to rising U.S. exports, it recommends Mexico and Canada achieve standards that are “functionally equivalent” to those in the United States.

The surge in used lead-acid battery exports to Mexico has been dramatic: the CEC study estimates that they increased between 449% and 525% from 2004 through 2011. (The difference is due to a discrepancy between export numbers reported to the U.S. Census Bureau and data from the Environmental Protection Agency.) Exports to Canada also have grown, rising 221% in the same eight-year period.

Non-governmental groups that first spotlighted the surge of spent lead-acid batteries into Mexico disagree with the CEC on the cause of the trend. The report’s lack of a definitive conclusion “evades much of the analysis throughout the document that indicates Mexico has many regulatory, environmental, health and labor disparities, as well as economic advantages, that encourage the export of SLABs from the United States to Mexico for recycling,” wrote Marisa Jacott, director of Common Borders, a Mexican non-governmental group, in comments on the draft report in December.

Recycling companies in the United States also called on the CEC to reach a stronger conclusion. Commenting on the draft report, Robert Finn, chief executive of RSR, a battery recycler based in Dallas, Texas, wrote that “the stringent regulatory program for battery recyclers in the U.S. allows batteries to be recycled in Mexican facilities at a cheaper cost.”

Company looms large

The lion’s share of the increase comes from one company—Johnson Controls, the largest manufacturer of lead-acid batteries in the world. (The report estimates that Johnson Controls accounts for 74% of all SLABs sent to Mexico from the United States in 2011.)

To ensure a steady supply of spent batteries, Johnson Controls picks up used batteries from its retailers in Mexico and the United States after consumers return them, then recycles them in its company-owned smelters in both countries. The recovered lead then goes into new batteries the company produces on both sides of the border.

The company says its new Enertec secondary smelting plant in Mexico is built in compliance with U.S. standards. It has also promised improvements in another large Mexican battery recycling plant it acquired in 2005.

In a letter responding to questions from the CEC last June, Mike Carr, vice president and general manager for North America at the Johnson Controls Power Solutions division, wrote that lax environmental controls were not the reason for the company’s surge in shipments. Instead, he cited factors such as consumer demand, global economic conditions, tighter control over lead supplies and the integration of North American operations.

At almost every point, the study found, that Mexico’s environmental standards for secondary smelters which extract lead from SLABs are lower than those in the United States and Canada—and in some cases are non-existent.

For example, Mexico has no regulations governing lead emissions from smokestacks. Its standard for lead concentrations in ambient air is 1.5 micrograms per cubic meter, compared to a standard that is 10 times more stringent in the United States: 0.15 micrograms per cubic meter. The permissible airborne exposure to lead is roughly three times as high in Mexico as it is in the United States or Canada. Meanwhile, secondary smelters in the United States have until January 2014 to comply with tough new airborne-lead emissions standards—an average of 0.2 milligrams per cubic meter, or 10 times tighter than the current U.S. standard.

Scant monitoring

Assessing the impact of Mexico’s lower standards is difficult. There is little information about lead contamination in surrounding communities or lead concentrations in the ambient air around the plants. In addition, there is only partial compliance with self-reporting requirements under Mexico’s pollutant release and transfer registry.

The CEC issued several recommendations aimed at improving regulation and enforcement in Mexico and sharing information across North America. To begin with, it asked Mexico—and Canada—to improve regulation to “avoid the development of pollution havens.”

The study found that the import-export data in all three countries was haphazard, and called on them to streamline their information gathering and to share data. In particular, it said the U.S. Environmental Protection Agency should require companies in the United States to show export manifests and a certificate of recovery in order to track battery exports and lead that is recycled and returned.

Another concern is the existence in Mexico of small, unregulated lead smelters that are operating without oversight. Coronado and Marco Heredia, the CEC’s program manager for environmental law, say preparation of the report prompted a response from Profepa, Mexico’s environmental-enforcement agency.

Heredia, a co-author of the report, says Profepa has set up a special program to monitor SLAB recycling. An annex to the report details a number of seizures of unauthorized used-battery shipments and inspections of storage and recycling facilities that Profepa carried out in the past year. Says Coronado: “Mexico is on it, that’s for sure.”