In a world where electric vehicles (EVs) are the primary mode of private transportation, there will no doubt be a lot of used batteries. So, researchers and even some automakers are already racing to determine what roles these batteries can play in their second lives—and what kind of business model can support used EV batteries once they are retired.
Researchers and even some automakers are already racing to determine what roles these batteries can play in their second lives—and what kind of business model can support used EV batteries once they are retired.
“Batteries are kind of like people,” Brett Williams, the Senior Project Manager for Electric Vehicle Initiatives at the Center for Sustainable Energy, tells The Fuse. “They don’t like to be too hot, they don’t like to be too cold. They don’t like to be worked too hard—and even if they’re not doing much work, eventually they just age.”
Williams is one of the top experts currently at work on the problem of finding secondary applications for EV batteries. His team recently completed a three-year study on used EV batteries on the micro-grid at University of California-San Diego, subjecting them to the types of demands they would sustain if they were used in a stationary secondary use scenario. Williams said degradation is one major obstacle that looms large in making used EV batteries a viable energy solution.
“You can think about how they were worked in their first life as their main career: powering the EV. Then you can think about how they will work in their retirement career as their secondary job,” Williams explains.
But battery usage varies according to EVs. In general, an EV battery no longer meets the required standard once it’s degraded to about 70 to 80 percent of its capacity, Williams estimates. While that degradation can last between eight to 10 years, according to the Center for Sustainable Energy, it remains inevitable. By the time the used EV battery arrives at a repurposing center, it will be in need of diagnostics before it can be sent on to find its best-suited secondary usage.
“Some battery modules and even battery packs may be ready to fall off a cliff,” Williams explains, noting that an optimal battery for secondary applications should be facing a “nice smooth slide” in terms of future degradation. He admits that figuring out which batteries will fail and which are more durable is often a “tricky” proposition—and one that, right now, automakers are not adequately incentivized to track while the battery is still in the vehicle.
He does note that there are in fact some exceptions such as GM’s OnStar that track the battery’s life in the car, but says that there’s not yet enough standardization among automakers to eliminate a much-needed and often complicated diagnostic step in determining future use of these batteries.
Automakers see value in EV batteries beyond their use in cars
Nonetheless, automakers are starting to understand that there could be value in EV batteries even once they have outlived their use in cars. Just this month, for instance, Mitsubishi partnered with several corporate heavy-hitters in Europe to demonstrate how used EV batteries can provide stationary energy storage. In June, Nissan announced a commercial enterprise to use EV batteries for secondary applications, also in stationary storage systems. Also last month, GM said that five used Chevy Volt batteries were helping power one of its buildings in Michigan.
Even after the battery has reached the end of its useful life in a Chevrolet Volt, up to 80 percent of its storage capacity remains.
“Even after the battery has reached the end of its useful life in a Chevrolet Volt, up to 80 percent of its storage capacity remains,” Pablo Valencia, senior manager of Battery Life Cycle Management said in a statement announcing the initiative, echoing Williams’ estimate of remaining power in the battery after EV usage. “This secondary use application extends its life while delivering waste reduction and economic benefits on an industrial scale.”
As promising as it may sound to use EV batteries to power a building or supplement a grid, there are many issues to contend with—one of which is the swift drop in cost of new batteries. The lower costs could prompt some to just toss them away and buy a new one.
“The elephant in the room is rapidly decreasing new battery cost,” Williams acknowledges. “But you’re always going to have a cost advantage as a used battery because it’s essentially being paid for in its first life [in the vehicle].”
So, what could these secondary applications look like in the real world?
“You can imagine the battery being in everybody’s garage—like a water boiler just tucked in the corner,” Williams says, indicating that the batteries could shave off some peak usage and also serve as a back-up in case of emergencies, instead of a rarely used generator.
But even without technological and scientific obstacles, Williams sees two major impediments remaining. One is making a strong business argument for secondary EV battery usage. The other is having vocal policymakers to help clear the way forward.
“There’s a total net benefit to the system, but it’s hard to make an individual business motivated to pursue this today,” Williams says. “It’s a tough sell.”
Policy changes needed
With some policy changes and incentives, more businesses will likely see the value proposition in secondary EV battery life.
With some policy changes and incentives, however, more businesses will likely see the value proposition in secondary EV battery life. One particularly helpful policy would be standardizing transportation processes for lithium ion batteries so they can be moved cheaply but safely from the car to the repurposing facility where they will be begin their second career. Another helpful policy Williams detailed was a “take back law,” similar to legislation that already exists in Europe, where a consumer has the right to return a product and its packaging back to its manufacture at the end of its life cycle. Williams believes similar legislation in the U.S. would encourage automakers to consider the “post-use design” of the batteries and the cars some more. Finally, initiatives to create a home for energy storage modules on the grid—and even give them preferential load order—could help incentivize businesses to invest in secondary EV battery applications. A law doing just that already exists in California.
“I’m pretty optimistic that the private and policy innovations that are needed to unlock the net benefit of battery second life will succeed…because we have a lot of used batteries coming our way and it behooves us to be able to squeeze every ounce of valuable juice coming out of them,” Williams says.
But, he notes, if he had to fit all of his thoughts on the future of secondary EV battery usage into a telegram, it would read: “Proceed, with caution.”