Can we repurpose EV batteries?

 Can we repurpose EV batteries?

V-Storage started a pilot using old batteries from busses as an energy storage system. The ‘old’ batteries are placed in a large container. They intent to use the stored energy to electrify busses and to increase the Grid Balance. The pilot will start in January 2017.

In four or five years, the batteries in the roughly one and a quarter million EVs currently on the road are going to start to wane. EV owners will either replace them, or replace the cars entirely.

That means we’ll have a lot of used batteries (with plenty of life left in them) but which are no longer suitable for EVs. What to do?

One possibility is repurposing them to serve as grid-connected energy storage.

Storage is valuable to the grid for many reasons, including its ability to smooth out fluctuations in supply, allowing for more integration of variable renewable energy.

A promising path?

Once a battery is performance has degraded by around 30 percent, it could become available for stationary storage. Research by BNEF suggests that by 2018, these second life batteries could cost as little as $49 per usable kWh to repurpose. If you compare that to the current new stationary battery price today of around $300 per kWh, they will further support the economics of both renewable energy and electric vehicles, accelerating the uptake of both.

But Roger Sathre is skeptical:

“Notwithstanding the potential ‘greenness’ of second-life batteries, I imagine there are strong business reasons to invest in new purpose-built batteries for grid storage, to eliminate any uncertainty about the performance of used batteries.”

BNEF report

In the BNEF report, Claire Curry, senior analyst has compiled the first data and shows that low-cost energy storage could be here sooner than previously thought. An overview:

  • There will be 29 GWh of used EV batteries coming out of cars in 2025. This far exceeds the size of the current stationary storage market
  • Of this, almost a third will get a second life as stationary storage. (10GWh)
  • Today, a new stationary storage system can cost up to $1000/kWh. In contrast, repurposing used EV batteries could cost as little as $49/kWh in 2018, with an additional $400/kWh cost to convert to stationary.
  • The auto industry is divided on the issue. While Tesla won’t be involved in second life, BMW, Nissan and Mercedes Benz have second-life stationary storage projects in place.

Tesla is not enthusiastic

JB Straubel, battery expert and CTO of Tesla, is not enthusiastic.

We expect 10, maybe 15-year life at a minimum from the Tesla battery. And, the degradation is not entirely linear. By the end of their life, the efficiency has degraded on every cycle, you see lower efficiency, the capacity will have somewhat degraded, and for a lot of reasons, it makes it very difficult to deploy those efficiently back into a grid setting, where you want high reliability and you do want predictability.

So what’s going on? Can we repurpose EV batteries as grid storage or not? And if not, what should we do with them?

1.26 million

The International Energy Agency noted in its Global EV Outlook that the number of EVs (a category in which it includes battery electric, plug-in hybrid electric, and fuel-cell electric vehicles) on the road worldwide crossed the symbolic threshold of one million in 2015. Currently it’s at about 1.26 million.

 Can we repurpose EV batteries?

International Energy Agency “Global EV Outlook” 2016

 

Discarded second-hand EV batteries

The first generation of EVbatteries is about five years old, and performing great so far. However, warns BNEF, when they get to around eight to ten years old, they are expected to start losing enough capacity to substantially affect driving range. Some time around then, or shortly thereafter, they will drop below an acceptable level of performance.

EV owners will face a choice: Replace the battery and ditch the old one, or just upgrade to a new car. That will put a lot of EVs on the secondary market, and at least so far, they aren’t performing very well there. Consumers are worried about their declining range.

So in all likelihood, there’s going to be a wave of discarded second-hand EVbatteries to deal with, starting in four or five years. These batteries will still have around 70 percent of their energy capacity left.

Second-life battery market

Car companies don’t want customers to use them for unsafe home applications (car-company-branded). They would very much like for there to be some kind of established second-life battery market. Recycling them, at least given today’s recycling capabilities, is effectively, and … pretty expensive.

But their are other examples

  1. Vattenfall, BMW und Bosch are testing an electricity storage in Hamburg built by second life batteries.
  2. And V-Storage started a pilot using old batteries from busses as an energy storage system. They intent to use the stored energy to electrify busses and to increase the Grid Balance. The first test results are expected in January 2017.

Advantages of reusing

  • Putting batteries to work as stationary storage, would increase the lifetime value, potentially by quite a lot, reducing their overall cost and spurring further expansion of the EV market
  • Plus grid storage is good to have: every bit of storage adds to the grid’s stability and its ability to integrate renewables.

Challenges of repurposing

In order to successfully repurpose used EV batteries, we have some challenges.

  1. Value
    The value of used EV batteries is not uncertain because, at this moment, there are barely any used EV batteries to speak of
  2. Warranty
    Used batteries have lower energy density than new stationary-storage batteries and won’t last as long, since they are nearer the end of their lifecycle. So far, car companies refused to warranty used EV batteries
  3. Variety
    EV batteries vary wildly. With different sizes, shapes, and performance characteristics. But they have been used differently, in different climates, under different stressors, in different cars. Batteries
    Jeremy Michalek, director of Carnegie Mellon’s Vehicle Electrification Group: “Batteries that have experienced different environments and use cycles are going to have different degradation trajectories.”

Of course, stationary storage is cheapest when its constituent battery cells are most uniform.

The more they vary, the more expensive software is required to regulate them. It’s going to take a lot of time, experience, and money to figure out how to mix and match old EV batteries into consistently performing storage.

Some of the only research done on the energy and environmental effects of second-life EV batteries on grid storage is this study in the Journal of Power Sources, which looked at battery repurposing in California. Their conclusion:

“second-life use of retired PEV batteries may play a modest, though not insignificant, role in California’s future energy system.”

What makes Tesla batteries different?

  • First, Teslas are different. They are better cars, so their owners will drive them longer, perhaps 15 years, at which point their batteries will only be worth recycling, as it will be an old chemistry that nobody will want to use for stationary storage.
    And even if their original owners don’t drive them that long, because their batteries are so big, even if they lose 20 percent of their kWhs, their driving range is still over 200 miles,” which means they will sell just fine on the secondary market.
    (This is in contrast to current Nissan Leafs, for instance, which fall below a 70-mile range when their battery loses a third of its capacity)
  • Second, Tesla’s recycling is different. Tesla’s factory in Nevada develops its own recycling capabilities
  • Recycling all of Tesla’s used EV batteries would significantly reduce the potential size of the second-life storage market
  • Materials are becoming scarce. Tesla intends to boost its cars. This has influence on the availability of metals like lithium, cobalt, and nickel. As mining capacity can not scale-up, Tesla wants to recycling its batteries in-house so they can reuse some key materials in new batteries.
  • Third, by 2030 or so, 15-year-old batteries coming out of EVs will be competing with new custom-built stationary storage batteries that benefit from the intervening years of research, reduced costs, and increased performance.

Positive business case

But who knows. Ven Viswanathan, a professor at Carnegie Mellon University, and promotor of Redox Flow Batteries, is more optimistic. He divided the discarded batteries into two camps: EV and stationary. He thinks that second-hand EV batteries might get so good and cheap at some point that people can “oversize the battery pack,” compensating for reduced performance with more capacity, especially for home uses, where there are lower power requirements.

And to some extent, it’s already happening. This summer, Nissan introduced a stationary home storage system composed of a stack of 12 old Leaf battery modules. Perhaps second-life EV batteries will squeeze into the storage market that way, as cheap home batteries, growing from there as they prove themselves. We’ll see.

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