Second life batteries – less belief, more data

PR projects, greenwashing or advanced landfill? The image of second life or reuse of batteries from electric vehicles in other applications is often shaded by scepticism. Everything from legislation to technical hurdles seems to block the road to success.

Or is that true? Could it be like, while we are discussing our beliefs, a rapidly growing industry is taking shape out there, sometimes without sending a press release about every single installation they make.

One way to find out is to actually see what is going on and how it works. That’s what we have been doing for several years. But for the first time for the second life market, we have done it really systematically and thoroughly, combining top-down with bottom-up analysis.

We have identified all major projects around the world where EV batteries have been used either in stationary energy storage or repurposed and used in other applications such as utility vehicles or ships. We are also listing technology providers, battery suppliers and operators. And the list is quite Impressive. Since 2016 more than 50 installations, ranging from 100 kWh to 33 MWh, have been deployed outside of China. Add to that thousands of smaller 1-50 kWh systems which today are in use relying on battery modules which previously served in electric cars.

In total 178 MWh of energy storage capacity is today installed around the world outside of China. 158 MWh of this capacity is installed in Europe. It’s not only second life batteries. Almost half of the batteries are new, serving their first years in a fairly gentle ESS environment before they will be used as replacement batteries when cars like the Smart, the i3 and Zoe start to get some serious milage, and require a touch-up. But they are all EV batteries bringing the automotive and energy industries into a closed loop with the battery at the centre. Bring in vehicle-to-grid and EV-charging and the combined industry starts to look very dynamic.

If we compare the numbers with what we at Circular Energy Storage consider available for reuse (batteries that have reached end-of-life but are still in good shape for another adventure) today’s amount doesn’t seem so impressive. In 2019 we estimated that 257 MWh of batteries would be available for reuse in Europe while only 58 MWh were deployed, of which half were new batteries.

There are several factors which explain this.

Basically all larger EV-based ESS deployments have been championed or at least supported by OEM’s. Some OEM’s, most notably Tesla with more than half of the end-of-life volume in 2019, have chosen not to get actively involved in the game. That drastically brings the actual available volume for second life down, although their modules are very popular in the market. Another factor is remanufacturing. Most car makers are, either within their own organisation or through third party suppliers, involved in processes where their batteries, the single most expensive component in the car, are both repaired and remanufactured so they can serve another life in a car before repurposing or recycling. Reuse is much more then only second life.

Still with that in mind, by studying the pipeline and plans of the players in the industry we expect another 152 MWh to be added to the already existing installations in 2020, bringing the cumulative amount to 330 MWh of EV batteries used in stationary energy storage outside of China.

The drivers of the growth are many but some 20 partnerships and more than 30 companies which now all invest in second life solutions is one important aspect. Increased availability of end-of-life batteries and limited availability of new batteries are two others.

This information, including lists of ESS installations, technology providers, product companies, operators and further analysis, is available for our CES Online subscribers. The service also include volume data for lithium-ion batteries from when they are placed on the market to recycling, prices of used batteries and raw materials and lists of recyclers and research in the area.