Old electric-vehicle batteries are getting a second life

There are currently 10 million EVs on the world’s roads, a figure that is expected to rise to 300 million by 2030, the IEA says. That will create a valuable market for retired batteries: Roughly 1.7 million will be available for reuse in 2030 (Photo: Bloomberg)
There are currently 10 million EVs on the world’s roads, a figure that is expected to rise to 300 million by 2030, the IEA says. That will create a valuable market for retired batteries: Roughly 1.7 million will be available for reuse in 2030 (Photo: Bloomberg)


Auto makers like Nissan and Renault are using retired batteries to build large-scale energy-storage systems

Millions of electric vehicles will be scrapped in the coming years. For the batteries that power them, that won’t be the end of the road.

Eventually, auto makers and recycling companies want to harvest valuable materials from old EV batteries to make new ones. But before they are recycled, used batteries could be given a second life on the electricity grid.

Wind and solar plants are increasingly being coupled with lithium-ion batteries to store excess power for times when the sun isn’t shining and the wind isn’t blowing. As these are the same type of batteries as those used in electric cars, auto makers say repurposing them could aid the expansion of renewable energy as well as address an electronic-waste challenge.

Auto makers such as Nissan Motor Corp. and Renault SA are stepping up efforts to repurpose old batteries and tap surging demand for energy storage. Global investment in grid-scale batteries reached $6.8 billion in 2021, up from $4 billion in 2020, according to International Energy Agency estimates.

There are currently 10 million EVs on the world’s roads, a figure that is expected to rise to 300 million by 2030, the IEA says. That will create a valuable market for retired batteries: Roughly 1.7 million will be available for reuse in 2030, with a combined value of $5.1 billion, according to Circular Energy Research and Consulting, which collects data from sources such as car dismantlers and online marketplaces.

EV batteries degrade as they are charged and discharged. Drivers can expect upward of 100,000 miles of use before a battery loses 20% or more of its capacity, roughly the point at which performance drops noticeably, experts say. But they remain useful for grid storage until their capacity drops to around 60%, potentially giving them another 10 to 15 years of service, according to Hans Eric Melin, founder of Circular Energy Storage Research and Consulting.

Used EV batteries can be resold for small-scale applications such as storing electricity from rooftop solar panels. Auto makers and power-equipment companies have been trialing larger-scale second-life applications for years. A soccer stadium in Amsterdam uses nearly 150 new and old Nissan EV batteries to power an energy-storage system.

As more old batteries become available, these projects are proliferating. Volkswagen AG’s Skoda unit last year started providing energy-storage systems—each of which uses 20 plug-in hybrid batteries or five all-electric batteries—to power charging stations at dealerships in Europe. Skoda said it could eventually make 4,000 of the units.

In March this year, European utility Enel SpA started operating a project with Nissan that uses 48 old EV batteries with 30 new ones in an energy-storage system at a power plant that provides electricity for Melilla, a Spanish enclave on the coast of Morocco with 86,000 inhabitants. The system can provide 15 minutes of backup power.

Nicola Rossi, head of innovation at Enel’s renewable-generation arm, said “every improvement and economy of scale enhancement that can be achieved on EVs can improve stationary batteries as well." Enel is using second-life batteries to build an energy-storage facility for a 30-megawatt solar park at Rome Fiumicino Airport.

Soufiane El Khomri, director of Nissan Energy Services, said that the Japanese auto maker has a head-start in selling old batteries for the grid because it launched a compact battery electric car, the Nissan LEAF, back in 2010 and now has more than 500,000 EVs on the road. “We expect future opportunities to increase as the EV market continues to flourish," he said.

Battery packs from a first-generation Nissan LEAF were sold for an average of $130 per kilowatt hour in 2021—roughly $3,500 for a 24 kilowatt-hour model—according to Circular Energy Storage Research and Consulting.

Auto makers often get old batteries back, for instance through leasing agreements with customers or by keeping hold of batteries that are upgraded. Renault, for instance, has rented out more than 250,000 batteries that will come back for repurposing or recycling in the coming years, although it now usually sells the batteries with the new cars. Renault has several energy-storage sites in France that combine old and new EV batteries.

The combined capacity of retired batteries will climb from 10.4 gigawatt hours last year to 107.5 gigawatt hours by 2030, according to Circular Energy Storage Research and Consulting estimates. That would correspond to an hour of power consumption for around 80 million U.S. households. In practice, not every old battery will wind up being used for energy storage. Some will retain enough juice to be used in another car.

Hans-Günter Schwarz, head of battery development at German energy provider RWE AG, said using repurposed EV batteries could be cheaper than new batteries, depending on the battery’s voltage and other factors. But the low volumes of batteries currently available means it is too early to know whether they will be a large-scale solution for the grid, he said.

RWE operates an energy-storage system with a capacity of around 4.5 megawatt hours in Herdecke, Germany, that uses 60 lithium-ion batteries taken from Audi EVs.

What happens to old EV batteries also depends on how the potential rewards from repurposing them stack up against those of reusing their materials in new batteries.

Specialist battery-recycling companies such as Carson City, Nev.-based Redwood Materials Inc. and Li-Cycle Holdings Corp. of Toronto are developing technology and building factories for battery recycling, teaming up with big auto makers.

Redwood, for example, collects and recycles battery components from Panasonic Holdings Corp., Tesla Inc.’s main battery partner. This year, the startup plans to supply the Japanese conglomerate with copper foil produced from recycled materials to make new lithium-ion cells at Tesla’s Gigafactory in Nevada. Li-Cycle is working on a General Motors Co.-backed battery-recycling effort.

In Europe, Renault SA has a partnership with Veolia Environnement SA and Solvay SA to extract and purify end-of-life EV battery metals.

Some experts say recycling is already a better option than finding new homes for batteries. Emma Nehrenheim, chief environmental officer at Swedish battery maker Northvolt AB, said recycling has become a cost-efficient way of recovering valuable metals, while second-life uses haven’t been proven on a large scale.

“Comparatively, the economics of immediate recycling are compelling," she said.

But others envision a three-stage life cycle for batteries, with recycling being the final phase. “We want to enable a full-circle life cycle," said Dustin Grace, chief technology officer at Burlingame, Calif.-based EV company Proterra Inc., which makes batteries for medium-and heavy-duty commercial vehicles and has sold more than 850 buses.

Proterra is now considering a second life for their batteries. One possibility is to put them into EV charging stations. “We like to think of the second-life application as something that we should do before they are recycled," Mr. Grace said. He said batteries are too valuable to end up in landfill.

“The goal isn’t to build these large 1,500 pound batteries so they can be used and then put back in the earth," he said. “You have a whole army of engineers thinking about this."


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