Thriving Second Life EV Battery Market

As electric vehicles proliferate, so too will used EV batteries. Car companies and researchers are hustling to figure out how to safely adapt and reuse those depleted batteries when that time comes.

The basic pitch is simple enough: cars demand very high performance from their batteries, so once the battery’s capacity declines past a certain point 70 percent or 80 percent, depending on who you talk to it needs to be swapped out. At that point, though, the battery can still handle a lot of charge and discharge, making it useful for storage in less intensive stationary settings.

The sheer expense of developing and building those batteries in the first place makes a compelling case for capturing some additional value after their initial use. Second-life applications also delay the need to dispose of these resource-intensive products, which nobody has yet figured out how to do economically. If storage vendors can resell used batteries as a cheaper alternative to new storage, they could help more people consume their own rooftop solar generation, or reduce their peak demand, or any number of other uses that would advance the progress of a low-carbon grid.

This is new territory, so there are a lot of questions yet to be resolved. What are the engineering challenges involved in taking batteries from mobile use to stationary use? Will they perform as well in the new capacity? How do you standardize across different degrees of wear and tear?

There is also the matter of setting up markets around used batteries and determining who benefits from that trade. Before that can happen, the physics of the transition have to be worked out. GTM asked some people pioneering the field about what they’ve encountered so far.

How do you standardize quality from disparate used batteries?

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Commodities markets rely on some degree of standardization to ensure that customers know what they’re getting for a certain price. New EV batteries have to meet exacting specifications, but the ones that come out of the chassis after years of driving will perform at all kinds of different levels.

“Batteries are a lot like people: They each have their own individual state of health depending upon what they’ve been exposed to and how they’ve been treated over the course of their life,” said Ken Boyce, who’s developing a safety standard for second life batteries at Underwriters Laboratories, a major safety certification firm.

Also like people, batteries are made up of multiple interlocking systems — the health of the pack as a whole depends on the health of each of the modules, which depend on the health of the cells within them. Second-life developers have to account for differing wear and tear at each of these levels, in order to standardize the packs and put together storage units that perform at a consistent and predictable level.

Moreover, they’ll have to ascertain that information without wrecking the cells in the process. Noninvasive procedures are necessary for the batteries to remain useful after the assessment.

The good news is that methods for testing the batteries are not daunting. Evaluators can track rates of electrical charge and discharge, use thermal imaging to screen for abnormal performance, and parse data from the battery management system, which governs its functions.

Once the standard, known as UL 1974, comes out — Boyce said it should be ready by the end of the year — that will guide second-life battery developers in the level of quality they need to meet.

“Making sure that we’ve thought through that collectively as a technical community and captured those requirements in a standard is really important, so that as they go into that brand new application, everybody can really feel comfortable about that and expect that they will perform in a safe and sustainable manner,” he said.

How do you match up old batteries?

Meeting the UL standard won’t be easy. It requires studying the differences of each used battery and accounting for them in the stationary system design. But it’s possible, because it’s already been done.

The University of California at San Diego set up the first large-scale second-life battery installation back in 2013. It networked 100 kilowatts and 160 kilowatt-hours of batteries from BMW’s first EV, the Mini E, and connected it to the microgrid that powers almost all of the campus’ electricity needs.

“It took a lot of effort; no one had done this before at the time,” said William Torre, program director of energy storage research at UCSD. “We had a lot of challenges with the development of the control systems and getting them communicating properly.”

Once they’d figured out the battery management systems for each pack, they had to create a “super BMS” to oversee all the different battery management systems. The next key step was categorizing each of the batteries so they could group together batteries with similar states of charge and capacity.

“You can do some things with the control system to accommodate some variance in the battery packs and their voltages, but if you can keep them closely within range, you’re going to get more use out of the batteries and more capacity out of the system,” Torre said.