Bloomberg New Energy Finance has released a new report about the used-EV-battery landscape, and it’s intriguing, because of the opportunities and also because of its divergence from Tesla’s point of view.
One particular prediction is that, in 2025, there will be 29 GWh of used batteries from EVs available, and that about 10 GWh could be utilized for stationary storage. Tesla CTO JB Straubel, on the other hand, has stated that using used EV batteries for stationary storage doesn’t pencil out in as good a way as you’d presume, and he doesn’t see a future for this market (at least, for Tesla’s batteries).
Another projection from the BNEF report is that, by 2018, $50 kWh may be the cost of testing, cycling, repurposing, and transporting used EV batteries.
Its estimate for the cost of repurposing a used EV battery in 2018 is $49/kWh, and the cost of converting one for stationary storage is an additional $400/kWh.
That compares to $1000/kWh for stationary storage now, but as JB Straubel highlighted, the cost of battery storage using new batteries specifically tailored to the purpose is expected to drop a lot in the coming years, and will theoretically beat these conversion options on cost.
The report authors and several major automakers, however, see a large and growing potential supply of used batteries available which could be turned into stationary storage and sold on the storage market. The BNEF document summarized the situation succinctly:
“The development of the ‘second-life’ battery market is interesting to car companies, policy makers, stationary storage companies, utilities, renewable power developers and battery manufactures. It offers the potential for large amounts of low-cost batteries, with plenty of energy left in them, to become available years before newly manufactured unsubsidised batteries are cheap enough to deploy.”
Another consideration is the hesitation that consumers have toward buying EVs because the batteries (which are quite expensive) will eventually need to be replaced. However, if it turns out that they could sell their used battery in a second-life market, EVs might be more attractive to those folks. On the other hand, selling batteries back to the automakers or to other parties simply so they can recycle the materials inside of the batteries and use those basic components again could be even more profitable.
EVs are growing in popularity, due mainly to the successes of the Tesla Model S. The Model 3 is coming soon, and the all-electric Chevy Bolt with a similar price tag and range will precede it.
If, or when, all the Model 3 orders are fulfilled, there will be hundreds of thousands of new EVs and EV batteries on the market. It’s hard to say how many more Bolts, electric BMWs, and LEAFs there will be and the number of batteries they will bring into the picture, but suffice to say, there will probably be hundreds of thousands of used EV batteries available in the next 7 years or so. It’s still highly debatable how useful it will be to repurpose the batteries for stationary storage versus recycle them, and it seems different automakers have different opinions on the matter.
There is also the possibility that some EV owners remove their own batteries and re-purpose them to make home stationary storage — that may be the most economical option, but will likely only be done by DIY types.
In the end, the growing EV trend could become a “happy accident” for stationary storage, but we’ll have to wait to see.
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