As you may know, Li-Ion batteries loose their capacity (kWh) over their lifetime. At a certain point this means for electrical vehicles, that the range (km), which depends on the battery capacity, is not sufficient anymore. This happens after approximately 5-10 years operation, depending on the behavior of the car owner. What happens with the battery of an electric vehicle after reaching this point? There are three different possible scenarios: disposal, recycling or reuse. The disposal is the most common method and results in a simple combustion of the batter, which is of course not a sustainable use of raw material and neither is it good for the environment. The second option is recycling, where the raw material like cobalt, nickel or manganese is extracted and reprocessed. The third option is to reuse the batteries and give them a 2ndlife.
The batteries after operation in an electric vehicle may have not enough capacity left to satisfy the requirements of transportation but may are still suitable for other applications. This could be e.g. frequency response for the electricity grid or a back up system for a data center. These are stationary applications, which require many battery packs of electric vehicles connected in series and parallel to form a so called utility-scale battery system. Different OEMs like Daimler or Nissan are already working with used EV batteries to develop 2ndlife applications.
The volumes of used EV batteries will be huge in the future with the growing amount of EVs in Europe. This amount can even overcome the amount of new installed stationary utility-scale batteries by 2030.
Despite the huge potential of 2ndlife EV batteries there are as well challenges to overcome like regulations for used battery applications or standards for the development of battery packs, as every OEM has their own battery pack design. Despite that already battery manufacturers are developing different cells for EV and stationary applications (as well called “ESS – Energy Storage System”). This makes totally sense as cells for EV need a high energy density and a lifetime of ~1000 cycles, which results in ~300 000km. Cells for stationary applications need a lifetime of more than ~4000 cycles to realize a feasible business case and the energy density is not as critical as for mobile applications.
2ndlife will definitely be an application that will find its place in the stationary market for a certain duration and is a very good alternative to a direct disposal. But in my opinion in the future the battery packs for EV will be designed for a shorter lifetime to fit the requirements for the this particular applications and afterwards go to a recycling process to extract the raw material. For stationary applications different cells are being developed and with decreasing battery prices the purchase of new batteries will be more economical rather than using the EV batteries after their first end of life.
Please find below an article regarding this topic from McKinsey, which shows most of the aspects discussed above more in detail.
Link to article by McKinsey