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Unlocking the opportunity for second life batteries in stationary storage

Unlocking the opportunity for second life batteries in stationary storage

It is thought that over 100 million electric vehicle (EV) batteries are expected to be retired in the next decade, a significant percentage of which could be repurposed into stationary storage. Matthew Lumsden, CEO of Connected Energy, discusses findings from the first 10 years of designing and operating second life stationary battery storage revealing how the industry is turning this opportunity into reality.

The market for spent EV batteries has the potential to be an exciting, high value sector extending beyond the current limits of recycling. While EV batteries were not originally designed with a second life in mind, through comprehensive testing it has become clear that batteries entering the waste stream with around 75% capacity or more could be economically repurposed as stationary storage.

Extending the battery’s useful life by up to 100%, it presents an alternative option for automotive original equipment manufacturers (OEMs) and EV fleet owners, while offering a more sustainable, low risk and readily available battery alternative, serving the fast-growing energy storage market with similar performance capabilities to new batteries. 

Indeed, according to a recent report from RenewablesUK, the pipeline of battery projects has grown by two-thirds in the last 12 months, increasing demand for batteries and the critical materials required for their production.

How do you repurpose an EV battery into stationary storage?

With safety paramount, the first step in determining a battery’s suitability for repurposing it into stationary storage is to understand its history and perform state of health checks as well as physical inspections to assess damage and corrosion. Only batteries that have ‘naturally’ reached their end of life are used by Connected Energy, rather than those that have been involved in a collision or ended up as scrap.

At present, most second life battery stock considered by Connected Energy for stationary storage comes from fleet vehicles, such as vans via automotive OEMs. There are several practical reasons for this, not least because EV manufacturers are enthusiastically engaged in exploring new avenues to reuse spent batteries, which regulations require to be collected and disposed of. This means large volumes of batteries are increasingly available.

Fleet vehicles typically have excellent traceability with good service history which provides a baseline of high-quality data. Most fleet vehicles also have predictable daily duty cycles and are charged steadily overnight which makes them relatively homogeneous in terms of use and degradation. 

Altogether this has made fleet vehicle batteries ideal as a basis on which to develop the necessary technologies for a stationary storage solution using second life batteries.

A noticeable learning to date has been that battery degradation has not been as significant as was once expected. In fact, our own test data has revealed that under normal operating conditions, most second life batteries offer 80-85% efficiency with theoretical lithium always being the high end of 90% – not dissimilar to what is experienced in a car.

Similarly, we have now gathered more data on second life battery performance than has existed before covering a wide range of duty cycles. This is being used to continually improve prediction capabilities and ensure robust safety processes.

Using second life batteries in stationary storage

In Connected Energy’s second life stationary storage solution, battery packs are controlled in pairs. Containerised systems consist of between 24 and 100 packs, depending on the minimum system capacity, while utility scale systems will be much larger.

A control system manages each pair, allowing for greater flexibility in operation. This is particularly beneficial for systems built from packs with different states of capacity – over the first few years, the operator can call on higher capacity packs more frequently allowing the packs to reach the same state of health over time. This has the benefit of reducing downtime to replace packs.

As the peak power requirements of an EV are much higher than what is required of stationary storage, the packs are charged and discharged at a rate about three to four times lower than in peak EV use, making for gentler operation and lower degradation. Power can also be rebalanced across the system to minimise the batteries being subjected to a prolonged high state of charge, thereby increasing efficiency overall. 

The positive impact of this approach becomes apparent in utility scale systems where larger numbers of packs enable greater levels of dynamism and flexibility to be used to optimise how the batteries are used and monetised.

Once in operation, each pack is monitored remotely 24/7. Data from the packs including operating temperature, charge, efficiency and exception alerts are analysed to assess the system’s health and machine learning is used to identify anomalies, trends and relationships between the variables. The results inform rea- time operation to enhance performance as well as identifying preventative operation and maintenance strategies to optimise the system. The data is also used to update the models and assumptions to improve future systems and business cases. In some cases, the data is fed back to the battery OEM so they too can better understand how their batteries operate in later life and update their own models. 

Finally, the OEM’s original battery management system remains in use too – the same system that is trusted by millions of EV users to get their families and goods from A to B – to ensure continued safety.

The future of second life batteries

The forthcoming introduction of the Battery Passport in the EU in 2027 will go some way to improving the data available from batteries, with statistics on performance and durability expected to be made available which will support better decision making at the end of a battery’s first life.

The industry is also likely to experience a move away from transactional relationships as the EU Battery Regulation Amendment begins to have an impact. With the goal of achieving sustainable battery lifecycles, battery manufacturers will be increasingly interested in novel ways to extend battery lifecycles particularly given the current lack of battery recycling facilities that is impacting the supply chain UK and EU-wide. This could see battery manufacturers increasingly working collaboratively with stationary storage providers, potentially retaining ownership of their batteries and receiving revenue from their use. 

Finally, as a market for second life batteries develops, we are likely to see increased engagement from large fleet owners, who will be interested in maximising the value that they can get from the sale of their batteries by balancing use and degradation.

The potential for using second life batteries in stationary storage is hugely exciting with the next five years set to see a significant increase in the volume of batteries reaching the end of their first life along with the benefits of a more supportive policy environment. 

Offering a comparable alternative to new batteries, second life storage helps to solve several of the UK’s key energy challenges all at once; from the need for grid storage to support greater renewables penetration and improve energy security to providing additional power capacity to support the electrification agenda.

Matthew Lumsden

CEO of Connected Energy

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