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Old batteries could play big role in greening grid — study

Old batteries could play big role in greening grid — study


David Iaconangelo, E&E News reporter

Old electric vehicle batteries could become a key form of storage for utilities by the end of the next decade, boosting the power sector’s transition to renewables, according to an analysis last month from the McKinsey Center for Future Mobility.

The rigors of life on the road tend to wear out lithium-ion batteries within about a decade, but once retired from the powertrain, they can still hang on to about 80% of their capacity. That’s more than enough to store energy for the grid.

If cycled sparingly — the equivalent of once every one to three days — reused batteries could replace more expensive gas-powered turbines, allowing utilities more flexibility in how they sell their power, said analysts at the consultancy.

These second-life batteries would also win out on cost. By 2025, they could be 30% to 70% less expensive than those arriving fresh off the assembly line.

The analysis doesn’t estimate how big the market for second-life batteries will become in financial terms.

But with EV sales expected to boom in coming years, the supply of second-life batteries in 2030 could reach volumes comparable to the amount of batteries utilities will need for their low- and high-cycle applications — a market that might top $30 billion, McKinsey said.

“The shift of electric vehicles into mainstream use” has already changed the automotive market, said analysts, and “is now on the verge of disrupting” energy storage.

Industries and regulators face a “stark challenge” in developing a market for second-life batteries but should be able to find value in it, according to McKinsey. “They just need to look ahead,” the report said.

Some manufacturers are already beginning to catch on to the idea. Nissan Motor Co. Ltd., for example, is part of a joint venture that will open a plant this month in Japan where EV battery packs are refurbished and prepared for reuse in stationary applications and smaller vehicles like forklifts.

Another source of value from used EV batteries would entail recycling the valuable metals, like nickel or cobalt, especially if a supply crunch for those metals occurs in coming years. At present, though, those processes are rarely cost-effective compared with mining.

But an abundance of retired EV batteries doesn’t guarantee a large market for them. Battery-pack designs vary by manufacturer, complicating refurbishing. Falling costs of new batteries could cut the cost advantage of second-life options by a quarter by 2040. Performance standards of reused batteries are nonexistent. And few governments at any level have regulations that make the responsibilities of producers clear, the analysts said.

Still, the private sector and regulators should be able to develop solutions as the market grows, according to McKinsey.

Automakers could think of second-life applications when they draw up designs for new EVs, for example. Auto and battery manufacturers could link up with utilities or other companies to pair recycling and reuse programs with capacity expansions. Agencies and industry coalitions could come up with standards that match battery performance to their storage applications.

“While these challenges are significant, they can be overcome by targeted action,” the report said.

Source: E&E News

BY:  David Iaconangelo, E&E News reporter

Published: Monday, May 6, 2019


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