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NextEnergy battery update: thoughts on “second life” for EV applications and Detroit events to learn more

By Posted on June 15, 2017
Blog

Dave Anderson
Director, Venture Services
NextEnergy

 

Electric vehicles (EVs) are trendy, fun to drive, cheaper to maintain, and better for the environment. As the EV market continues to grow, so too will the market for batteries that power them. Unless you work in the EV industry, you’re probably unfamiliar with how sophisticated an EV battery can be. EV batteries are substantially different from the battery you’d find in your cell phone or the standard 12 volt battery used to start your car and power its accessories. Typical EV battery packs contain cells (which come in many different capacities, form factors, and chemistries), modules, a battery management software system, a battery disconnect unit, an enclosure, and a plethora of wires and busbars that connect everything. When it’s all said and done, an EV battery can be as large as your dining room table, weigh as much as 4 NFL lineman, and currently cost almost as much as the rest of the car.

While most consumers don’t care about the size, software, or energy density of their EV battery pack, they certainly care about the cost because it ultimately adds to the price of the car. One factor to consider in regards to the price of the pack is recycling, which is currently very expensive. Since the EV market is expected to grow significantly over the next few years, we must consider solutions for what to do with EV batteries that are no longer suitable for use in the vehicle. Should they be safely discarded, scrapped for parts, or reused in other applications? EVs demand optimum performance from its battery, which typically lasts for 8-10 years and over 100,000 miles. At that point, the battery pack can no longer adequately power the car but could be reused in other stationary applications such as large-scale electrical power grid storage and residential solar storage.

If you’re now thinking of starting a company to reuse electric vehicle batteries, slow down–it’s not as easy as it seems. One of NextEnergy’s clients, Totus Power, just decided to shut down after over four years because they uncovered significant challenges in this space. As Shiv Rajendran, founder and CEO of Totus Power explains, “Used electric vehicle batteries seem great in theory: roughly 70% leftover capacity, for 20% of the cost of new Lithium-Ion batteries! What’s not to love? Despite 4.5 years of work, Totus Power failed to build an economic model around battery reuse. We concluded that used EV batteries are not cost effective when underlying liabilities such as end of life recycling, reverse logistics, lack of scalability, etc. are factored in.” Totus Power found that after factoring in liability, testing, logistics, and other factors, their product only offered 10% to 15% cost saving over new lithium-ion batteries. To access the insights and lessons learned from Totus Power, download Shiv’s report.

Despite the challenges in this space, I expect opportunities for second life EV battery applications to grow as the EV market matures, and battery pack architectures and testing protocols are standardized. I’ll certainly keep a close eye on this market and invite you to join me.

If you’d like to learn more about battery-related topics, there are a couple events happening this summer that you should check out. From July 18-20, the PlugVolt Battery Seminar in Ann Arbor, MI has a full day dedicated to automotive applications, followed by a day dedicated to stationary energy storage applications. From September 12-14, The Battery Show in Novi, MI showcases the latest advanced battery technologies.

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