A second life for EV batteries? Depends how long the first is
Global automakers have touted plans to re-use electric vehicle (EV) batteries when they lose power, but competition for battery packs and cell materials, and the appetite for affordable cars cast doubt on this part of the circular economy.
An array of startups offers second-life energy storage using old EV batteries.
But creating the viable industry envisioned by carmakers such as Nissan would mean fighting off competition from recyclers, refurbishers and the needs of drivers squeezed by the cost-of-living crisis.
"The assumption that EV batteries are only going to last eight-to-10 years and then owners will swap them out is just not true," Hans Eric Melin, founder of consultancy Circular Energy Storage (CES), which tracks battery volumes and prices, said. "It's going to be tricky to make second-life work."
While a possible solution for buses, trucks and other commercial vehicles, it will take longer for batteries from passenger cars to be re-used at scale.
The second-life energy storage idea is in theory simple.
As EV batteries' capacity falls below 80%-85% after eight-to-10 years of use, the theory goes, they will be repurposed to power buildings or even balance local and national energy grids.
Investors believing in the circular economy, where products and materials are repaired and re-used, have provided around $1 billion in funding to nearly 50 startups globally, according to Reuters calculations.
In addition, carmakers from Mercedes to Nissan have set up their own second-life operations.
The problem is a lack of old EV batteries that shows no sign of easing.
The rising average age of fossil-fuel cars on the road - now a record 12.5 years in the U.S. according to S&P Global Mobility - suggests many EVs will stay on the road
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