In the first quarter of 2024, electric car sales grew by about 25% compared with the first quarter of 2023, similar to the year-on-year growth seen in the same period in 2022. By the end of 2024, the market share of electric cars could reach up to 45% in China, 25% in Europe and more than 11% in the United States.
The growth of electric vehicle sales will require more batteries and critical raw materials. Demand for graphite, lithium and cobalt is expected to increase by nearly 500% by 2050. Relying on new batteries alone will not satisfy market needs nor make progress on creating a more sustainable future. Extending the life cycle of electric vehicle batteries reduces the need to mine for materials while maximizing battery return on investment for valuable economic and environmental benefits. Second-life batteries may be used in various applications, including backup power, stationary storage and low-speed vehicles. As the first wave of EVs approaches their end of life, millions of batteries can be allocated to second-life utilization.
How are batteries used on an EV charging site?
Charging sites must provide a steady flow of reliable electricity to fuel electric vehicles. However, the grid may not always be able to supply enough available power, especially when it comes to fast charging. Even if it can, overdrawing past your grid limit could result in high demand charges that may significantly affect profit margins.
Instead of upgrading transformers and other grid components immediately, battery energy storage systems (BESS) paired with onsite renewable energy and EV charging stations can handle increased loads, spreading the costs over a longer period and avoiding large upfront capital expenditures.
That’s why charging depots and enterprises from EVs to C&I to utilities and more are investing in energy storage to reduce operating expenses and maintain vehicle uptime with cost-efficient, resilient energy.
For example, scheduling when you’re using grid energy in light of utility time-of-use rates can help you better manage electricity expenses. Also, using battery power to help meet peak site electricity needs can reduce utility demand charges. Don’t have enough available grid power to supply your site loads? Your BESS can provide the boost you need to charge quicker without investing in infrastructure upgrades. Better still, when you charge your batteries with the solar or other clean power you produce onsite, you enjoy even more cost-effective, reliable, operations while demonstrating your commitment to the environment. From peak shaving to load shifting, load management and more, the many use cases of a BESS collectively contribute to a more cost-efficient and robust charging infrastructure.
What are the advantages of using batteries on an EV charging site?
CPOs struggle with increasing mismatch between their EV charging station energy demand schedule, utility supply charges and infrastructure needs. Having the ability to store grid or renewable energy in a BESS greatly increases site flexibility, which offers a number of benefits through increased alignment.
Cost-effective charging
Power from the grid costs more at some times than others. With a battery, you can store utility electricity when it’s less expensive and discharge the power to your EV charging site when prices go up. Strategically shifting loads around in light of utility time-of-use rates can help you better manage electricity expenses.
Increased profit margins
Utility demand charges are typically based on your highest level of grid use during a billing period. Switching to using battery power when you’re getting close to your grid limit can lower your peak demand for grid power. This peak shaving helps use your resources more efficiently and avoid utility charges, reducing operating costs and improving the profitability of your charging network over time.
Get more customers in and out
When you don’t have enough available grid energy to supply your site loads, your BESS can assist with power, providing a boost to generate the extra electricity you need. The ability to supplement grid power and maintain reliable charging where your capacity is limited allows more customers to charge up quicker without making expensive infrastructure upgrades.
Clean, cheap energy
Charging your battery with solar power offers a cost-effective alternative when the price of grid electricity peaks. Batteries coupled with renewables can also increase the resiliency of your site by islanding (disconnecting from the grid) through grid outages. Additionally, powering EVs with renewables demonstrates your commitment to environmental responsibility, which resonates with environmentally conscious EV users.
What are second-life EV batteries?
Second-life batteries are previously used electric vehicle batteries that are reused in EV charging stations. As demand for EVs grows, more batteries and critical raw materials will be required. Global lithium shortages present a significant challenge. Lithium prices have hit all-time highs. Most of the available raw lithium is being allocated for EV batteries, reducing the supply for stationary applications. Additionally, the lengthy process of permitting and developing new mines means the mining industry will need time to meet the rapidly growing demand.
Supplies of new batteries will not be adequate to meet market needs, potentially halting progress toward future sustainability.
However, as the EV market takes off, there will be a new stream of used batteries. It’s possible to reuse these EV batteries, which still maintain 70-80% of their capacity after they’re retired. While they can no longer power a car, their capacity is enough to help charge vehicles. Rather than using more new batteries, EV battery recycling into a BESS reduces waste and prevents additional Earth mineral depletion. In fact, second-life lithium-ion battery supply could surpass 200 GWh per year by 2030.
How does battery repurposing work?
Battery repurposing refers to the entire process from EV retirement to the delivery of the second-life product. This includes the collection of retired EV batteries, logistics, testing, sorting, disassembly, and second-life system integration. Repurposing batteries is possible at the pack, module, or cell level, each offering unique advantages in terms of flexibility, reusability, product design, and applicable uses in second-life scenarios.
Battery cells are made of degradable materials, so recycling them is inevitable. Repurposing battery packs into second-life energy storage systems may stretch the value of battery packs further, and make the use of them more sustainable and environmentally friendly.
Before they are deemed suitable for second-life markets, end-of-life EV batteries undergo several processing stages. The batteries are collected, tested, sorted, disassembled and assembled. There are several repurposing approaches which are used depending on the design of the second-life product and its intended application.
How can EV charging sites benefit from second-life batteries?
Charge point operators (CPOs), auto manufacturers and fleets can benefit from repurposing batteries in depot storage for EV charging.
- Increase ROI: Repurposing EV batteries in your BESS can provide even more value through reduced costs and better EV charging. Repurposed EV batteries are often cheaper than new batteries, which reduces the initial investment required for the BESS, further cutting down the operating costs. Also, if the charging site is integrated with renewable energy sources such as solar or wind, a BESS can store excess clean energy generated during peak production times. This stored energy can then be used for charging EVs even when renewable generation is low (such as during the night or on cloudy days). Intelligent use of renewable energy sources increases the efficiency of the charging process.
- Provide environmental benefits: Rather than using more new batteries, recycling EV batteries into a BESS reduces waste and prevents additional Earth mineral depletion, enhancing your sustainability efforts and economics. Pairing your BESS with onsite clean energy can even further your impact. Repurposed EV batteries can qualify for green incentives, grants or rebates. These financial incentives can lower the overall cost of implementing and operating a BESS. Repurposed batteries also comply with regulatory requirements related to waste reduction and energy efficiency.
- Meet increasing demand: Increased power demand and high utility charges can undermine the value of transitioning to EVs. Charging depots and enterprises from EVs to C&I to utilities and more are investing in energy storage to reduce costs and maintain vehicle uptime with cost-efficient, resilient energy.
What advantage do EV second life batteries uniquely provide for commercial fleets?
The main cost of repurposing lies in purchasing used batteries. Repurposing expenses can’t surpass those of purchasing new batteries to remain a viable option. This makes second-life projects especially attractive to battery owners, such as fleet owners, since they are the asset owners, the main cost of purchasing retired EV batteries is avoided.
Commercial fleets have unique environmental and economic advantages when it comes to finding batteries for their EV charging station onsite BESS. EV fleets regularly cycle through vehicles, leading to a steady supply of used batteries that still retain significant capacity. Regulatory requirements say that EV batteries must be retired at 70% to 80% capacity, while other mandates are increasingly holding automakers responsible for EV batteries at the end of the vehicle’s life. But recycling costs can be high.
Instead of discarding or recycling these batteries elsewhere, fleets can repurpose them for their own lower-cost, higher-value BESS applications. This not only extends the batteries’ useful life but also reduces the need to purchase new batteries for energy storage, significantly lowering costs and environmental impacts. Having a business model that involves reusing old batteries from feet’s own EVs in their BESS only amplifies the system’s benefits to maximize their storage investment.
What does the future of second-life batteries look like?
The volume of second-life batteries is expected to skyrocket after 2030. Most battery packs are expected in China, followed by Europe, the US and the rest of the world.
The ownership and operation of batteries, along with the establishment of battery swapping
networks, demand substantial capital and technological resources. Various stakeholders must collaborate to construct and manage the required infrastructure. These stakeholders include automakers, battery manufacturers, EV charging or car service firms, pack and storage system integrators, recyclers, and second-life battery producers.
Currently, second-life battery initiatives are in their pilot phase, with companies from all across the supply chain experimenting with such projects. The second-life expertise which is forming amongst various players in the market, is expected to tip the scales, when it comes to the viability of these initiatives.
Why use second-life batteries from Sparkion?
Not all second-life storage solutions are the same. To understand further, let’s first explore the components of a BESS. Battery energy storage systems are composed of several key components that work together to store and manage electrical energy:
Battery cells and modules: These are the fundamental building blocks of any BESS. Cells store electrical energy using a variety of chemistries such as lithium-ion, lead-acid, nickel-cadmium, or others. Groups of battery cells form modules (or racks/packs) to provide the desired voltage and capacity. Batteries and other components are housed in protective enclosures or racks to protect them from animals, climate and other hazards.
Power conversion system: The PCS consists of an inverter that converts direct current (DC) stored in the batteries to alternating current (AC) for grid use, and vice versa. This conversion enables the system to charge from and discharge to the grid.
Battery management system: Electrical vehicle (EV) batteries must operate in a controlled, optimized manner to function in a way that maximizes battery longevity and performance while reducing safety risks for users. That’s why electric vehicles have battery management systems (BMS), which serve as the brains of the batteries managing and monitoring charging and discharging for safe and efficient operation of the battery pack.
Our vast experience with and deep understanding of electrical infrastructure also allowed us to design the SparkCore™, a better energy management system including software and controller.
Second-life batteries often have different thermal characteristics, cells with different degradation levels due to varying usage histories and more sensitivity to overcharging and discharging. As cells age, their capacities and internal resistances can vary widely, which can lead to uneven wear that could jeopardize the overall life of the battery pack. Second-life batteries must be properly managed continuously to function optimally in their new roles in stationary energy storage or grid support and adhere to safety standards and regulations.
No matter the manufacturer, chemistry or state of health, Sparkion’s AI-driven battery management system solution can recycle electric vehicle batteries into energy storage systems for EV charging. The flexible, AI-driven SparkCore™ collects and analyzes site and other third-party grid and weather data using proprietary algorithms customized to operate according to the initiatives you’ve set for your business model. SparkCore™ uses real-time monitoring to control the BESS and make the most out of battery storage across the site. In this way, Sparkion can maximize investments and minimize harmful effects on the environment with second-life EV batteries.
Benefits of the Sparkion solution include:
- Turning your retired EV batteries into viable energy storage systems
- Significantly extending the life and throughput of second-life batteries
- Reusing batteries of different chemistries, manufacturers and states of health
- Enhancing output with a configurable, modular storage platform
- Cloud interface with flexible API for third-party connections
- Intelligent storing and charging across all site assets
- Peace of mind with automated control in line with business goals
- Enabling sustainable power for a sustainable future
- Increased value to customers
- Reducing utility charges
- Maximizing vehicle up-time
- Establishing energy resilience
