Exploring Second Life Applications for Electric Vehicle Batteries

Abstract

The purpose of the study is to explore an economically viable second life applications for electric vehicles (EV) batteries. There is a common consensus in the automotive industry that the reuse of retired EV batteries—often referred as a second life of a battery—can provide greater economic and sustainability benefits. Although literature acknowledged potential business opportunities with batteries’ second life, there are still a lot of uncertainties, making success difficult to realize. In particular, identification of a profitable second life application with a right business model in the battery value chain has become a key success factor. Therefore, a case study, with a mixed research approach, considering both qualitative and quantitative methods, has been conducted in a company that is one of the leading manufacturers in the heavy-duty industrial vehicle industry, which currently is developing their electric vehicle machines with a li-ion battery pack. The study generated and analyzed several different second life concepts to find the most economically viable second life applications. The analysis concluded three second life business concepts in the initial phase. In the later phases, individual business model canvases and different reverse logistics processes were created, mapped, compared, and validated through quantitative analysis. The analysis show that out of three concepts remanufacturing application proved to be the most applicable one for the case company, within a range of 15 years’ time. The paper contributes to the theory of circular business models in the context of EV batteries.

A survey of second-life batteries based on techno-economic perspective and applications-based analysis

“…The majority of the literature on battery ageing in second-life applications focuses on firstuse in EVs [7, 32, 37, 49, 50, 56, 57, 61-63, 65, 66, 68-70, 74, 78], which is why it is still a relatively new issue. Only a small number of studies [36,61,80,81,89,95,96] have specifically looked at battery ageing during primary and secondary usage, also, almost all of these studies employ the same ageing models created for first-use. The ability to accurately conduct battery health estimation during second-life applications, which is essential for extending the battery's usable life, is currently lacking.…”

“…There have been various techno-economic tools reported in the literature, such as Return on Investment [62,66,96], Return Rate on annual basis [89], Levelized Cost of Energy [36,91] and Levelized annual Cost of Energy using Net Present Value [93,95], Benefit-cost Ratio [61], and cost-optimization algorithms [77,80,94] for economic analysis, but these are based on several assumptions and are applicable only for specific battery compositions and controlled gridconnected applications [61,66,80,90]. These economic studies have mostly confirmed the cost benefits of second-life batteries over new batteries in terms of decrease in LCOE [91,93], increased annual revenue [36,61,70,92] and operating as well as payback years [89,90,92] but it should be noted that these results cannot be generalized. There are many uncertainties like unpredictable battery prices [92,96] and application based benefits and controlled conditions [61,69,89,90,93].…”

“…These economic studies have mostly confirmed the cost benefits of second-life batteries over new batteries in terms of decrease in LCOE [91,93], increased annual revenue [36,61,70,92] and operating as well as payback years [89,90,92] but it should be noted that these results cannot be generalized. There are many uncertainties like unpredictable battery prices [92,96] and application based benefits and controlled conditions [61,69,89,90,93]. It is recommended to take into account future battery and energy prices inflation for more reliable results.…”

“…Electricity tariff reduction is proposed in an energy storage system with data from market and suitable battery ageing model. A leading electrical vehicle manufacturing company has recently devised a mixed research methodology for said purpose [89]. An application-based analysis of second-use batteries is conducted, and a comparison is made for economic feasibility themselves.…”

A Reverse Logistics Framework of Swap Battery for Sustainable Supply Chain : A Preliminary Research

“…Battery charging time is fairly fast, only about three to eight minutes. EV investment costs can be reduced by offering EV sales without a battery or commonly known as a battery ownership model, a battery rental model; the battery belongs to a third party (Alamerew & Brissaud, 2020;Vu & Rahic, 2019;Yang et al, 2018;Zhao et al, 2021). The following solution, when the EV battery is declared EoL, still has a high enough remaining capacity that allows it to be used as a second-life battery.…”