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Used electric car batteries are heading to factories and farms

Targeted at industrial consumers who’ve been slower to adopt the technology than utilities or homeowners.
Image: James Bugg/Bloomberg

Retired electric vehicle batteries that are repackaged into energy-storage systems are being targeted at industrial consumers who’ve been slower to adopt the technology than utilities or homeowners.

Relectrify, an Australian technology developer, is beginning sales of units that repurpose expired Nissan Motor Co. Leaf batteries to create products capable of storing renewable power at manufacturing facilities, farms or remote mines. The systems can also be used to smooth out peaks in electricity demand at EV charging stations, or by utilities to improve the reliability of complex rural grids.

So-called second-life battery systems harness the remaining lifespan in EV packs, which can typically perform less demanding tasks for another seven to 10 years even after they’re no longer capable of powering cars. Eaton Corp. has installed reused batteries for backup power at sites including Amsterdam’s Johan Cruijff ArenA, while Sumitomo Corp., Renault SA and BYD Co. are among others that have tested a range of applications.

More complex economics and a lack of incentives means battery storage has been slower to take hold in commercial and industrial markets, though the segment is primed for growth, according to BloombergNEF analyst Yiyi Zhou. By 2050, the sector should have a total of 325 gigawatts of storage capacity, compared to a residential storage market with about 185 gigawatts, she said.

“This market actually has a tremendous hunger for storage, which is so far under-satisfied,” Relectrify CEO Valentin Muenzel said in an interview. “There’s demand from industrial companies with rooftop solar who’d like to store it, all the way through to utilities that’d like more distributed offerings to support their networks.”

Lower costs of reused battery systems will help spur adoption among industrial users, according to Muenzel. Melbourne-based Relectrify, which has tested its technology with partners including American Electric Power and Volkswagen AG, can deliver products that are as much as 50% cheaper than brand new systems, while offering at least 75% of the life-span, he said.

Sales are initially focused on Australia and New Zealand, though the firm sees potential to expand into the US, Europe and Asia. “China is a fascinating market,” Muenzel said. “We’re actively looking for capable collaborators.”

The cost advantage for second-life systems is likely to narrow as the price of new lithium-ion cells continues to fall. Battery pack prices fell 89% between 2010 and 2020, BNEF said in a December report.

Still, a future boom in availability of used EV batteries should be an advantage for utilities and industrial users seeking to add storage capability, said Moonis Vegdani, group head of technology, strategy and product at New Zealand’s Counties Power, a distributor that has tested the units.

“As more and more of those batteries become available for second-life applications for asset owners or distribution networks, we expect that to further drive down the cost of storage,” Vegdani said.

© 2021 Bloomberg

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Even systems with new batteries are now at compelling price points for people with surplus solar or that suffer from abusive tariffs.

Time of use tariff users : draw down batteries in the 350c peaks and recharge them in the 55c per kWh periods. 5h per day 400kw 22 days a month saves you R1.5m per year.

Users with very high peak kVA tariffs : use the batteries to cap the grid draw. In my case, the kVA rate is R315/kVA (is being challenged at NERSA). So using batteries (and even generator) to “shed” that grid draw 400kVA lower saves me R1.5m a year.

That is over just a few few years multiples of the system cost for a 400kVA 1MWh system. Two to three hours of storage is probably minimum needed.

Cherry on top is if you have huge solar. Self-consume as much as possible, dump surplus in batteries for use in those tariff optimization opportunities. Response on modern systems is under a second, very easy to beat the council metering periods.

It is absurd, but I can run 400 kVA generators for about 50h a month and still come out cheaper than using grid in those few bad weather periods.

Smart hybrid grids will dominate very soon. Best of all – no loadshredding.

Renewables are certainly a thing whose time has come. Just today a major study came out in the UK regarding the environmental impact of EV versus petrol or diesel. The technology gets better and better and cheaper and cheaper. There is no serious doubt that our actions have consequences for the planet. Industrial anything is going to impact but some actions are far more beneficial than others obviously. Why then on politicsweb are a small number of people (the contributors included sometimes), allowed to rage against progress and use the term climate change in inverted commas?

The stubborn, delusional ultra conservatives like to congregate, have their bosberaad on that site.

I agree strongly with your points on EV and environmental impact. I disagree strongly with your view that people should not be allowed to rage against progress or whatever else they want to, does not matter how wrong i think it is.

End of comments.

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