Second Use of Transportation Batteries: Maximizing the Value of Batteries for Transportation and Grid Services

Plug-in hybrid electric vehicles (PHEVs) and electric vehicles (EVs) are expected to gain significant market share in the next few decades. The economic viability for such vehicles is contingent upon the availability of cost-effective batteries with high power and energy density. For initial commercial success, government subsidies will be instrumental in allowing PHEVs and EVs to gain a foothold. However, in the long term, for electric vehicles to be commercially viable, the economics have to be self-sustaining. Toward the end of the battery life in the vehicle, the energy capacity left in the battery is not sufficient to provide the designed range for the vehicle. Typically, the automotive manufacturers recommend battery replacement when the remaining energy capacity reaches 70%-80%. There is still sufficient power (kilowatts) and energy capacity (kilowatthour) left in the battery to support various grid ancillary services such as balancing, spinning reserve, and load following. As renewable energy penetration increases, the need for such balancing services is expected to increase. This work explores optimality for the replacement of transportation batteries to be subsequently used for grid services. This analysis maximizes the value of an electric vehicle battery to be used as a transportation battery (in its first life) and, then, as a resource for providing grid services (in its second life). The results are presented across a range of key parameters, such as depth of discharge (DOD), number of batteries used over the life of the vehicle, battery life in the vehicle, battery state of health (SOH) at the end of life in the vehicle, and ancillary services rate. The results provide valuable insights for the automotive industry into maximizing the utility and the value of the vehicle batteries in an effort to either reduce the selling price of EVs and PHEVs or maximize the profitability of the emerging electrification of transportation.