Unlike conventional gas-powered vehicles that run on an internal combustion engine (“ICE”), electric vehicles (“EVs”) are powered by rechargeable lithium-ion battery packs. EV battery technology is still relatively new, and battery makers, as well as EV firms, are working to develop designs that are cheaper, more energy dense and last longer. However, rechargeable EV batteries will degrade over time and after ten or 20 years, most EV owners have to replace the battery pack.
So where do these used batteries go? They usually still maintain around 70–80% of their original capacity at this point. Although this isn’t enough to power an electric vehicle, it is more than enough capacity for several other applications. Recycling used batteries makes more economic and environmental sense than chucking them in the bin, and being repurposed as power storage solutions has emerged as the most viable reuse option.
Industrial consumers with high-energy storage needs could benefit a great deal from second-hand EV battery packs. These batteries can usually perform less taxing tasks for 7–12 years years after they are removed from an EV. Australian technology developer Relectrify is an early entrant into the used-EV market, repurposing and selling used Nissan Leaf battery units to provide storage for renewable power at farms and factories.
According to Relectrify CEO Valentin Muenzel, Relectrify, this space has a great demand for power storage solutions but has so far seen limited supply. BloombergNEF analyst Yiyi Zhou concurs, stating that although the segment is poised to grow, especially as more EV batteries lose capacity, limited incentives coupled with complex economics have stopped battery storage solutions from taking root. Industrial consumers should have 325 gigawatts of power storage capacity by 2030, she observes.
For instance, Muenzel notes, industrial factories and farms equipped with rooftop solar will need to store the excess power the solar panels generate during the day. One thing that would boost the adoption of used EV batteries for storage solutions among industrial consumers would be lower costs, he says. Relectrify’s products are as much as 50% cheaper than brand-new battery systems, and they offer at least 75% of the battery’s original lifespan.
The Melbourne-based firm technology developer has partnered with companies such as Volkswagen AG and American Electric Power to test its products. Although most of its sales have been in New Zealand and Australia, Relectrify is looking to expand to Europe, the United States and Asia.
The EV space is likely to see the introduction of plenty of innovative products as numerous new players come on board. For instance, payment-as-a-service company Net Element (NASDAQ: NETE) is set to make an entry into the electric vehicle sector once its merger with Mullen Technologies Inc., a manufacturer of fully electric vehicles, is completed.
NOTE TO INVESTORS: The latest news and updates relating to Net Element (NASDAQ: NETE) are available in the company’s newsroom at http://ibn.fm/NETE
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