Spotlight on the Reuse Market

In our last communication, we discussed how batteries are priced differently according to who is buying them. In this article, we are going to get into more detail on the first market for End of Life EV batteries –  Re-use. 

In the EV context, re-use usually means direct re-use of a used battery pack in another vehicle application (like replacing a failed pack in a similar EV, e.g. a BMW i3). 

It widely agreed that the pricing of batteries that are re-used is likely to be higher than for any other but that this market is smaller. Let’s explain why this is. 

Direct re-use of EV batteries in another vehicle is expected to remain fairly small – typically less than 10% of all end-of-life batteries – due to strict compatibility requirements, limited replacement demand and quality.  

However, these are forecasts and could charge, but what we can be confident of is that it will not be close to 100%. 

Why it’s so low? 

Compatibility constraints is the biggest factor. Batteries must match exactly – same model, same software, same BMS systems and physical design.  

Limited failure demand is another. EV batteries are lasting longer than expected and often longer than the vehicle itself, meaning fewer replacements are needed and therefore lower demand for re-use  

Quality control is also a factor. Batteries need to be able to demonstrate sufficient battery health to be an option to be used for re-use.  

So, as a result of the above reasons, we can confidently predict that not all end-of-life batteries can be used for the re-use market.  

Deciding whether an EV battery should go into the reuse (second-life) market is an interesting question and one impacted by several issues. 

Understanding the battery State of Health (SOH) is crucial. By running a battery test, you will better understand the remaining capacity (kWh) and other measures that will impact on the performance and safety of the battery. 

The history of the battery may also be an issue, with the key question being how did it come to no longer being needed in its first vehicle? 

The other hot issue is what are the economics going to be like? Replacing a battery is going to incur costs. Costs of the logistics. Costs of the qualified technicians needed to take out one battery and replace with another.  

And finally, one would also need to understand the demand for that particular battery. How many vehicles are there that can accommodate that battery, that are still on the road, and where is that demand most likely to be.  

Once you’ve decided to price for the re-use market, then that price will be driven by the cost of a new battery, factoring in the state of health and an allowance recognising that the battery you are selling is second-hand.   

A pristine battery in good health can definitely garner you the highest price for your battery. Finding the right buyer, however, doesn’t happen overnight, so patience might be the biggest factor of all when considering this option. 

At recell.store, we work with partners who can both source and purchase EV batteries for the re-use market. If you think you have a battery/batteries suitable for re-use, let us help find them the right second life.