Electric Vehicle "Second Life" Batteries are Fueling a Sizable Microgrid Boom

July 09, 2020 - Baystreet.ca


When electric vehicles (EV) reach the end of their lives, their batteries often retain 70-90% of their original capacity. This presents opportunities for reusing EV batteries as low-cost stationary storage in a second-life application. After all, extending the life of used batteries further lessens the need for mining or rare earth minerals thereby making batteries as an energy storage solution even more sustainable.

For example, in 2019, South Africa was able to reduce its energy costs thanks to microgrids that use first and second life EV batteries, as highlighted by Microgrid Knowledge. “As more companies jump on the EV bandwagon and we face increased pressure to find renewable energy solutions, we may see more auto manufacturers giving their batteries second lives in microgrids,” according to an Engadget report.

In addition, according to Clean Technica, “As the market for electric vehicles grows, so too will the supply of second-life batteries. Forecasts from academic studies and industry reports estimate a range of 112–275 GWh per year of second-life batteries becoming available by 2030 globally. For context, this is over 200 times total energy storage installed in the U.S. in 2018.”

Some of the top companies to watch on microgrid and EV news are CleanSpark, Inc. (NASDAQ:CLSK), Ford Motor Company (NYSE:F), Tesla Inc. (NASDAQ:TSLA), Nikola Corporation (NASDAQ:NKLA), and Nio Inc. (NYSE:NIO).

CleanSpark, Inc. (NASDAQ:CLSK) BREAKING NEWS: CleanSpark, Inc., a diversified software and services company, and ReJoule, a battery diagnostics and optimization company announced that they have been awarded a grant from the California Energy Commission.

The grant is approximately $2.9 million and is slated to be deployed over the next 30 months. The funds will be distributed to the multi-group partnership of clean energy and technology companies. ReJoule and CleanSpark will be further supported by Ford Motor Company, BigBattery, and GRID Alternatives. CleanSpark expects to receive approximately $470,000 of the grant funding for its microgrid design and mVSO software services and follow-on deployment of its mPulse software and controls. CleanSpark has also agreed to provide over $88,000 in matched funding.

The California Energy Commission Grant proposal was for Validating Capability of Second-life Batteries to Cost-Effectively Integrate Solar Power for Small-Medium Commercial Building Applications. The underlying goal is to deploy second life batteries from electric vehicles for use in a microgrid application. Additional grant information can be found here: https://www.energy.ca.gov/solicitations/2020-02/gfo-19-310-validating-capability-second-life-batteries-cost-effectively.

As electric vehicles (EV) reach their end-of-life, batteries often retain from 70-90% of their original capacity. This presents opportunities for repurposing EV batteries as low-cost stationary storage in a second-life application. Extending the life of used EV batteries further lessens the need for mining of rare earth minerals, thereby making batteries as an energy storage solution more sustainable. The largest barriers to repurposing used EV batteries are the cost of disassembly, long test times, and uncertainty of the remaining useful life. While there are a variety of tests and grading methods, there has been limited success to reliably and cost-effectively test and grade used batteries for second-life applications.

Ford Motor Company, Inc. (NYSE: F) will be supporting the project by donating used EV battery modules and providing the ReJoule team with technical support from Ford’s Greenfield Labs based in Palo Alto, California. Last year, Ford agreed to a framework with the California Air Resources Board to meaningfully reduce greenhouse gas emissions in its vehicles as part of Ford’s long-term sustainability strategy to achieve carbon neutrality globally by 2050. To learn more about Ford’s sustainability leadership and commitments, visit sustainability.ford.com.

ReJoule, as the primary grant recipient, will develop a battery grading process and degradation model. They will then collaborate with the other partners to validate the feasibility of repurposing EV batteries for storage paired with solar Photovoltaic systems to provide building resiliency and load shifting services for small and medium-sized commercial buildings.

The systems covered by the grant will be deployed at two locations, Lucky Cat Labs, an artist’s studio located in Los Angeles, California, and a Housing and Training center for the Homeless, located in Santa Ana, California. They will both incorporate solar and second-generation energy storage batteries controlled by CleanSpark’s mPulse software and controls platform and ReJoule’s battery management system.

Steven Chung and Zora Chung, Co-Founders of ReJoule stated, “This is a big step towards our goal of enabling the circular economy for EV batteries. This project will address the technical challenges associated with repurposing used EV batteries and demonstrate our technology in a commercial setting. We are excited to work with our partners composed of companies and nonprofits dedicated to combating climate change through the deployment of clean energy solutions”.

Zach Bradford CEO of CleanSpark added, “This is an exciting opportunity for CleanSpark, we recognize the need in the market to extend the life of battery energy storage solutions. Electric Vehicle batteries are an ideal candidate to provide not only long-term value for deployment in residential and commercial applications, but repurposing used EV batteries can greatly assist in the avoidance of potentially substantial disposal and recycling costs. We have found that cost is generally the single largest factor that is considered by an end user. The ability to effectively offer lower cost solutions using second life batteries not only increases sustainability but it could potentially open up an entirely new market to those who find new energy storage systems cost prohibitive.”

Will Paxton, electrification research engineer at Ford’s Greenfield Labs says, “We are excited to work with innovative companies such as ReJoule and CleanSpark to improve the sustainability of electrified transportation and move closer to a circular economy for EV batteries.”

Other related developments from around the markets include:

Ford Motor Company (NYSE:F) announced that Ford Transit is going digital, with an all-electric version coming for the 2022 model year. “Commercial vehicles are a critical component to our big bet on electrification,” said Jim Farley, chief operating officer, Ford Motor Company. “As leaders in this space, we are accelerating our plans to create solutions that help businesses run better, starting with our all-electric Transit and F-150. This Ford Transit isn’t just about creating an electric drivetrain, it’s about designing and developing a digital product that propels fleets forward.” With the world’s best-selling cargo van and as America’s best-selling commercial van brand for 41 years, Ford intends to lead the transition to zero emissions in the segment with its all-electric Transit. Ford’s U.S. truck and van fleet sales have grown 33 percent since 2015 and the company expects continued growth of van sales in the U.S. as e-commerce and “last mile” delivery increase. Ford’s overall van sales delivered their best fourth quarter results since 1978 on sales of 59,930 vans. For the year, Ford van sales totaled 240,529 vehicles. Ford expects electric vehicles to grow to 8 percent of the industry in 2025 in the U.S.

Tesla Inc. (NASDAQ:TSLA) announced that in the second quarter, it produced over 82,000 vehicles and delivered approximately 90,650 vehicles. It added, “While our main factory in Fremont was shut down for much of the quarter, we have successfully ramped production back to prior levels. Our net income and cash flow results will be announced along with the rest of our financial performance when we announce Q2 earnings. Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5% or more. Tesla vehicle deliveries represent only one measure of the company’s financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.”

Nikola Corporation (NASDAQ:NKLA) signed a purchase order with Nel ASA for 85-megawatt alkaline electrolyzers supporting five of the world’s first 8 ton per day hydrogen fueling stations. Together, these electrolyzers may produce over 40,000 kgs of hydrogen each day. The purchase order has a value in excess of USD $30 million, and the electrolyzers will primarily be delivered from the new electrolyzer mega-factory currently under development in Norway. This purchase order will support Nikola’s five initial stations with 8 ton per day hydrogen production capacity. The remaining equipment will be covered by a separate purchase order that is expected to be finalized within the coming months. “We are building the largest hydrogen network in the world and I couldn’t be prouder to have Nel part of it,” said Trevor Milton, Nikola Corporation’s founder and executive chairman. “These electrolyzers will support five heavy duty hydrogen stations which will cover multiple states and trucking routes. The future of clean transportation is here, and fleets are lining up to be part of the transition with Nikola.”

Nio Inc. (NYSE:NIO) provided its June and second quarter 2020 delivery results. NIO delivered 3,740 vehicles in June 2020, representing a strong 179.1% growth year-over-year. The deliveries consisted of 2,476 ES6s, the Company’s 5-seater high-performance premium smart electric SUV, and 1,264 ES8s, the Company’s 7-seater high-performance premium smart electric SUV, and its 6-seater variant. NIO delivered 10,331 vehicles in the second quarter of 2020, representing an increase of 190.8% year-over-year and an increase of 169.2% quarter-over-quarter. As of June 30, 2020, cumulative deliveries of the ES8 and the ES6 reached 46,082 vehicles, of which 14,169 were delivered in 2020. “In June, we achieved a historical high of monthly deliveries, contributing to our best quarterly performance. We appreciate the continuous support from our growing and loyal user community,” said William Bin Li, founder, chairman, and chief executive officer of NIO. “We are proud of our team for their strong execution from production to delivery. We remain committed to offering the best premium smart electric vehicles and the best user experience to our users.”

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