Economic feasibility of recondition 2nd life lithium ion batteries for grid services

J.C. Quinn, N. Horesh, C. Quinn, A. Tong, H. Wang, R. Zane
Colorado State Univeristy,
United States

Keywords: 2nd life battery, reconditioning, li-ion battery, techno-economic analysis

Summary:

The rapid adoption of electric vehicles will result in a large number of Li-ion batteries available for 2nd life use. A major technical challenge of utilizing 2nd life batteries is the diversity of health due to different use scenarios and intrinsic characteristics. A technically solution is need for wide utilization of 2nd use batteries, which has a rapidly growing demand of 95GWh to be extracted by 2025. This work investigates the sustainability of a novel reconditioning process coupled with an energy storage facility which would provide energy services to the electrical grid. The work focused on understanding the economic viability of different technological solution that integrate reconditioning and grid energy serviced. The work includes investigating the revenue potential from grid services including revenue potential form the real time market and the day ahead market at 100 electrical nodes in the western US. The results form this work are coupled with a discounted cash flow rate of return analysis which is used to understand the economic viability of three different system configurations. Results show the coupling of a recondition facility with an energy storage system must generate between $131 and $161 per MW-day which is dramatically less than that of a system that uses new Li-ion batteries, $192 per MW-day. Included in the analysis are two different battery reconditioning processes, 1) reconditioning while providing energy storage for the grid and 2) a power shuffle system which accelerates the reconditioning processes. The system configuration that incorporates energy storage connected to the grid when the end use of the reconditioned batteries is energy storage represents an economically favorable configuration. The work is used to understand what research and development must be done for the reconditioning technology to be economically competitive. Current work is focused on understanding the environmental impact of the system through life cycle assessment methodology.