IDEAS home Printed from https://ideas.repec.org/p/cdl/itsdav/qt2ws2c6jw.html
   My bibliography  Save this paper

Applying levelized cost of storage methodology to utility-scale second-life lithium-ion battery energy storage systems

Author

Listed:
  • Steckel, Tobiah
  • Kendall, Alissa
  • Ambrose, Hanjiro

Abstract

The dramatic increase in electric vehicle (EV) sales has led to a rapid increase in deployed lithium-ion battery (LIB) capacity over the last decade. As EV batteries age and are retired from use in vehicles, they will require management. Second-life applications are often proposed as an environmentally and economically preferable management strategy to direct recycling or disposal. In particular, the repurposing of EV LIBs in stationary applications is expected to provide cost-effective solutions for utility-scale energy storage applications. However, the adoption of second-life battery energy storage systems (BESS) has been slow. One barrier to adoption is the lack of meaningful cost estimates of second-life BESS. Thus, this study develops a model for estimating the Levelized Cost of Storage (LCOS) for second-life BESS and develops a harmonized approach to compare second-life BESS and new BESS. This harmonized LCOS methodology predicts second-life BESS costs at 234-278 ($/MWh) for a 15-year project period, costlier than the harmonized results for a new BESS at 211 ($/MWh). Despite having a higher LCOS, the upfront costs for second-life BESS are 64.3-78.9% of new systems' costs. Results for second-life BESS are highly sensitive to assumptions of discount rate, depth of discharge, and module repurposing costs. If deemed environmentally or societally beneficial, policies should stimulate the use of second-life LIBs, such as providing incentives equal to or greater than those available for first life BESS. Further work can explore comparative economics at smaller scales and quantify non-economic benefits of second-life BESS. View the NCST Project Webpage

Suggested Citation

  • Steckel, Tobiah & Kendall, Alissa & Ambrose, Hanjiro, 2021. "Applying levelized cost of storage methodology to utility-scale second-life lithium-ion battery energy storage systems," Institute of Transportation Studies, Working Paper Series qt2ws2c6jw, Institute of Transportation Studies, UC Davis.
    • Handle: RePEc:cdl:itsdav:qt2ws2c6jw
    as

    Download full text from publisher

    File URL: https://www.escholarship.org/uc/item/2ws2c6jw.pdf;origin=repeccitec
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Assunção, André & Moura, Pedro S. & de Almeida, Aníbal T., 2016. "Technical and economic assessment of the secondary use of repurposed electric vehicle batteries in the residential sector to support solar energy," Applied Energy, Elsevier, vol. 181(C), pages 120-131.
    2. Gavin Harper & Roberto Sommerville & Emma Kendrick & Laura Driscoll & Peter Slater & Rustam Stolkin & Allan Walton & Paul Christensen & Oliver Heidrich & Simon Lambert & Andrew Abbott & Karl Ryder & L, 2019. "Recycling lithium-ion batteries from electric vehicles," Nature, Nature, vol. 575(7781), pages 75-86, November.
    3. Mathews, Ian & Xu, Bolun & He, Wei & Barreto, Vanessa & Buonassisi, Tonio & Peters, Ian Marius, 2020. "Technoeconomic model of second-life batteries for utility-scale solar considering calendar and cycle aging," Applied Energy, Elsevier, vol. 269(C).
    4. Xiong, Rui & Sun, Wanzhou & Yu, Quanqing & Sun, Fengchun, 2020. "Research progress, challenges and prospects of fault diagnosis on battery system of electric vehicles," Applied Energy, Elsevier, vol. 279(C).
    5. Battke, Benedikt & Schmidt, Tobias S. & Grosspietsch, David & Hoffmann, Volker H., 2013. "A review and probabilistic model of lifecycle costs of stationary batteries in multiple applications," Renewable and Sustainable Energy Reviews, Elsevier, vol. 25(C), pages 240-250.
    6. Song, Ziyou & Feng, Shuo & Zhang, Lei & Hu, Zunyan & Hu, Xiaosong & Yao, Rui, 2019. "Economy analysis of second-life battery in wind power systems considering battery degradation in dynamic processes: Real case scenarios," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    7. Kirmas, Alexander & Madlener, Reinhard, 2017. "Economic Viability of Second-Life Electric Vehicle Batteries for Energy Storage in Private Households," FCN Working Papers 7/2016, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Steckel, Tobiah & Kendall, Alissa & Ambrose, Hanjiro, 2021. "Applying levelized cost of storage methodology to utility-scale second-life lithium-ion battery energy storage systems," Applied Energy, Elsevier, vol. 300(C).
    2. Emanuele Michelini & Patrick Höschele & Florian Ratz & Michael Stadlbauer & Werner Rom & Christian Ellersdorfer & Jörg Moser, 2023. "Potential and Most Promising Second-Life Applications for Automotive Lithium-Ion Batteries Considering Technical, Economic and Legal Aspects," Energies, MDPI, vol. 16(6), pages 1-21, March.
    3. Horesh, Noah & Quinn, Casey & Wang, Hongjie & Zane, Regan & Ferry, Mike & Tong, Shijie & Quinn, Jason C., 2021. "Driving to the future of energy storage: Techno-economic analysis of a novel method to recondition second life electric vehicle batteries," Applied Energy, Elsevier, vol. 295(C).
    4. Al-Wreikat, Yazan & Attfield, Emily Kate & Sodré, José Ricardo, 2022. "Model for payback time of using retired electric vehicle batteries in residential energy storage systems," Energy, Elsevier, vol. 259(C).
    5. Shahjalal, Mohammad & Roy, Probir Kumar & Shams, Tamanna & Fly, Ashley & Chowdhury, Jahedul Islam & Ahmed, Md. Rishad & Liu, Kailong, 2022. "A review on second-life of Li-ion batteries: prospects, challenges, and issues," Energy, Elsevier, vol. 241(C).
    6. Binghong Han & Jonathon R. Harding & Johanna K. S. Goodman & Zhuhua Cai & Quinn C. Horn, 2022. "End-of-Charge Temperature Rise and State-of-Health Evaluation of Aged Lithium-Ion Battery," Energies, MDPI, vol. 16(1), pages 1-17, December.
    7. Tang, Yanyan & Zhang, Qi & Li, Yaoming & Li, Hailong & Pan, Xunzhang & Mclellan, Benjamin, 2019. "The social-economic-environmental impacts of recycling retired EV batteries under reward-penalty mechanism," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    8. Aree Wangsupphaphol & Surachai Chaitusaney & Mohamed Salem, 2023. "A Techno-Economic Assessment of a Second-Life Battery and Photovoltaics Hybrid Power Source for Sustainable Electric Vehicle Home Charging," Sustainability, MDPI, vol. 15(7), pages 1-19, March.
    9. Merlin Frank & Daniel Serafin Holz & Domenic Klohs & Christian Offermanns & Heiner Hans Heimes & Achim Kampker, 2024. "Identification and Mitigation of Predominant Challenges in the Utilization of Aged Traction Batteries within Stationary Second-Life Scenarios," Energies, MDPI, vol. 17(5), pages 1-17, February.
    10. Tang, Yanyan & Zhang, Qi & Mclellan, Benjamin & Li, Hailong, 2018. "Study on the impacts of sharing business models on economic performance of distributed PV-Battery systems," Energy, Elsevier, vol. 161(C), pages 544-558.
    11. Wu, Wei & Lin, Boqiang & Xie, Chunping & Elliott, Robert J.R. & Radcliffe, Jonathan, 2020. "Does energy storage provide a profitable second life for electric vehicle batteries?," Energy Economics, Elsevier, vol. 92(C).
    12. Braco, Elisa & San Martín, Idoia & Sanchis, Pablo & Ursúa, Alfredo & Stroe, Daniel-Ioan, 2022. "State of health estimation of second-life lithium-ion batteries under real profile operation," Applied Energy, Elsevier, vol. 326(C).
    13. Han, Xiaojuan & Liang, Yubo & Ai, Yaoyao & Li, Jianlin, 2018. "Economic evaluation of a PV combined energy storage charging station based on cost estimation of second-use batteries," Energy, Elsevier, vol. 165(PA), pages 326-339.
    14. Farhad Salek & Aydin Azizi & Shahaboddin Resalati & Paul Henshall & Denise Morrey, 2022. "Mathematical Modelling and Simulation of Second Life Battery Pack with Heterogeneous State of Health," Mathematics, MDPI, vol. 10(20), pages 1-23, October.
    15. Lai, Xin & Huang, Yunfeng & Deng, Cong & Gu, Huanghui & Han, Xuebing & Zheng, Yuejiu & Ouyang, Minggao, 2021. "Sorting, regrouping, and echelon utilization of the large-scale retired lithium batteries: A critical review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 146(C).
    16. Gunawan, Tubagus Aryandi & Monaghan, Rory F.D., 2022. "Techno-econo-environmental comparisons of zero- and low-emission heavy-duty trucks," Applied Energy, Elsevier, vol. 308(C).
    17. Zhuk, A. & Zeigarnik, Yu. & Buzoverov, E. & Sheindlin, A., 2016. "Managing peak loads in energy grids: Comparative economic analysis," Energy Policy, Elsevier, vol. 88(C), pages 39-44.
    18. Guelpa, Elisa & Bischi, Aldo & Verda, Vittorio & Chertkov, Michael & Lund, Henrik, 2019. "Towards future infrastructures for sustainable multi-energy systems: A review," Energy, Elsevier, vol. 184(C), pages 2-21.
    19. Battke, Benedikt & Schmidt, Tobias S. & Stollenwerk, Stephan & Hoffmann, Volker H., 2016. "Internal or external spillovers—Which kind of knowledge is more likely to flow within or across technologies," Research Policy, Elsevier, vol. 45(1), pages 27-41.
    20. Yang, Jian & Zhang, Tiezhu & Hong, Jichao & Zhang, Hongxin & Zhao, Qinghai & Meng, Zewen, 2021. "Research on driving control strategy and Fuzzy logic optimization of a novel mechatronics-electro-hydraulic power coupling electric vehicle," Energy, Elsevier, vol. 233(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cdl:itsdav:qt2ws2c6jw. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lisa Schiff (email available below). General contact details of provider: https://edirc.repec.org/data/itucdus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.