Utility Firms Eye Retired EV Batteries for Energy Storage

As the world moves towards cleaner energy, retired electric vehicle (EV) batteries are finding a new purpose. Utility companies and energy firms are now looking at these used batteries as a low-cost solution for large-scale energy storage. One company leading this change is B2U Storage Solutions, based in California.

B2U is repurposing old EV batteries to store electricity and support the power grid. In Bexar County, Texas, the company is setting up a new facility using 500 used EV batteries. These batteries, stored in cabinets the size of shipping containers, will help supply power to the grid when needed. The facility will provide 24 megawatt hours of storage, which is enough to power around 800 homes for a day.

These batteries will charge when there is extra renewable energy on the grid and then release the power when demand is high. This system helps balance supply and demand, making the grid more stable. B2U plans to expand further in Texas with three more projects expected to add 100 megawatt hours of storage.

One reason retired EV batteries are gaining attention is their remaining capacity. Although they are no longer good for driving, many still have 70 to 80 percent of their original energy capacity. B2U found a way to use them without needing expensive changes. Their system can work with batteries of different strengths and health, making the process easier and cheaper.

The global electric car market has grown quickly. By the end of 2024, nearly 58 million electric cars were on the roads. As more EV batteries reach the end of their use in vehicles, the second-life battery market is expected to grow into a $4.2 billion industry by 2035.

Texas, with its open energy market, offers a great place for such projects. In fact, nearly half of the new electricity capacity added to the Texas grid recently came from battery storage. Retired EV batteries are now part of that growth.

B2U already runs three storage sites in California using batteries from cars like the Nissan Leaf and Tesla. The company manages more than 2,000 used batteries and is preparing another 2,000 for deployment. They check each battery before use and reject those that are too weak.

As technology improves, the cost and time needed to test and use these batteries will go down. This makes retired EV batteries an even better option for the future. While the idea is still new, many believe it will soon become a key part of how we store clean energy.

The way things are going, we shouldn’t be surprised when utility-scale energy storage companies go as far as negotiating arrangements with various EV makers like NIO Inc. (NYSE: NIO) to access used batteries for reuse in storing energy.

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