Challenges and Opportunities for Second-Life Batteries: Perspectives from the North American Industry

A growing number of second-life battery companies are entering North America’s stationary energy storage market as the demand for both electric vehicles and electricity grid energy storage continues to rise. These companies have many potential revenue streams available to them, but the unique characteristics of second-life batteries also present many challenges beyond those faced by conventional battery developers. To explore these challenges, this study engages directly with industry stakeholders, including eight North American second-life battery companies and five Canadian electrical utilities and electricity system operators. Based on a series of interviews with these stakeholders, this study compiles an aggregate perspective on the current state of the North American second-life battery industry as well as its present opportunities and challenges. The study concludes that although the industry is largely still in an exploratory stage, with nascent supply chains and minimal progress towards competing in utility-scale applications, second-life battery companies are working to overcome major regulatory barriers that are inhibiting industry growth and developing innovative technological and commercial solutions to compete with conventional battery energy storage. The study finds that utilities and electricity system operators seem open to, and certainly not discriminatory toward, this technology and its inclusion in the grid. Even so, the second-life battery industry still has a lengthy developmental curve ahead, subject to dynamic market forces. A set of 17 actionable steps is recommended for governments seeking to support the growth of this industry.