That bodes well for the coming wave of electric vehicles, and it’s safe to assume lithium-ion batteries will keep cars we’ll see next month like the Nissan Leaf and Chevrolet Volt rolling for a long time to come. But at some point those cars or the batteries in them will hit the end of the road. Then what?

This is not a trivial question. GM plans to build 10,000 Volts next year, while Nissan could have the capacity to build 500,000 EVs annually by 2015. Electrics will penetrate the market slowly, but even conservative estimates say they will comprise about 2.6 percent of the 70.9 million cars sold worldwide in 2020.

That’s a lot of batteries. Even if General Motors and others are correct in saying the batteries will last at least as long as the cars using them, vehicles have a typical service life of 10 to 12 years. That means we’ll see used batteries stacking up in about 20 years.

Automakers already are planning for that — and planning to make money from it.

Energy storage is a growing industry, and automakers see a demand for used packs, which could help make the grid more efficient. Nissan expects demand in Japan to be so great by 2020 that it would need 50,000 EV batteries to meet it. Automakers are confident they’ll find buyers because the lithium-ion packs used in electric vehicles are expected to retain around 70 percent of their storage capacity after 10 years. Although that may not be enough for a commuter who needs maximum range, it’s fine for stationary applications like backup power in a hospital or load-leveling at a substation.

“We expect to see an entirely new industry arise to use these batteries,” said Paul Gustavsson, vice president for business development at Volvo. The company expects to sell its first electric cars in 2013. “Every hospital has a huge battery backup in the basement. So do power plants, military installations, some skyscrapers. There’s some fascinating business opportunities there that are just now being discovered.”

General Motors is working with ABB Group to identify those opportunities. Nissan has a partnership with Sumitomo to “reuse, resell, refabricate and recycle” electric vehicle batteries. Both have outlined several possible uses for old batteries:

• Renewable energy storage: Power generated by wind farms or solar panels could be stored until needed.
• Back-up power supplies: Businesses with a critical need for electricity — hospitals, server farms and even homes — could use banks of batteries during outages or emergencies.
• Grid load management: Utilities can store energy generated during off-peak periods to help meet demand during peak periods.
• “Time of use management,” also known as peak shaving: Industrial customers could store energy during off-peak periods, when rates are lower, and use it during high-demand periods to save money.

A 24 kilowatt-hour battery being installed in a Nissan Leaf. Photo: Nissan

“We are meeting with utilities, with wind- and solar-farm owners, to look at their requirements for energy storage and how our Leaf batteries would fit in with that,” said Ken Srebnik, senior manager of corporate planning for Nissan North America. “It’s not as simple as removing the batteries from the car and reusing them. It will require some re-manufacturing and re-engineering. But we’re going to do that.”

Not so fast, said Mark Duvall of the Electric Power Research Institute, an industry R&D think tank. He isn’t convinced the secondary market is as vast as automakers might think. He sees two potential issues: The cost of re-purposing EV batteries for industrial applications and the reliability of the resulting packs.

“We need to know the true cost of the system configured for stationary applications, it’s reliability and durability,” he said. “This isn’t an industry that uses unproven technology. They’re really going to have to prove that it works. Several utilities are interested in this, and they’re trying to understand it, but we’re still a long way from mass adoption.”

Duvall sees slightly different uses for batteries:

• Premise energy storage: Batteries could be used by homes and businesses to store energy from rooftop solar cells, or for peak-shaving.
• Distributed energy storage: Batteries could be used at transformers to manage loads at peak periods.
• High-power, short-duration storage: Battery banks could store energy to provide additional supply — a “buffer” — as the load increases during peak periods. They also could store energy from renewable sources to even out supply when, for example, cloud cover briefly blocks a solar array.

“Batteries are very good at helping regulate the grid,” Duvall said. “They can help make up for minute-to-minute shortfalls. But they really can’t be used to store a night’s worth of wind power.”

At this point, using batteries for large-scale storage isn’t feasible, Duvall said. That’s not to say there isn’t work being done in this area. Southern California Edison is launching a $54.9 million project to build and test a 32-megawatt-hour system that would store wind power at a substation in the Tehachapi Mountains. “That’s the outer limit of what we know right now about lithium-ion technology,” Duvall said.

Automakers plan to recycle those batteries that aren’t robust enough for stationary energy storage. Lithium-ion batteries are not toxic like lead-acid batteries, Duvall said. In fact, the 2- and 4 kilowatt-hour packs that Zero Motorcycles uses are rated for landfill disposal. Lithium-ion batteries contain many valuable materials, including copper, aluminum and, of course, lithium. Much of it can be recycled.

Authors: Chuck Squatriglia

to know more click here