| Summary: | © 2020 Elsevier Ltd The rapid proliferation of electric vehicles is creating a fleet of millions of lithium-ion batteries that will be deemed unsuitable for the transportation industry once they reach 80% of their original capacity. The repurposing and deployment of these batteries as stationary energy storage provides an opportunity to reduce the cost of solar-plus-storage systems, if the economics can be proven. We present a techno-economic model of a solar-plus-second-life energy storage project in California, including a data-based model of lithium nickel manganese cobalt oxide battery degradation, to predict its capacity fade over time, and compare it to a project that uses a new lithium-ion battery. By setting certain control policy limits, to minimize cycle aging, we show that a system with state-of-charge limits in a 65–15% range, extends the project life to over 16 years, assuming a battery reaches its end-of-life at 60% of its original capacity. Under these conditions, a second-life project is more economically favorable than a project that uses a new battery and 85–20% state-of-charge limits, for second-life battery costs that are <80% of the new battery. The same system reaches break-even and profitability for second-life battery costs that are <60% of the new battery. Our model shows that using current benchmarked data for the capital and operations and maintenance costs of solar-plus-storage systems, and a semi-empirical data-based degradation model, it is possible for electric vehicle manufacturers to sell second-life batteries for <60% of their original price to developers of profitable solar-plus-storage projects.
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