Companies around the world, including Nissan, Renault, Daimler, BMW and Siemens, are investigating ways to reuse EV batteries after they retire from the road. Bloomberg analysts recently predicted that by 2025, there will be 29 GWh of used EV batteries available, and that a third of these will enjoy second lives in the stationary storage market.

However, a new report from Lux Research disputes the desirability of reusing batteries, and suggests that it may be better simply to recycle them.

In “Reuse or Recycle: The Billion-Dollar Battery Question,” Lux says that reusing batteries from EVs “will deliver questionable returns due to reduced performance, limiting them to applications with less frequent and shallower depth of discharge cycles.”

Lux forecasts that, in 2035, 65 GWh worth of used EV batteries will come on the market each year. An oversized 11.2 kWh residential storage system made from second-life batteries will cost about $4,600, compared with $6,000 for a new 7 kWh system. However, reduced round-trip efficiency and cycle life make a second-life system a poor fit for residential units and other daily cycling applications.

There are several different recycling methods available. Pyrometallurgical processing, or smelting, is the most mature technology, and can recover key metallic elements. Mechanical processing can recover valuable cathode materials directly, and hydrometallurgical processing can offer lower costs.

While automakers such as Nissan, Daimler and BMW are already commercializing residential storage products, Tesla pursues recycling, as its NCA cathodes are not suitable for most stationary storage needs.

“With present technology, recycling old batteries for new materials is the more economical option for creating the most value from existing materials,” said Christopher Robinson, Lux Research Associate and lead author of the report. “That said, innovations in areas like packaging and testing could tip the balance in the future, so companies should have plans for both recycling and reuse.”

Source: Lux Research via Green Car Congress