Analysis of The Combined Vehicle-and Post‐Vehicle-Use Value of Lithium‐Ion Plug-In-Vehicle Propulsion Batteries
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Open Access Publications from the University of California

Analysis of The Combined Vehicle-and Post‐Vehicle-Use Value of Lithium‐Ion Plug-In-Vehicle Propulsion Batteries


Advances in electric-drive technology, including lithium-ion batteries, as well as the development of strong policy drivers such as California’s Global Warming Solutions Act, now contribute to a more promising market environment for the widespread introduction of plug-in vehicles in California. Nevertheless, battery costs remain high and uncertain, presenting significant hurdles to commercialization. This report builds upon previous research (CEC-500-2009-091) investigating the potential reduction in plug-in-hybrid battery lease payments that incorporation of value from postvehicle provision of grid energy storage services in California might provide. That work discussed the potential to lower battery lease payments by repurposing used vehicle batteries for stationary use as grid-support, distributed electrical storage devices. Such devices, if realized as home energy storage appliances (HESAs), might not only provide valuable services needed by existing statewide grid-support markets, but could also provide customer-side-ofthe-meter benefits, improve utility operation, help defer costly grid upgrades, and potentially support the profitability and penetration of intermittent renewable energy. This report advances methods for analyzing combined vehicular and post-vehicular value using specific plug-in electric vehicle examples, incorporates new and more sophisticated inputs based on a growing body of knowledge, and describes lessons learned about testing and repurposing vehicle batteries for post-vehicle use. It analyzes offsetting plug-in-vehicle battery costs with value derived from post-vehicle stationary use, quantifying the possible effect the net-present-value of several of these benefits might have on battery lease payments. This analysis finds positive but modest potential benefits from repurposing batteries into energy-storage devices sized in accordance with their degraded vehicle capacity. Bounding scenarios all show battery lease payment reductions. For the “Chevy Volt”-based HESA example, which exhibited a 22% reduction in the base case, the bounding scenarios ranged from 1% to 32%. Monte Carlo analysis indicates the point estimates developed throughout might need upwards adjustment to account for uncertainty, possibly negating second-life benefit in the base case. The analysis indicates that, if valuable grid-regulation revenues are hotly contested and provide limited impetus to HESA commercialization, value from multiple applications is necessary to support HESA profitability. This makes the artful combination of services (and thus duty cycles/load profiles) a critical uncertainty. One previously identified combined value proposition related to servicing local air conditioning loads was examined as the base case and might be particularly attractive. Another important uncertainty is the level of cost associated with power-conditioning requirements, which must also be optimized with increasingly specific combined load profiles in mind and/or reduced, e.g., through coupling HESAs with local photovoltaic systems.

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