In four or five years, the batteries in the roughly one and a quarter million EVs currently on the road are going to start to wane. EV owners will either replace them, or replace the cars entirely. That means we’ll have a lot of used batteries on our hands — batteries with plenty of life left in them, but which are no longer suitable for EVs. What to do? One possibility is repurposing them to serve as grid-connected energy storage. Storage is valuable to the grid for many reasons, including its ability to smooth out fluctuations in supply, allowing for more integration of variable renewable energy.

Liebreich and McCrone say this is a promising path:
Once a battery’s performance has degraded by around 30 percent, it could become available for stationary storage. Upcoming research by BNEF’s advanced transportation team will suggest that by 2018 these second-life batteries could cost as little as $49 per usable kilowatt-hour to repurpose, compared to the current new stationary battery price today of around $300 per kilowatt-hour. If so, they will further support the economics of both renewable energy and electric vehicles, accelerating the uptake of both.