While purchasing out-of-commission vehicles has long been the purview of salvage yards and auto-restoration enthusiasts, a new market has been emerging when it comes to out-of-use electric vehicles: buyers of secondhand EV batteries. 

As the transition to renewable sources of energy has continued, the demand for used lithium-ion batteries has surged, according to a report by the Guardian. These batteries can be used to store solar power on everything from large, power-plant-scale arrays to home solar systems. 

The demand has become so high that new companies have been created to take advantage of the secondhand EV battery market. 

“It’s only very early days, but they are certainly in strong demand,” said Brendan Green, general manager of automotive solutions at Pickles, an auction house, per the Guardian. “We’ve got this new element of second-life battery startups. That industry really didn’t exist 18 months ago.”

The nascent industry has served as an example of the many unpredictable yet creative ways that people have innovated as cleaner sources of power become more prevalent. 

For years, one of the main concerns around the transition to EVs has been what will be done with their used batteries once the vehicles are no longer in service. By creating a new market for secondhand EV batteries, these startups have prevented used batteries from going to waste while also reducing the resources needed for the manufacture of new batteries. 

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Once batteries have outlived their usefulness for powering electric vehicles, they can still be put to different uses that do not require the same level of energy output. 

“The output requirements for a solar battery are a lot less than what you need for an electric vehicle,” explained Andrew Chadwick, a lithium battery repair specialist, according to the Guardian. “Even if they are no longer good for an electric vehicle, with a little finessing, they’re perfect for a solar system.”

Energy output for an EV is five times what is required for a home solar battery, per the Guardian. 

Some entrepreneurs have already been putting used EV batteries to large-scale use.

Earlier this year, JB Straubel, the former chief technology officer at Tesla, revealed how his company, Redwood Materials, had used a collection of secondhand EV batteries to store the energy created from a nearby solar array. The system generated and stored enough electricity to run a small data center, according to Canary Media. 

As the energy-hungry data centers that power artificial intelligence and cloud computing consume more and more of the world’s electricity, Straubel’s solution has shown a potential path forward. If these data centers can be powered by sources of energy such as solar, they pose much less of a threat to the environment and public health. 

Additionally, as power demand from data centers has grown faster than new sources of electricity have been brought online, it has caused energy prices to go up for everyone. Straubel’s solution could help keep electricity prices affordable. 

“We’re confident this is the lowest-cost storage solution out there,” Straubel said, per Canary Media. 

And to think, it all started with a used EV headed to the scrapyard. 

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