Abstract
Circular business models for batteries have been revealed in earlier research to achieve economic viability while reducing total resource consumption of raw materials. The objective of this study is to measure the economic performance of the preferred business model by creating different scenarios comparing second life (spent) and new battery investment for seven different European regions and four energy management strategies. Findings reveal levels of economic ability for a total of 34 scenarios simulated, including direct savings per kWh, a total change in energy costs per year, battery charge/discharge cycles, and comparative breakeven analyses. Regional effects are also measured based on day-ahead electricity prices and solar irradiation. The minimum payback time is 7 years before battery system investment costs are covered. The most viable energy management strategies also had the highest number of charge/discharge cycles, which decreases battery lifetime. Investment in a second life battery compared to a new battery reduced the payback time by 0.5 to 2 years due to lower investment costs. However, the estimated lifetime range (3 to 10 years) is lower compared to a new battery (5 to 15 years), which questions the circular business model viability for the scenarios studied. Energy management strategies should be combined and customized to increase economic benefits.
Highlights
Grid connected battery energy storage systems (BESSs) linked to transient renewable energy sources, such as solar photovoltaic (PV) generation, contribute to the integration of renewable energy to the grid [1,2], which is important to Sustainable Development Goals (SDGs) [3]
This paper develops multiple scenarios consisting of different combinations of the factors identified as important for economic viability of battery system investment: battery behavior; energy management (EM) strategies; different European regions; and investing in a second life versus a new battery
These results were applied in an Batteries 2022, 8, x FOR PEER REVIEeWconomic model, including investment costs to estimate breakeven points and life9tiomf e18 range for the different scenarios of a new or second life battery system
Summary
Grid connected battery energy storage systems (BESSs) linked to transient renewable energy sources, such as solar photovoltaic (PV) generation, contribute to the integration of renewable energy to the grid [1,2], which is important to Sustainable Development Goals (SDGs) [3]. Combined with energy management (EM) strategies, such as peakshaving, load shifting, electricity arbitrage, and solar PV generation with self-consumption, BESSs benefit the power system by contributing to sophistically balancing the demand and supply of electricity on the demand side [7]. BESSs can provide various services that achieve economic savings [5] and are currently becoming an increasingly profitable investment [6]. The potential economic benefits of BESS investment rely on several parameters connected to costs of investment, savings achieved through EM strategies, and end-of-life (EOL) management
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