Battery Insiders Reflection - Closing the Loop: Repurposed EV Batteries in Mobile On-grid ESS

0:00Transcript

0:00Welcome to Battery Insiders, your podcast providing you insights and the fascinating world of batteries. Hosted by Bhavya Jha and Simon Engelke. Hello, hello, hello. Welcome back, everybody. We're here today to talk about the 68th session of Battery Revolution here on Battery Insiders. I'm Bhavya Jha and I have Simon joining me. Hello, Simon. Hello. How is it going? Really well. Feels like we had a bit of a summer outbreak and we're back in the rainy season. Not sure how it is over in the US. Well, Monday through Friday is gorgeous weather when I'm in the office and Saturday and Sunday is gloomy and rainy. So not really enjoying the best of the weather yet, but it's getting there. I think we're probably on second or third winter now, so we'll see how long this one lasts. But overall, can't complain. Not too shabby. Can't believe it's already mid-past April. Oh my God. We're about to wrap up April 2024. And yeah, time is just flying. So hopefully it warms up a little bit soon.

1:14For sure. Yeah. I'm excited. I'm traveling a lot. We'll be in the US next week in California. So hopefully going to be warm there. But yeah, for now, I guess we're going to talk about closing the loop. We purpose EV batteries and mobile on-grid ESS. Yes, we are. We had a nice conversation with Lorenzo a couple weeks ago. Lorenzo from Ally Energy. You know, he personally just has so much experience in developing and validating these batteries, these EV batteries that have become so popular. And has gone on to co-found Ally Energy with two other folks who, together, they've created this company that takes batteries and repurposes them. You know, I'm not going to lie. While I was listening to it, Simon, I'm pretty sure we were talking about this topic in 2020, 2019. And to say the least, it was a very different conversation. This has been an ongoing debate in battery world for a very long time. Repurpose, recycle. Should batteries stay in the same application?

2:22Should they be repurposed for different applications? What are the implications of doing that? And I think he unpacked a lot of Ally's approach to that. And this new niche that they have kind of targeted in the battery market. What did you think? Absolutely. No, I agree. It's fascinating, right? So we had a few of these conversations before. And maybe we can try something new today. A bit of a summary of the session. And then we can go on some of these topics in more depth. So, yeah, I think, you know, very interesting, as you said, introduction with Lorenzo, who also has a background, right? So I think with Vivian, for example. And so I've seen also, you know, on the EV side, what it gets done and how to make these new Vs, which I think is very helpful, you know, to understand, you know, his mission of his company. And, yeah, so, right, I think, as you said, Ally's energy is to aim is to save customers money on the energy builds, provide great flexibility using repurposed batteries and from repurposed EV batteries.

3:21And, yeah, I think, you know, to break it down, I think we started with why repurpose batteries, right? And I think his argument was that provides solution for your batteries, which are stockpiling of recyclers. We've heard that, especially for kind of chemistries. Now we're looking at LFP, et cetera, right? Where there's not much value in it. And then it's like, you know, he described it as a more cost-effective, environmentally friendly than recycling, as it delays the need for extracting new raw materials. Although we, of course, know in the end of the day it has to be recycled, right? But I think there's interesting studies on that. And, yeah, if you want, I think we don't have time for this now, but it's interesting studies for when Second Life makes sense from an environmental perspective, when maybe recycle makes more sense. Because some of these chemistries, of course, contain more material, let's say, cobalt in an older version. And if you make now, let's say, an updated battery or like a new battery, and you actually maybe need less cobalt because the chemistry advanced since then, then you could even claim it's better, right?

4:15Because we can use the same cobalt from our batteries. But there's all of these different lenses and interesting studies on these topics. Yeah, absolutely. Yeah, I think you also touched a lot on the strengths and weaknesses of this kind of the pros and cons. What did you think about the pros and cons of this type of system? Yeah, I think, I mean, next topic, I think we spoke a bit about was the process and safety, right? And I think it was interesting, I think also different to other players, that they actually maintained original battery management system, right? To interface with current and also ensure the safety. I mean, they also have their own electronics. And we spoke a lot about testing, which was very interesting, I think. Yeah. They have the kind of testing setups to understand the health of the chemistry. And, you know, yeah, so they have some testing developed, they're saying, right, for conducting on the Viva Cyclast side also and on the allies facility that they're, you know, safe for repurposing.

5:10Which I think was also an interesting approach to kind of how to do the selection, right? Because I think people would probably agree that there are batteries out there which are, you know, quite good. Like they haven't been used much. Automotive batteries tend to be at a very high standard compared to maybe other batteries, like stationary. But yeah, if they're not tested properly, you need to know what their safety status is. It's tricky. Also for shipping. Yeah. They definitely do things that I initially thought would be very unconventional. Like I think a couple of things were like they put batteries of different state of health, different state of charge. Like they are not unpacking and getting disassembling the battery in any way. They are taking it as they get it. I think typically they're Tesla Model 3 batteries. And then they, each individual battery, it still works within its own like battery management system. But they kind of overall monitor that. And, you know, if there is, if it is a different state of health or state of charge, then they make sure that batteries that are stronger, quote unquote, are cycled more.

6:17And that allowing the overall battery storage system to still produce the expected level of power, which I thought was really interesting. I definitely had always thought that, you know, you need to check on the state of health. They need like the system will by default cater to the battery of the lowest state of health. And I just think that they've really done, taken some leaps and jumps and making sure and making that not the case, which I thought was very innovative. Totally. And I think then also another topic spoke about was the business model, right? And the customers. So here, he was explaining that they're operating as an energy as a service model, making the energy storage solution more affordable by repurposing batteries. Right. And he also spoke about the first customer, AeroVault, who use LI storage for EV charging for electric aircraft. So highlighting flexibility, right, for the system. And then also, you know, I think we also spoke a bit about the GRIST service options, which could be in an additional revenue stream as well.

7:15Not sure if you had any thoughts on that. I think that, yeah, the business model was interesting. They also afterwards talked on challenges and like, you know, what are some of the future outlooks for this technology? And I think they kind of also started with that, the why as well, because one thing that, you know, the US, Europe, Asia, every continent is struggling with is grid, is enhancing the grid and making sure there's enough power available. And so I think one of the things they, with doing this battery storage system is, you know, how navigating that grid connection bureaucracy and ensuring, you know, safe transportation of these repurposed batteries is going to be an ongoing challenge. But they're at the same time addressing some of the issues that the grid also poses, which is its own limitations and demand response. And so I think that's something that they're definitely keeping an eye on. And the battery passport in the EU especially is going to definitely introduce more competition, but also increases opportunities to collaborate with OEMs.

8:20Like I mentioned earlier, they predominantly do work with Tesla Model 3s. Maybe they can have other partners that they work with, more formalized ways of working with them. And I think that's something that Ally Energy is looking forward to as well. Totally, yeah. And I think that is a bit on the challenges and outlook, right? As you just mentioned. And I think interesting also, we had some great questions as well, which I think also was about, for example, battery passport, right? What could this help with or make it more challenging? Also, maybe improve, right? The opportunities, corporations, OEMs. Couldn't be talking much about that. I remember. And then, yeah, also I think bureaucracy was a topic, right? And we also spoke about safe transportation, which is something we also have covered in the BatteryMBA. And I know it's quite a fascinating topic. I haven't thought about too much in my past. I've realized actually that's especially for anything used battery-wise, because you have to essentially know what's their state, right?

9:16You have to really understand. And then if something goes bad, there's huge fines. And of course, big liability as well. So yes, exactly. Which I'm sure you know much more about. And then in the old days. And I think then it was the last one, right? We had a topic, I think, for advice. Or for anybody new, do you have any thoughts on the advice you shared? Advice on industry reasons? I mean, I think the biggest thing is that emphasizing that you need to stay up to date on what changes are coming. For example, this is a big change that I'm learning about, again. And I would imagine that for new industry entrants, he kind of touched on this, but it's something more that I learned from his conversation. The debate before was about things that I thought were conventional methods and how things had to be done. And so I guess, and I'm sure, you know, obviously, with many of the speakers we have on Battery Revolution, it's just constantly a discussion about innovation.

10:18And just making sure that you're always challenging the way people think things need to or should work or must work. And I think this is a very great example of that, what Ally is doing. I totally agree. Perfect. Well, with that, I think we have, if you weren't able to listen to the full episode, I think we hopefully gave you the few points that were the main takeaways. And we are super excited that you were able to join us. For those of you listening, we will be having our next session in May. Any inkling of what the topping might be, Simon? I do, but I will keep it a surprise. Amazing. Amazing. Awesome. Well, I guess you all will have to tune in then. Find us on Clubhouse, Battery Revolution. And if not, we will see you back here on Spotify or Apple Music on Battery Insiders. And with that, we can wrap it up. Thanks, everybody. Thanks, Simon. Thank you. Bye-bye. Bye-bye.