Repurposing EV Batteries for Second-Life Stationary Storage

As electric vehicles (EVs) become an essential part of the transition to a cleaner transportation future, demand for the minerals used in EV batteries is expected to rise dramatically in the coming decades.

These minerals — including lithium, cobalt, nickel, and manganese — are often sourced from outside the United States, making them both a scarce resource and a major cost driver in EV production. Beyond their high financial price tags, these minerals also carry significant environmental impacts linked to mining and processing.

Although mining EV batteries creates environmental impacts, the share of global human-caused climate change caused by combustion engine vehicles is far worse.  In July 2025, the International Council on Clean Transportation (ICCT) released a groundbreaking report assessing the environmental impact of battery electric vehicles (BEVs) in the European Union. One of the most striking conclusions from the report is that BEVs have life-cycle emissions nearly four times lower than gasoline cars. EVinfo.net summarized the report.

While recycling EV batteries at the end of their useful life can help recover valuable minerals to produce new batteries, many of these batteries still have substantial remaining capacity after they can no longer power a car efficiently, typically retaining upward of 80% of their original capacity. Instead of heading directly to recycling, used battery packs can be repurposed for other applications — yet in practice, repurposing remains rare. The United States currently lacks clear standards or a consistent framework for handling EV batteries after their automotive use, leaving this potential largely untapped.

One promising avenue is repurposing EV batteries for stationary energy storage. Deploying used EV batteries in stationary storage systems — such as those that store solar or wind energy for use when the sun isn’t shining or the wind isn’t blowing — can significantly extend the useful life of each battery pack. This not only maximizes the investment and energy that went into manufacturing the battery but also helps drive down costs and supports a more resilient, decarbonized grid.

In June 2025, EVinfo.net reported on a groundbreaking collaboration by Crusoe and Redwood Materials. Together, they unveiled North America’s largest microgrid powered by large-scale solar and second-life EV batteries—a pioneering achievement that powers Crusoe’s modular AI data center infrastructure with renewable energy and unmatched agility.

However, as the second-life EV battery market is still young, such projects are not widespread at the moment. A new policy brief from the American Council for an Energy-Efficient Economy (ACEEE) explores the many benefits and challenges associated with repurposing EV batteries, encouraging more projects like the collaboration by Crusoe and Redwood Materials.

Based on extensive discussions with industry leaders and policy experts, the brief highlights policy solutions that could unlock the potential of battery repurposing in the U.S. These recommendations include developing national standards for repurposing, incentivizing second-life applications, and streamlining regulatory pathways to create a robust market for used EV batteries.

As the EV market continues to grow, thoughtful policy action on battery repurposing represents a critical opportunity to reduce costs, lower environmental impacts, and strengthen energy security. With the right frameworks in place, the U.S. can move closer to a circular economy for batteries — turning a looming challenge into a powerful advantage.

The New ACEEE Policy Brief

The new policy brief from the American Council for an Energy-Efficient Economy (ACEEE), developed with support from GAIA (a global network promoting zero waste and environmental justice), outlines the opportunities and barriers for repurposing EV batteries. The brief draws from extensive interviews with industry and policy experts and insights from a GAIA-hosted workshop focused on environmental justice and battery repurposing held in April 2025.

Suitable Applications

Suitable applications include backup power for commercial and residential buildings, storage systems at EV charging stations, and grid support projects where the energy demands are infrequent and less intense.

However, not all stationary storage needs are a good match. Applications that require frequent cycling, such as grid ancillary services or daily solar storage, are less suited to second-life batteries due to their reduced capacity and higher degradation risk.

Current Barriers and Policy Opportunities

A critical barrier to scaling repurposing is the lack of access to crucial battery data. Repurposers often acquire used batteries with minimal or no information about their history, state of health, or prior usage patterns. Without this data, determining which batteries can be safely and effectively reused becomes significantly harder.

To overcome these challenges, ACEEE’s brief proposes a suite of policy solutions:

• Require automakers to provide access to battery management software data for repurposers and second-life battery owners.
  
  
• Establish a “battery passport” system to include comprehensive information about battery health and usage history.
  
  
• Update safety certification processes to reduce compliance costs and ease market entry.
  
  
• Create extended producer responsibility requirements to ensure manufacturers consider repurposing options in their end-of-life plans.
  
  
• Develop design standards to facilitate easier and safer battery disassembly and repurposing.
  
  
• Update hazardous waste and material classifications to better support second-life applications.

EVinfo.net’s Take: The Future of Second Life EV Batteries for Stationary Storage

EV batteries that meet certain safety and performance thresholds can become valuable assets in stationary storage markets. However, without standardized data sharing, design considerations, and clear policy support, the full potential of second-life battery systems will remain out of reach.

By creating robust frameworks and incentives, federal and state policymakers can help turn battery repurposing from an underutilized opportunity into a cornerstone of a circular, low-carbon economy — reducing costs, strengthening grid resilience, and minimizing environmental impacts.

EVinfo.net recommends that federal, state and local governments, as well as business leaders, follow the ACEEE’s recommendations, to create more groundbreaking projects like the great example that Redwood and Crusoe accomplished.

This brief offers a timely guide for decision-makers eager to advance the U.S. battery reuse market while supporting cost-saving, environmental justice, and long-term sustainability goals. Download the brief here.