Economic analysis for centralized battery energy storage system with reused battery from EV in Australia

With battery energy storage technology development, the centralized battery energy storage system (CBESS) has a broad prospect in developing electricity. In the meantime, the retired lithium-ion batteries from electric vehicles (EV) offer a new option for battery energy storage systems (BESS). This paper studies the centralized reused battery energy storage system (CRBESS) in South Australia by replacing the new lithium-ion batteries with lithium-ion second-life batteries (SLB) and evaluating the economic benefits with economic indicators as net present value (NPV), discounted payback period (DPBP), Internal rate of return (IRR) to depict a comprehensive understanding of the development potential of the CRBESS with the lithium-ion SLB as the energy storage system. This paper proposes a calculation method of frequency control ancillary services (FCAS) revenue referring to market share rate (MSR) when building the economic model. Moreover, the residual value of lithium-ion batteries is considered. This paper uses the economic model to calculate the profitability and development potential of CRBESS. From an economic perspective, the superiority and feasibility of CRBESS compared with CBESS were analyzed.