Business Models for Second-life Electric Vehicle Battery Systems
Innovative Business Models (BMs) are essential in commercialising new technologies that are initially seen as inferior. Battery second use (B2U) brings used batteries from an electric vehicle (EV) into a secondary storage application and holds the potential to improve the sustainability of EVs while generating value for stakeholders across the automotive and energy sectors, as well as for the environment and society (Gohla-Neudecker et al. 2015; Neubauer et al. 2015). However, important knowledge gaps exist as the potential value of second-life batteries and how to better extract that value are still poorly understood by both practitioners and researchers.
To fill the knowledge gap, this study explores the BMs of repurposing a second life for the retired EV batteries through rich empirical case studies. The main outcomes of the research are firstly, a deeper understanding of the sustainable value of second-life batteries as is currently being achieved by industry, which also provides a comprehensive view of the potential value of B2U. Secondly, the critical B2U challenges are identified from a multi-stakeholder’s perspective across the value chain that present a fresh overview of the key factors that might impair the potential value of B2U. Thirdly, an empirically-generated typology of existing B2U business models is proposed that shows how B2U stakeholders are interacting in different ways to create and capture value from B2U. Fourthly, three critical BM design elements, namely, lifecycle thinking, system-level design and the shift to services are proposed as helpful aspects for B2U stakeholders to consider to better design their B2U business models. Fifthly, Business Model of a Technology (BMoT) is proposed as a new perspective to understand the value potential of second-life batteries and how to maximise the total value creation from B2U at the system level.
The research has filled a literature gap, has met an industrial need, and has made contributions to knowledge on sustainability and BMs in the specific context of B2U. Practically, the findings have the potential to inspire practitioners toward better understanding the potential value of second-life batteries and improve their BMs to better extract value from B2U.