The second-life electric vehicle (EV) batteries market is anticipated to achieve a valuation of $20.25 billion by 2030, projecting a Compound Annual Growth Rate (CAGR) of 39.1% from 2023 to 2030, as highlighted in the latest report from Research and Markets.
The growth trajectory of the second-life EV batteries market is primarily influenced by initiatives aimed at mitigating the environmental impact of battery disposal, the increasing adoption of renewable energy sources, and the rising demand for electric vehicles (EVs).
Segmentation based on application categorizes the second-life EV batteries market into EV charging, grid connections, renewable energy storage, power backup, and other applications. In 2023, the power backup segment is expected to hold the largest market share globally. This dominance is attributed to the growing demand for power backup applications in residential and commercial sectors and ongoing efforts to address the environmental concerns associated with battery disposal.
However, the EV charging segment is forecasted to register the highest CAGR during the forecast period. The surge in demand for cleaner and more efficient energy systems, coupled with the increasing adoption of EV charging applications across industrial, residential, and commercial sectors, is anticipated to bolster the growth of this segment.
The global second-life EV batteries market, based on end-use segmentation, encompasses commercial use, residential use, and industrial use. In 2023, the commercial use segment is anticipated to claim the largest market share. This dominance is driven by the increasing utilisation of second-life EV batteries for stationary applications, such as backup power for buildings, data centres, or telecommunications infrastructure.
Concurrently, the residential use segment is expected to record the highest CAGR during the forecast period. This growth is fueled by the rising demand for energy storage systems in the residential sector and strategic developments by market players exploring second-life EV batteries for residential and commercial grid-scale energy storage applications.
Geographically, North America is poised to dominate the global second-life EV batteries market in 2023. The significant market share in this region is attributed to initiatives promoting the utilisation of second-life batteries, addressing concerns related to end-of-life EV batteries, and organizing the battery waste sector.
On the other hand, Europe is projected to exhibit the highest CAGR during the forecast period, propelled by initiatives from automakers aiming to create second-life energy storage systems from used EV batteries.
Factors influencing market growth include efforts to mitigate the environmental impacts of battery disposal supporting market growth; increasing reliance on renewable energy generating opportunities for market players and increasing adoption of electric vehicles supporting the development of second-life batteries, the report said.
According to the research firm, the factors determining second-life applications include opportunities for implementing second-life batteries, providing power to those without access, supply chain challenges for manufacturers of new batteries, offsetting lithium-ion battery recycling costs and scalable supply of second-life batteries, the report added.
Courtesy: Research and Markets. NB: Photo is representational; courtesy: Mercedes.
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