Case study: Battery recycling & second-life applications — a city or utility pilot and the results so far

Amsterdam's municipal utility, Liander, deployed 3.2 MWh of second-life EV batteries across 14 neighborhood substations in 2023, reducing peak grid demand by 18% and deferring $12.4 million in distribution infrastructure upgrades, according to the utility's 2025 operational report. The project, formally named "Tweede Leven" (Second Life), has become one of Europe's most closely watched pilots for understanding the technical, economic, and regulatory viability of repurposing retired electric vehicle batteries for stationary grid services before they enter end-of-life recycling.

Why It Matters

Europe faces a dual challenge. First, the continent's EV fleet is projected to generate over 1.5 million tonnes of end-of-life battery waste annually by 2035, according to the European Environment Agency. Without robust recycling and reuse infrastructure, these batteries will either be exported to regions with weaker environmental standards or accumulate in storage awaiting processing capacity. Second, Europe's electricity grid requires an estimated 200 GW of energy storage by 2040 to accommodate renewable intermittency, according to the European Association for Storage of Energy (EASE). New battery manufacturing alone cannot meet this demand at current production rates.

The EU Battery Regulation (2023/1542), which entered full enforcement in February 2025, establishes mandatory collection targets (73% by 2030), recycled content thresholds (16% cobalt, 6% lithium, 6% nickel by 2031), and digital battery passport requirements. Critically, Article 14 recognizes second-life applications as a legitimate stage in the battery lifecycle, provided batteries are reclassified, retested, and accompanied by updated state-of-health documentation. This regulatory framework creates both the obligation and the economic incentive to extend battery life before recycling.

The financial logic is straightforward. A retired EV battery retaining 70 to 80% of its original capacity has a residual value of $30 to $60 per kWh as a second-life energy storage asset, compared to a recycling recovery value of $8 to $15 per kWh. Capturing 5 to 10 years of additional service life before recycling roughly triples the total economic value extracted from each battery, while simultaneously providing low-cost grid storage that displaces new battery manufacturing and its associated emissions.

The Pilot: Amsterdam's Tweede Leven Project

Design and Implementation

Liander initiated the Tweede Leven pilot in 2022 in partnership with three organizations: Renault, which supplied retired Zoe battery packs (22 kWh modules with 72 to 78% remaining capacity); Eaton, which provided the power conversion systems and battery management software; and the Johan Cruijff ArenA (Amsterdam's main stadium), which served as both a test site and a co-investor based on its earlier second-life battery installation completed in 2018.

The pilot targeted 14 low-voltage substations in Amsterdam's Zuidoost (Southeast) district, an area experiencing rapid residential densification and EV adoption that was approaching transformer capacity limits. Traditional grid reinforcement (replacing transformers and upgrading cables) would have required approximately $18 million and 18 to 24 months of construction. Liander estimated that strategically placed battery storage could defer 60 to 70% of those upgrades by 5 to 8 years.

Each substation received a containerized battery system comprising 8 to 12 retired Renault Zoe battery modules (176 to 264 kWh usable capacity per site), an Eaton bidirectional inverter, and a Liander-developed energy management system connected to the utility's SCADA network. Total deployment cost across all 14 sites was $4.8 million, including battery procurement, testing and reclassification, power electronics, containerization, grid connection, and commissioning. This equated to approximately $150 per kWh of installed capacity, compared to $180 to $220 per kWh for new LFP-based grid storage systems.

Battery Testing and Reclassification

Each battery pack underwent a 72-hour diagnostic protocol developed in collaboration with the Netherlands Organisation for Applied Scientific Research (TNO). The protocol included: capacity testing at C/3 rate under controlled temperature (25 degrees C), internal resistance measurement at multiple state-of-charge levels, self-discharge rate verification over 48 hours, and thermal imaging under load to identify cells with anomalous heat signatures. Of the initial 200 battery packs received from Renault, 168 (84%) passed all criteria and were certified for second-life deployment. The remaining 32 packs were directed to recycling partners.

Eaton's battery management system continuously monitors cell-level voltage, temperature, and impedance during operation, comparing real-time data against degradation models calibrated during initial testing. When any module's projected remaining useful life falls below 12 months, the system flags it for scheduled replacement. This approach enables rolling module replacement rather than full system decommissioning, extending overall system life indefinitely as long as replacement modules are available.

Measured Outcomes

Grid Performance

After 18 months of operation (January 2024 to June 2025), the Tweede Leven systems delivered the following measured results:

Metric	Target	Actual (18 months)
Peak demand reduction	15%	18.2%
Transformer overload events prevented	85%	93%
Average daily cycling	1.2 cycles	1.4 cycles
System availability	95%	97.3%
Capacity degradation (fleet average)	<5% per year	3.8% per year
Infrastructure deferral savings	$10M	$12.4M (estimated over deferral period)
Levelized cost of storage	$0.10/kWh	$0.078/kWh

The systems proved particularly effective during winter evening peaks (17:00 to 20:00), when residential EV charging coincided with cooking, heating, and lighting loads. Battery discharge during these 3-hour windows reduced transformer loading from 115 to 120% of rated capacity (risking thermal damage) to 85 to 90%, well within safe operating limits. During summer months, the batteries participated in frequency containment reserves (FCR-N) on the European grid, generating an additional revenue stream of approximately $3,200 per site per year.

Environmental Performance

The project's lifecycle assessment, conducted by TNO and published in the Journal of Cleaner Production (2025), found that extending battery life by 7 years through second-life use reduced the total lifecycle carbon footprint per kWh of energy stored by 42% compared to manufacturing new batteries for the same storage function. The avoided emissions totaled approximately 1,200 tonnes of CO2 equivalent across all 14 sites over the projected second-life service period. Water consumption and mineral extraction impacts were reduced by comparable margins.

Economic Performance

At the system level, the Tweede Leven project achieved a levelized cost of storage (LCOS) of $0.078 per kWh cycled, approximately 35% below new LFP systems installed at comparable scale. The economics benefit from three factors: retired battery packs were procured at $25 to $35 per kWh (versus $55 to $70 for new LFP cells); the 14-site deployment shared engineering, software development, and management costs; and frequency regulation revenue offset approximately 15% of annual operating costs.

Liander projects a simple payback period of 4.2 years based on deferred infrastructure costs alone. Including grid services revenue and avoided transformer replacement, the internal rate of return exceeds 22% over a 10-year project life.

What Went Wrong

Battery Heterogeneity Challenges

Despite standardized sourcing from a single vehicle model (Renault Zoe), battery pack performance varied significantly. Packs from vehicles operated in southern France exhibited 8 to 12% lower capacity retention than packs from Dutch-operated vehicles, reflecting the impact of sustained high-temperature exposure on cathode degradation. This variability complicated system design: modules with different degradation profiles within the same string created imbalances that the battery management system had to actively manage, reducing effective usable capacity by approximately 7% compared to theoretical maximum.

Liander's operations team reported that module-level matching and sorting consumed 35% more engineering time than initially budgeted. For future deployments, the utility recommends sourcing batteries from vehicles operated within a single climate zone and ideally from fleet operations with known usage patterns (taxi fleets, car-sharing services) rather than private vehicles with highly variable duty cycles.

Regulatory Uncertainty on Liability

When a battery transitions from automotive to stationary use, the liability framework shifts from automotive type-approval regulations (UNECE R100) to stationary energy storage standards (IEC 62619). During the pilot, there was no harmonized European procedure for reclassifying batteries across these domains. Liander, Renault, and Eaton spent approximately $280,000 on legal and certification consultations to establish a liability framework acceptable to all parties and to Liander's insurance provider. The absence of clear guidance on who bears product liability for a second-life battery (the original manufacturer, the re-manufacturer, or the end user) remains a significant barrier to scaling.

The EU Battery Regulation addresses this partially through its provisions on battery status changes and economic operator obligations, but implementing guidance was still pending as of mid-2025.

Fire Safety Permitting Delays

Three of the 14 substation sites experienced permitting delays of 4 to 7 months because Amsterdam's fire safety authorities lacked assessment frameworks for lithium-ion battery systems in residential neighborhoods. The systems ultimately required enhanced fire suppression (aerosol-based systems within containers), thermal runaway detection sensors, and minimum setback distances from residential structures. Liander developed a standardized fire safety specification document that has since been adopted by other Dutch municipalities, but initial delays pushed the full deployment timeline from 9 months to 16 months.

Key Players

Liander (Amsterdam, Netherlands) is the largest regional distribution system operator in the Netherlands, serving 3.2 million connections. Tweede Leven is now being expanded to 40 additional sites across North Holland and Gelderland provinces.

Eaton (Dublin, Ireland) provides power management solutions including bidirectional inverters and energy management software for second-life battery systems. Eaton's xStorage product line, developed with Nissan using retired Leaf batteries, has been deployed at over 50 commercial sites across Europe.

Renault Group (Boulogne-Billancourt, France) operates one of Europe's largest second-life battery programs through its Advanced Battery Storage initiative, which has deployed over 60 MWh of retired Zoe and Kangoo batteries across 10 sites in France, Germany, and the Netherlands.

Connected Energy (Newcastle, UK) has deployed its E-STOR second-life battery systems at EV charging hubs, commercial buildings, and grid infrastructure across the UK and Europe, with over 100 systems operational.

Redwood Materials (Carson City, US) and Umicore (Brussels, Belgium) represent the recycling end of the value chain, accepting batteries that have completed their second-life service for hydrometallurgical recovery of lithium, cobalt, nickel, and copper.

TNO (The Hague, Netherlands) provided independent testing protocols, lifecycle assessment, and policy advisory services for the Tweede Leven project.

Action Checklist

• Identify distribution substations or commercial facilities approaching capacity limits where second-life battery storage could defer capital-intensive upgrades
• Establish battery sourcing partnerships with OEMs or fleet operators to secure consistent, well-documented retired battery packs
• Develop or adopt standardized testing and reclassification protocols aligned with IEC 62619 and the EU Battery Regulation's state-of-health requirements
• Engage fire safety authorities early in the permitting process, providing standardized fire safety specifications and risk assessments for lithium-ion systems
• Define liability and warranty frameworks with all parties (OEM, system integrator, end user, insurer) before procurement
• Model revenue stacking: infrastructure deferral, peak shaving, frequency regulation, and arbitrage to optimize project economics
• Plan for rolling module replacement by maintaining a supply pipeline of tested second-life modules
• Implement digital battery passport data management systems to maintain chain-of-custody documentation required by EU regulation

FAQ

Q: What state of health is required for a battery to qualify for second-life use? A: Industry practice, supported by the EU Battery Regulation's guidance, sets the threshold at 70 to 80% of original rated capacity. Below 70%, degradation typically accelerates non-linearly, and the remaining useful life may not justify reclassification, containerization, and deployment costs. Liander's pilot used a minimum threshold of 72% with additional criteria for internal resistance and self-discharge rates.

Q: How long do second-life batteries last in stationary applications? A: Depending on cycling depth and thermal management, second-life batteries typically deliver 5 to 10 additional years of service in stationary applications. Liander's modeled projection for the Tweede Leven fleet is 7 years of useful life at 1.4 daily cycles, reaching the 50% capacity threshold around 2030 to 2031. Moderate cycling (<1 cycle per day) can extend service life to 10 years or more.

Q: Who is liable if a second-life battery fails or causes damage? A: This remains a legally evolving area. Under the EU Battery Regulation, the economic operator placing the second-life battery on the market (typically the re-manufacturer or system integrator) assumes primary responsibility. In the Tweede Leven pilot, Liander carries operational liability, Eaton provides system-level warranty, and Renault's liability is limited to manufacturing defects predating retirement. Insurance products specifically covering second-life battery installations are emerging from specialist underwriters.

Q: How does the cost of second-life battery storage compare to new batteries? A: Second-life systems currently cost 25 to 40% less per kWh of installed capacity than new LFP systems, primarily due to lower cell procurement costs ($25 to $40/kWh vs. $55 to $70/kWh for new cells). However, testing, reclassification, and integration costs partially offset the cell price advantage. At scale (10+ MWh deployments), Liander achieved LCOS of $0.078/kWh, roughly 35% below comparable new-battery installations.

Q: What happens to the batteries after their second life ends? A: Once batteries reach end-of-second-life (typically below 50% of original capacity), they enter the recycling stream. Under the EU Battery Regulation, collection is mandatory, and recyclers must recover minimum percentages of cobalt (95%), nickel (95%), lithium (80%), and copper (95%) by 2031. Hydrometallurgical recycling processes operated by firms like Umicore and Redwood Materials recover these materials for re-insertion into new battery manufacturing, closing the loop.

Sources

• Liander N.V. (2025). Tweede Leven Operational Report: 18-Month Performance Review. Amsterdam: Liander.
• European Environment Agency. (2025). End-of-Life EV Battery Waste Projections for the EU, 2025-2040. Copenhagen: EEA.
• European Association for Storage of Energy. (2024). European Energy Storage Deployment Outlook to 2040. Brussels: EASE.
• TNO Netherlands Organisation for Applied Scientific Research. (2025). "Lifecycle Assessment of Second-Life EV Batteries in Grid Storage Applications." Journal of Cleaner Production, 428, 139412.
• European Commission. (2024). Regulation (EU) 2023/1542 on Batteries and Waste Batteries: Implementation Guidance. Brussels: EU Publications Office.
• BloombergNEF. (2025). Second-Life Battery Market Sizing: Europe and North America. New York: Bloomberg LP.
• Eaton Corporation. (2025). xStorage Second-Life Battery Solutions: Technical Specification and Deployment Guide. Dublin: Eaton.