# Economic Analysis of Potential Secondary Use of Batteries from Electric Vehicles
## 3 Economic Analysis
### Large Battery Storage Strategy from 2 nd Life Batteries
Depreciation is linear and the economic life was determined as follows: battery 5 years, inverter 15 years, universal container 15 years, transformer 15 years, dispatching 15 years and charging station 15 years. Operating cash flows other than electricity expenditures are not dependent on input parameters. These are personnel expenses and office rental. The electricity consumed was calculated using the number of positive energies sold on the balancing market and the air conditioning's consumption. Due to the climate in the Czech Republic and Slovakia, the model assumed an annual use of air conditioning of 2232 h (6 months--12 h per day). Power consumption was set at 1500 W. As part of the refinement of the results, three scenarios of revenues from the provision of regulatory energy were worked on. For this reason, we also work with three scenarios of the tax base and subsequently with three scenarios of higher tax. Here, the model recognized whether the amount of depreciation is not higher than the tax base. After that, the model calculated the cash flows for each year and determined the NPV. For this economic analysis, the entered parameters were calculated using the software Solver in MS Excel so that the resulting NPV was maximized. An evolutionary algorithm with several constraint conditions based on the above assumptions was used. Output investments and parameters can be seen in Tables 11 and 12. According to the calculation model, the NPV for this strategy came out in two positive values out of the three scenarios (see Table 13). Based on the definition of a positive NPV, it can be concluded that this investment can be recommended and implemented. \begin{table}
\begin{tabular}{c c c} \hline \hline
**Scenario** & **Amount** \\ \hline NPV (S) & \(\epsilon\)916,300 \\ \hline NPV (M) & \(\epsilon\)\(-\)887,178 \\ \hline NPV (H) & \(\epsilon\)2,390,256 \\ \hline \hline \end{tabular}
\end{table} 
Table 13: Eventual net present values of large battery storage strategy. \begin{table}
\begin{tabular}{c c} \hline \hline
**Parameter** & **Value** \\ \hline Number of 2 nd life batteries & 710 \\ \hline Battery capacity & 43 kWh \\ \hline Remaining capacity & 77\% \\ \hline DoD & 60\% \\ \hline Inverter—power & 50 kW \\ \hline Connected power & 9 MW \\ \hline Business capacity & 14.02 MWh \\ \hline Offered FCP & 5 MW \\ \hline Capacity for the balancing market & 4 MWh \\ \hline Number of containers & 25 \\ \hline Corporate tax & 19\% \\ \hline \hline \end{tabular}
\end{table} 
Table 11: Output investments. \begin{table}
\begin{tabular}{c c c c} \hline \hline
**Parameter** & **Value** & **Parameter** & **Value** \\ \hline Number of 2 nd life batteries & 758 & Number of 2 nd life batteries & 777 \\ \hline Increase power & 0.96 MW & Increase power & 0 MW \\ \hline Connected power & 9.96 MW & Connected power & 9.96 MW \\ \hline Business capacity & 14.97 MWh & Business capacity & 15.34 MWh \\ \hline Offered FCP & 5 MW & Offered FCP & 5 MW \\ \hline Capacity for the balancing market & 5 MWh & Capacity for the balancing market & 5 MWh \\ \hline Number of containers & 27 & Number of containers & 27 \\ \hline \hline \end{tabular}
\end{table} 
Table 12: Output parameters of the large battery storage strategy after 5 (left) and 10 (right) years. Another important analysis was the dependence of NPV on the failure rate of battery cells (see Figure 8). Currently, it is known exactly how much service 2 nd life batteries will need. However, today's literature estimates that the failure rate of battery cells should be no more than tenths of a percent.