Giving Electric Vehicle Batteries a Second Life:
Best Practices for a Sustainable Transition

Zero-emission fleets are an exciting prospect for some and a regulatory pressure for others. Regardless, the pros are clear: cleaner air for drivers and communities, quieter streets and reduced fuel costs. Clear too are the cons: infrastructure gaps, large upfront costs, vehicle charging logistics and range anxiety. But these perceived downsides should not be obstacles to electrification.

While government incentives are available to help haulers adopt zero-emission fleets, private-sector financing for electric fleets has been slower to evolve. To make economic sense, lenders need to adopt a full lifecycle view. This includes factoring in the “residual value” of batteries beyond simply their initial vehicle use.

Global nonprofit CALSTART offers a helpful Innovative Financing Toolkit that includes strategies for calculating residual values of electric vehicles. Our company is a contributor to the Toolkit, and advocates for an industry standard that makes financing more accessible by improving lender confidence in EV assets.

Kabir Nadkarni, CALSTART’s EV Industry Assessment Specialist, highlights the importance of residual value: “Understanding residual values isn’t just about predicting the future, it’s about unlocking financing for zero-emissions car, trucks and buses today. With a $2 to 3B second life battery market emerging, residual values of used electric vehicle components are proving to be competitive with gasoline vehicles. Leading companies are sending a clear market signal that electric vehicles hold their worth.”