Repurposed electric vehicle batteries are emerging as a viable solution to help AI data centers manage surging electricity demands while reducing strain on aging power grids across America.

Key Points

• Repurposed EV batteries retain roughly 80% capacity, offering a cost-effective way to store energy during off-peak hours for use during high-demand AI processing.
• The global data-center battery market is projected to grow from $3.38 billion in 2025 to nearly $6 billion by 2035.
• Lithium-ion shipments for data-center storage are expected to increase from 12 gigawatt-hours in 2025 to 272 gigawatt-hours by 2030.
• Redwood Materials deployed a 12-megawatt, 63-megawatt-hour microgrid in Nevada using hundreds of second-life battery packs to power a Crusoe Energy data center.
• Firms like Re-Teck are facilitating the supply chain by sourcing retired batteries from automakers like Tesla, Lucid, and BMW for industrial energy storage.

Why it Matters

Integrating second-life batteries into data center infrastructure addresses both the immediate energy crisis caused by AI and the long-term need for domestic supply-chain resilience. By reducing reliance on new battery production and critical foreign-controlled materials, this approach offers a scalable, economically practical strategy to stabilize power grids.