Portrait of the three founders wearing hoodies with Circunomics logo
Start-ups

Start-ups

What to do with electric vehicle batteries?

Increasing the use of electric vehicles (EVs) is an important part of the transition to clean energy. But there is one problem with electric cars – their batteries only power them at optimum level for around eight years. After this, they are thrown away, even though they could be turned to good use in other areas. Circunomics has developed a system that can put the batteries back in circulation. The Mainz based company was crowned the federal winner of the KfW Entrepreneurs’ Award for its concept.

In the first eight months of 2021, more than 230,000 new all-electric vehicles were approved for road use in Germany. The industry is booming, fuelled by government purchase incentives and the ongoing expansion of charging infrastructure. But the most expensive part of the car, the battery, has a comparatively short lifespan. Their performance decreases when they fall to just 80% capacity, at which point they need to be replaced. But that does not make them worthless. In other, less demanding applications, such as energy storage, they can still be used for up to 15 years. However, this has been a rarity to date.

Circunomics has set out to change that state of affairs. Discussing the status quo, CEO Patrick Peter explains: “Car manufacturers are legally required to take the batteries back. To determine whether they can have a second life in a different environment, they first have to be tested in a special facility after removal. But this testing is expensive and time-consuming. As a result, the decision of whether to reuse or recycle is not made at all – instead, all the batteries are simply recycled. We’re skipping a whole chapter in the battery’s lifespan – a useful life of more than ten years and an asset worth several thousand euros is going to waste. And in turn, we’re wasting the valuable potential of this resource purely because we don’t know what condition the batteries are in.”

Analysis and simulation

The three founders of circunomics walking along a road

With road vehicles responsible for a large proportion of CO2 emissions, increased adoption of electric vehicles will help combat climate change. However, this will also require sustainable use of EV batteries.

This is where Circunomics comes in. The company takes the entire life cycle of the battery into consideration, always with a view to later use.

A modern EV is a computer on wheels with its battery constantly transmitting data about its condition. Circunomics feeds all this data into special software. To make this possible, a digital twin is created for each battery – and this digital rendering can be observed on an ongoing basis right from the start of the battery’s lifespan. Using the algorithms the firm has developed, the time when the battery in the vehicle will no longer be powerful enough can be predicted with pinpoint accuracy. At the same time, it is possible to simulate how the same battery would respond if used differently. This means the process of preparing for the battery’s next phase of life can be planned and initiated while it is still on the road inside the car. Consequently, future buyers will know not only when a battery is available, but also what it is suitable for.

This method is positive for everyone involved. Manufacturers can automate processes and find reliable buyers for the batteries that have become worthless. Buyers receive high-quality products that are fit for their purposes and much lower in cost. The second-hand batteries are then used, for example, in emergency power supply systems or other energy storage systems. And the biggest beneficiary of all is the environment.

A problem outsourced

Portrait of the three founders wearing hoodies with Circunomics logo

Cesar Padros, Patrick Peter and Sebastiaan Wolzak want to put used EV batteries back in circulation – and the trio have built a digital marketplace for this purpose.

Most of the time, we do not see what happens to the electronic waste generated in our own country. In 2017, Patrick Peter visited the world’s largest e-waste dump in Ghana. “A number of countries offload their televisions, laptops, fridges and batteries in the country – 250,000 tonnes a year. The people there take the items apart with their bare hands, sell the materials and burn the rest. It’s extremely harmful, and the working conditions are terrible. What I saw there completely broke down the distance I otherwise have to maintain as a researcher. It was one of the moments when it struck me that I was better off starting up a company than researching the circular economy as I had been doing until that point,” Peter recalls.

Two years later, Peter founded his business with help from company builder Next Mobility Labs, which helps to develop technology companies in the transport sector. Business angels with strong ties to the automotive industry also came on board and invested in Circunomics. One by one, Patrick Peter expanded his contact list. He was joined by Sebastiaan Wolzak and Cesar Prados, two experienced start-up entrepreneurs who immediately recognised the idea’s potential.

Well positioned for the future

portrait of the circunomics team.

Part of the international team: Eight nations work together at Circunomics.

In providing this solution, Circunomics is the first – and so far, only – trading platform of this kind for batteries on the market. The timing could not be better. Car manufacturers are currently working to electrify their products and are under additional pressure with competition from Asia. “They don’t even have time to think about what will happen when the used batteries come back to them in a few years’ time. That’s our opportunity. We’re already here when the problem needs to be solved,” Peter explains.

The next logical step is urban mining – the process of recovering of the valuable materials inside the batteries. The trio of founders are developing the infrastructure that will make this possible. In addition to the digital marketplace, from 2022 onwards, batteries that have been taken out of service will be sent to an initial treatment facility to be dismantled, tested and prepared for resale or directly recycled. There are plans to create ten of these decentralised remanufacturing plants near European car and battery manufacturers by 2030.

The company employs eleven staff of eight different nationalities at its location in Mainz, Germany. As employees at a start-up, they appreciate being able to make many of their own decisions. This would not be possible in a large company with more traditional structures, as in the car industry. But the team is also driven by a sense of purpose: the added value that Circunomics creates. Patrick Peter feels the same way: “Batteries are the key technology for the transition to green energy. If they are unsustainable, the whole transition will be too.” And even if he is never absolutely certain that everything will succeed, he is sure of one thing: “Launching a start-up is the best experience you can have in your career!”

Published on KfW Stories: 28 October 2021.