B2U Adds Waymo Batteries to a 1,000 MWh Second-Life Pipeline

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B2U Storage Solutions has brought its second repurposed-EV-battery facility in Texas into commercial operation, and the details accompanying the announcement suggest the company is moving faster than its earlier timeline implied.

The commissioning matters for more than one developer. Second-life battery storage, the practice of building grid-scale energy storage from used electric-vehicle battery packs, has struggled to attract institutional capital and prove it can deliver projects on a repeatable basis. B2U now has two commissioned facilities feeding into the Texas grid operator ERCOT, a third tranche planned within six months, a disclosed pipeline exceeding 1,000 MWh, and a fresh feedstock agreement with Waymo, one of the most visible EV fleets in the country.

Here is what the Bexar Martinez commissioning, the Waymo deal, and the pipeline figures tell energy investors about whether repurposed-battery storage is shifting from a niche experiment into a scalable infrastructure play.

Bexar Martinez brings B2U’s ERCOT footprint above 50 MWh

The Bexar Martinez project is a 10 MW / 28 MWh second-life battery energy storage system located in Converse, Texas, in Bexar County near San Antonio. Its commercial operation was confirmed on 9 September 2026.

The facility connects within the service territory of CPS Energy, the local municipal utility, while selling grid services into ERCOT’s wholesale market on a merchant basis. Both of B2U’s Texas projects qualify for expedited grid connection because their roughly 10 MW rated output falls under ERCOT’s interconnection pathway for smaller generators.

What sets the project apart from a conventional battery build is its construction. More than 700 previously used EV battery packs make up the facility, financed through the $45 million structured finance fund B2U closed in December 2025, which covers seven projects including both Texas sites.

The portfolio picture behind a single commissioning

Step back from the individual project and the sequence becomes the story. With Bexar Martinez energised, B2U’s ERCOT operating portfolio now exceeds 50 MWh across two facilities.

Across Texas and California combined, B2U now manages more than 5,000 repurposed EV battery packs totalling roughly 100 MWh of storage capacity.

Back-to-back commissioning across two ERCOT facilities is the detail that should register with investors. Repeatable delivery in the same market is the threshold lenders and offtakers typically want to see before treating a developer as an established operator rather than a pilot-stage company. B2U has now cleared it with a second operational data point built on the same repurposing model.

What the Waymo supply agreement adds to B2U’s feedstock position

The Waymo agreement, announced in June 2026, is a battery supply arrangement rather than a project partnership. Under the long-term deal, B2U can repurpose batteries from retired Waymo vehicles as well as packs pulled from active vehicles, processing them at its facility in Lancaster, California.

That distinction matters because Waymo is a strategically different feedstock source from B2U’s existing supply base of Ford, General Motors, Honda, Nissan, and Tesla. Waymo runs an all-electric autonomous fleet with high-utilisation duty cycles, meaning battery retirements should scale as the fleet grows, and its operating hubs in California and Texas line up with B2U’s existing footprint.

The technical specifics point to how the volumes flow:

• First tranche of batteries: Jaguar I-PACE packs
• Yield of 2 batteries per Waymo vehicle
• Cabinets integrating 36 Waymo batteries each
• Processing at B2U’s Lancaster, California facility
• Waymo-sourced batteries expected to be operating in San Antonio-area projects by 2027

B2U received its first batch of Waymo batteries earlier in 2026, and the scale ambition is considerable.

“The agreement is expected to supply hundreds of megawatts of storage capacity over the duration of the partnership,” said Freeman Hall, Chief Executive Officer of B2U Storage Solutions.

For energy investors, the significance sits less in the headline volume and more in the validation. A high-profile commercial EV operator has chosen B2U’s repurposing route over direct recycling as its preferred end-of-life path. That strengthens the case that diverse OEM feedstock will keep flowing as EV fleets mature, and feedstock security is the single biggest structural risk facing second-life operators trying to scale. A named, long-term supply agreement with an expanding autonomous fleet materially lengthens the visible runway for B2U’s development pipeline.

Waymo’s decision to route retired packs through B2U rather than direct recycling reflects a broader calculation around used EV battery value, where state of health, remaining cycle count, and module chemistry all determine whether second-life redeployment or material recovery produces the better economic return for the fleet operator.

A 1,000+ MWh pipeline and the economics making it viable

The pipeline ambition is large. According to CEO Freeman Hall, B2U’s total development pipeline surpasses 1,000 MWh across multiple markets, with a near-term ERCOT plan attached to it.

• More than 50 MWh of additional ERCOT capacity targeted within six months of Bexar Martinez’s September energisation, implying roughly March 2027
• Potential groundbreaking on further ERCOT projects as early as late 2026
• Grid services from those projects anticipated to begin in 2027

The economics that underpin this ambition are front-loaded on capital cost. Hall states that installed costs for typical B2U projects run as much as 40% below comparable conventional battery energy storage systems, a claim broadly consistent with a 2023 academic review finding second-life capital costs at 64-79% of new-battery equivalents. The saving comes primarily from acquiring used EV modules at a fraction of new-pack prices, with deferred recycling costs recovered later.

The capital cost advantage cited by B2U’s CEO is consistent with peer-reviewed second-life battery capital cost research that models acquisition pricing for used EV modules relative to new-cell equivalents, finding repurposing facilities can achieve meaningful cost reductions depending on chemistry, degradation state, and processing approach.

The lifecycle picture is more nuanced, and investors should see both sides.

The gap between the CEO’s capital-cost claim and the levelised cost of storage (LCOS) figures, the total cost per unit of energy delivered across a project’s life, tells you where the model’s edge lies. The capital advantage is real and significant. Lifecycle parity with new-battery systems, however, depends on operational execution, degradation management, and the discount rate assumptions lenders ultimately price into project finance. B2U’s pipeline is competitively cheap upfront; whether it stays competitive across the full project life is the question the LCOS data keeps open.

For investors wanting to benchmark B2U’s claimed 40% capital-cost advantage against the current new-build cost curve, our dedicated guide to lithium battery storage costs covers LFP pricing trends, chemistry-level performance differences, and the emerging sodium-ion competition that may reshape new-battery reference prices by 2028.

BESS demand growth at the global level provides important context for why merchant ERCOT projects are attracting institutional capital: surging grid-scale procurement is compressing new-battery module prices across the supply chain, which paradoxically also tightens the economic margin that makes second-life systems competitively attractive relative to conventional builds.

Past performance does not guarantee future results. Financial projections are subject to market conditions and various risk factors.

Why ERCOT is the proving ground for merchant second-life storage

ERCOT is not a geographic accident in B2U’s strategy. It is an energy-only wholesale market with no capacity payments, and that structure suits low-capital-cost second-life systems in a way it would not suit higher-cost assets.

Batteries in this market earn revenue from several streams without needing a long-term contract:

• Arbitrage of volatile real-time electricity prices
• Scarcity pricing captured during extreme weather and peak demand
• Ancillary services such as regulation and reserves through fast frequency response

That revenue mix is where second-life economics and market design meet.

Where a new-battery project may need a tolling agreement or capacity contract to support financing, B2U’s lower capital base means merchant revenues can carry project economics even at the higher LCOS levels the research documents.

B2U is currently operating both ERCOT facilities on a merchant basis while finalising tolling arrangements with third-party counterparties. This is a deliberate posture, not a financing gap waiting to close: the ability to earn returns without contracted revenue is precisely what validates the repurposed-battery model at this scale.

The bankability story is starting to catch up with the operations. The $45 million structured finance fund closed in December 2025 is cited by sector analysts at Faradex Partners as a pioneering case of institutional capital growing comfortable with second-life performance and residual-value assumptions. Wider ERCOT battery build-out, including projects such as the 160 MW / 320 MWh Houston IV system, reflects broad confidence in the market’s battery economics.

For investors, understanding why ERCOT specifically fits second-life storage helps separate B2U’s approach from conventional battery projects that need different financing. That distinction matters when judging how replicable the model is across the other U.S. markets in B2U’s pipeline.

What B2U’s Texas expansion signals for second-life storage as an investable category

Four signals landed within the same reporting window in September 2026: a second ERCOT commissioning, a high-profile OEM feedstock agreement, a disclosed pipeline above 1,000 MWh, and a structured finance precedent already in place. Taken together, they point to a sector moving into accelerating commercial validation rather than sitting in perpetual pilot mode.

Whether the pipeline converts depends on variables investors can now track directly:

• The 50+ MWh ERCOT addition landing on schedule around March 2027
• Waymo-sourced batteries reaching San Antonio-area projects in 2027 as expected
• Tolling arrangements closing on acceptable terms
• Confirmation of domestic content bonus eligibility under the Section 48(e) Investment Tax Credit, where sector debate continues over how repurposed EV batteries are treated
• EV retirement volumes and the share of packs suitable for reuse after screening scaling as modelled

The next six months function as the real stress test. If the additional ERCOT capacity delivers on the same timeline Bexar Martinez did, investors will have three sequential completions as evidence that repurposed-battery storage can be built and operated at a pace that justifies pipeline capital, not just proof-of-concept attention.

You do not need to decide today whether second-life storage is a permanent infrastructure category. You do need to know which milestones would update that call, and B2U has now handed you a specific near-term timeline to measure against.

The Section 48(e) Investment Tax Credit question sits within a broader set of regulatory risks for battery storage that include interconnection queue reform, evolving state-level siting rules, and unresolved federal guidance on what constitutes domestic content for repurposed systems assembled from internationally manufactured EV modules.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions. These statements are speculative and subject to change based on market developments and company performance.