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Guide · Second-Life & BESS

State of Health: The Only Number That Sets Battery Value

State of health is measured remaining capacity as a percentage of rated capacity.

SB

Sarah Brandt

Second-Life Systems Engineer

3 min read Updated 2026-08-28
Second-life battery cabinet at a rural telecom tower at sunset

The short answer

State of health is measured remaining capacity as a percentage of rated capacity. It is the single strongest predictor of a retired pack's value, because it decides whether modules enter the high-value second-life route or the lower-value refining route.

On this page4 sections

Key takeaways

  1. 1State of health compares remaining usable capacity with the rated capacity of the battery when new.
  2. 2Pack-level SOH from the vehicle is an estimate; module-level tests are what buyers trust.
  3. 3Resistance and cell-to-cell balance must be read alongside capacity to predict remaining life.
  4. 4A few percentage points of SOH can move a module between grades and change its value substantially.
01

What SOH actually measures

State of health is most commonly defined as the capacity a battery can still deliver, expressed as a percentage of its rated capacity. A pack rated at 50 kWh that now delivers 40 kWh under standard conditions has an SOH of roughly 80%. Some definitions also include power capability, because resistance rises as cells age and reduces the power a battery can supply.

The number sounds simple but depends on how it is measured. Temperature, charge and discharge rate, rest time and the voltage limits used all change the result. That is why SOH figures from different sources often disagree, and why a buyer will normally insist on its own test under a defined procedure before agreeing a price.

02

Vehicle estimates versus bench tests

The battery management system in a vehicle continuously estimates SOH from voltage, current and temperature data. These estimates are useful for tracking trends across a fleet, but they are model-based and can drift, and they describe the pack as a whole. A pack reporting 82% may contain modules ranging from the high 80s down to the low 70s.

Bench testing removes that uncertainty. Each module is cycled at a controlled rate and temperature to measure capacity directly, and DC internal resistance and impedance are recorded at the same time. The result is a module-level profile that shows which parts of the pack are reusable, which are marginal and which should go to refining.

Measured SOHGradeTypical route
85% and aboveAGrid-tied or commercial storage
75–85%BTelecom backup, solar buffering
65–75%CLow-cycle, low-power applications
Below 65% or damagedDRecycling and refining
How SOH maps to grade and route
03

Using SOH to protect value

For fleets, SOH is the lever that most changes end-of-life returns. Tracking it over time lets operators retire packs while they still qualify for higher grades instead of running them until they fall into refining territory. The difference between a Grade A module and the same module as black mass feed is usually the largest single value gap available.

Storage conditions after removal matter too. Packs left fully charged or in hot yards continue to age, and a module measured at 86% at removal can fall below the Grade A threshold by the time it is tested. Discharging to below 30%, keeping packs cool and booking collection promptly all help preserve the SOH that was measured in service.

  • Trend BMS SOH monthly rather than waiting for failures
  • Plan retirements before packs cross grade thresholds
  • Store removed packs cool and below 30% state of charge
  • Ask for module-level test reports, not a single pack figure

Field note

Price on measured module data — a pack-level BMS reading is a starting point, not a valuation.
Questions

Frequently asked questions

Is SOH the same as state of charge?

No. State of charge is how full the battery is right now; state of health is how much capacity the battery has left compared with when it was new.

Why does my BMS SOH differ from the test report?

BMS figures are estimates for the whole pack under varying conditions. Bench tests measure each module directly under controlled conditions, so they are more precise and often reveal spread the BMS averages out.

Turn this into a plan for your packs

Send pack counts, chemistry and approximate state of health. You get an indicative value split, a slotted collection window and pre-filled dangerous goods paperwork.

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