Toyota is recycling old EV batteries to help power Mazda's production line

Those who TL;DRd - it's for the factory, not the cars!

Old EV batteries are great for energy storage. A worse weight-to-capacity ratio doesn't matter for batteries sitting on the ground. A battery that holds only 70% of its original capacity is considered worn-out for EVs (and even replaced under warranty), but grid storage isn't driving anywhere, so any capacity left is still useful.

Battery banks are worse than degraded raid arrays in some important respects. The bad cells tend to try to bring the rest of the pack with them. It’s one of the reasons people keep toying with partitioning cells and putting controllers onto individual cells or small groups of them.

Parting out two or three dead battery packs to cull the best of the survivors can improve things quite a bit. And as you say, on a stationary pack you can afford to overdo telemetry, cooling, and safety circuitry because it doesn’t have to move, let alone accelerate.

I don’t know what the half life is like for the reused cells though. Do the cells that lasted twice as long as their neighbors continue to outperform or do they revert to the mean over time? I could see either being true. The days when you accidentally produce cells that are several stddev better than your target quality should make cells that last longer, unless they’re sold to a leadfootted driver.

A degraded battery bank does not mean a bank with outright "bad" cells. The cells will probably be way more off than they used to be, but there can still be plenty of effective capacity in the bank. Heck, if space isn't an issue, it's productive as long as it isn't self-discharging too fast.

You can still have a working battery even with some "bad" (i.e., way out of spec) cells, depending on the BMS. All the thresholds are configurable, just that a regular EV setup would lean towards safety.