Echelon utilization of retired electric bus batteries: Economic and environmental potential

• An integrated model covering the entire process of power batteries is established. • A GPS-data-based SoC simulation method enhances battery degradation prediction. • EBSLB utilization potential is systematically forecasted for 2025–2035. • Echelon utilization enables significant environmental and economic co-benefits. The rapid deployment of electric bus fleets introduces dual pressures on grid stability and sustainable battery retirement. Harnessing the residual capacity of retired batteries through echelon utilization presents a strategic pathway toward circular economy and carbon neutrality. This study presents an integrated multi-model framework combining vehicle behavior simulation, battery degradation modeling, retirement flow forecasting, and benefits analysis to evaluate the echelon utilization potential and economic-environmental benefits of deploying electric bus second-life batteries (EBSLBs) in energy storage scenarios. A case study of Wenzhou, China, demonstrates that over 1.9 GWh of EBSLBs capacity will become available annually by 2035. Leveraging these energy storage resources to store curtailed renewable energy and manage peak power loads can reduce per capita carbon emissions from urban residential electricity consumption by 10%, and generate annual economic revenues exceeding ¥600 million, thus enhancing urban energy resilience and supporting low-carbon development.