Economic Benefits and Safety Considerations for Battery Energy Storage Systems

The integration of battery energy storage systems (BESS) and electric vehicles (EVs) into the energy grid represents a significant advancement in the energy sector, which needs alternate energy sources during peak demand periods.  These technologies allow for energy storage during periods of low demand and release energy during peak times, stabilizing the grid and reducing energy costs for the consumers.

BESS is particularly effective when paired with renewable energy sources like solar power, storing excess energy generated during the day and releasing it when solar generation is not possible, i.e. during the evening, when the demand peaks.  This capability enhances the efficiency of renewable energy systems and provides a reliable backup during grid peak periods.

Lithium-ion batteries, known for their high energy density and long cycle life, have revolutionized energy storage and management. Their configuration, whether in series to achieve the desired voltage (VDC) or in parallel to enhance capacity (Ampere Hours), is crucial for optimizing the performance of energy storage systems.

The rapid evolution of EV technology has introduced new challenges, particularly in battery management and safety. The development and maintenance of EV charging infrastructure are critical. Significant advancements have been made in charging technology. Level 1 chargers use standard household 120VAC outlets, Level 2 chargers are robust and typically found in residential settings connected to 240VAC , and Level 3 chargers, or DC fast chargers or boost chargers, are designed for rapid charging in commercial areas. These fast chargers often integrate battery energy storage systems to deliver high energy quickly. Compliance with standards such as NFPA 855 is crucial due to the substantial energy stored in these systems. Many users are unaware of the batteries within these fast chargers, indicating a need for better education and awareness.

In several BESS projects, a joint venture with the developer and the owner is being implemented. Where the developer installs the system and performs maintenance for a short period, typically one year, and then hands the project to the owner. This type of arrangement can lead to ambiguities regarding liability if a loss occurs during the transition period.

The deployment of BESS has also highlighted significant safety concerns, particularly related to the flammable gases (i.e. Propane, Butane and Hydrogen)  produced by batteries that caused substantial property damage.  Recent Incidents in California (Moss Landing Fire BESS) and in Ontario (Brantford BESS Fire) have highlighted the potential dangers and the need for updated safety standards, updates in NFPA-855 (Standard for the Installation of Stationary Energy Storage Solution Systems, uand pdates in the Building and Fire Codes.

Economic and Safety Insights on Battery Energy Storage Systems

The economic benefits of BESS are significant. Charging batteries during off-peak hours when electricity rates are much lower and discharging them during peak hours when rates are higher allows businesses and consumers to achieve considerable cost savings.

The cost differential between peak and off-peak electricity rates can reach up to 900%, making energy storage a financially attractive option. This approach is particularly advantageous for industries with high energy consumption, enabling them to manage energy costs more effectively and enhance operational efficiency.

The technology behind lithium-ion batteries, commonly used in BESS and EVs, is vital for their performance and safety. These batteries consist of multiple cells connected in series and parallel configurations to achieve the required voltage and capacity. Each cell includes an anode, a cathode, and an electrolyte, with lithium ions moving between the anode and cathode during charging and discharging cycles.

Early Lithium Battery technology used NMC (Lithium Nickel Manganese Cobalt oxides) chemistry, newer systems use LFP (Lithium Iron Phosphate) chemistry. LFP cells have a higher thermal runaway onset temperature than NMC, meaning the cells can withstand higher temperatures before a fire ignites. This translates to safer battery technology.  

The design of these Lithium battery cells incorporates safety features such as vents and fuse links that open if a rapid internal overpressure of gases occurs.  Lithium-ion batteries pose risks, particularly in cases of physical damage or thermal runaway, which can lead to fires or explosions.

In EVs, the battery packs are typically located in the undercarriage of the vehicle and protected by robust frames to prevent damage during collisions. Severe accidents can still result in battery damage and subsequent fires, as seen in incidents involving high-speed crashes.

Ensuring the safety of EV batteries is crucial, and ongoing advancements in Battery Management Systems (BMS) aim to improve their reliability and safety. BMS monitors and controls the charging and discharging processes, ensuring that batteries operate within safe temperature and voltage ranges.

Battery Energy Storage Systems and Electrical Vehicles: Enhancing Grid Stability and Safety

The application of BESS and EVs extends to broader grid applications. BESS can provide essential electrical grid services like frequency regulation, voltage support, and load balancing, which are crucial for maintaining electrical grid stability, especially with the increasing installation of intermittent renewable energy sources. Acting as a buffer, BESS absorbs excess energy during low demand periods and releases it when demand spikes, smoothing out fluctuations and enhancing electric grid resilience.

Effective temperature management is critical for the operation of lithium-ion batteries. These batteries are prone to thermal runaway, a dangerous condition where the battery's temperature increases uncontrollably, generating flammable gases such as hydrogen, propane, and butane.

Thermal runaway can result from overcharging, short circuits, or mechanical damage, typically starting at around 90°C and escalating to temperatures above 200°C, potentially causing fires or explosions. Robust thermal management and protective measures are essential to prevent such incidents and ensure safe battery system operation.

The manufacturing and transportation of lithium-ion batteries present significant challenges. Currently, these batteries are produced in locations like North America, Korea, and China, and these batteries are subject to stringent transport regulations. For instance, they must be transported by ship rather than air and kept at a state of charge below 70%.   If stored for a prolonged period, they should be stored at a state of charge of 30%.

Incidents like the recent fire at the Port of Montreal underscore the importance of adhering to these regulations to prevent accidents.

The cost of battery energy storage systems has risen due to new safety standards revisions, such as NFPA 855, which mandates specific safeguards and testing protocols (UL9540 and UL9540A) for safe installation and operation.

BESS is increasingly deployed in applications like solar farms and EVs, requiring robust battery management systems (BMS) to monitor and control charging, discharging, temperature, and voltage. The BMS is crucial for maintaining battery system safety and efficiency.

The adoption of standards like NFPA 855 (first published in 2019 and current revision is 2023),. which provides guidelines for installing and operating stationary energy storage systems, is essential for ensuring safety. This standard limits the maximum energy per system and mandates fire suppression systems, such as sprinklers or dry chemicals, to mitigate fire risks. Also, it has a minimum clearance distance between combustibles and BESS and installation requirements like fire ratings of the walls around the BESS.

The integration of EV chargers into residential and commercial buildings has prompted updates in local codes and regulations. For instance, the Canadian Electrical Code and the US National Electrical Code NFPA 70  have been revised to accommodate the growing presence of electric vehicles. Utilities are promoting overnight charging by offering ultra-low rates, which helps manage the electrical grid load.

In condominium buildings, the installation of fast chargers or boost chargers must comply with NFPA 855, ensuring safety and reliability. This regulatory evolution supports the widespread adoption of electric vehicles and mitigates potential risks.

Case Studies

Real-world incidents involving EV batteries and Battery Energy Storage Systems highlight the importance of robust safety measures.

Fire Risks in Emerging Battery Technologies: A mining truck with a prototype Lithium Magnesium Oxide (LiMn2O4) battery experienced a fire due to arcing and coolant leaks, underscoring the need for rigorous testing and approval processes before deploying new battery technologies in the field.  Similarly, a solar farm with BESS in upstate New York suffered a significant loss when a fire in one battery container spread to others, resulting in a $7 million loss. This case emphasizes the necessity of proper fire suppression systems and physical fire barriers to prevent fire spread between one BESS container and others.

Battery System Explosions: In Surprise, Arizona, in 2019, an explosion occurred due to the introduction of oxygen into a battery system container full of combustible gases, injuring several firefighters and highlighting the volatility of gases produced by batteries. In Ontario, a significant fire in a battery energy storage system is under investigation, with lessons learned expected to influence future safety standards. These cases illustrate the critical need for comprehensive safety protocols and adherence to established standards like NFPA 855, which govern BESS installation and operation.

Large-Scale Energy Storage Fire: A power plant in California (Moss Landing Power Plant)  experienced a major fire in January 2025, further highlighting the risks associated with BESS. This facility, converted from oil and gas turbines to a BESS, suffered extensive damage due to the fire, revealing vulnerabilities in the system's design, particularly the lack of containment for the batteries installed in open racks inside a building. The fire's impact extended beyond the facility, necessitating the evacuation of nearby residents and underscoring the broader community risks posed by BESS incidents.

Essential Safety Standards for Preventing Incidents

The development and enforcement of safety standards, such as NFPA 855 and UL9540 and UL9540A, and updates to the local Fire and Building codes are essential for preventing future incidents. These standards, updated by past incidents, aim to mitigate risks associated with BESS. Compliance with these standards is both a regulatory requirement and a critical component of ensuring the safety of systems and communities. The cost of non-compliance can be substantial, including the financial burden of remediating contaminated water used in firefighting efforts and disposing of damaged battery cells. In the US, NFPA-855 was approved as an American National Standard on September 1, 2022.

Ensuring a Safe and Sustainable Energy Future

The deployment of BESS and EVs marks a pivotal advancement in the energy sector, offering substantial benefits such as cost savings, enhanced grid stability, and improved integration of renewable energy sources. To fully capitalize on these technologies, it is imperative to address the safety concerns related to the high energy density of lithium-ion batteries, which require stringent safety measures to mitigate risks like thermal runaway and physical damage.

Additionally, the rapid advancement of EV technology and its infrastructure necessitates adherence to evolving codes and standards, thorough testing, and effective risk management strategies. Stakeholders must remain proactive in implementing these measures to guarantee a safe and sustainable transition to electrified transportation.

Experiences from various regions underscore the importance of learning from past incidents and continuously improving BESS technology and regulations. By prioritizing safety and compliance, stakeholders can ensure the reliable and secure integration of these transformative technologies into the energy grid, ultimately supporting a more resilient and sustainable energy future.

Partner with Envista Forensics to Navigate BESS and EV Risk with Confidence

As battery energy storage systems and electric vehicles reshape our energy infrastructure, understanding their complexities is essential.

At Envista Forensics, our engineering experts help clients uncover the root causes of battery failures, assess system vulnerabilities, and support safe, compliant BESS deployments. Whether you're addressing a fire investigation, navigating NFPA 855 standards, or developing risk mitigation strategies, we provide the insights needed to protect people, property, and progress.

Contact us today to learn how our forensic engineering team can support your energy storage initiatives.