Industrial batteries like Battery Energy Storage Systems (BESS) play a pivotal role in the modern energy landscape by offsetting grid electricity and storing energy generated from renewable sources. In essence, BESS technology is crucial for enhancing energy security, and stabilising the grid. Plus, BESS can store surplus renewable energy and release it precisely when needed, enhancing the efficiency of the grid and supporting the integration of more renewable sources into the energy mix. This not only helps in avoiding waste of renewable energy but also in reducing reliance on fossil fuel-based power generation during periods of high demand, thereby contributing to more sustainable and resilient energy systems.

BESS and the EU Battery Regulation

The European Union is leading by example, demonstrating a commitment to sustainability and the reduction of carbon emissions across the lifecycle of products, especially with the Battery Regulation. This move is expected to inspire other regions to adopt similar policies. The EU Battery regulation, which began to apply in February 2024, aims for sustainable, circular, and safe batteries sold in the European market. In this context, batteries for energy storage are not left out of the game.

Carbon Footprint Declarations

The EU Battery Regulation, in line with climate neutrality targets from European battery manufacturers, has set requirements for the performance and carbon footprint of batteries as we explained in another blog. Under the EU Battery Regulation, industrial batteries exceeding 2 kWh, used in energy storage (excluding external storage), must declare their carbon footprint from February 2026. For those batteries used in energy storage systems with external storage, carbon footprint declarations will start to apply later on in time.

Carbon footprint declarations are a critical step towards understanding and minimising the environmental impact of batteries. This initiative not only encourages manufacturers and all players along supply chains to innovate towards more sustainable practices, but also informs end consumers, enabling more environmentally conscious decisions around the use of batteries.

There are many methodologies offering alternative lenses, for example the one following the GHG Protocol. In particular, the EU Battery Regulation employs the Life Cycle Assessment (LCA) methodology for the carbon footprint calculation, which offers a holistic approach to evaluate environmental impacts across all stages of a product's life. It is worth highlighting that choosing LCA does not diminish the value or applicability of other methods. Instead, it highlights the importance of selecting the most appropriate tool based on the specific goals, scope, and criteria of each sustainability project.

When batteries used in electric vehicles degrade below 80% of their original capacity, might be suitable for a second life as BESS. This reuse aligns perfectly with the circular economy principles, as these batteries, despite their reduced capacity, meet the lower requirements of stationary storage systems. Repurposing EV batteries for BESS not only supports sustainable energy solutions by avoiding waste and reducing the demand for new battery production but also illustrates a practical implementation of the reuse aspect of the circular economy, with significant benefits for environmental sustainability. The LCA methodology can measure these impacts over the lifecycle of a battery. LCA can be applied to assess the first life of a battery, and also to a second life, for example when a battery used in an EV is repurposed for energy storage purposes as aforementioned. However, the methodology comes with its limitations and faces certain modelling complexities.

Complexities of LCA Models

The LCA methodology, while comprehensive, faces challenges in capturing the full environmental impact of batteries' diverse applications, especially during their use phase and in considering their second life. The variability in battery applications, from powering small electronics to serving as the backbone for electric vehicles and renewable energy storage, complicates the assessment of their environmental footprint accurately.

Particularly challenging is capturing the impacts during the use phase, which can vary significantly based on factors like the source of electricity for charging, operational conditions and even consumer behaviour, sometimes leading practitioners to exclude this lifecycle stage from the LCA's system boundaries. Moreover, the potential for batteries to have a second life, repurposed for applications such as stationary energy storage, introduces further complexity. Repurposing spent lithium-ion batteries to BESS delays access to secondary materials (e.g., recycled cobalt from LIB recycling), which makes it challenging to quantify the overall environmental costs and benefits of the battery ecosystem.

Advancements in LCA modelling, underscoring the need for advancements in LCA modelling to ensure these factors are accurately reflected, are crucial for refining this methodology and ensuring it accurately reflects the batteries' lifecycle impacts.

Charging Ahead

As we advance towards greener energy solutions, BESS emerges as a key player in decarbonisation efforts for grid mixes, driving countries and jurisdictions towards more sustainable energy systems. However, accurately assessing their full environmental impact across all life stages, from their primary role in electric vehicles to their secondary application in energy storage, remains a complex task.

The LCA methodology can be used to assess the potential environmental impact and benefits of providing a second life for spent LIB into BESS. Advancements in this area are crucial for providing a complete picture of batteries' environmental contributions and ensuring that our shift towards renewable energy is both sustainable and informed.