What is degradation in an industrial battery, and when does it become a problem?

An industrial BESS installation is a long-term investment in a company's energy infrastructure. As with any other physical equipment, performance changes over time. For lithium-ion batteries, degradation is not a fault or an unexpected event, but a known physical process with both calendar and cycle-related ageing (NREL). The question is not whether the battery degrades, but how quickly it happens, and how that affects day-to-day operation. This article explains the mechanisms behind degradation in an industrial battery, which factors drive the process, and when capacity loss starts to matter for the system's operation and lifetime.

What is capacity degradation, and how is it measured?

When people talk about degradation, they typically look at a decline in capacity and, in some cases, also a drop in power. Capacity describes how much energy the battery can store and deliver. Power describes how quickly it can do that. In practice, degradation is assessed by comparing current performance with the battery's original specifications under defined test conditions. Capacity fade and power fade are the central measures used in that assessment.

The most important measures are therefore the battery's current capacity and power relative to the specification. Those figures show whether the installation still delivers the performance that the operating model and business case rest on.

Actual losses normally develop gradually. That is why it is useful to monitor the trend continuously, rather than reacting only once an installation has already lost a large share of its functionality.

What drives degradation?

Degradation is influenced especially by temperature and operating profile. High temperature increases stress, and the battery's state-of-charge history also plays a role. State of charge (SOC) is how full or empty the battery is at a given time. High current during charge and discharge is another important stress factor, just as deeper cycles and more frequent cycling typically increase wear. NREL's BLAST material points to ambient temperature, state-of-charge history, electrical current, and cycle depth and frequency as central parameters in lifetime modelling, and NREL research correspondingly describes temperature history, operating window, and charge/discharge rate as governing factors for degradation (NREL, NREL). An installation that is often run hard and hot will typically be stressed more than one with more stable operating conditions.

It is also important to distinguish between calendar ageing and cyclic ageing. Calendar ageing occurs while the battery simply sits idle. Cyclic ageing occurs when the battery is charged and discharged again and again. Both contribute to the overall capacity loss.

When does it become a problem?

Degradation becomes a practical problem when a decline in capacity or power means the installation can no longer deliver the desired usable capacity and power in the operation that the project's economics rest on. At that point, the need for augmentation or replacement can arise earlier than planned, because available capacity has become lower than the original sizing assumed (NREL).

To assess the concrete risk, it is useful to look at the battery's actual operating data and compare them with the supplier's terms, the intended use, and the project's economics. That combination determines whether degradation is already an operational problem, or whether it only becomes one later.

What can be done to limit the loss?

Loss can be limited by managing operation against the parameters that actually affect ageing: temperature, SOC window, cycle depth, cycle frequency, and charge/discharge profile (NREL, NREL). In practice, that means avoiding unnecessarily high temperatures, overly narrow SOC windows, very high C-rates (how fast the battery is charged or discharged relative to its capacity), and very deep cycles, if the aim is to reduce stress on the battery.

If an installation needs a closer assessment, the assessment should start from the actual operating data and the warranty terms, and then consider whether degradation already affects capacity, power, or economics. Contact us here: Contact Zynex Group.