Battery system failures fell 98% in 7 years, but older systems need special care: report

Large battery storage systems, the kind utilities use to store power on the grid, are failing far less often than they used to. A new analysis from the Electric Power Research Institute found that failure rates for lithium-ion battery systems dropped 98% from 2018 to 2025, and 50% in the last year alone. Annual failure rates now run between 0.04% and 0.14%, similar to the failure rate for oil-filled electrical transformers that have been in use for decades. Most incidents, 93%, caused no injuries.

The improvement mainly applies to newer systems built under stricter safety codes. Systems installed before 2021 make up only 3% of global storage capacity but tend to fail more often than newer ones. The most serious U.S. incident involved an older facility near Santa Cruz, California, where a 2020 battery installation caught fire in January 2025 and burned for days, though no one was hurt. Experts say older systems can benefit from safety reviews and sometimes retrofits, like adding gas detectors or improving ventilation, though some fixes are costly enough that replacing an aging system outright may make more sense than upgrading it.

This news mostly concerns utility-scale battery installations, not the smaller battery systems some homeowners pair with rooftop solar. Still, it's a reminder that battery safety standards have moved quickly, and anyone considering a home battery system might ask when the equipment was designed and whether it meets current safety codes, since the industry itself expects older designs to carry higher risk.