Lithium-ion batteries have become an indispensable part of modern life. Phones, smartphones, laptops, even forklifts: many devices rely on this technology today. Despite the growing use of these batteries, awareness of how to handle them safely remains limited, according to one expert.
According to Adrian Simmonds (pictured), practice leader for property risk solutions at QBE, explains, the risks associated with these batteries are only now being recognized by Canadians.
And for businesses, the risks are amplified by scale. Companies often house dozens, if not hundreds, of lithium-ion-powered devices without even realizing it.
Simmonds attributes this to how the hazard “crept upon us.” “When you start thinking about it, you might estimate having 10 or 15 such devices at home,” he said. “But when I counted, I realized I had 47. It’s quite frightening.”
While the designers and engineers working on lithium-ion technology have long known about its risks, that knowledge hasn’t fully trickled down to the public. “We have households and businesses with lots of these devices, but actual awareness of what to do about the risks is still very much in its early stages,” Simmonds said.
This lag leaves a significant gap, which insurance companies and brokers can work to close through education and guidance. QBE stressed that businesses using lithium-ion batteries are also exposed to supply chain and fire risks, which they need to mitigate.
At the heart of the risk with lithium-ion batteries is thermal runaway, a chemical reaction unique to lithium-ion batteries that makes fires especially hard to control. “Once it starts, it essentially can’t be stopped,” Simmonds said.
Thermal runaway is not a new phenomenon, but its introduction to batteries has created a unique and particularly dangerous challenge. Damage to a battery—whether from dropping a phone or a more significant impact—can disrupt internal connections. Plugging in a damaged battery can lead to overheating, triggering the exothermic reaction.
For firefighters, dealing with lithium-ion battery fires is an arduous task. The current best practice is to let the battery burn out while trying to contain the surrounding fire. However, this approach isn’t foolproof; if the fire is in a combustible building or near other flammable materials, it can quickly spiral out of control.
The lack of awareness among businesses can be costly, as improper handling or charging of these devices can lead to catastrophic incidents.
“I’ll ask a business, ‘Do you have lithium-ion battery devices?’ They’ll say no. Then I’ll point out their phones, their radios, their scanners, their forklifts. Within 10 to 15 minutes, we’ve identified 30 or 40 devices,” Simmonds told Insurance Business.
One practical step businesses can take is controlling how devices are charged. Simmonds recommends that personal devices not be charged in commercial settings unless they pass a Portable Appliance Test (PAT).
For higher-risk items like e-scooters or e-bikes, he advises charging them outdoors whenever possible. “Don’t let people bring them into the building and plug them into a socket next to their desk,” Simmonds said. Dedicated outdoor charging stations are now available and are a safer alternative to indoor charging.
The timing of charging is also critical. “Ideally, don’t charge out of hours when no one is present,” Simmonds advised.
There may be logistical challenges for businesses around managing lithium-ion batteries, particularly with equipment like forklifts that are often charged overnight. In these cases, installing fire detection systems linked to power supplies that cut off electricity in the event of a fire. While this won’t stop a thermal runaway, it reduces the risk of the fire intensifying before firefighters arrive.
Returns and reused batteries present another layer of risk. Businesses renting out devices like e-scooters or mobility scooters, for example, often refurbish and reuse batteries, not knowing what damage they may have sustained.
“Returns are much more likely to be abused, much more likely to have this potential risk of thermal runaway,” Simmonds said. Used batteries must be treated with extra caution, separating them from new stock, and implementing stricter inspection and handling procedures.
Finally, one of the most significant risk factors, particularly in the public space, is the use of mismatched chargers. Statistics indicate that around 40% of lithium-ion fires occur during or shortly after charging. “If you use the wrong charger, there’s often a mismatch in power or control software. That can overcharge the battery, leading to overheating and thermal runaway,” Simmonds said. Ensuring the correct charger is used, especially in commercial settings, should be a priority.
Another key consideration is the quality of the batteries themselves. With no formal certification standards for lithium-ion batteries in most countries, businesses must rely on reputable suppliers to minimize risks. But even this isn’t foolproof.
“Transport Canada has found a phenomenal number of imported batteries were defective,” Simmonds said. Some of these batteries even failed during testing, triggering faults that led to thermal runaway.
The problem is exacerbated by counterfeit products, which are often reverse-engineered versions of original designs. Simmonds said these fakes lack the quality control of genuine products, significantly increasing the likelihood of defects.
In addition, after finding that replacement batteries fail fire tests more often than original parts, Transport Canada said it was developing strategies to increase compliance. For now, businesses should stick to established brands and trusted suppliers – though Simmonds warned even this doesn’t guarantee safety.
“It’s an idealistic statement to say we should only buy certified products, but how do you actually achieve that? The supply chains are so complex,” Simmonds said. “When you’re buying a bike from a reputable company, you don’t know where they get their batteries from.”
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