Australia’s mining sector is rapidly adopting lithium-ion battery storage, with over $2 billion invested in Battery Energy Storage Systems (BESS) in the first quarter of 2025. These systems are crucial for meeting renewable energy targets and enhancing reliability across industries, especially for mining operators seeking energy independence and reduced reliance on fossil fuels by integrating BESS with renewable sources like solar. However, the rise in battery fires and thermal runaway events worldwide poses a significant challenge, as highlighted by NSW Fire and Rescue.
A 2024 report estimated between 10,000 and 20,000 battery-related fires occur annually. A major fire at the Moss Landing battery storage facility in California earlier this year, which destroyed roughly 80% of the facility, has raised concerns about the safety of energy storage systems. In response, Mike Hunneyball, Operations Chief Engineer at commercial property insurance firm FM, which helps clients protect their property by offering risk management solutions, has outlined six risk mitigation strategies to help mining operators deploy BESS safely.
Hunneyball emphasises the need for proactive management strategies to address the inherent risks of battery fires. FM advises positioning BESS away from critical infrastructure and densely populated areas to minimise fire spread. Constructing enclosures with fire-resistant materials like concrete, steel, and brick can also contain fires and provide additional response time. Other strategies include separation and ventilation, fire protection systems, emergency response protocols, redundancy, and ongoing maintenance.
Shell notes that BESS plays a crucial role in Australia’s transition to a lower-carbon future by providing vital grid stability services and accelerating the uptake of renewable generation. The Australian Renewable Energy Agency (ARENA) has supported eight grid-scale batteries with a 2-gigawatt capacity, worth $2.7 billion, which will increase grid-forming battery storage capacity tenfold once built, further highlighting the importance of risk mitigation in this rapidly expanding sector.
