The use of lithium-ion batteries is rising—and so are the potential hazards linked to them. Known for powering everything from smartphones to electric vehicles (EVs), when damaged, these batteries can enter a state of “thermal runaway," a dangerous condition that leads to hotter, more challenging and intense fires, posing a significant risk for commercial property management. 

What Is Thermal Runaway? 

Thermal runaway happens when a damaged lithium-ion battery overheats and ignites. Because lithium is a highly flammable metal, the damaged cells can become extremely hot, rapidly heating the cells adjacent to them until they ignite, setting off a chain reaction. Adding to the difficulty in managing these fires is the fact that lithium self-oxidizes, generating its own oxygen, which can further intensify the fire. 

While the risk of a lithium fire may be more likely in manufacturing facilities, the potential for thermal runaway poses a significant threat across warehouses, retail environments and distribution centers that handle electronics and similar devices. For example, a simple accident like a warehouse forklift puncturing a battery in a product being stored there can trigger a thermal runaway—resulting in a catastrophic event. 

Basically, any business involved with electronic products faces heightened risks. This includes distributors and retailers of electronics, as well as companies using lithium-ion battery-powered equipment. 

Further, certain industries are starting to find that the engineering that worked well in the past is rapidly becoming ineffective against these new hazards. For example, some covered or underground parking structures are now banning EVs because the facilities were not designed for the exposures posed by this new technology. The hard-to-control fires that can arise from their batteries may not be easily extinguished with standard firefighting equipment and the structure of parking garages—often enclosed and with limited access—exacerbates the difficulty in controlling such fires. 

Moreover, the design of many parking facilities does not account for the specific needs required to safely accommodate EVs. For instance, the ventilation systems in many garages may not be sufficient to clear the heavy smoke and potentially toxic fumes produced during a lithium battery fire and the intense heat produced by thermal runaway can cause significant structural damage that was not anticipated when the garage was engineered to handle internal combustion engine (ICE) fires. This creates increased risk not only for the property itself but for the safety of drivers and firefighters as well.

Managing Lithium Battery Risks 

There are several key strategies to mitigate the risks associated with lithium-ion batteries. In the case of a parking structure, property managers and developers may consider retrofitting the existing structures with improved fire suppression systems specifically designed to handle lithium battery fires. These systems might include enhanced sprinkler systems capable of delivering more water to cool the fires or specialized fire-extinguishing agents tailored to these types of fires. Better ventilation systems can also help. Additionally, implementing strict parking guidelines for EVs—such as designated parking areas equipped with appropriate fire safety measures—can isolate the potential exposure to an easily accessible area and help minimize the risk of a fire spreading. 

Similarly, in a storage setting such as a warehouse, having designated, secure areas where lithium batteries are kept can help to control and minimize fire risks. It is important to keep these areas away from other highly combustible materials and support structures. These settings should also include adequate sprinkler systems to help quash thermal runaway risks. Also, specialized response procedures and equipment should be in place where batteries may potentially become damaged or pose a fire threat. 

Regular checks and maintenance of equipment powered by lithium-ion batteries are other ways to stay ahead of fire risks. Routine maintenance can prevent malfunctions that can lead to fires. Any damaged equipment should be reported immediately and taken out of service to an isolated fire-safe area. 

A commercial property manager's greatest friend is continuing education and employee training. From safety managers to warehouse staff, understanding the hazards of this technology as well as the mechanisms for dealing with thermal runaway is crucial to significantly mitigate the risks. Insurance carriers and agents can position themselves as great sources for their clients on risk management education.

Evolving Coverage and Engineering 

Although commercial property insurance typically covers fire damage, the unique risks posed by lithium-ion batteries can often necessitate additional policy endorsements. The insurance industry is still adapting to this emergent risk, continually refining policies to effectively address its specific challenges. 

While insurance is one piece of the puzzle, ongoing advancements in product engineering and emergency response training are anticipated when it comes to lithium batteries. As safety measures continue to improve, businesses are becoming better equipped to handle the potential risk of thermal runaway. Embracing a proactive risk management approach from the onset is indispensable to safeguard commercial properties. 

Ben Peetz is a seasoned fire service veteran and risk control consultant at Westfield Insurance, focusing on commercial property and agribusiness exposures, providing expert inspection and technical analysis across the U.S.