The Devastation of a Lithium Fire

The following newsletter was posted by CIA Building Insurance

“With all honesty, this fire was the most traumatic thing I’ve ever experienced in my life” - Eugene, CEO of Axiom Hydraulics.

On 16 June 2023, Eugene’s life completely changed when a fire broke out at his hydraulic factory.

On a public holiday on his way to the mall with his family to celebrate his wife’s birthday, Eugene received an alarm notification, when he looked at the CCTV footage on his phone he could see smoke and flames through the workshop window.

Eugene alerted emergency services and immediately rushed to his factory. Upon arrival the fire was so severe that they could not access any part of the property.

Eugene recalls standing in front of his burning building watching his life’s work go up in flames, horrified at the potential impact on the 40 families that relied on Axiom, not to mention their loyal clients which they had been serving for 60 years.

In an interview with Eugene after the fire, he mentioned that while he had a vague idea of what a fire might entail until the 16th of June he had no comprehension of how devastating such a situation actually is and how important having good insurance is.

Eugene had always thought his factory had very limited fire risk - it was a clean engineering risk, and almost all the stock was made of steel - what could have gone wrong?

The cause of the fire:

As is the case with an increasing number of businesses and homes today, the factory was fitted with a solar system coupled to a set of lithium batteries. Having this system gave Axiom the ability to operate during loadshedding which was critical for the business.

The forensic investigation found that one of the lithium batteries had failed, most likely due to the failure of its built-in battery management system. This in turn caused sparks to fall onto the adjacent wooden racking, igniting the racking and the other batteries in the system - leading to a devastating fire that spread throughout the building.

Unfortunately, although getting to site quickly, the fire brigade was unable to extinguish the fire. Due to the unique chemical composition of lithium batteries, water and powder fire fighting equipment are not effectual in putting out a lithium fire.

Fulfilling our promise:

While this was Axiom’s first (and hopefully only) fire, it is something we at CIA, as building insurance specialists deal with on a regular basis. Once the site had been declared safe we were able to activate our specialist professional team to begin the reinstatement process.

Despite large scale building works, we were able to find a way for Axiom to continue operating a few machines in an adjacent portion of the building that was undamaged, thereby enabling them to continue to fulfil key client orders – which they risked losing to their competition.

Working together we were able to help Axiom get back to full operating capacity within 6 months in their brand-new building serving their clients, making good on our promise.

Although the fire was one of the most traumatic experiences Eugene has ever had to deal with, in our final handover meeting he showed his sincere appreciation for our claims team and commented:

"Insurance is something I’ve always believed in but never had to really test. I now know first-hand what it means and how important it is that when devastation strikes, you have someone to help put back the pieces"

And what about the new solar system?

Axiom’s system was covered as part of the building. They took the opportunity during the reinstatement to upgrade to a bigger system. However, in line with our recommendations, the system was moved to a separate outbuilding. They are also currently exploring more specialised temperature monitoring and auto suppression system which have recently been launched in South Africa.

Source: CIA

Following our previous newsletter about the devastation caused by a lithium battery fire at Axiom Hydraulics, we will look at the most common causes of lithium battery fires.

Since June last year, only four lithium battery fires have resulted in damages of more than R45 million.

One of the biggest concerns with these systems is incorrect installation. With this booming demand, it appears that anyone and everyone is now installing alternative energy systems.

The system must be installed and tested by a qualified electrician in compliance with all applicable legislation and manufacturer’s guidelines.

It is vitally important that the manufacturer's instructions and specifications are adhered to. This photo illustrates an incorrect installation with insufficient spacing between the inverter and battery.

A valid electrical certificate of compliance and test report for the system must be issued and available for inspection when required.

Another fire trigger is thermal runaway in these batteries. A thermal runaway is a chain reaction within a battery that leads to rapid temperature and pressure increase.

Causes of thermal runaway could be due to any of the following:

• a) Internal short circuits due to physical damage or manufacturing defects.
• b) Overcharging and discharging- exceeding the recommended charging or discharging rates.

• c) External heat sources - batteries exposed to high ambient temperatures or near heat generating devices.

• d) Age and wear and tear over time.
   

To prevent failure regular inspections and maintenance are recommended to identify potential risks.

In addition to the above a lesson learnt from the fire in our previous newsletter is that no combustible material may be stored within two meters of any inverter or battery.

Landlords must ensure that their tenants are made aware of the dangers of and requirements in terms of these systems as failure to do so may result in the repudiation of a claim.

In our next newsletter, we will look at why traditional firefighting methods are not effective on lithium battery fires.

Source: CIA