Lithium batteries and air shipment risks
Lithium-ion batteries were cited in South Korean investigators’ final report as a contributing factor in the 2011 Asiana Airlines Boing 747 crash that killed both pilots on board. Since 2006, lithium-ion batteries have been connected to several airline cargo fires including two jumbo jet crashes and a UPS cargo plane emergency landing. Also interesting to note, Malaysia Airlines flight 370 was reported to have been carrying 440lb of lithium-ion batteries.
Lithium batteries, when packed tightly together, can overheat and emit gasses which build up leading to fire and explosions. Recent testing by the Federal Aviation Administration shows aircraft fire protection systems “are unable to suppress or extinguish a fire involving significant quantities of lithium batteries, resulting in reduced time available for safe flight and landing of an aircraft to a diversion airport,” aircraft makers said. “Therefore, continuing to allow the carriage of lithium batteries within today’s transport category aircraft cargo compartments is an unacceptable risk to the air transport industry.”
The use and transport of lithium-ion batteries is growing rapidly, driven recently by the increased use in the renewable energy and auto industries, and by the continued growth in personal electronics. The overall market for lithium-ion batteries is expected to quadruple by the year 2020. “Overall demand for lithium-ion batteries will continue to increase throughout the forecast period due to anticipated high growth in the automotive and grid and renewable energy storage segments,” said Frost & Sullivan Research Manager Vishal Sapru. “North America and Asia-Pacific will lead demand, followed by Europe, wherein countries look for alternative energy sources to sustain automotive and energy sectors.”
While U.S. and international regulators continue to try and negotiate industry-wide standards to address the battery shipment issue, battery manufacturers and the airlines must take it upon themselves to manage these risks. For example, American Airlines has stopped accepting some types of lithium-ion battery shipments in February, Delta and United have made similar restrictions. Senior Boeing engineer Doug Ferguson, urged passenger carriers to stop all lithium battery shipments in cargo holds “until such time as safer methods of packaging are developed and implemented.” Although expected to resist regulations due to the added cost to their business, manufactures are also being urged take a proactive approach, ensuring appropriate packaging, safety procedures as well as adequate products liability insurance to help protect against large losses.
About the Author
Matthew Rist is an Area Assistant Vice President and a member of Gallagher WGA’s Renewable Energy and Clean Technology team. He provides risk management and insurance solutions to clients in the energy and clean technology areas, working closely with them to help design, negotiate and implement comprehensive insurance programs.