This study investigates the environmental and economic impacts of end-of-life (EOL) treatment for a 2.8 MWh/2.5 MW battery energy storage system (BESS) based on lithium-ion batteries (LIBs). It focuses on recycling pre-treatment processes for battery systems and recycling procedures for components like cooling systems, fire extinguishing systems, inverters, and the reuse of BESS containers and substations. A life cycle assessment (LCA) was employed to evaluate key environmental impacts, including climate change, eutrophication, and resource use. The study reveals substantial environmental benefits, particularly from recovering secondary materials like aluminium and copper, with recycling pre-treatment contributing significantly to overall benefits. Additionally, the economic analysis projects profits, emphasizing the advantages of locally sourcing critical raw materials. The research highlights the need for more sustainable recycling practices and provides insights for improving environmental and economic strategies in BESS management, offering guidance for future research and policy development in battery waste processing.