Large-scale grid-connected lithium-ion batteries are increasingly being deployed to support renewable energy roll-out on the power grid. These battery systems consist of thousands of individual cells and various ancillary systems for monitoring and control. Although many studies have focused on the behaviour of single lithium-ion cells, the impact of system design choices and ancillary system controls on long-term degradation and efficiency of system, containing thousands of cells, has rarely been considered in detail.Here, we simulate a 1 MWh grid battery system consisting of 18900 individual cells, each represented by a separate electrochemical model, as well as the thermal management system and power electronic converters.Simulations of the impact of cell-to-cell variability, thermal effects, and degradation effects were run for up to 10000 cycles and 10 years. It is shown that electrical contact resistances and cell-to-cell variations in initial