A battery energy storage system is disclosed, the battery energy storage system comprising a rechargeable battery assembly for storing and providing energy and a protection system including an arc flash protection device to protect against risks due to arc flashes. The arc flash protection device comprises an overcurrent protection unit which detects overcurrent conditions indicating arc flash conditions in case of a low impedance of the battery assembly and an undervoltage protection unit which detects undervoltage conditions indicating arc flash conditions in case of a low impedance of the battery assembly, wherein upon detecting the overcurrent conditions and/or the undervoltage conditions for a predetermined minimum time period, the arc flash protection device initiates protective measures to prevent further operation of the battery assembly. An energy conversion system comprising such a battery energy storage system, which can be used for stationary and mobile energy supply or distribution applications, is also disclosed.