Declining Capacity
Declining capacity is when the amount of charge a battery can hold gradually decreases due to usage, aging, and with some chemistry, lack of maintenance. PDA batteries, for example, are specified to deliver about 100 percent capacity when new but after usage and aging and lack of conditioning a pda battery's capacity will drop. This is normal. If you are using a pda battery (or any lithium-ion or lithium-polymer battery) when your battery's capacity reaches 60% to 70% the pda battery will need to be replaced. Standard industry practice will warranty a battery above 80%. Below 80% typically means you have used the practical life of a battery. Thus the threshold by which a battery can be returned under warranty is typically 80%.
Loss of Charge Acceptance
The loss of charge acceptance of the Li‑ion/polymer batteries is due to cell oxidation. Cell oxidation is when the cells of the battery lose their electrons. This is a normal process of the battery charge creation process. In fact every time you use your battery a loss of charge acceptance occurs (the charge loss allows your battery to power your device by delivering electrical current to your device). Capacity loss is permanent. Li‑ion/polymer batteries cannot be restored with cycling or any other external means. The capacity loss is permanent because the metals used in the cells run for a specific time only and are being consumed during their service life.
Internal Resistance
Internal resistance, known as impedance, determines the performance and runtime of a battery. It is a measure of opposition to a sinusoidal electric current. A high internal resistance curtails the flow of energy from the battery to a device. The aging of the battery cells contributes, primarily, to the increase in resistance, not usage. The internal resistance of the Li‑ion batteries cannot be improved with cycling (recharging). Cell oxidation, which causes high resistance, is non-reversible and is the ultimate cause of battery failure (energy may still be present in the battery, but it can no longer be delivered due to poor conductivity).
Elevated Self-Discharge
All batteries have an inherent self-discharge. The self-discharge on nickel-based batteries is 10 to 15 percent of its capacity in the first 24 hours after charge, followed by 10 to 15 percent every month thereafter. Li‑ion battery's self-discharges about five percent in the first 24 hours and one to two percent thereafter in the following months of use. At higher temperatures, the self-discharge on all battery chemistries increases. The self-discharge of a battery increases with age and usage. Once a battery exhibits high self-discharge, little can be done to reverse the effect.
Premature Voltage Cut-Off
Some devices like pdas do not fully utilize the low-end voltage spectrum of a battery. The pda device itself, for example cuts off before the designated end-of-discharge voltage is reached and battery power remains unused. For example, a pda that is powered with a single-cell Li‑ion battery and is designed to cut-off at 3.7V may actually cut-off at 3.3V. Obviously the full potential of the battery and the device is lost (not utilized). Why? It could be something with elevated internal resistance and or pda operations at warm ambient temperatures. PDAs that load the battery with current bursts are more receptive to premature voltage cut-off than analog equipment. High cut-off voltage is mostly equipment related, not battery.
Source :
Battery Education: Battery Degradation and Power Loss