Those who TL;DRd - it's for the factory, not the cars! Old EV batteries are great for energy storage. A worse weight-to-capacity ratio doesn't matter for batteries sitting on the ground. A battery that holds only 70% of its original capacity is considered worn-out for EVs (and even replaced under warranty), but grid storage isn't driving anywhere, so any capacity left is still useful.
At the cell level they don’t degrade linearly. First it’s slow then it’s fast and then it’s abrupt collapse. You probably have noticed that yourself with old devices. Some do not hold charge even for a minute. With battery packs probably you can do some smart things to make the degradation curve look more linear, but again there is only so much you can do.
Sudden failure in a big battery like these is usually due to a single cell failing, which can usually be replaced and then the battery pack is back to the 70% capacity or whatever. Probably in this context of scale it's worth doing the work of replacing bad cells.