In their efforts to implement a circular economy (CE) for lithium-ion batteries (LIB) in electric vehicles, automotive manufacturers need to take into account the perspective of energy consumers when assessing the environmental benefits of LIB repurposing in life cycle assessment (LCA). In response to this issue, this study presents a novel LCA framework, which allows manufacturers to assess different cases of LIB repurposing in an energy system and interpret the results in a CE context. The framework firstly uses energy flow modelling to enable the assessment of combining different battery storage applications in multi-use cases. Secondly, it includes a comparison of repurposing with alternative circular business models options for LIB. The framework is applied to an automotive manufacturer, seeking to assess a real-world project of LIB repurposing in different combinations of behind-the-meter applications at an industrial production site in Germany. As a key outcome, results reveal that from the perspective of the energy consumer, climate change benefits in multi-use cases are 10–22% lower than in single applications. Furthermore, from the perspective of the automotive manufacturer, repurposing is identified as the most beneficial option of circular business models available for LIB, taking into account additional recycling benefits resulting from the delay of end-of-life. Based on these findings, the study contributes to the application of LCA for decision-making in a CE and highlights pitfalls and potentials for a sustainable implementation of LIB repurposing in the future.