They are, however, laying power lines to have illumination of the entire tunnel. Seems more like they're doing batteries because that's something they have already, not because it's the optimal solution.
The lines to power LEDs over a few miles are several orders of magnitude cheaper than lines and infrastructure capable of delivering power to a Subway car. The LA Metro runs on 750V DC.. the transmission and switching/transforming for that amount of power isnt cheap.
You'll have to switch/transform/transmit exactly the same (or bigger) amount of power for charging batteries with this solution. And you'll definitely have more electricity losses when you have to go through a battery.
But you can centralize that technology at the terminals instead of burying / waterproofing extremely thick cables for miles and miles.
There's no doubt it will be less efficient, especially since the cars are carrying their batteries but the whole point of this is to cut CapEx by 90+% and eliminating miles of power lines is an important part of that effort.
It's a lower level of importance over this 3 mile trip, but it's not uncommon for power upgrades/maintenance to be a multi hundred million dollar Annual outlay for large transit systems.
OTOH you are forgetting about the CapEx of the batteries, which looks to be in the ballpark of $1M-$10M depending on number of "skates" etc. That's $1M per mile of track (order of magnitude), which is the same as what METRANS estimates is the cost of retrofitting a third rail on existing rail track. As a rule of thumb, retrofits are significantly more expensive per mile, so I'd say odds are better than even the batteries are more expensive than a third rail.
A well-executed new metro line development, like the MetroSur line in Madrid, runs at around $60M per mile total cost including everything, all the construction and the trains and the stations and property rights.
If you want to improve on that by 90%+, you can't afford much more than just the batteries and the "skates" for this Dugout line.
I don't quite see the purpose of illuminating the entire tunnel unless they're using their autonomous driving tech which uses a camera. If so, they've just put a single point of failure on their lighting systems.
