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The slow acceleration is from the trans being in 'limp' mode = 3rd gear starts.
Sounds like you may have the classic 'bad' PNP sensor. A well documented failure in these cars. You can try a possible temporary solution if you like. Turn the ignition 'on' but do not start the engine, put your foot on the brake and 'row' the shifter from 'P' to 'L' 20 to 30 times. Then start your car and drive it and see if it still starts in 3rd gear. The dash lights may still be on since it takes several drive cycles for the OBDII system on these cars to reset itself if this problem has temporarily cleared.
You can replace it yourself in a few hours (Volvo OE parts cost ~$125). There should be instructions in the FAQ's as well I can send the procedure I documented if you like. If you have a shop do the repair it will probably cost you anywhere from $100-$150 on top of the $125 for the part. Your call.
Has your mechanic pulled any codes? Did he check all your battery connections for corrosion? Did he check the alternator BEFORE replacing the battery?
A fully charged battery should read ~12.7 volts after 8 hours. 14.04 volts is fine if you read it immediately after a start otherwise 13.8 volts or so is normal on these cars.
No worries, it's not a major problem and is not expensive to fix if it's indeed the PNP sensor.
DEWFPO
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1998 S90 077,400 and 1995 964 154,100
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