Should I explain my grades in my cover letter?
You only have one year of grades.  That is not many grades at all.  You said most of the grades are not from classes related to the internship.
We do not know what exactly the labs are looking for or who else is applying, so we cannot predict if you will get an internship.  But if you do not get what you want, it will probably be due to lack of experience rather than low grades.  Try again next year.
It is fine to say something like &quot;My grades have improved because of...&quot; and give a brief reason that implies the problem you had before is unlikely to occur again.  In your case, your reason might be &quot;a traumatic event during my first semester.&quot;