India is gearing up to create manufacturing, R&D and testing capabilities in the batteries space and the recently approved production linked incentive (PLI) scheme will act as a catalyst to meet both domestic and export needs (once self-reliance is achieved).
The Union Cabinet recently approved Rs 18,100 crore PLI scheme for Advanced Chemistry Cell (ACC) battery, providing new opportunities in the consumer electronics, electric vehicles, and renewable energy sectors. It aims to enable setting up 50 GWh annual production capacity ACC manufacturing facilities and lead to net savings of Rs 2 lakh crores-Rs 2.5 lakh crores on account of oil import bill reduction.
Dr Rahul Walawalkar, president, India Energy Storage Alliance (IESA), told Telangana Today, “The ACC programme will enable Indian companies to take the first step to become part of the global advanced battery manufacturing ecosystem and attract global technology leaders and investors to invest in India. ACC batteries will be crucial for India’s energy security in the coming decade given its role in enabling renewable integration and e-mobility transition.”
The scheme is directly linked to production which will lead to creation of manufacturing capabilities in the country. The focus will be on stationary energy storage, mobility and consumer electronics sectors. Higher incentive is expected for higher performance batteries. The scheme allows flexibility for companies to upgrade the technology after five years and claim higher incentive to develop higher performance cells. This will not only meet the domestic value addition needs but also enable catering to global markets. The next 12-18 months are going to be crucial for Indian industry. The supply chain is set to improve significantly, Walawalkar emphasized.
India had been importing cells completely. In the last five years, the industry has started building capability for cell packs. In the last year, 5 GW hr (worth $600-700 million) of cells had been imported. This number could go to 100 GW hr in the next one decade. Majority of the cells are coming from China, Korea and Taiwan. Consumer electronics (cell phones and laptops), telecom towers, backup batteries, electric vehicles remain the major consuming segments of lithium-ion batteries. In the next 10 years, EVs will certainly dominate, particularly after 2025, he noted.
While the Department of Heavy industries is going to implement the PLI scheme, several other government departments and Niti Aayog will coordinate and monitor the implementation of the scheme in the country. Pan-India, Telangana, Karnataka, Tamil Nadu, Maharashtra and Gujarat are leading in the energy storage and EV space. Gradually States such as Rajasthan, Uttar Pradesh and Punjab are also trying to attract investments.
He said, “India is on the path to improve design, research and development. IESA has been making efforts to build these capabilities in the country by 2022. The focus will be on energy density, compactness and long usage life. The industry is expected to significantly invest, so that niche technologies can be developed.”
IESA is also closely working with the government to ensure safety standards are maintained in making batteries that are used across verticals, particularly when the focus is going to be on high density. Testing labs for evaluating performance standards are being set up. Niti Aayog is also providing guidance in this direction. He said, “IESA has already set up three testing labs in Pune and is looking to replicate the lab model across the country and work with testing agencies and testing equipment companies.”
“These are crucial for tapping export opportunities. IESA is also rolling out initiatives to incorporate renewable energy in battery making plants. We are also looking into recycling/waste treatment and setting up zero discharge facilities of lead acid batteries makers,” he added.