Li-ion batteries make up for the most expensive component of an electric vehicle, accounting for 40-50% of its cost. With the increasing penetration of EVs in our transport system, the demand for Li-ion batteries for EV applications is set to skyrocket. Apart from Electric Vehicles, other applications such as renewable energy integration with the grid will boost the Li-Ion battery demand. According to the government’s estimates, India will need a minimum of 10 GWh of Li-ion cells by 2022, about 60 GWh by 2025 and 120 GWh by 2030. This article explores the current state of Lithium-ion battery manufacturing in India.
Currently, either Li-ion cells are imported from China or Taiwan to be assembled into batteries in India, or already assembled battery packs are being imported. Considering the ambitious plans to push EVs, these imports are going to cost the economy dearly. India neither has any known sources of lithium (the lightest metal) or cobalt nor do we have lithium-ion battery manufacturing capabilities as of now. The government wants to encourage the local manufacturing of lithium-ion batteries through battery chemistry linked FAME incentives and increments on import duties. Local manufacturing of Lithium-ion batteries is expected to bring down the EV cost in due time.
Players in the Fray
The market for electric vehicle power packs is set to grow to $300 billion by 2030, including a huge secondary market comprising of more than 2.5 million e-rickshaws and 4,00,000 lead-acid battery-powered 2 wheelers on roads today. Many players in automobile and energy space have started teaming up together and finding synergies to roll out Li-ion battery manufacturing units for EV applications. Let’s take a look at some prominent names involved:
1. TDS Lithium-Ion Battery Gujarat Private Ltd (TDSG) is being set up in Gujarat by Toshiba Corporation, DENSO Corporation and Suzuki Motor Corporation to manufacture and supply Li-ion batteries to Maruti Suzuki and Suzuki Motor Gujarat plant in Hansalpur. The plant is located in Maruti Suzuki Supplier Park in Ahmedabad. This plant is expected to become operational by February 2021. The foundation stone for the plant was laid in September 2017 when Prime Minister Narendra Modi and then Japanese PM Shinzo Abe visited Gujarat.
The JV sees the equity stake split between Suzuki (50 per cent), TOSHIBA (40 per cent) and DENSO (10 per cent). 180 MILLION USD has been invested between all three Japanese ventures. The official website says “TDSG’s LIB is a highly safe rechargeable battery with six outstanding characteristics.
By using oxide-based materials (Lithium Titanium Oxide), TDS’s LIB is designed to prevent thermal runaway resulting from short-circuiting caused by physical stress.”
2. Exide Industries formed a 75:25 joint venture with Switzerland-based Leclanché SA, one of the world’s leading energy storage companies to produce lithium-ion batteries. The JV is called Nexcharge. The company will initially import the cells from Leclanche’s plant in Germany, citing cell production at the local plant will start later.
On July 10th, 2020, CEO of Nexcharge – Stefan Louis announced that they are ready with their production line to make Li-ion pouch cell battery modules in India. The plant is located at Prantij (near Ahmedabad) and started with a capacity of around 1.5 GWh. The cells are being imported from Leclanche’s plant in Germany, at present.
3. TATA Chemicals has a plant site of 127 acres in Dholera, Gujarat that can house manufacturing of active materials, Li-ion cells, and batteries of up to 10 GW per annum as well as the recycling operations. In the process of commissioning a commercial pilot cell manufacturing by 2021, which based on market demand could expand to 3 to 5 GW by 2025 and investment envisaged for the same is INR 800 crores. The cells will cater to applications in the automotive sector as well as stationary energy storage. Source
According to a report, the plant will attract an investment of INR 4,000 crores.
4. In Aug 2020, Japanese firm Amperex Technology Limited (ATL) acquired 180-acre land in Haryana to set up a manufacturing unit for Lithium-ion Polymer (LIP) batteries.
ATL (Owned by TDK corporation) spent Rs 550 crore to acquire the land near Gurugram. ATL is headquartered in Hong Kong and is a leader in supplying LIP batteries globally. The company already runs two cell manufacturing facilities in China. According to reports, ATL plans to invest Rs 7000 crore in the next few years to supply batteries to industries including smartphones, two and three-wheeler e-vehicles.
5. Li Energy has purchased 125 Acres of Land in Thondi, Tamilnadu to develop an SEZ and set up Li-ion cell manufacturing with the guidance of Dr Gopu Kumar, former Head of Lithium-ion Battery Research appointment by CSIR. The company has also signed a MoU with Guidance Tamil Nadu, the nodal agency of the government for investment promotion in the state.
Update as on Feb 09, 2021 – Li Energy is building a vertically integrated value chain and has planned the project as follows. Further updates awaited from the company.
Phase 1 – First fully automated prismatic Li-ion battery assembly line (1 GW) in India to be ready by Nov 2021, along with an R&D unit for cells. Talks underway with CATL to supply Cells. Li Energy plans to raise USD 15-20 million for Phase 1 and has boarded an Investment bank to that end.
Phase 2 – Li-ion cell manufacturing pilot line of 150 MW. Cathode, anode & other cell constituents to be imported.
Phase 3 – To do away with material imports and setup a Cell Material Company for LFP, NMC and LTO chemistries with CECRI-CSIR technology.
Phase 4 – Scale the Cell manufacturing facility to 1 Gigawatt.
Assembly line, R&D to be set up in Chennai. Plans to raise INR 750 Crores over next 4 years. Industries under focus are EVs & Energy Storage for Renewable Energy.
6. Manikaran Power Ltd is setting up a battery raw material project to manufacture lithium hydroxide – producing 20,000 LCE (Lithium Carbonate Equivalent). It is likely to be commissioned by mid-2024. Manikaran Power Limited is one of the country’s largest power trading and renewable energy company and will be investing USD 300 million to set up this refinery. The company will be importing Lithium ore from Australia and will be processing it to produce battery-grade material.
7. In Aug 2020, Mumbai based Epsilon Carbon announced starting production of graphite anode material for Li-ion batteries. In phase 1, starting with an initial capacity of 5,000 TPA, Epsilon wants to start producing 15,000 TPA of Mesophase by Jul 2021 for supply to anode manufactures. In phase 2, it plans to start producing Synthetic Graphite material to directly supply to battery manufacturers.
Government Initiatives Around Li-ion batteries
1. On 11th Nov, 2020 – Union Cabinet approved PLI (Production Linked Incentive) Scheme worth INR 1,45,980 crores for 10 key Sectors for enhancing India’s manufacturing capabilities and enhancing exports. One of the key sectors covered under this scheme is Advanced Chemistry Cell (ACC) Battery that has been approved for a financial outlay of INR 18,100 crores over a 5 year period.
National Programme on ACC Battery Storage will support 50 GigaWatt hours (“GWh”) of domestic ACC manufacturing. Implementing authorities are NITI Aayog and DHI. NITI Aayog has issued the draft RFP document for the selection of private entities to set-up manufacturing facilities for ACC and invited stakeholder comments on the same by Dec 14, 2020. According to the document, the subsidy support will be limited to a cumulative 50 GWh of ACC manufacturing capacity in India, with a single beneficiary not allowed more than 20 GWh cell manufacturing facility. Minimum bid may be restricted to 5 GWh capacity, which may be developed in phases over a five-year window.
2. Restricted FAME 2 benefits to EVs with Lithium-ion and better chemistry batteries, excluding lead-acid battery-powered vehicles.
3. Increased import duty on lithium-ion cells to 10% from the current 5% from April 2021.
4. Increased the import duty on assembled battery packs from 5% to 15% from April 2021.
5. Setting up of National Mission on Transformative Mobility and Battery Storage in 2019 to drive mobility initiatives with the goal of setting up large scale manufacturing plants for cells, batteries and other components of the EV value chain.
6. India and Bolivia have forged a partnership that entails India investing in developing Bolivia’s vast lithium deposits and Bolivia would, in turn, facilitate the supply of lithium, lithium carbonate and cobalt to India. The MoU between the two countries is set to foster alliances for lithium battery/cell production plants in India and the possibility of Indian companies setting up production capabilities in Bolivia.
7. Tender worth USD $50 billion was expected to be floated for global investors to set up a 50 GW battery manufacturing base under ‘Make in India’. NITI Aayog to seek proposals from states to identify a total of 5-20 locations in the country. The companies will be required to set up the manufacturing facilities by 2022, after which they will get the incentives for eight years till 2030. Ref IEEFA report. | There is no further development reported on this effort after initial reports.
8. According to news reports, 3 different Lithium-ion battery manufacturers (names withheld) were expected to set up units with a combined capacity of 10 gigawatts in Telangana, with an investment of Rs 1,500 crore in the first phase and a total investment of Rs 6000 crore |There is no further development reported on this effort after initial reports.
In addition to the above points, government bodies are also engaging in Li-ion cell manufacturing. BHEL was planning to set up India’s first Li-ion Giga-factory to manufacture Li-ion cells in a JV with Libcoin with plans to scale up the capacity to 30 GWh in due course, but there is no further development reported on this effort after Jan 2019. Earlier in 2019, ISRO chose 10 companies to transfer its indigenously developed low-cost Li-ion cell technology. These companies are listed below, however there are no official updates available on their progress with the technology.
1. Amara Raja Batteries, Andhra Pradesh
In Feb 2021, Amara Raja announced opening a technology hub to develop lithium-ion cells in Tirupati, that company plans too develop into a Li-ion cell manufacturing unit over next few years. According to reports, Amara Raj has already invested Rs 20 crore into the hub, excluding technology transfer and bidding fees paid to the ISRO in January 2019.
2. Bharat Electronics Limited BEL, Pune
3. Carborundum Universal Limited (CUMI), Kochi
4. Exicom power solutions, Gurgaon
5. GOCL, Hyderabad
6. Jyoti CNC Automation Ltd, Gujarat
7. Tata Chemicals Ltd, Mumbai
8. Thermax Ltd, Pune
9. Sukhbir Agro Energy Limited, New Delhi
10. National Aluminium Company Limited (NALCO), Bhubaneshwar
Lithium-ion Battery Pack Assembly for EV Applications
Many companies in India supply lithium-ion batteries for non-EV applications like consumer electronics but EV batteries are bigger and more complex. Below, we have put together a list of a few Li-ion battery pack manufacturers who are providing Li-ion batteries for EV applications in India:
1. Exicom – Exicom offers fixed and portable Lithium-ion batteries for e-autos, e-rickshaws, e-scooters and light electric vehicles. Kinetic Green 3 wheelers are using batteries produced by Exicom.
2. Okaya Power offers an LFP (Lithium Iron Phosphate) battery for e-rickshaws.
3. ACME – ACME Cleantech plans to expand the capacity of its lithium-ion battery manufacturing unit in Rudrapur, Uttarakhand to 2-3 GWh by 2020. ACME claims to be the first manufacturer of Li-ion batteries in the country.
4. PuREnergy Pvt. Ltd, Hyderabad
5. Grinntech, Chennai
5. Future hi-tech Batteries, Mohali
6. Pastiche Energy Solutions, Panchkula
7. Greenfuel Energy Solutions, Gurgaon
8. Amptek, Gurgaon
9. Inverted, New Delhi
10. Amara Raja Batteries Ltd is building a 100 megawatt-hour Lithium-ion assembly plant in Andhra Pradesh in close coordination with IIT Chennai.
11. Panasonic plans to assemble Lithium-ion batteries for two- and three-wheelers in India by importing lithium-ion cells from Japan or China.
Globally, China is the biggest consumer of lithium. China also plans to procure lithium from Bolivia through a joint venture with the latter’s state lithium company. Lithium rich countries like Bolivia, Chile, Argentina and Australia are set to play a critical role in the energy storage industry in coming years. In order to achieve the country’s EV adoption targets, we need to see quick capability building for lithium-ion cells and battery production. Hopefully, the initiatives being taken by the government and industry will secure access to lower-cost energy storage systems for India’s EV future.
Please let us know if you would like us to add any other Li-ion battery suppliers for EV applications to this list. For a list of EV Charging Solution providers, visit EV Charging Solution Providers in India.
Last Updated: 21 Feb, 2021
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