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India, powering future mobility through advanced battery manufacturing
Industry News- Oct 04,23
A recent report from the credit rating agency ICRA predicts a substantial influx of electric vehicles that will trigger investments in cell manufacturing, a pivotal component in the EV ecosystem.
India is witnessing a surging wave of electric vehicles (EVs), signifying not just a shift towards cleaner transportation but also a revolution in battery manufacturing efficiency. A recent report from the credit rating agency ICRA predicts a substantial influx of electric vehicles that will trigger investments in cell manufacturing, a pivotal component in the EV ecosystem. By 2030, these investments are anticipated to surpass a staggering Rs 70,000 crores.
Central to this transformation are advanced chemistry batteries, constituting a significant portion (ranging from 35% to 40%) of an EV's cost. To democratise EV usage and ensure competitive pricing, India needs to establish a local ecosystem for battery cell production.
Strategically, investments in battery manufacturing play a crucial role in making EVs more affordable. ICRA's report emphasises that achieving economies of scale in battery production is pivotal to reducing EV costs and achieving pricing parity with conventional vehicles.
While EV adoption is rising, the gradual improvement in charging infrastructure remains a challenge. Enhancing energy efficiency is critical, and partnerships among battery manufacturers across the value chain are essential in overcoming these obstacles. Additionally, a robust framework for battery recycling is imperative to ensure sustainability in the EV industry.
The government of India is actively supporting the EV sector through initiatives like the Production-Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) Battery Storage. This policy aims to enhance domestic value addition and nurture capability development in the swiftly evolving EV industry. Notably, prominent companies like Reliance New Energy Limited, Ola Electric Mobility Private Limited, and Rajesh Exports Limited have inked agreements with the government, receiving substantial incentives amounting to Rs 18,100 crores under this program.
Regarding battery chemistry, while Lithium-ion batteries have been the preferred choice for EVs due to their high energy efficiency and thermal stability, the report suggests that Lithium Iron Phosphate (LFP) chemistry is gaining momentum. LFP batteries offer superior thermal stability and lower production costs, making them an attractive option for the Indian EV market.
As India accelerates towards sustainable and eco-friendly mobility solutions, the significance of battery manufacturing cannot be overstated. The recent investments in the battery manufacturing sector not only unlock the potential for affordable EVs but also substantially contribute to the nation’s economic growth and environmental preservation. With strategic partnerships, government backing, and advancements in battery technology, India is well on its way to electrifying its future on the roads.
Source: smallcase.com
India
advanced battery manufacturing
electric vehicles
eco-friendly transportation
battery technology
energy efficiency
charging infrastructure
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