Govt Soon To Invite Bids for 40 GW EV Battery Manufacturing Plants

The government is considering a plan to establish a battery making capacity of 40 gigawatts (GW) to give a boost to its electrical vehicles and renewable energy initiatives.

It will ask states to compete for the opportunity to set up internationally competitive facilities that will also service global markets. Domestic and global battery makers will be asked to bid for setting up plants in the selected states.

The proposal is expected to entail investments of $40 billion in the next two-three years and is likely to garner interest from global battery manufacturing firms and renewable energy players such as SoftBank, Tesla and Panasonic, a government official source was quoted by a financial daily.

The Centre is working on fiscal and non-fiscal measures to enable states to set up manufacturing units as competitive as those in China. Bids will be judged on the basis of land, incentives, power tariff discounts and regulatory and industrial support. Plants have to be competitive so that exports are commercially viable.

The large-scale battery manufacturing proposal is aimed at making storage systems competitive in India so electric vehicle adoption becomes more viable.

Batteries and battery cells are imported from the likes of China and the US. With plans to add 175 GW renewable energy generation capacity by 2022 and ensure that 30% of India’s vehicles are electrically powered by 2030, the demand for battery storage is pegged at 300 GW. However, according to the sources government is aiming for 70 GW batteries in the next three years.

Batteries consist of many cells packed together. Nearly a fifth of components for lithium-ion cells are not available locally.

The proposal is part of the National Mission on Transformative Mobility and Battery Storage approved by the Cabinet in March. An inter-ministerial steering committee chaired by Niti Aayog chief executive officer Amitabh Kant has been set up to promote clean mobility initiatives. This involves a phased manufacturing roadmap to implement large-scale battery module and pack assembly plants by 2019-2020, followed by integrated cell manufacturing by 2021-2022. State officials welcomed the proposal but said the Centre needed to ponder challenges such as battery technologies, integration with existing EV makers and Chinese competition.