Energetica India nº91 July August 2020

India towards Atma Nirbhar Bharat IESA believes that it is high time for the Indian industry to take up R&D and advanced cell manufacturing so that the country reduces its dependence on other countries. The recent pandemic related to COVID19 has highlighted the importance of domestic manufacturing considering the risk of global supply chain disruptions. Energy storage and EVs have importance for national energy security and we should learn from the recent events and accelerate our efforts for building domestic capabilities. Introduction: The onset of COVID-19 (novel coronavi- rus) began in China, and quickly spread to South Korea. Together they comprise much of the world’s Lithium-ion (Li-ion) battery manufacturing. China is domi- nant in the battery supply chain, as it accounts to three-quarters of battery manufacturing capacity. The COVID-19 impact then expanded to Europe and North America, which together com- prise a bulk of non-Chinese demand for those batteries. This progression creat- ed a series of disruptions in the supply chain for Li-ion batteries, which will also affect Indian electric vehicle and sta- tionary energy storage market. Apart from Li-Ion Ion Batteries, the continuous lockdown in India , has also affected the supply and demand gap of the lead acid battery manufacturing industry. It will affect all verticals of business such as energy storage for renewable inte- gration, applications in residential back up, C&I back up, telecom, datacentre and others. While most of market par- ticipants expected some delays, the extent of disruption may not be fully re- vealed for several months. An understanding of the supply chain, related supply markets (e.g., Li-ion elec- tric vehicle batteries) and how these markets interact with the broader econ- omy will be critical to analyze the im- pact, as well as suggest strategies that market participants, regulators, and pol- icymakers can employ to mitigate some the adverse effects. Even though, India is encouraging indigenous manufactur- ing and have succeeded to an extent, but the most important part of any bat- tery being the cell, which are still being imported mostly from China and other East Asian countries, the growth is ex- pected to slow down the industry event further. As the coronavirus spread, our focus should shift from foreign manufac- turing capability to develop indigenous ecosystem development. To understand the importance of en- ergy storage & eMobility technologies IESA is organizing a global conference on 22nd September on the occasion of world Energy Storage Day in associa- tion with 30+ international partners. India picture: India is one of the leading countries in lead acid manufacturing. The li-ion bat- tery manufacturers in India are currently assembling packs importing cells. In- digenous manufacturing is highly es- sential to make the current energy tran- sition sustainable. Reliance on imports has many demerits and India as a coun- try has been on the receiving end of the same more than often. We witnessed the effects of rising oil price in recent past. The Government of India has re- alized the advantages of indigenous manufacturing and has been promot- ing the same actively. With the recent announcement of AtmaNirbhar Bharat, our Honorable Prime Minister has made clear the intent of the Government. NITI Aayog has also in lines of the same de- veloped National program for Advanced Chemistry Cell (ACC) Manufacturing with an outlay of 35,500 crore, that is anticipated to get launched shortly. NITI Aayog has sought Cabinet approval for the proposal which outlays build- ing up to 10 large gigafactories which would get subsidies to produce Lithium ion batteries. Once it gets the approv- al, the Aayog will invite bids for setting up these gigafactories, with a total ca- pacity of 50 GWh, over ten years. The move is part of an effort to push use of EVs, for which high battery cost is a big hurdle and promote integration of ener- gy storage more actively in the power grid. The Finance Ministry has already sanctioned the Aayog’s proposal to offer a Rs 700 crore a year in subsidies to battery makers, starting 2022. The pro- posal is made more output based rather than input based, with subsidy linked to the capacity creation committed and the level of indigenization (60% necessary). Most recently, Hon’ble PM Shri Naren- dra Modi mentioned about energy stor- age R&D and manufacturing for solar integration and encouraging investment in this space. Finance Minister Smt. Nirmala Sitharaman also mentioned in AtmaNirbhar Bharat package to con- sider energy storage manufacturing as the champion sector for India. The cur- rent pandemic related to COVID19 has highlighted the importance of domestic manufacturing, considering the risk of global supply chain disruptions. Way forward: Apart from attracting investments for Debi Prasad Dash Executive Director, India Energy Storage Alliance (IESA) energetica INDIA- July-Aug_2020 33