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Automotive Product Finder Magazine | Can India become a R&D and manufacturing hub for EVs?
Can India become a R&D and manufacturing hub for EVs?
Automotive industry is currently experiencing a huge transformation
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India has significant market potential for EVs. Although we are still in the infancy of adoption of EVs, with the changes in the technology landscape as well as the clear vision set by the Indian government. This transition of the transportation sector from petroleum based internal combustion engines (ICEs) to EVs, would create a market of 750 GWh of advanced energy storage solutions over the next decade. In this article Debi Prasad Dash talks about future of EV in India and initiatives backing it.
State Governments such as Karnataka, Telangana, Uttar Pradesh, Uttarakhand, Kerala, Andhra Pradesh, Delhi, Tamil Nadu and Maharashtra have made a promising move by announcing their own policies to promote the development of electric mobility infrastructure and providing incentives for manufacturing of EVs and energy storage. Although currently, consumers have very limited choices on EVs in India, Indian automobile sector leaders have already showcased their upcoming EVs which can hit the roads very soon.
India has emerged as one of the fastest- growing markets for energy storage technologies in the past decade. The current decade saw adoption efforts led by the distributed energy storage for applications such as diesel optimisation and the emergence of e-Rickshaws as the fastest growing EV in India. Now, with the launch of FAME II and National Mission for Transformative Mobility and Battery Energy Storage, India is aiming not just to be one of the largest markets, but also to become a global hub for R&D and manufacturing in the coming decade.
The country has a huge market for conventional technologies like lead acid. With a higher life cycle, high efficiency and stiff price reduction, Li-Ion is giving tough competition to current lead acid technologies. Over the years, Li-ion batteries have evolved from LCO, LMO, LFP, NCA, NMC and emerging technologies like LTO, Li-Air and Li-Sulphur. Other technologies like flow batteries (VRB, ZBR), Sodium based battery, Zinc –Air are also emerging applications.Electric vehicle manufacturers have chosen Li-ion as a preferred technology due to higher energy and power density. At the same time, India has also seen large scale utilization of lead acid batteries for eRickshaws. One of the challenges for EVs in India is the higher temperatures and thus, there is a focus for research on batteries with higher temperature tolerance as well. In the case of EVs, energy density is important than battery cycle life.
In 2019, a lot of efforts from the government were seen in regard to electric vehicles. The annual budget announced tax incentives of around ?250,000 (~$3651.63)on purchase of EV and reduction of GST rates on vehicles and chargers from 12% to 5%. The Ministry of Power proposed a plan to develop EV infrastructure across 70 cities and 20 highways in the next 5 years. It also set standards for setting up of EV charging stations and came out with the plan that there will be an EV charging station in every 9km radius in urban areas and one in every 25kms on highways. Energy Efficiency Services Limited as well as National Thermal Power Corporation Limited and others are getting involved in setting up pf charging infrastructure which also includes IESA member companies like Exicom and Fortum. The biggest push has also come from the government in the form of e-buses and it was approved 5000 e-buses under the FAME 2 programm and we have seen almost 500 e-buses deployed in India. This number is expected to increase rapidly in 2020-21. While Ministry of Heavy Vehicles itself approved 5,000 E-Buses under FAME II program and EESL tendered for 10,000 buses. The NEMMP also set a target for the deployment of 7 million hybrid and EVs in India by 2020.
According to IESA, the EV battery market in India is estimated to be US$ 520 Million in 2018 and forecasted to grow at a CAGR of 30% till 2026. The total MWh addition in 2018 hit 4.75 GWh and expected to grow till 28.0 GWh by 2026. With respect to public charging infrastructure, the market is estimated to be US 520 billion in 2018 and forecasted to grow at a CAGR of 60% till 2026. The total charger sales in 2018 were less than a thousand units and is expected to grow till 50,000 units by 2026.The good point is there is enough hope and the market holds enough potential. Even with business as usual IESA predicts that’s by 2025 there will be a market of 250 GWh in India, the major part of it comes from EV penetration but avenues like DG optimization, Telecom, RE integration are also gaining ground. The stationary storage market is expected to grow at a CAGR of 6% till 2026 while the EV market can grow at a rate of 36%. India is expected to attract investment in 2 to 4 giga-factories for advanced Li-ion batteries, attracting over $3 billion in investments in the next 3 years.With appropriate government support, industry participation, India will be one of the top markets for energy storage adoption and manufacturing.
About the author:
Debi Prasad Dash works with India Energy Storage Alliance (IESA) as an Executive Director and holds an MBA degree in Finance from SCMHRD (Symbiosis International University) and Post-graduation Diploma in Renewable Energy from TERI University. He has over 7 years of industry experience and has worked with more than 50 clients in various capacities. He has also worked with ONGC and Oracle Financial Services.
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