NEW DELHI: Octillion Power Systems, the US-based manufacturer of advanced energy storage systems for electric vehicles (EVs) and power grids, today announced its foray into the fast-growing Indian market. The company has set up an office in India with plans to establish an advanced EV battery manufacturing facility at an investment of $15 million, reports ETAuto.
The publication also reported that the new factory will be based in Pune, Maharashtra and is expected to add 500 new jobs in the next three years. The new company will operate under the name Octillion Power Systems India Private Limited. “Octillion is proud to participate in this effort as India embarks on the most ambitious electric vehicle adoption plan in the world,” Octillion President Paul Beach told ETAuto.
The new EV battery facility will have a production capacity of over 250 Megawatt Hour (MWH). The company has been operating in India since the past two years, working with major Original Equipment Manufacturers (OEMs) in a variety of market segments to establish the core technology required to drive India’s EV revolution.
“I have worked in and around the India automotive and lithium-ion battery market for over ten years, and the growth I am seeing today is truly unrivalled. Octillion is bringing to India the most advanced cell and battery technologies available and we look forward to being part of this E-mobility revolution,” Yashodhan Gokhale, General Manager, India operations, Octillion Power Systems told ETAuto.
Having worked in the market for a couple of years and going through Automotive Research Association of India (ARAI) and UL certifications, Octillion views local production and content for key components such as the battery as necessary to achieving target pricing and to providing timely and reliable customer support to vehicle OEMs.
According to Nikhil Parchure, Octillion has been “working very hard in India for the past few years to deploy prototypes and validation vehicles with our OEM partners. We now see a large inflection coming where EVs are going to see a rapid adoption as the country pushes to revolutionize the transportation and electric grid market,” reported the publication.
The government has an ambitious plan to have an all-EV fleet in the country by 2030. A 12 per cent levy on pure electric vehicles (EVs) has been proposed under the Goods and Services Tax regime, a move that reflects the government’s intention to push its adoption. Since the country expands its renewable energy production portfolio and readies itself for large deployments of EVs, Octillion is also willing to offer battery systems that support the grid.
India Lithium-ion Battery Market
According to the recently published TechSci Research report “India Lithium-ion Battery Market Forecast and Opportunities, 2020” the market for lithium-ion (Li-ion) batteries in India is projected to witness double digit growth at over 35% CAGR during 2015-20. The reports said that under the new policies taken up by the government, adoption of Li-ion batteries is anticipated to grow at a tremendous pace in the coming years. “In the coming years, India is expected to witness substantial investments by various companies to set up their Li-ion battery manufacturing base in the country. Considering the continuous increase in smartphone and electric vehicle penetration in the country, major players like Panasonic and China BAK already have plans to set up their manufacturing units in various parts of the country.”, said Mr. Karan Chechi, Research Director with TechSci Research, a research based global management consulting firm in a press release.
Government’s push for making lithium-ion batteries in India
Moreover, the government is contemplating incentivising manufacturers to set up facilities for making lithium-ion batteries in India to lower the cost of electric vehicles. In May, elaborating on the plans to develop low-cost lithium-ion batteries in India, Union heavy industry minister Anant Geete told PTI, “We are trying to establish a manufacturing facility with Bharat Heavy Electricals Limited entailing an investment of Rs 100 crore. Maruti also wants to invest Rs 2 lakh crore for manufacturing lithium batteries.”
India’s leading business groups including Reliance, Adani, Suzuki, JSW, Hero are also readying plans to enter battery manufacturing and battery pack assembly with investments running into several billion dollars over the next decade or so, according to Factor Daily. Multiple sources said Reliance Industries, the country’s largest company by revenues had aggressive plans with one telling FactorDaily that it was looking at a factory that would produce Lithium-Ion (Li-Ion) batteries of 25 gigawatt-hours (GWh) capacity. A second source said that the Reliance factory would be in either Gujarat or Maharashtra.
The global production of Li-Ion batteries stands at over 100 GWh today and is expected to climb to 273 GWh by 2021, according to data from Bloomberg.
With increasing competition in the electric vehicles segment in India, many international players such as Suzuki Motor Corp. and Toshiba Corp. have already unveiled their Li-Ion battery plans for India. Last month, Suzuki announced that it will invest Rs 1,150 crore together with Japanese partners Toshiba and Denso Corp. to set up a Li-Ion battery facility in Gujarat. Suzuki will own 50%, Toshiba 40%, and Denso 10% of the joint venture that will make batteries and battery packs for Indian car maker Maruti Suzuki and export to Suzuki. Mumbai-based JSW Energy, part of Sajjan Jindal-led JSW Group, which wants to launch EVs by 2020, is also planning to set up a battery factory.
Virtuous Li-Ion prices
The prices of Li-Ion cells are also falling, which is making the solar energy-battery storage combination to power energy needs a reality. In 2011, Li-ion batteries cost around $600 per KWh to produce but with improvements in battery technology, this cost has substantially come down to around $200 per KWh. Tesla claims that the Tesla Model 3 battery comes at a cost below the $190 per KWh mark.