As we attended the IESA event which was held in the first week of May-2022 one of the important panel discussions was on how India can secure raw materials and its supply chain to build future giga factories. Here I write important things I noted during the conference.
In November, the Indian Cabinet approved the National Program for Advanced Chemistry Cell Battery Storage Manufacturing as part of the Production Linked Incentives (PLI) program for 10 sectors. To achieve this, NITI Aayog, on behalf of the government, issued draft Request for Proposal (RFP) documents for the selection of private entities to set up manufacturing facilities that produce Advance Chemistry Cells (ACC). ACC battery has been approved for a financial outlay of ₹ 18,100 crores, and automobiles and auto components have been approved for ₹ 57,042 crores.
One of The important steps in securing the raw materials is setting up a chemical/raw material processing plant here in India.
What is a Processing Unit?
The mined minerals or raw materials cannot be directly used for the manufacturing of batteries; they need to be processed to remove contaminants/unnecessary elements to turn them into battery-grade materials. Approximately 40% of the cell cost is the Anode and Cathode, and 18% of the manufacturing cost of the cell is the energy cost during chemical processing.
The processing industry in India can be worth anywhere around 1 Lakh Crore INR (12.8 Billion USD) by 2030.
What has china done well to secure its raw material and what India can learn?
Even though China doesn’t have all the natural resources available it has set up huge processing units, India similar to China can get the mined materials from Australia, South America, and Africa, and a lot of minerals are available in India itself and then these minerals/raw materials can be processed in the processing units to turn them into battery-grade materials to be finally eligible to be used in Batteries. It takes anywhere around 18-22 months to test the eligibility and become a supplier for battery manufacturers.
To look down the line for 10 Years, In 2024-25 India’s cell manufacturing capacity will be at 10-15 GWh capacity, and from 2027-28 the growth will be exponential so the supply chain and raw materials should go hand in hand with the growth and demand. The battery manufacturers should commit/partner with the raw material processing units to help them grow hand in hand and processing units need to be aware of the capacities of the battery makers to avoid shortages or bottlenecks.
To achieve cost competency with Chinese and Korean battery makers, India needs to improve its scale of processing the battery materials. It’s very challenging to go from lab to pilot scale to commercial.
For India, the next coming years are very important for the battery raw material supply chain to enter and make investments.
Here are some important points discussed by the panel:
Mr. Randheer Singh from Niti Ayog stated that “The capacity of batteries required for both EV and Energy storage application is estimated to be around 160GW by 2030 and 90% of the demand is going to be coming from EVs. As the increasing prices of raw material is a big concern, determining the source of raw material and processing of the raw materials for getting the battery-grade materials plays a vital role”.
Mr.Brieux Boisdequin from BASF stated that it’s important to transform the linear supply chain of battery Raw materials today into a circular supply chain and it’s possible in two steps.
Step One: Regulations to incentivize companies to look into recycling batteries.
Step Two: Recycle the Metals collected from those batteries where each step will add value.
Mr.Kanani from Neogen, Neogen has expertise in electrolyte manufacturing and they can add value and reduce supply chain complexity for supplying the electrolyte. Neogen has recently started the manufacturing of electrolytes for Li-Ion batteries and specializes in bromine-based compounds and inorganic lithium salts.
Mr. Kanani sees a huge opportunity for the EV battery manufacturing business.
Miss. Stacy Osenbaugh from Future Battery Industries CRC, Western Australia spoke about economic partnerships between India and Australia, and Australia’s capabilities as a producer of critical raw materials for battery manufacturing.
She stated, “ We need to examine how two countries (India-Aus) can partner in technology exchange and trade at different points in the battery value chain”.
Mr.Vikram Handa from Epsilon Advanced Materials, Feels we need to first understand the setbacks in India and work on developing a small road map on how to tackle things to go up the global ranking as battery producers. India can then attract a lot of investment and many international players will focus on coming to India to develop this industry.
The global battery raw material demand is going into millions today, he said, adding that it’s important to figure out how much of this India can capture. “We talk about India needing 100GWh by 2030, the battery materials supply chain and the processing industry itself can be a 1 lakh crore industry by 2030 to support Giga factories. We are talking of generating a lot of employment, and a lot of taxation revenue as well for the States.”
- IESA Event 3rd May 2022, New Delhi