Epsilon Carbon believes that the recently announced PLI (production linked incentive) scheme for advanced chemistry cells battery storage needs further clarifications and fine-tuning in order to be successful.
Vikram Handa, Managing Director of the Mumbai-based carbon/coal tar derivatives company, told Autocar Professional that while the Centre is currently focusing on end-product (batteries), industry expects incentives for raw material suppliers as well.
Further, the timeline for the project should be stretched as it may take nearly 10-12 years for an ecosystem to develop. “Nevertheless, it is a good start,” said Handa.
The Centre had recently okayed the Rs 1,800 crore plan for 'National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ which has targeted manufacturing capacity of 50-gigawatt hour (GWh) of ACC and 5-GWh of ‘niche’ ACC.
ACCs are advanced storage technologies that can store electric energy either as electrochemical or chemical. They can then convert it back to electric energy as and when required. ACCs are found in consumer electronics, electric vehicles, advanced electricity grids and solar rooftops.
At present India imports almost Rs 20,000 crore worth of batteries for energy storage needs. The beneficiary firms are expected to achieve localisation of at least 25 percent and incur the mandatory investment of Rs 225 crore/GWh within two years. The next step is to raise it to 60 percent domestic value addition within five years — either at the mother unit, in-case of an integrated unit, or at the project level where it is a hub & spoke structure. The incentive rates declaration form the Centre is still awaited.
According to Handa, graphite anodes comprise 25-30 percent volumes of lithium battery cells and are the highest single material in a cell chemistry. Historically, China has been supplying more than 80 percent of the global demand.
Epsilon Carbon, on its part, has signed an MoU with a Finland-based graphite miner to convert its natural graphite flakes to spherical purified graphite for use as anode material. Experts say synthetic graphite is more popular than the natural version as carbon can be manipulated to suit the needs of lithium batteries. Globally, synthetic graphite has 60 percent market share in the anode material space.
As part of its effort to tap new opportunities, Epsilon Carbon plans to invest around Rs 500 crore over the next five years and has commissioned a new facility in Karnataka to produce 2,500 tonnes of carbon black annually. The objective is to expand to 35,000 tonnes by 2025 and further to 100,000 tonnes by 2030.
The company is in talks with some Indian cell makers and industrial houses which want to secure their raw material needs. According to Handa, it will take at least 4-5 years for battery manufacturers to commission their plants and justify investments in setting up a giga factory.