Investments in cell manufacturing to help bring EV costs down: ICRA

New Delhi, Sept 3 (KNN) The investments in electric vehicle (EV) cell making is likely to exceed Rs 70,000 crore by 2030, It will also help bring EV costs down, ICRA report stated.

“In EVs, advance chemistry batteries remain the most critical and the costliest component, accounting for almost 35-40 per cent of the vehicle price, to achieve mass scale penetration of EVs and a competitive cost structure, India will need to create its own eco-system of developing battery cells locally, " Said Shamsher Dewan, Senior Vice President & Group Head - Corporate Ratings, ICRA in the report.

Additionally, given that the charging infrastructure penetration will only improve gradually, improvements in energy efficiency remain imperative, it added.

"The ability of battery manufacturers to enter into agreements/alliances with players across the value chain to mitigate these risks, coupled with the creation of a robust framework for recycling would remain key," the report said.

Releasing the potential of the country to make its own cell batteries, the Government has recently signed agreements with three companies for incentives under its Production-Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) Battery Storage. 

The policy emphasizes enhancing domestic value addition and is expected to support capability development in this sunrise.

While Lithium-ion batteries have emerged as the battery of choice for EVs, given their high energy efficiency, decent thermal stability and low self-discharge, Lithium Nickel Manganese Oxide (NMC) is the most prevalent cathode chemistry currently.

ICRA expects Lithium Iron Phosphate (LFP) chemistry to also gain increased acceptance going forward, given its higher thermal stability and lower production cost.  (KNN Bureau)