Recently, it was reported that the German auto giant BMW cancelled a 2 billion Euro battery deal with Swedish battery company Northvolt, which it had signed in 2020. This was apparently due to production delays and technical issues in ramping up production of cells from its gigafactory, thus being unable to fulfill supply obligations to the automaker.
Northvolt, a company started by Tesla alumnus Peter Carlsson and Paolo Cerruti, set up Europe’s first battery gigafactory in late 2021, around 200 kilometres south of the Arctic circle, in Skelleftea, Sweden. It was an important milestone for Europe in the quest to be a part of the global battery race and compete with Asian giants who dominate battery manufacturing such as China’s CATL, Japan’s Panasonic and South Korea’s LGChem. Infact, Nortvolt intended to set itself apart from other manufacturers by pledging to use 100 per cent renewable energy to run its production facility, since Sweden has one of the greenest electricity grids in Europe.
However, the decision of BMW to rescind the contract for locally (from Europe) sourcing batteries for its EV portfolio, and turning to established battery manufacturers from Asia, provides a glimpse into the difficulties faced by new entrants in getting cell manufacturing gigafactories up and running to be able to demonstrate continuous operation with a reliable production throughput.
In India, a number of companies have announced their plans / ambitions of setting up cell manufacturing gigafactories. Seven companies, which include ACME Cleantech Solutions Private Ltd, Amara Raja Advanced Cell Technologies, Anvi Power Industries Private Ltd, JSW Neo Energy Ltd, Reliance Industries, Lucas TVS Ltd and Waaree Energies Ltd, have submitted bids for production of advanced chemistry cells under the Centre's production-linked incentive scheme.
While most of these firms have announced the availability of cell technology through in-house development or tie-ups, full scale industrialisation or commercialisation of these technologies is a big concern. As evidenced by Northvolt’s experience, scaling up cell manufacturing is not straightforward, and navigating the ladder of commercialisation is vital for the success of India's battery industry.
The nascent lithium ion cell manufacturing ecosystem in India faces multiple risks — technology risk, policy risk, demand risk, financial risk, supply chain risk and talent risk. A joint effort to plan an indigenous cell manufacturing roadmap by the central government’s Department of Science and Technology (DST) and Delhi-based think tank Centre for Science and Environment, backed by extensive stakeholder consultations, had highlighted the need for setting up rapid prototyping centres (RPC) for cell manufacturing.
An RPC is envisioned to be a dedicated facility with specialised equipment like coating machines, calendering machines (high pressure rollers) and electrolyte filling machines, among others, for advancing the technology readiness level of new cell technologies from lab prototypes to industrial-scale manufacturability.
Going from lab-scale cells to production-size cells to be used in commercial applications essentially involves an increase in the physical dimensions of the cell as well as a significant increase in the production volumes. This is accompanied by challenges such as maintaining uniformity of electrode coating and precise stacking of electrode and separator foils (key layers of a cell) across large volumes.
It is difficult for startups and companies to create consistent prototyping samples and replicate industrial processes during initial stages of fabricating production-size cells. This necessitates the setting up of RPCs, without which cell characterisation (assessing parameters like capacity, cycle life) and safety testing are hampered. Moreover, there are long lead times in procuring testing and qualifying equipment.
Some firms from the battery manufacturing industry laid down their expectations from an RPC, at a recent stakeholder consultation meeting organised by DST at the Indian Institute of Technology Tirupati. RPCs would be extremely useful for process and product validation, global intellectual property procurement and to attract global talent, said Vijayanand Samudrala, chief executive of Amara Raja, one of India’s largest automotive battery manufacturers.
At present, the lithium iron phosphate powder produced in India is sent to labs in countries like the United Kingdom and Japan for material validation in cells, due to lack of an equivalent domestic facility, highlighted a representative of Hyderabad based Altmin, India’s first cathode active material manufacturer. To bridge this gap, the role of indigenous RPC cannot be overstated, they added.
The objective of an RPC should be to reduce the go-to-market time and production costs for battery manufacturers, stressed Pratyush Sinha from Lohum, a prominent battery recycling company based in Delhi-NCR.
Thus, the goal of RPCs would be to mimic commercial manufacturing at a pilot level and establish quality control, manufacturing readiness and a sourcing plan for firms. It would also be useful in creating a skilled workforce in the country which is well-equipped to work in the battery manufacturing industry.
Global references of RPC-like facilities include the UK Battery Industrialisation Centre, the United States Advanced Battery Consortium and Europe’s Fraunhofer Institution for Battery Cell Production.
Policy and financial support for such an initiative will prove to be a useful step in indigenous capacity building towards advancing electric mobility as well as battery energy storage in the country.