Today, increased penetration of electric vehicles and deployment of energy storage systems drive the rising demand for batteries in India. A recent report by a consulting firm projected that India needs to invest about USD 10 billion to boost cell manufacturing and raw material refining to meet domestic demand for lithium-ion batteries for electric vehicles by 2030.
India is currently dependent on China and Hongkong to meet 70% of its Lithium-ion battery demand as it lacks the raw materials to manufacture EV battery components. Â Although China ranks the top in both the graphite reserve and the output worldwide, the graphite mining industry is relatively backward compared with the countries that own advanced graphite processing technology, such as the US, Japan, Germany, and South Korea. Raw materials and primary processing products predominate in China, but disorderly mining, low-price export, and environmental destruction have been called out many times. With environmental, social, and corporate governance (ESG) considerations becoming increasingly critical for the industry globally, the world is leaning on Asia for homegrown EV batteries.
Vikram Handa, Founder and Managing Director at Epsilon Advanced Materials, shares his insights on e-mobility ecosystem and about the organisation, which has the vision to develop and manufacture innovative, high performance and quality carbon products for anode components of lithium-ion Batteries (LIB).
Please tell us about Epsilon Advanced Materials Pvt Ltd (EAM)Â
We are a leading global battery material manufacturer delivering innovative, high-performance, quality, and green battery materials. Epsilon Advanced Materials is a leader in the cutting-edge field of advanced materials and graphite technology, with innovative solutions that drive progress and boost efficiency. Established with a deep-seated passion for innovation in 2018, we have been dedicated to honing our craft in the field of advanced materials. With headquarters in Mumbai, our reach extends globally, encompassing operations in Europe, North America, and East Asia.
Our team of experts is a diverse group of individuals united by their shared desire to innovate and create. We specialize in developing and manufacturing advanced materials for a wide range of industries, including Li-ion battery technology and industrial and energy applications. Our leadership team comprises professionals with a wealth of experience and expertise in the advanced materials industry.
Li-ion batteries have made today’s mobile IT society a reality and will play a central role in building a sustainable society. How is India placed in the world order and what is EAM’s role?
India is rapidly expanding its use of lithium-ion batteries, focusing on electric vehicles and grid storage. According to several estimates, India’s demand for lithium-ion batteries is expected to grow from 20 Gwh in 2025 to 100 Gwh in 2030, with a strong potential for higher growth than the current projections. Currently, most of this demand is met through imports of batteries from countries in East Asia. The government of India has addressed this issue by launching several policy initiatives at the central and state level, including the Production Linked Incentive Scheme (PLI) for Advanced Chemistry Cell Storage (ACC). Several OEMs and conglomerates have announced plans under the PLI and independent schemes to set up capacities in the next 3-5 years. The government of India has also announced several policy initiatives to promote the use of electric vehicles and encourage the development of a domestic battery manufacturing industry. Epsilon Advanced Materials is at the forefront of India’s efforts to promote electric and hybrid vehicles aligned with the National Electric Mobility Mission Plan, which aims to have 5-6 million electric vehicles on the roads by 2025, and the National Electric Mobility Plan, which targets for 30% of all vehicles in India to be electric by 2030.
As one of the pioneers in India’s battery storage industry, we manufacture anode material, which is a vital component of lithium-ion batteries, making up almost 50% of the battery. Currently, China is the primary supplier of anode material, meeting almost the entire demand from India. Relying on imports from China for batteries is a significant challenge from a cost efficiency and supply security perspective to the battery industry in India. With years of determined efforts, conviction, and perseverance, we have developed a patent technology that converts coal tar. This raw material is locally produced in India into graphite anode material for lithium-ion batteries. We began commercial production of anode material using this technology in 2020 and are well-positioned to significantly increase production to meet local and global demand. By 2025, we aim to boost our anode material production capacity to 30,000 TPA and expand it to 100,000 TPA by 2030. With this increase in production capacity, we anticipate holding a market share of 5% globally.
With a focus on silicon for anodes and advanced materials in other areas, a new generation of Li-ion batteries is poised to improve electric vehicle range and affordability. How does EAM see this approach?
The use of silicon in lithium-ion battery anodes has the potential to greatly improve the range and affordability of electric vehicles. Silicon has a much higher capacity than the traditional graphite anodes currently used in most lithium-ion batteries, meaning it can store more energy in a given volume. This can lead to a significant increase in the range of electric vehicles and a reduction in cost. Advanced materials such as lithium-sulfur and lithium-air batteries are also being researched, which have even higher energy density than silicon anodes and could lead to even greater improvements in range and affordability. However, the development of silicon anodes and advanced materials is still early, and it might take some time to commercialize them on a large scale. Also, silicon anodes can have some challenges, like cycling stability, which is being researched to overcome. We expect that silicon will continue to be used as a composite with graphite as the dominating material, with silicon percentages to go from the current 2-3% to 5%-10% by 2030.
We are optimizing a Silicon and graphite-based composite for the anode and have a pending patent grant for our first-generation silicon anode composite.
What are the most significant challenges facing the industry today?
As electric vehicles (EVs) become more prevalent in India, the grid may face challenges, with rising power consumption projected to reach 100TWh by 2030. Â With the increasing penetration of renewable energy sources into the market, the need to provide quality of power will emerge more than the need of power generation. According to the Ministry of Mines, India imports nearly 70% of its Li-ion cell requirements from China and Hong Kong. As cells are the most crucial component of the e-mobility value chain, heavy reliance on imports hinders the growth of India’s electric vehicle (EV) industry. This dependence on imports is due to several factors, such as limited local manufacturing capacity and limited access to raw materials, refining capacities, and so on. We stand out in the market as the only company manufacturing materials for anode and cathode through advanced technological processes with minimal dependency on mines.
The recent announcement of an Advance Cell Chemistry (ACC) Manufacturing PLI Scheme has brought major companies in India to enter the market with local manufacturing of cells in India. However, these PLI schemes are not for the ancillary industries like battery material manufacturers and battery assemblers. The government should implement a PLI scheme for raw material sourcing, manufacturing & refining to have a strong hold on the complete Battery supply chain. Given the nascency of the Indian battery manufacturing landscape, scaling of gigafactories and investment in infrastructure is still in the planning stage. There is a huge push for localization, but our pace is slower compared to our European market players. However, India has the potential to unlock their true power, the government is pushing for battery innovation and battery swapping policies. India’s strength in information technologies offers the potential to develop intelligent solutions for managing batteries from the cradle to the grave. This is enabling better utilization of batteries in first life applications in EVs as well as second life potentially in energy storage solutions. Finally, end-of-life waste management directives and extended producer responsibility norms, coupled with recycling efficiency targets, can help the cell manufacturers proactively design and develop circular business models. This is where we are focusing now from policy lens.
There is a growing focus on EVs, and EV requires 10-15 times more anode materials in a battery than lithium, so there is a huge demand for graphite. How are you scaling up the capacity to cater to this requirement and what kind of investments are you planning to increase capacity?
Currently, 95% of anode material capacity is concentrated in China and this dominance will continue till 2032Â based on the capacity announcements in the past few years. These is a significant gap between demand and local supply of anode materials in Europe, North America and India. Epsilon is one of the few companies outside China that is setting up capacity in India and globally to meet this supply-demand imbalance. We are currently producing anode materials at a commercial level pilot plant.By 2025, we aim to boost our anode material production capacity to 30,000 TPA and expand it to 320,000 by 2030. With this increase in production capacity, we anticipate holding a market share of 5% globally.
Is solid-state technology the next major battery engineering disruptor it’s been billed and long believed to be?Â
Solid-state technology has the potential to be a major disruptor in battery engineering. It offers several advantages over traditional lithium-ion batteries, such as higher energy density, improved safety, and faster charging times. However, solid-state batteries are still in the early stages of development, and it remains to be seen if they can achieve the level of performance and cost-effectiveness needed to become a mainstream technology. They are also relatively expensive to produce, which makes it difficult to achieve the economies of scale necessary to make them cost-competitive with traditional lithium-ion batteries. Lithium-ion batteries have dominated the market for the past three decades and have evolved over the years with continuous innovation. Solid state batteries will take another decade to reach this stage.
Pandemic has taught us many lessons. Partnerships/collaborations is one such important lesson. Tell us about EAM’s partnerships that have helped you.
EAM believes in the importance of alliances and collaborations in this growing and evolving industry and has entered and is continuously entering into alliances with participants across the entire industry’s value chain. From the material development perspective, EAM has several joint material development programs running with companies in the US and Europe to develop next generation composite anode materials. On the industrial side, EAM has entered into several alliances, including EAM’s proposed joint venture with Finnish Minerals Group (FMG), a fund backed by the Finnish government, for its upcoming anode material plant in Finland and a MoU for a JV with a natural graphite mining company in Canada. EAM has several MoUs with customers around material development and offtake supplies in Europe, US and India.
Batteries are a core technology to realize the energy transition and broaden energy access around the world. What is EAM’s investment in R&D?
EAM has invested primarily in R&D since its inception in 2018. This includes investments in both equipment, lab facilities and, more importantly, in attracting and training skilled manpower which is a challenge in this industry. In addition to its comprehensive pilot plant facilities for anode precursors and anode materials, EAM very early in its inception decided to invest in comprehensive battery testing facilities. The facilities can make cells in various formats, including coin cells, single-layer pouch cells and multi-layer pouch cells and has the capability to perform 40+ physical and electrochemical tests. This data is critical for EAM to constantly evolve its product portfolio and customize materials for specific customer requirements.