Ola Electric, Mahindra bid for incentives under country's $2.4 bn battery scheme
EV maker Ola Electric, Hyundai Global Motors and Mahindra have submitted bids under the country's $2.4 billion battery scheme, Reuters reported, citing sources. Along with these companies, conglomerate Reliance Industries also submitted its bid for the scheme.
The scheme is a part of an incentive program that was finalized last year to encourage companies to invest in the local manufacturing of batteries as the government looks to establish a domestic supply chain for clean transport and build storage for renewable energy.
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It aims to establish a total of 50 gigawatt hours (Gwh) of battery storage capacity over five years, expecting it to attract direct investment of about $6 billion.
Some other companies including engineering conglomerate Larsen & Toubro and battery makers Amara Raja and Exide have also submitted bids under the scheme, the report stated. In total, about 10 companies have submitted their bids, totalling close to 100 Gwh of storage capacity.
In order to qualify for the incentives, the companies that have placed a bid will need to set up at least 5 Gwh of storage capacity and also meet certain local content conditions. All of these would require a minimum investment of more than $850 million.
The government was also encouraging foreign energy and EV companies such as Tesla, Samsung, LG Energy, Northvolt and Panasonic to invest in the scheme. Efforts are being aligned in the direction for electric cars to make up 30% of private car sales in the country by 2030, and for electric motorcycles and scooters to make up 40% of such sales. This is expected to drive demand for batteries which currently contribute about 35% to 40% of the total vehicle cost.
The government aims to use clean auto technology to cut pollution in major cities and reduce oil dependence. However, currently electric vehicles (EVs) only make up a fraction of total sales in the country, essentially due to their high price as batteries are imported.