In a significant boost to India’s Electric Vehicle (EV) usage, reserves of Lithium, a crucial metal used in making EV batteries, were discovered in the Srirangapatna taluk of Mandya in Southern Karnataka. This find could turn out to be a boon for local manufacturers of EV batteries.

Popularizing the use of green vehicles has been one of the chief priorities of the government in order to reduce air pollution from internal combustion engine powered vehicles. A 2015 study has attributed at least 66% of air-pollution related deaths in India to exhaust from diesel vehicles.

Shifting to EVs requires a corresponding shift to electric batteries. Although more than one EV battery technologies exist, Lithium-based batteries are the most popular.

Huge Lithium Import Dependence Leading to Higher EV Manufacturing Costs

Currently, India imports lithium batteries worth $1.2 billion from China, Hong Kong and Vietnam. This figure is a little over three times the value of lithium imported in FY 2017. Lithium is nature’s lightest metal, used abundantly in ionic form in Lithium-Ion batteries. With greater energy density per gram and longer battery life than other comparable battery components, Lithium is the element of choice in modern EV batteries.

A Bloomberg NEF report finds that China owned 73% of the world’s total lithium cell manufacturing capacity as of early 2019. The USA was a distant second with just 12% of global capacity. In hopes of offsetting India’s import dependence on China and others for EV cells, the Niti Aayog had announced ambitious plans in January, to set up 10 large battery production units with a total capacity of 50 Gigawatt hours.

One of the major hurdles to electric vehicle popularization in India, has been the cost of energy sources to run the EV. The cost of procuring batteries could go up to half of the total cost of manufacturing the EV. It has been opined that domestic production could bring these prohibitive expenses down.

Lithium Reserves estimated at 14,100 tonnes in India

In the research paper made public by scientists at the Atomic Minerals Directorate, an R&D wing under the government’s Department of Atomic Energy, Lithium Oxide weighing about 30,300 tonnes was found to be spread over 2.5 square kilometers in the Allapatna-Margalla sector in Mandya. This gives an estimated yield of 14,100 tonnes of lithium metal that can potentially be mined. The extracted metal could then be converted into Lithium ions used in the production of Lithium batteries to be used in an EV.

The figure of 14,100 tonnes pales when compared to the 14.8 million tonnes of lithium reserves estimated in Argentina, 9 million tonnes in Bolivia, or the 8.5 million tonnes in Chile. However, AMD researchers note that lithium sources have been found in small traces in a number of parts across the country. In fact, the Mandya discovery is a result of the first such attempt at subsurface drilling and chemical sample analyses begun in 2013.

A far more comprehensive and detailed study is required to assess the land’s true potential if we are to get a clearer picture of lithium availability in India.

Acquiring and Operating Lithium Mines in Other Countries to Lower EV battery Costs

Meanwhile, Khanij Bidesh India Ltd., a joint venture between NALCO HCL and MECL, is in talks to acquire stakes in Lithium mines in Argentina, Chile and Bolivia. This multi-pronged strategy will go a long way in ensuring India’s energy dependence. It could also be an affordable solution to India’s long-standing air pollution woes.

Businesses looking to invest in EV manufacturing or EV battery manufacturing in India could also find the lower Lithium sourcing costs to be a fruitful opportunity.

Write a comment

Comments: 0