Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing4thInternationalConference&Exhibitionon'AatmaNirbharBharatforCleanEnergyTransition’EnEtnetrer>>>WeacknowledgecontributionsfromSomeshKumarShubodayGantaSaitejaJupudiPartner&Leader–Power&UtilitiesDirector–Power&UtilitiesSeniorAssociateGPSStrategyandTransactions(SaT)StrategyandTransactions(SaT)EYIndiaEYIndiaEYIndiaChandrajitBanerjeeDirectorGeneralConfederationofIndianIndustryWeacknowledgecontributionsoneditanddesignfromVikramDChoudhuryAshishGeorgeKuttickalAssociateDirector-Brand,Market&CommunicationsAssociateDirector-Brand,Market&CommunicationsEYIndiaEYIndiaShwetaSharmaJasmeetJoshiAssociate-Brand,Market&CommunicationsManager-Brand,MarketingandCommunicationsEYIndiaEYIndiaForewordCIIAatmaNirbhartainrenewableenergytechnologysupplychainsisvitaltoadvancethesecurity,sustainabilityandaffordabilityofIndia’senergytransitiongoals.Thestrategyforself-reliancemustfosterR&Dincleanenergytechnologiestodevelopindigenoussolutions,encouragecollaborationsbetweengovernment,industry,andacademicinstitutionstofosterinnovation,andcultivateastableandpredictablepolicyenvironmentthatencouragesinvestmentsincleanenergy.Itmustdeveloptransportationandlogisticsinfrastructuretosupportsupplychains,promoteexport-orientedincentivesforsustainedaccesstoglobalmarkets,andstrengthencriticalmineralsandrawmaterialsupplychains.Promotingrecyclingtoensureacirculareconomyforsteadysupplyofnecessaryrawmaterials,buildingaskilledworkforceincleanenergysectorsandcreatingfinancialinstrumentstode-riskinvestmentswillbecritical.ThisreportincludesvaluableinsightsfromIndustrymembersinthecontextofIndia’senergytransitioninvestmentopportunitiesandevolvingpolicyecosystemtoadvancerenewableenergyinnovationandmanufacturing.TheEnergyTransitionInvestmentMonitorisacollaborativeplatformforinvestorstoidentifyandtrackenergytransitioninvestmentsfromconcepttocommissioning.WeappreciatethesupportfromEY,ourknowledgepartnerforthisconference,andthevaluableinsightsfromGovernmentandIndustrystakeholdersinshapingthisreport.ChandrajitBanerjeeDirectorGeneralConfederationofIndianIndustry4Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678EYMr.SomeshKumarPartner&Leader(Power&Utility),India’senergytEraYnIsnidtiioanisgainingmomentumwithpotentialtoemergeasaglobalchampionforadvancingrenewableenergyinnovationandmanufacturing.Theongoingtransitiontorenewableenergysourceslikewind,solar,hydro,biofuelsetc.requiresavastarrayoftechnologiesandequipmenttoproduce,store,transformanddeliverenergyforvariousend-useapplications.Thesetechnologiesarecomposedofinnovativematerialsandcomponents,someofwhicharecurrentlysourcedfromspecificregionssubjecttovulnerabilities.BuildinglocalmanufacturingcapacitiescanhelpreducedependenceonimportsandbuildsupplychainresilienceforIndiaandrestoftheworld.Mostimportantly,AatmaNirbharinnovationandmanufacturingwillhelpbridgethesustainability-affordabilitygapformassadoptionofrenewableenergytechnologies.Thisreportshedslightonthedemandandsupplychaindynamicsofrenewableenergytechnologies,governmentinitiativesandpolicyinterventionsforbuildingfurthermomentum.TheEnergyTransitionInvestmentMonitorisacollaborativeplatformforglobalinvestorstoidentifyandtrackenergytransitioninvestmentsfromconcepttocommissioning.WeappreciatethevaluableinsightsandcooperationfromCII,GovernmentandIndustrystakeholdersinshapingthisreport.SomeshKumarPartner&Leader–Power&UtilitiesGPSEYIndiaCONTENTSSection1Section2Section3Section4ExecutiveIndia’senergyBuildingsupplyStrengtheningsummarytransitionchainresiliencethewindturbinejourneyandforsolarPVmanufacturingsupplychaincells,modulesecosystemindynamicsandancillariesIndiaforexportsSection5Section6Section7Section8DomesticvalueGreenhydrogenCorporateBiofuelsandadditioninandelectrolyserrenewablecircularadvancedmanufacturingenergyeconomychemistrycellecosystemforprocurementpathwaysfor(ACC)batterydomesticmarketinIndiaenergysecuritymanufacturingproductionandexports6Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678AcronymsACCAdvancedChemistryCellGSTGoods&ServicesTaxMNREMinistryofNew&RenewableEnergyALMMApprovedListofModuleManufacturersAPACAsiaPacificGUVNLGujaratUrjaVikasNigamLimitedMTMillionTonsBCDBasicCustomsDutyBESSBatteryEnergyStorageSystemsGWGigaWattMtoeMillionTonOilEquivalentBPLBelowPovertyLineBUBillionkWhGWECGlobalWindEnergyCouncilMWMegaWattC&ICommercial&IndustrialCAGRCompoundedAnnualGrowthRateIEAInternationalEnergyAgencyMWhMegaWatthourCEACentralElectricityAuthorityIndiaInfrastructureFinanceCorporationNDCNationallyDeterminedContributionsLimitedIIFCLNIWENationalInstituteofWindEnergyINRIndianRupeeNTPCNationalThermalPowerCorporationIntergovernmentalPanelonClimateOEMOriginalEquipmentManufacturerChangeIPCCPEMProtonExchangeMembraneIRAInflationReductionActPFCPowerFinanceCorporationDISCOMDistributionCompanyIREDAIndianRenewableEnergyDevelopmentPLIProductionLinkedIncentiveAgencyPSUPublicSectorUndertakingEEZExclusiveEconomicZoneEIAEnvironmentImpactAssessmentISTSInterStateTransmissionSystemPTCProductionTaxCreditEPSElectricPowerSurveyESSEnergyStorageSystemITCInvestmentTaxCreditRECRuralElectrificationCorporationEUEuropeanUnionFCEVFuelCellElectricVehicleKREDLKarnatakaRenewableEnergyRPORenewablePowerPurchaseObligationFDIForeignDirectInvestmentDevelopmentLimitedFYFinancialYearSDSSustainableDevelopmentScenarioGDPGrossDomesticProductkWhKiloWattHourSECISolarEnergyCorporationofIndiaLATAMLatinAmericaSTEPSStatedPoliciesScenarioLCOELevelizedCostofElectricityT&DTransmission&DistributionLIBLithiumIonBatteryUNEPUnitedNationsEnvironmentProgramMEMiddleEastVGFViabilityGapFundingExecutivesummaryIndia'senergytransitionholdspotentialtobecomeaglobalchampionforadvancingrenewableenergyinnovationandmanufacturing►Duringthe26thsessionoftheConferenceoftheParties(COP26)tothePanchamritof►500GWofnon-fossilenergycapacityby2030UnitedNationsFrameworkConventiononClimateChange(UNFCCC),IndiaIndia’s►50%ofenergyrequirementfromrenewablesourcesby2030expresseditscommitmenttointensifyclimateactionbypresentingfivekey►Onebilliontonsofprojectedcarbonemissionsreductionby2030strategicelements,referredtoasthe"Panchamrit,".India’sclimateactions,climateaction►45%reductionincarbonintensityoftheeconomyby2030despitehavinglowGHGpercapita,willbeanexamplefortheworldtoraise►Netzeroemissionsby2070theirclimateambitions.Sources:EYanalysis►TheprincipaldriverandenablerforIndia’snetzeroemissionsgoalisreducingdependenceonimportsandbuildingsupplychainresilience.Thegovernmenthasputpoliciesinplacetoencouragethedemandandsupplyofenergytransitiontechnologiesinvarioussectors.►TheecosystemforgovernmentsupporttoglobalinvestorsinIndia’senergytransitionmarketsanddomesticsupplychainsincludebutnotlimitedtodemandsideincentives,productionlinkedincentives(PLI),purchaseobligationsandbiddingtrajectoryforcompetitiveprocurement,de-riskinginstruments,offtakeguaranteesandminimumpricing,demandaggregationandcentralizedprocurement,domesticvalueadditionandcontentregulations,greenenergyopenaccessrules,taxwaiversandexemptions,singlewindowsystems,landpoolingandallocationforprojects,infrastructuredevelopment,harmonizationwithinternationalstandards,CAPEXsubsidies,concessionalfinancing,publicfundingforskilling,R&Dandtechnologicaladvancements,labormarketreforms,etc.►Thetotalpipelinefordomesticenergytransitioninvestmentsincludingsupplychaininnovationandmanufacturing,isaboutUS$240billioninthepresentscenario.Indiahasthepotentialtoplayapivotalroleinachievingglobalsupply-chainresilienceforrenewableenergytechnologiesandcriticalcomponents.Overthepastfewyears,Indiahasincreasinglypositioneditselfasanalternativeglobalhubforrenewableenergyinnovation,manufacturing,servicesandtradefortheworld.ForIndiatorealizeitsfullpotentialinachievingglobalsupply-chainresilience,itmustaddressdemandsidechallengesincludingaffordability,striveformaximumdomesticvalueadditionandimprovecompetitivenessofsupplychainsforservingglobalmarkets,fixinconsistentpolicyandregulatoryenvironmentsandaccelerateinfrastructurebuilding.Withappropriatemeasures,Indiacanindeedserveasacornerstoneforamoreresilientglobalsupplychain.9Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678EnergytransitioninvestmentpipelineandenablersforadvancingsupplychainresilienceUtilityscaleREpowergenerationEnergystoragesystemsProjectpipeline27597GWINR1.61Projectpipeline72243GWhINR87,785andimpactandimpactprojectsofpipelinelakhcroreequityprojectsofpipelinecroreequitycapacitycapacityINR3.755,220MTINR2.042,106MTlakhcroredebtavoidedCO2emissionslakhcroredebtavoidedCO2emissionsEnablersTheme:DistributedREandcorporateopenaccessProjectpipeline19816.0GWINRandimpact22,552•HarmonizedadoptionofgreenenergyopenaccessrulesatstateProjectsofpipelinecapacitylevelcroreequity•Long-termpredictabilityandconsistencyofopenaccesschargesINR52,622625MT•ComplianceandenforcementofRPOandESOonobligatedentities•DemandaggregationservicesforRERTCsupplytoOAconsumerscroredebtavoidedCO2emissions•PredictablegridbankingregulationsforOAconsumersTheme:GreenhydrogenandElectrolyserEnablersProjectpipeline5110GW/YearmanufacturingandimpactProjectsofelectrolysermanufacturingcapacity•Nationalprogramtoincentivize/compensatestateutilitiesforimplementingannualgridbankingfacilityforcaptiveINR7.9610.17MTopenaccessREpowersupplyLakhGreenH2/Ammoniaproductionperyear•Blendedinnovativelow-costfinancinginstrumentscroreinvestment•Promoteexport-orientedincentives•Settingupsharedcommondesalinationfacilitiesinemerginggreenhydrogenclusters•BoostavailabilityofskilledworkersandprofessionalsSources:EYanalysis10Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Theme:ACCBatterymanufacturingEnablersProjectpipeline2796,700MWh/Yearandimpact•GraduallyincreasedomesticcontentrequirementsforProjectsProductionCapacityincentivesinmobilityandstationarygridapplicationswithatime-boundmandate.INR87,400•ExpediteminingandexplorationactivitiesofcriticalmineralscroreinvestmentusedinACCbatteries60640+Tons/Day•UniformGST@5%applicationonallACCbatteriesusedinmobilityandgridstorageapplicationswithrenewableenergyCompressedBiogasprojectsProductionCapacity•ProductionlinkedincentivesforactivematerialextractionfromEnablersProjectpipelineINR4,464recycledACCbatteriesandimpactcroreinvestment•Boostavailabilityofskilledworkersandprofessionals21728,500+KiloTheme:Bio-fuelsLitres/DayEthanolproductionprojects•PromotebiomassaggregationandstorageProductionCapacity•Blendingmandates•CreationofamarketecosystemforbiomanureandpromotionINR36,081ofFOMcroreinvestment•Productionlinkedincentives•EstablishfeedstockpricingmechanismSources:EYanalysis11Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Theme:SolarPVmoduleandwindturbinemanufacturing3388GW/Year68GW/Year•ProductionlinkedincentivesforsolarPVmoduleandsystemProjectsSolarmoduleSolarcellancillariesmanufacturingpipelinecapacitypipelinecapacity•PolicyconsistencyandpredictabilityforALMMimplementation•Blendedinnovativelow-costfinancinginstruments•Promoteexport-orientedincentives•Boostavailabilityofskilledprofessionals•UniformGST@5%applicableonallrenewableenergymanufacturingequipment,rawmaterialsandancillaries•Accesstoroundtheclockaffordableelectricity•Promoterawmaterialsupplychainindustry•Productionlinkedincentivesforwindturbinegradeancillarymanufacturersandrareearthmineralprocessing•Strengtheningtransportationandlogisticsforwindturbineinstallations•SettingupsharedtestingfacilitiesforwindturbinecomponentsinPPPmodeSources:EYanalysisEnablers41GW/yearINR1.24ProjectpipelineWaferpipelinelakhcroreinvestmentandimpactcapacity12Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678EnergyTransitionInvestmentMonitorAcollaborativeplatformforglobalinvestorstoidentifyandtrackenergytransitioninvestmentsfromconcepttocommissioningEYiscollaboratingwiththeConfederationofIndianIndustryEnergyTransitionInvestmentMonitor(CII)toenableglobalinvestorstoidentifyandtrackenergytransitioninvestmentsinthepipeline(announced,underTracksabout930bidding,permitting,construction,etc.)fromconcepttoprojectsinthepipelinecommissioning.Theplatformtracksover930energytransitioninvestmentopportunitiesinthepipelinewithtremendousRenewableThematicSolarPVpotentialforeconomicdevelopment,jobsandultimatelypowercoveragemodulecontributingtowardsIndia’slong–termclimateactiongoalsandoflow-carbonmanufacturingenergysecurityobjectives.Projectlevelinformationwasgenerationinvestmentgatheredfromamixofprimaryandsecondaryresearchtoolsopportunitiesincludingawidevarietyofsourcesinthepublicdomain,inpipelineconsultationswithprojectdevelopers,OEMs,investorsetc.(onasamplebasis)withthesupportfromaleadingmarketresearchagency.Proprietarydatabaseswerealsoleveragedtoidentifythelonglistofinfrastructureprojectsinthepipeline.Theprojectpipelineidentifiedhavethedesiredpotentialtocreatesocial,environmentalandeconomicvalueintheimmediatefuture.LimitationsEnergyBio-fuelsTheprojectpipelineidentifiedinthisplatformandanalyzedinstorageH2ACCbatterythereportrepresentsjustafractionoftheoveralllowcarbonmanufacturinginfrastructureinvestmentunderdevelopmentinIndia.TheGreenprojectpipelineinformationwasputtogetherfromourhydrogenandassessmentoftheirstatusofdevelopmentuntilMarch2023.ThisisonlyafractionofalllowcarboninfrastructureprojectsderivativesunderdevelopmentinIndia.Itisimportanttonotethattheprojectpipelineidentifiedinthisreportisillustrativeandshouldnotbereadasafullpolicy/commercialendorsement.Sources:EYanalysis13Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’senergytransitionjourneyandsupplychaindynamicsCleanenergysourceswitnessedthehighestgrowth(CAGR)ofcommercialenergyproductioninthelastdecadeAsperEnergyStatisticsIndia2023,cleanenergysources(Hydro,NuclearandotherRES)witnessedthehighestgrowth(6.83%CAGR)incommercialenergyproductionbetween2012-13and2021-22.Thetotalcommercialenergyproductionwitnesseda2.62%growth(CAGR)duringthisperiod.Coalenergyproductionhaswitnessedonlya3.8%CAGRgrowthduringtheperiodandaccountedfor73%oftotalcommercialenergyproductionin2021-22.Cleanenergysources(Hydro,NuclearandotherRES)contributedto8.24%oftotalcommercialenergyproductionin2021-22.Renewableenergysourcessuchassolar,windandothersources(excludingHydroandNuclear)accountedfor11.51%oftotalcommercialenergyproductionin2021-22.India’scommercialenergyproductionmixreflectsahighrelianceoncoalandanincreasingshareofclean,sustainable,andrenewableenergysources.AllIndiacommercialenergyproductioninPetaJoulesShareofcommercialenergyproductioninFY-22(P)8%18,00016,0008%14,0008%12,0003%10,00073%8,0006,0004,0002,000-2013201420152016201720182019202020212022(p)CoalLigniteCrudeOilNaturalGasElectricityCoalLigniteCrudeOilNaturalGasElectricitySource:EnergyStatisticsIndia,MOSPI-202315Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Thedecliningenergyandemissionsintensitysignalsagrowingfocusonshiftingtowardscleanerenergysources►AspertheUNEmissionsGapReport2022,India’spercapitaemissionsat2.4AllIndiaGHGEmissionIntensitytrends(CO2/USD)tCO2earefarbelowtheworldaverageof6.3tCO2e.Thedecreasingtrendofenergyandemissionsintensityisatestamenttothegrowingemphasisonclean1.301.221.261.191.041.020.950.81energytransitionforcommercialproductionandend-useinallsectorsof1.201990199520002005201020152020theeconomy.1.101.00►TheIntergovernmentalPanelonClimateChange(IPCC)estimatedthatstartingin0.902020,thetotalcarbonbudgetremaining,fora50%chanceoftemperatureriseto0.80remainbelow1.5degreesCelsius,as500gigatonsCO2(IPCC2022).Atthe0.70currentannualaverageemissions0.60►rateof~50GTobservedduring2010-19(IPCC2022),thisbudgetwillbeAllIndiaEnergyIntensitytrends(MegaJoules/INR)exhaustedbefore2030.Globalemissionsmustbereducedby45%by2030anddeclinedrasticallythereafter(UNEP2022).Globally,88parties,includingthe0.2800.2800.2220.225majoremitters,haveadoptednetzerotargets,coveringapproximately79%of0.2600.2680.265globalGHGemissions(UNEP2022).Emergingeconomiesgloballywillwitness0.240risingenergydemand,and88%oftheoverallglobalgrowthinelectricitydemand0.252between2019and2040isexpectedtocomefromtheseeconomiesasperCEEW.0.2400.2370.234►ThechallengetomeetIndia’srisingenergydemandthroughcleanenergy0.225transitionpathwaysthatensurereliability,affordability,sustainability,andsecurityofenergysupplyisunprecedented.Giventhatthecleanenergytransition0.220isexpectedtobedrivenbymultipletechnologypathwaysincludingsolar,wind,hydro,nuclear,energystorage,greenhydrogen,biogas,andethanol,self-reliance0.200(AatmaNirbharta)inmanufacturingandinnovationofcleanenergytechnologies,equipment,andrawmaterialssupplychainiscriticalforachievingtheabovefourFY-13pillarsoffutureenergyecosystem.Mostimportantly,thegovernmentofIndia’sFY-14commitmenttoreduceimportrelianceonfossilfuelcommoditiesalongwiththeFY-15five-fold(PANCHAMRIT)climatestrategy(seebelow)committedinCOP26willFY-16ultimatelyhingeonAatmaNirbhartaofmanufacturingandinnovationforcriticalFY-17REtechnologiesandrawmaterials.FY-18FY-19FY-20FY-21FY-22(P)Source:IEA,2021,EnergyStatisticsIndia,MOSPI-2023500GWofnon-fossil50%ofenergyrequirementReduceCO2eemissionsReducecarbonintensityofAchieveeconomywidenetzeroenergycapacityby2030fromrenewablesourcesbyby1billiontonstill2030economytolessthan45%byemissionsby20702030203016Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Powersectorwillcontinuetoleadtheenergytransitionthrough2030,with~64%shareofnon-fossilsourcesinallIndiainstalledcapacityand~44%shareingrosspowergenerationGrossgenerationinFY-23:1624billionunitsProjectedsourcewisegenerationinFY-3013%22.70%10%3%54.50%8.50%1%73%0.40%8.70%3.80%1.40%Coal+LigniteGasNuclearHydroRESSolarWindOtherREHydroNuclearGasCoalInstalledcapacityasofMarch-2023inGW–415GWProjectedinstalledcapacityinGWinFY-30–777GW2554519125.15252211.8546.82936.7824.821515Coal+LigniteGasNuclearHydroRES100HydroSmallHydroPSPSolarPVWindBiomassNuclearCoal+LigniteGasSource:CEAPowerSectorDashboardMarch2023,OptimalEnergyMixReport,CEA202317Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Privatesectorinvestmenttowardsinnovation,manufacturingandsupplychainofcriticalREtechnologiesandrawmaterialswillfurtherunlockenergytransitionpotentialTopstatesinenergytransitioninvestment(US$million)India’sambitionsandgoalstoexpandrenewablepowergeneration,energystorage,electrificationofhard-to-abatesectors,greenhydrogen/ammonia,ethanol,biogas,Others55,040etc.,willcontinuetobedrivenlargelybyprivatesectorinvestmentsintheforeseeablefuture.Moreimportantly,privatesectorinvestmentstowardsMaharashtra19,144manufacturingandinnovationofcriticalREtechnologies,equipment,andraw2,511materialssupplychainwilldeterminethespeedandscaleofIndia’senergy1,26transition.AndhraPradesh046India’srobustdomesticdemandoutlookforREtechnologies,policycommitments,Rajasthan1,8811andtargetsalongwithgrowingconsensusamongG20leadersforbuildingresilientsupplychains,servesthebestinterestsofprivatesectorcompanies,bothdomestic26,3231,2311andinternational,tocollaborate,innovateandmakeinIndiafortheworld.726Totalpipelineofinvestments(US$million)01,10131333,50337275Gujarat40,68228,296Karnataka64,6123,651Source:CEA20,00040,00060,00080,000-Source:EYAnalysis18Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Demandforsolarandwindenergygenerationthrough2030DemandforsolarPVsystemsthrough2030(MW)Demandforwindpowergenerationthrough2030(MW)Installedcapacity(March2023)Capacityunderconstruction/bidoutAdditionalcapacityrequiredthrough2030Optimumcapacityby2030Installedcapacity(March2023)Capacityunderconstruction/bidoutAdditionalcapacityrequiredthrough2030Optimumcapacityby2030Source:EYanalysisfromCEAoptimalgenerationmix202319Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678DemandforBESStechnologiesthrough2030Demandforbatteryenergystoragesystemsthrough2030(MW)Demandforbatteryenergystoragesystemsthrough2030(MWh)Announced/Underconstruction/BidoutAdditionalcapacityadditionthrough2030OptimumCapacityby2030Announced/Underconstruction/BidoutAdditionalcapacityadditionthrough2030OptimumCapacityby2030Source:EYanalysisfromCEAoptimalgenerationmix202320Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678BuildingsupplychainresilienceforsolarPVcells,modulesandancillariesCrystallinesiliconPVsystemdemandandvaluechainfordomesticvalueadditionDemandforsolarPVsystemsthrough2030(MW)Wafer-basedcrystallinesilicon(c-Si)currentlycontributestoover95%ofthemarket.AccordingtoCEEW,theproductionofpolysiliconandwafersisatechnicallycomplexprocessthatdemandsreliableandcontinuouselectricity.Additionally,thesemanufacturingunitsarelargeandrequiresubstantialcapitalforset-upandoperation.Hence,thecostofcapitalbecomesanessentialfactorforcompetitiveness,resultinginsignificantconcentrationwithintheindustry.Thenextstepissolarcellmanufacturing,whichencompassesvarioustypesofsolarcellswithvaryingefficiencies.SolarPVmodulevaluechainandmainconsumablesSolargradeQuartz,lowashcoal,limestone,prebakedMg-Sielectrodesetc.IngotpullingandDopingmaterial,argongas,diamondwire,Installedcapacity(March2023)waferslicingetc.Capacityunderconstruction/bidoutAdditionalcapacityrequiredthrough2030CellNitrogen,oxygen,ammoniaandsilane,manufacturingsilverandaluminumpaste,etc.Optimumcapacityby2030ModuleBacksheet,encapsulant,ribbons,solarassemblingglass,AL-frame,junctionboxPVsystemInverter,string–combinerbox,cables,installationtransformers,MMSSource:EYResearch,CEAPowerSectorDashboard,CEAOptimalEnergyMix2030report22Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678BillofmaterialsintheproductionofcrystallinesiliconPVcellsandmodulesAtypicalcrystallinesilicon(c-Si)PVpanel,whichiscurrentlythedominanttechnology,withover95%oftheglobalmarket,comprisesapproximately76%glass(panelsurface),10%polymer(encapsulantandback-sheetfoil),8%aluminum(frame),5%silicon(solarcells),1%copper(inter-connectors),andlessthan0.1%silver(contactlines)andothermetals(e.g.,tinandlead).Thinfilmtechnologies,suchascopper–indium–gallium–(di)selenide(CIGS)andcadmiumtelluride(CdTe),constitutetheremainingportionofthemarket.Thesetechnologiesrequirelessmaterialoverallcomparedtocrystallinesilicon.ForCdTepanels,thecompositionisapproximately96%to97%glass,3%to4%polymer,andlessthan1%semiconductormaterials(CdTe)andothermetals(e.g.,nickel,zinc,tin).CIGScontainsabout88%to89%glass,7%aluminum,4%polymer,andlessthan1%semi-conductormaterial(indium,gallium,selenium)andothermetals(e.g.,copper).CompositionofmaterialsincrystallinesiliconPVmodules13%3%8%0.07%4%0.05%0.00220.10%72%GlassAluminiumCopperPolymerSiliconSilverTinZincSource:DevelopingGlobalResilientCleanEnergySupplyChains,CEEW202323Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678SolarPVsupplychainSilverSilverPasteC-SicellRooftopCopperCIGSPowdermanufacturinginstallationIndiumGalliumGlassCIGSpanelPVModuleRecyclingorSeleniumCdSPowderManufacturing(c-Si,CIGSordisposalSilicaCdTePowderCdTepanelCdTe)CadmiummanufacturingTelluriumPVsystemAluminiumFrameassemblyCopperUtilityscaleinstallationBOSSource:Achievingtheparisclimateagreementgoals,Springerpublication,201924Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678GlobalcapacityforsolarPVmanufacturingandsupplychainAccordingtoCEEW,theglobalmanufacturingcapacityofsolarPVmodulesRegionalShareofGlobalSolarPVproductionandotherrawmaterialshassignificantlyincreasedoverthelastdecade.Atthesametime,growthisconcentrated.ManycountrieshavetakenModuleinitiativestoscaleupdomesticsolarmanufacturing,andsharesofotherregionsmayincreaseinthecomingdecade.Globalpolysilicon,wafer,cell,andmodulemanufacturingcapacitieswere294GW,414GW,441GW,and482GW,respectively.CellProductionshareofvariousPVmoduletechnologiesWafer100%Polysilicon20%40%60%80%100%90%80%0%EuropeNorthAmericaSouthKorea70%ChinaIndiaSouthEastAsiaRestoftheWorld60%Japan50%40%AccordingtoCEEW,in2021,monop-typePERCaccountedforover80%of30%themarketshareofsolarPVmodules.However,emergingtechnologies,such20%asheterojunctiontechnology(HJT),TOPCon,andinterdigitatedbackcontact10%(IBC),areexpectedtobecomemorecost-competitivebytheendofthe0%decade.Theseemergingcelltypesofferhigherefficienciesbutcomewithgreatercostandcomplexity.By2030,theshareofmonop-typePERCis20212023202520282031expectedtodecrease,withnewtechnologieslikeTOPConandHJToccupyingmorethan50%ofthemarketshare.Mono-ptypePERCMonontypeTopconMonontypeHJTMonoptypeTopconTandemOthersSource:DevelopingGlobalResilientCleanEnergySupplyChains,CEEW202325Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678IndiatradescenarioinsolarPVcellsandModulesSolarCells(Imports-INRcrore)HSCode:85414011Solarcells(Exports-INRcrore.)HSCode:8541401130,0001,60025,0001,40020,0001,20015,0001,00010,0008005,000600-400200-FY18FY19FY20FY21FY22FY18FY19FY20FY21FY22ChinaMalaysiaThailandCanadaDenmarkEcuadorHaitiVietnamAfghanistanSolarModules(ImportsinFY22-INRcrore)HSCode:85414012Solarmodules(Exports-INRcrore)HSCode:8541401225,000180020,0001600140015,0001200100010,0008005,000600400-FY22200ChinaSingapore0FY-22FY-21MalaysiaHongKongOthersSource:www.dgft.gov.in26Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’sPVmodulemanufacturingcapacitysurpassed~38GWin2023andpoisedtoexceed~110GWby2026AsofMarch2022,India'scumulativePVmodulemanufacturing(nameplate)capacitywasapproximately18GW.However,byMarch2023,thiscapacityhadsurgedtoaround38GW,representingaremarkableadditionofover100%.Furthermore,thereisapipelineofapproximately90GWofPVcellandmodulecapacityannounced,inpermittingandconstructionstages.IntermsofPVcellmanufacturing,thecumulativecapacityincreasedfromabout4.3GWinMarch2022toaround6.6GWbyMarch2023.Additionally,thereisapipelineofapproximately68GWofcellcapacityundervariousstagesofimplementation.Therearecurrentlyfewplayersiningot-wafermanufacturing,andnopresenceofpolysiliconmanufacturinginIndia,duetoitscomplexity,lackoftechnology/IPR,rawmaterials,andhighcapitalexpenditure.Overthepastdecade,IndiahasheavilyreliedonChinaforitssolarPVmodules,leadingtoanincreasedriskinthesupplychain.InFY-22alone,IndiaimportedsolarmodulesvaluedatINR22,931crores,alongwithsolarcellsworthINR8,013crore,primarilyfromChina.Toaddressthisdependency,theIndiangovernmenttooksignificantmeasures.ABasicCustomDuty(BCD)wasintroducedtomakedomesticallymanufacturedproductsmorecompetitive.Additionally,theMinistryofNewandRenewableEnergymandatedmanufacturerstoempaneltheirmodelsandmanufacturingunitsundertheApprovedListofModelsandManufacturers(ALMM)foravailingpolicyincentives.Thisinitiativeaimedtostreamlineandregulatethequalityandperformancestandardsofsolarmodulesinthemarket,furtherencouragingdomesticproduction.TheseinitiativeshelpedboostdomesticproductionofsolarPVcellsandmodulesandreducedependencyonimports.IndiaSolarPVmanufacturingcapacity,GWBy2026,India’scapacityforcriticalupstreamcomponentsinthesolarPV2026(P)valuechain,suchaspolysiliconandingot/wafer,isexpectedtoreach38GWand56GW,respectively.PVcellandmodulecapacityislikelytoexceed59GWand110GW,respectively.ThisexpansionisdrivenbyfactorssuchastheProductionLinkedIncentive(PLI)schemeforintegratedsolarPVmodulemanufacturingandthesignificantmarketpotentialbothwithinIndiaandglobally.2023However,theavailabilityofcriticalrawmaterials,technologydevelopment/acquisition,infrastructureandskillingforcomplexproduction2022processesplaysacrucialroleinthisexpansion.Forinstance,inthemanufacturingofmetallurgicalsilica,whichisanessentialcomponentintheproductionofsolarmodules,Indiareliesontheimportofrawmaterialssuchaslowashcoalandcharcoal.2020Bystrengtheningtheupstreamsupplychain,IndiaseekstobuildarobustandintegratedsolarPVmanufacturingecosystemsectortomeetboththegrowingdomesticandinternationaldemand.AsIndiastrivesforself-reliance,itshouldprioritizebuildingcompetitive020406080100120productsfortheglobalmarkets,expandingitspresence,positioningitselfasaCellIngotPolysiliconModulecrediblealternativeformarketslookingtodiversifysupplychainsandbuildresiliencetowardsglobaldisruptions.ThegovernmentshouldensureastableSource:IEEFA&JMKResearch,2023andpredictablepolicyoutlookforsustainedinvestorconfidenceandgrowth.27Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678GovernmentawardsINR18,395crorefor25,800MWsolarPVmanufacturingcapacityunderPLIincentivesacrossthevaluechainofpolysilicon,ingot,wafer,cellsandmodulesInApril2021,theGovernmentofIndialauncheditsfirstProductionLinkedCapacityawardedinPLI-2(MW)Incentive(PLI)schemeaimedatpromotingthemanufacturingofsolarmodulesacrosstheentirevaluechain.TheIndianRenewableEnergyDevelopmentAgency(IREDA)wasdesignatedasthenodalagencyresponsibleforimplementingthescheme.Underthisinitiative,grantedacumulativecapacityof6GWforfullyintegrated(Polysilicon-Module)manufacturingtothreecompanies,withanapproximateinvestmentofINR4,455crore.Furthermore,theSolarEnergyCorporationofIndia(SECI)assumedtheroleofthenodalagencyforthesecondphaseofthePLIscheme.Undertranche-II,SECIawardedatotalcapacityof19,800MWto11differentplayers,distributingthecapacityacrossthreedistinctvaluechaincategories.TheestimatedinvestmentforthisallocationamountedtoINR13,940crore.ThesePLIschemesweredesignedtoincentivizeandboostdomesticmanufacturinginthesolarmodulesector,ultimatelyreducingrelianceonimportsandstrengtheningIndia'sself-relianceinrenewableenergyproduction.ThisinitiativeholdsthepotentialtosignificantlyenhancethemanufacturingcapabilitiesandcompetitivenessofthesolarPVindustryinIndia.CapacityawardedinPLI-1(MW)(Polysilicon-Module)AdaniInfrastructure2,000RelianceNewEnergySolar2,0002,000ShiridiSaiElectricalsSource:PLITranche-1Results,IREDASource:PLITranche-2Results,SECI28Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ThepipelineofsolarPVmanufacturingprojects(announced,underpermittingandunderconstruction)willneedUS$15.2billionininvestmentsLocationoftheModuleCellIngot/WaferInvestmentmobilizationFacilityManufacturingManufacturingManufacturingcapacityundercapacityundercapacityAtotalofINR1.23lakhcrores(US$~15.28billion)pipelinepipelineunderpipelineofcapitalinvestmentwillbemobilizedto(GW/year)(GW/year)(GW/year)operationalizetheseprojectsinthepipeline.2118Gujarat35.65InvestmentacrossValuechain(US$billion)Himachal0.50Pradesh0Module2.8Karnataka1.50Maharashtra300Cell-Module3.2Rajasthan140TamilNadu49.43.4Wafer-Module2.2Telangana9.412.2511Uttarakhand1300Polysilicon-Module6.8WestBengal0.25303CapacitybyValueChain(GW)201316.371.645.432.4FacilityLocation2027.7notreportedPolysilicon-ModuleTotal89.413Ingot-ModuleCell-ModuleModuleSource:EYanalysis29Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersProduction-linkedincentivesforsolarPVmoduleandsystemPolicyconsistencyandpredictabilityforALMMancillariesmanufacturingimplementationAssolarPVtechnologycontinuestodominateglobalelectricitymix,theAcriticalfactorinpromotingthegrowthofdomesticPVcellandmoduleancillaryindustrywillplayacrucialroleinensuringreliability,efficiency,manufacturingindustryisensuringdomesticdemandcertainty.Theandintegrationofsolarenergysystems.India’sSolarPVindustry,implementationofApprovedListofModelsandManufacturers(ALMM)asprimarilyfocusedonthemanufacturingandinstallationofsolarpanels,amandatoryruleforprocuringsolarPVmodulesfordomesticprojectsissupportedbyavastnetworkofancillarycomponentsandservicesemergesasapivotalcatalystinthisregard.Byestablishingaclearessentialfortheefficientfunctioning,integration,monitoring,andframeworkforpermissiblemodelsandmanufacturers,theALMMmandatemaintenanceofasolarpowersystem.effectivelyprovidesdomesticmodulemanufacturerswithareliabledemandestimate.ThisisparticularlyvaluablewhenconsideredalongsideIndia'ssolarenergylandscapeischaracterizedbyasignificantdisparityIndia'sambitiouscapacityadditionplanswithintherenewableenergybetweenthecountry'ssolarglassproductioncapacity(approximately6sector.GW)andtheoverallmoduleproductioncapacity(approximately38GW).Thisglaringgapnecessitatestheimportoftheremaining34GWTheALMMmandateeffectivelyrestrictstheunregulatedimportofsolarequivalentofsolarglassformodules,hinderingthenation'sjourneymodules.Thisinfluenceonimportscreatesaconduciveecosystemwhereintowardsself-sufficiencyinsolarPVvaluechain.domesticmanufacturerscanrecalibratetheirproductionstrategiestomeettheanticipateddemand.Crucially,theimplementationofALMM,byBeyondsolarglass,otherindispensablecomponentssuchasethylene-constrainingimports,fostersanenvironmentwherethedomesticmodulevinylacetate(EVA),variousencapsulants,backsheets,junctionboxes,manufacturingsectorcanthrive.semiconductorcomponentsforInverters(includingIGBT,MOSFETetc.)relyonimports.ThesecomponentscollectivelyconstitutethebackboneBlendedinnovativelow-costfinancinginstrumentsofsolarmodulefabrication.WhileIndiasucceedsinmanufacturingsolarcellsandmodulesdomestically,thecomprehensiveobjectiveofTheintricateinterplayofdemandvolatilityandpolicyuncertaintyhasled"AtmanirbharBharat“cannotbefullyrealizedifthecountrycontinuesIndianfinancialinstitutionstoadoptacautiousapproachwhenitcomestorelyextensivelyonimportedancillarycomponentsformoduleandtosupportingdomesticsolarmodulemanufacturers.Theuncertaintiessystemsassembly.surroundingthedemandforsolarmodules,influencedbyfactorssuchasregulatorychangesandmarketdynamicshaveinstilledasenseofriskInthiscontext,AatmaNirbharpolicymustfocusonestablishingarobustaversionamongfinancialentities.EvenwhenfinancialinstitutionsareecosystemforthemanufactureSolarPVmoduleandsystemancillaries,willingtoprovidefunding,thetermsoffinancingoftencomeatacost.suchassolarglass,MOSFETandIGBTcomponentsforinverters,etc.Notably,theinterestratesassociatedwiththedebtofferedtosolarmodulemanufacturersaresignificantlyhigher.Thisfinancialburden,stemmingfromincreasedinterestcosts,directlyimpactsthecoststructureofdomesticsolarmodules.30Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678TheestablishmentofthesolarmodulemanufacturingfacilityisByofferingincentivestailoredtowardexports,thegovernmentwouldinherentlycapitalintensive,demandingsubstantialinvestmentsinprovideIndiansolarandsolarmodulecomponentmanufacturerswithainfrastructure,technology,andskilledmanpower.Recognizingthecompetitiveedgeininternationalmarkets.TheseincentivescouldsignificanceofdomesticmodulemanufacturinginrealizingIndia'sencompassvariousforms,suchasfinancialsupport,taxbenefits,renewableenergygoalsandfosteringself-reliance,thegovernmentisstreamlinedexportprocedures,orevenresearchanddevelopmentpoisedtoexplorestrategicmeasurestofacilitatethegrowthofthisgrants,incentivizingmanufacturerstoenhancethequality,efficiency,criticalsector.Onesuchapproachinvolvesenablingaccesstolow-costandaffordabilityofIndianmodulesfortheglobalmarket.blendedinstrumentsfordomesticmoduleandancillaryequipmentmanufacturers.Robustrisk-mitigationinstrumentsatscaledeployedbyBoosttheavailabilityofskilledprofessionalsIFI,MDBs,institutionalcapacityandreformsinthedevelopmentfinanceandbankingsectorbyinvolvingprivatesectorstakeholderscanhelpQuartzminingandmoduleassemblingarethesimplestprocessesincreateinvestmentplatformsforaccesstolow-costcapital.termsofrequirements.Theyrequirelowlaborcosts,low-to-mediumAtthecoreofthisinitiativeistheacknowledgmentthatthecostofskills,reliableanddevelopedinfrastructure,and,inthecaseofquartzcapitalsignificantlyinfluencestheviabilityofmanufacturingendeavors,mining,raw-materialavailability.Cellmanufacturingrequiresslightlyparticularlyinaninfrastructure-intensivesectorlikesolarmodules.Themorecapitalthanmodulemanufacturing,itsinfrastructurerequirementfinancialburdenimposedbyhigh-interestdebtcanamplifytheoverallissimilartosolarmodules.Thesuccessofcellmanufacturingrequiresacostofproduction,makingdomesticallymanufacturedmoduleslessskilledworkforceandthepresenceofresearchanddevelopment(R&D)competitiveagainsttheirimportedcounterparts.Toaddressthis,thecentersifinnovativetechnologies,liken-typemonocrystalline,arebeinggovernmentmayconsidermechanismstoprovidedomestictargetedbythefacility.Accesstopatentsandintellectualpropertymanufacturerswithaccesstolow-costdebt.rights(IPRs)isalsocrucialforthisstep.Upstreammanufacturingsteps,suchasmetallurgical-gradesilicon,solar-gradesilicon,andingotandPromoteexport-orientedincentiveswafermanufacturing,areverycomplex.Theyarethemostcapital-intensiveandrequirehighlyskilledworkers.TheindustryrequiresGiventhecurrentsurplusofsolarmodulemanufacturingcapacityintrainedtechnicians,engineers,andoperatorswhoarefamiliarwiththeIndia,domesticmoduleutilizationwithinthecountryisfacingchallengeslatestmanufacturingtechnologiesandqualitystandards.Theavailabilityduetofactorssuchasthedynamicsofreverseauctions.Additionally,inofskilledmanpowerneedstobeimprovedthroughtrainingprogramstheglobalmarket,Indianmodulesencounterfiercecompetitionfromandcollaborationswithindustryprofessionalsandacademicinstitutions.theirChinesecounterparts,whichoftenhavecostadvantages.ToaddressthissituationandbolstertheglobalcompetitivenessofIndianAddressingtheshortageofskilledworkforceisessentialforefficientsolarmodulemanufacturers,thegovernmentcouldcontemplatemanufacturingoperations.Establishskilldevelopmentprogramsinimplementingexport-orientedincentives.collaborationwitheducationalinstitutionsandindustryexpertsfromEUandUS.Providetrainingonadvancedmanufacturingtechnologies,qualitycontrolprocesses,andsafetystandards.Offerincentivestoattractskilledprofessionalstothesolarmodulemanufacturingsector.31Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678UniformGST@5%applicationonallrenewableenergyAccesstoround-the-clockaffordableelectricitymanufacturingequipment,rawmaterialsandancillariesAccesstoreliableandaffordableelectricityaroundtheclockisessentialThecrucialrawmaterialpolysiliconattractsaGSTrateof18%andaforupstreamcomponentsinthevaluechain.Electricityconstitutesacustomdutyof5.5%,resultinginanoveralltaxburdenof23%forthePVsignificantportion,approximately30%to40%oftheoperationalexpensesmanufacturingindustry.ThesetaxescontributetobottlenecksintheinsolarPVmanufacturing.Indiahascomparativelyhighindustrialtariffssolarindustry,hamperingdomesticmanufacturingandhinderingthecomparedtodomestictariffs.TheseelevatedindustrialtariffscontributeachievementofIndia'srenewableenergygoals.toincreasedproductioncostsformodules,therebymakingIndianproductslesscompetitiveintheglobalmarket.ImplementingareductionorwaiverofcustomdutyonpolysiliconwouldThefinancialhealthofstatepowerutilitiesandelectoralpromisesoffreehavefar-reachingbenefitsforthesolarupstreammanufacturingsectorpowersupplydoesnotleavefiscalroomforaccommodatingaffordableinIndia.Byreducingthecostburdenassociatedwithimportingindustrialtariffs.ExploringaNationalschemetoincentivize/compensatepolysilicon,domesticmanufacturerswouldbeencouragedtoinvestinstateutilitiesforreducingindustrialtariffsorpromotinggreenenergylocalproductionfacilities.Thiswouldnotonlyenhancetheself-relianceopenaccesstransactionsforround-the-clocksupplycanbeconsidered.oftheindustrybutalsoensureastablesupplychain,reducingImplementingpoliciesthatenablelongerdurationofbankingwouldallowvulnerabilitytointernationalmarketfluctuationsandsupplydisruptions.manufacturerstostoreexcessenergyandutilizeitwhenneeded,ensuringMoreover,afavorabledutystructurewouldmakesolarupstreamacontinuousanduninterruptedpowersupplyfromDISCOMs.manufacturinginIndiamorecost-effectiveandcompetitive,attractingbothdomesticandforeigninvestments.PromoterawmaterialsupplychainindustrySimilarly,establishingauniformGSTrateof5%onallrenewableenergyThesecondphaseofgovernmentsupportedPLI,approximately7.7GWofmanufacturingequipment,rawmaterialsandancillarieswouldbringincapacityhasbeenallocatedforpolysilicontomodulefacilities.Forothertherequiredclarityandsimplicitytothetaxregime.Thecurrentlessintegratedfacilities,theavailabilityofrawmaterialsisacriticalfactorvariationinGSTratesfordifferentcomponentsandequipmentaddsandposeschallengesintermsofsupplychaindisruptionsandpricecomplexityandhampersthegrowthofthesector.AuniformGSTratevolatility.Evenforpolysiliconmanufacturing,theavailabilityofkeyrawwouldleveltheplayingfieldformanufacturers,facilitatingtheirmaterialssuchasPVgradequartz,charcoal,limestone,andlow-ashcoalisdecision-makingprocessesandencouraginglong-terminvestments.Itlimited.Theimportofrawmaterialsposesrisks,includingdelaysinwouldalsostreamlinetaxcompliance,reducingadministrativeburdensshipments,customsandlogisticsissues,andfluctuationsininternationalandpromotingamoreconducivebusinessenvironment.marketprices.Theseuncertaintiescansignificantlyimpactthemanufacturingprocess,leadingtoproductiondelaysandincreasedcosts.Byprovidingcertaintyinthedurationandapplicabilityofthesetaxesandduties,thegovernmentcanofferstabilitytomanufacturersToensurethegrowthandstabilityofthefullyintegratedsolarmoduleoperatingintherenewableenergysector.Thisstabilityallowsmanufacturingindustry,itiscrucialtoestablishastableandsecuresupplymanufacturerstoaccuratelyassesscosts,plantheiroperations,andofrawmaterials.Encouraginginvestmentsindomesticrawmaterialmakeinformedinvestmentdecisions.Italsoenablesthemtodevelopmining,extractionandprocessingcapabilitiescanhelpcreateamoreself-strategiestonavigatechangingmarketdynamicsandtoremainresilientreliantsupplychainandreducevulnerabilitiesassociatedwithinthefaceofuncertainties.Ultimately,thesepolicymeasureswouldnotinternationalsourcing.onlybolsterthegrowthoftherenewableenergysectorbutalsocontributetoIndia'sself-sufficiencyincleanenergyproductionandenhanceitscompetitivenessintheglobalmarket.32Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678StrengtheningwindturbinemanufacturingecosysteminIndiaforexportsWindturbineandcomponentmanufacturingecosystem:AsnapshotAccordingtoCEEWanalysis,thewindsupplycomprisesRegionwiseproductionshareandSourcingofComponentsvariousassemblylines,.Theglobalsupplychaininvolvesparticipationby(i)originalequipmentGeneratorBladeGearboxManufacturingCapacitymanufacturers(OEMs)thatsetupassemblylinesorSourcingturbine-manufacturingfacilitiestosupplyfinishedproducts(windturbines)forinstallationatprojectsites,ManufacturingCapacity(ii)suppliersofindividualcomponentsandsub-Sourcingcomponents,and(iii)manufacturersofequipmentandmachineryusedforproducingkeycomponentsandManufacturingCapacityinstallationofturbinesonprojectsites.ThelogisticsofSourcinginstallation,construction,operation,andmaintenancearealsocrucialstepsinthewindsupplychain.0%20%40%60%80%100%AsperGWECanalysis,manufacturersmuststriketheUSAEUChinaRestoftheWorldInhouseproduction3rdpartyrightbalancebetweenthein-houseproductionofcomponentsandoutsourcingtothirdpartiestodeliverConsumables:Consumables:Consumables:Consumables:Consumables:ontheirturbinedesigns.In2020,thetotalnacelleREE,ferrite,cobaltCopper,BronzeandSpecializedsteelandmanufacturingcapacitywas120GW,withmajorFiberglass,resin,usedinpermanentSpecializedsteelBrassPlatinumgroupcountriesorregionsincludingChina(58%),Europeplastic,siliconefiber,magnet,copper,metals(18.5%),theUS(10%)andIndia(8.5%).SincebladeBalsawood,SpecializedsteelGearboxBearingsmanufacturingislaborintensive,countrieswithlowAluminumalloy,Semilaborcosts,primarilydevelopingeconomiesprovideCarbonfiber,GeneratorNacelleConductorscompetitivegroundsformeetingglobaldemand.Ceramics,Teflon(PTFE),Glass-fiber-Consumables:Consumables:Consumables:Aconcentratedecosystemformanufacturingcriticalreinforcedplastic,SteelCastironcomponentsimpliesahigherriskofinterruptionsinthecarbon-fiber-Concrete&steelavailabilityofthesecomponentsifthemanufacturingreinforcedplasticTowerHublocationsgetaffectedduetogeopoliticaldevelopments,Foundationpricevolatilityofmaterials,andclimaterisks.BladeTherefore,newmanufacturingcapacitiesmustbedevelopedinarelativelymoredistributedfashiontoWindTurbineeasetradeandreducetheimpactofsupplydisruptions.Source:DevelopingGlobalResilientCleanEnergySupplyChains,CEEW202334Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Criticalminerals,infrastructureandskilledresourcerequirementsforworldclasswindturbinemanufacturingecosystem►Innovationsareessentialformakingsupplychainsmorecost-effectiveWindturbinematerialcompositionandresilient.Forexample,accordingtoDOEanalysis,innovationsinmaterialscienceandengineeringcouldmakerotorbladeslighterreducingOnshoretransportationandmanufacturingcosts,usinglocallyavailablerawmaterials,orenablinghybridandcost-effectivetowerdesignsthatcanbe0%0%assembledon-sitecanalsocontributetoreducingtransportationcosts.29%►TheCEEWanalysisindicatedthatcontinuouschangesintechnologyandturbinesizesnecessitateadditionalinvestmentsinupgrading54%manufacturingfacilitiesforkeycomponentsandassemblylines.While4%theseupgradesarebeneficialforthegrowthofthewindsector,theyalsorequiresignificantfinancingcapabilitiesandworkforceswithciviland8%electricalengineeringskills.0%1%5%►AsperGWEC,alargernumberofscience,technology,engineering,andmathematics(STEM)professionalsarerequiredintheworkforce,OffshoreparticularlyforonshoreprojectswhencomparedtoothermatureREtechnologies,suchassolarPV.Thisimpliesthatextendedleadtimesand2%0%additionaleffortsareneededtogenerateaworkforcesuitableforthewindindustry.Thereisasignificantskilloverlapbetweentheoffshoreoil36%andgasindustryandtheoffshorewindindustry,suggestingthatthe52%offshoreoilandgassectorcouldhelpmeettheskillneedsforanaccelerateddeploymentofoffshorewindsystemsinIndia.Copper3%5%2%CobaltChromiumMolybdenum1%0%Others►TheIEAanalysishighlightsthatwhiletrainingsystemsfortheonshoreManganesewindsectorarealreadyestablished,thegrowthofoffshorewindwillNickelRareEarthsrequirenewerandmorediverseskillsets.ThisincludestrainingtoadhereZinctosafetyguidelinesrelevanttoprofessionalsworkingatheightsandseasurvival.►AsperGWEC,theconstructionofwindfarmsrequiresseveralmaterialssuchasconcreteandsteel,alongwithkeymineralslikecopper,zinc,andmanganese.Concreteandsteelconstitute90%ofthematerialrequirementforonshorewindfarms,whereassteelaccountsfor90%ofthematerialrequiredforoffshorewindfarms.AsperIEAanalysis,withintheoverallrequirementofkeyminerals,copperandzincaccountfor83%and88%ofthemineralrequirementinonshoreandoffshorewindturbines,respectively.Source:DevelopingGlobalResilientCleanEnergySupplyChains,CEEW202335Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Globalwindturbineblade,generatorandgearboxmanufacturingecosystemGlobalWindTurbineBladeManufacturingShare-2022GlobalWTGGeneratorManufacturingCapacity-20227%1%3%3%11%22%125GW65%7%ChinaIndiaEuropeLATAMOtherAPAC7%GlobalWindGearboxManufacturingCapacity-2022130GW1%12%60%14%12%160GW75%ChinaEuropeUSIndiaLATAMOtherAPACChinaEuropeIndiaOtherAPACSource:GlobalWindReport,GWEC202336Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678GlobalwindturbinenacellemanufacturingecosystemGlobalWindTurbineManufacturingShare-2023GlobalOnshoreNacelleManufacturingCapacity-20234%1%61503507%216009%13650135GW8200011500ChinaIndiaNorthAmericaEuropeLATAMRestofWorld163GW60%19%GlobalOffshoreNacelleManufacturingCapacity-20231900950027GW16000ChinaEuropeUSIndiaLATAMOtherChinaEuropeAPACexcl.ChinaSource:GlobalWindReport,GWEC202337Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’swindpowergenerationcapacityislikelytodoublethrough2030andmayevensurpass~150GWforachievingthegreenhydrogenproductiontargetsDemandforwindpowergenerationthrough2030(MW)State-wisewindpowerInstalledCapacityasofMarch2023(GW)Installedwindpowercapacity(March2023)Windpowercapacityunderconstruction/bidAdditionalwindpowercapacityadditionthrough2030Optimumwindgenerationcapacityby2030KeralaTelanganaMadhyaPradeshAndhraPradeshMaharashtraRajasthanKarnatakaGujaratTamilNaduTotalBy2030,anestimated5milliontonsofgreenhydrogenproductioncapacityisexpectedtobecreated,resultinginapproximately125GWofrenewableenergy(RE)capacity.Outofwhich,windpowerislikelytobeamajorcontributor.Round-the-clockREpowergenerationsystemstypicallyrequiredforelectrolyticproductionofgreenhydrogenisbestachievedwithahighshareofwindpowergenerationascomparedtosolarPVandenergystoragesystems.Moreover,asubstantialwindpowergenerationpotentialofapproximately696GWexistsatahubheightof120meters.GivenIndia’sabundantwindpowerpotentialanditscommitmenttoexpandrenewableenergy,theproductionofgreenhydrogenpresentsasignificantmarketopportunityforthewindturbinemanufacturingindustryinthenearfuture.Source:PowerSectorDashboardCEAMarch2023,EYResearch,CEAOptimalEnergyMixreport2023Source:PowerSectorDashboardCEAMarch202338Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Indianwindturbineproductioncontributesonly7%ofglobalproduction►On9January2023,MNREreleasedanofficememorandumthatrevisedthe►IndiahasestablisheditselfasamajorplayerinwindturbinecompetitivebiddingmechanismforprocurementofpowerfromWindPowermanufacturingwithatotalcapacityofaround12GW.AsofJune2023,Projects(WPPs).Thistransitionedfromreverseauctionbiddingtoasingle-theMinistryofNewandRenewableEnergy(MNRE)hasapproved33stagetwo-envelopeapproach,involvingtechnicalandfinancialaspects,withwindturbinemodelsfrom14OEMs,featuringadvancedspecificationsseveralotherchanges.Thebiddersmeetingthetechnicalrequirementswillbesuchasrotordiametersupto156metersandhubheightsupto160consideredforthefinancialbidandsubsequently,thelowestbidderwillbemeters.Additionally,thereisagrowingemphasisonindigenization,awardedtheproject.ItwasalsoproposedthatthecumulativebidcapacitywithmultipleOEMsachieving70-80%localizationandturbineunitswouldbe8GWeachyearuntil2030,withacapof2GWforeachstate.Inratedat3.6MW.Theseeffortsnotonlycreateopportunitiesforcaseswheretherewasonlyonebidder,theremainingcapacitywouldberolledinvestment,technologydevelopment,jobcreationbutalsocontributeovertothenexttender.Thiswouldbefacilitatedthroughcompositestate-tofosteringagreenandsustainableenergysectorinIndia.specificbidsforalleightwindystates(comprisingeightsub-bids),withindependentselectionofbiddersforeachstate.►Indiaholdsthedistinctionofbeingthesecond-largestmarketforgearboxesworldwideandthesecond-largestmanufacturerofbladesin►TherearealsoprovisionstopenalizethequalifiedbiddersincaseofdelayintheAsia-Pacific(APAC)region.AccordingtotheGlobalWindEnergyprojectexecution.Finally,thetariffsfromallthebidswillbepooledaspertheCouncilReport2023,Indiaaccountsforapproximately11%ofthenotifiedElectricity(Amendments)Rules,2022,andwillbeofferedtoglobalblademanufacturingcapacity,equivalentto14.3GW.Similarly,DISCOMs.ThismoveaimstoincreasethepaceofdeploymentofwindpowerIndiacontributesaround7%totheglobalwindgeneratormanufacturingcapacityandachievethewindpotentialestimatedbyNIWE.Theannualtargetcapacity,amountingto8.75GW,andholdsasignificant12%shareinwassetat8GWforonshorewindtenderseveryyearbetween2023and2030,globalgearboxmanufacturing,equivalentto19.2GW.usingasingle-stagetwo-envelopebidsystem.MNREpublishedastrategypaperoutliningatendertrajectoryof37GWofoffshorewindby2030.►AspertheGlobalWindEnergyCouncil(GWEC)globalwindreport2023,Indiacontributesonly7%oftheglobalwindturbinemanufacturingGlobalNacelleManufacturingFacilities-2023capacity,translatingtoapproximately12GW.ThecombinationoffavorablepricingandtheshiftingdynamicsinsupplychainsinEurope80No.ofOffshoreNo.ofOnshoreNo.ofOffshorepresentsasignificantopportunityforIndiaintheglobalwindenergyNacelleFacilitiesNacelleFacilitiesNacelleFacilitiessupplychain.Withadomesticmanufacturingcapacityof10-12GWfor60windturbinegeneratorsandastrongpresenceingearboxAnnouncedAnnouncedmanufacturing,blades,andgeneratorsintheAPACregion,Indiaiswell-40positionedinthewindmanufacturingsector.20►Tostrengthenitspositionasaleadingexporter,Indianeedstoestablisharesilientsupplychainforrawmaterials,includingrareearthmetals0andnon-standardsteel,andfocusonspecificvaluechaincomponentsNo.ofOnshoresuchascastingandforging.ItisimperativetocontinueprovidingNacelleFacilitiesimportdutyreliefoncertainequipmentandcomponentsthatcannotbeproducedlocally,suchasbalsawoodandpultrudedcarbonfiber.ChinaEuropeIndiaUSALATAMAPACAfrica&MESource:GlobalWindReport,GWEC202339Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinwindturbinesandgeneratorsWindturbineHSCode:84128004WindgeneratorHSCode:85023130002001801602500140200012010015008010006040500200FY-19FY-20FY-21FY-22FY-230FY-19FY-20FY-21FY-22FY-23FY-18FY-18Imports(INRCrs.)Exports(INRCrs.)Imports(INRCrs.)Exports(INRCrs.)Source:www.dgft.gov.in40Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678MNREhasannouncedastrategyroadmaptoinstall37GWofoffshorewindpowerby2030TheMinistryofNewandRenewableEnergy(MNRE)inIndiahasannouncedastrategyroadmaptoinstall37GWofoffshorewindpowerby2030.Thissignifiesasignificantfocusonharnessingwindresourcesfromtheseasandoceanssurroundingthecountry.OffshorewindfarmshavethepotentialtogeneratelargeamountsofcleanenergyandcontributetomeetingIndia'srenewableenergygoals.TheroadmapsetbytheMNREemphasizesthegovernment'sdedicationtoexploringandutilizingoffshorewindresourcestofurtherenhancethecountry'srenewableenergycapacity.Bysettingthesetargetsandimplementingstrategicplansforonshoreandoffshorewindpowerdevelopment,Indiaaimstostrengthenitspositionasagloballeaderinrenewableenergy.Thegovernment'sfocusonwindenergyexpansionalignswithitscommitmenttocombatclimatechange,reducegreenhousegasemissions,andachievesustainabledevelopment.Keepinginviewtherequirementoftheholisticdevelopmentofoffshorewindfarmsinthecountryandtofast-tracktheprocess,theMNREproposedthreemodels:Model-AModel–BModel-CProposedforB3zone(365sq.km)offthecoastExclusivityforseabedduringthestudyperiodofSeabedwillbeallocatedtobiddersthroughaofGujarat.Leaseagreementfor35years.Atwoyears.competitivebiddingprocess.two-stage-singlebidprocesswouldbefollowede-RAbySECIandPPAwillbesignedwithSECIasNostudieshavebeencarriedoutbyMNRE/NIWETheGovernmentwillcomeupwithabidfortheoff-taker.projectdevelopment/allocationoftheseabed.ProjectsunderEEZofIndiaThebiddingmayincludeanyofthefollowingViabilityGapFundingmaybeconsideredbyGovt.methods;Biddingonlease/allocationfeeorNIWEwillactasasinglewindowforclearancesrevenuesharingincaseofprojectsforcaptiveOWPDshallcommissiontheprojectwithinfourconsumption/thirdpartysale/salethroughyearsDevelopertoconductstudiesexchangeunderanopenaccessmechanism.Tariff-basedcompetitivebiddingincaseofMNREconductedfollowingstudiesthatwouldAfterstudiesandclearances,SECIwillinvitepowerprocurementbyDISCOMsorCentralenablethebidderstobidfortheprojectstendersforoffshorewindenergyGovt.orStateGovts.Anyothertransparentbiddingmechanismidentifiedbythe►Lidar-basedoffshorewindresourceOWPDneedtosubmitDPRandenterintoGovernment.assessmentfortwoyearsanddatapublishedconcessionagreementandleaseagreement(foraontheNIWEwebsite.Geophysicalperiodof35years)forprojectdevelopmentandMNREoritsdesignatedagencywillenterintoinvestigationandGeotechnicalinvestigationsaleofpowerunderopenaccess/captive/thirdtheconcessionagreementand‘Leasefor3nosofrepresentativeboreholesuptopartysaleregime.GovernmentmayalsocallforAgreement’for35yearswiththesuccessful60msoildepth.bidsforprocurementofpowerforDISCOMsonthebidders.basisoftariffaftertwoyears.►RapidEIAstudyOWPDtoshallcommissiontheprojectwithinOWPDshallcommissiontheprojectwithinthreefouryears►Oceanographic(Wave,Tide&current)foroneyearsmonthSource:StrategyPaperforOffshoreWindEnergyInIndia,MNREAugust,202341Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678MNREindicativeauctiontrajectoryforoffshorewindMNREindicativeoffshorewindauctiontrajectory(GW)6543210FY25FY26FY27FY28FY29FY30FY24Model-BModel-CModel-ASource:StrategyPaperforOffshoreWindEnergyInIndia,MNREAugust,202342Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersProduction-linkedincentivesforwindturbinegradeancillaryRareearthstomanufacturepermanentmagnetsforgenerator,manufacturersandrareearthmineralprocessingfiberglass/resin,etc.Domesticvalueadditioninwindturbinemanufacturingiscurrentlyonly~25%.PricevolatilitycanalsoaffectCastingandforgingisacriticalprocessinwindturbinemanufacturing,procurementplanningandinventorymanagementrequiringespeciallyforcomponentssuchasturbinehubs,rotorblades,andmanufacturerstocloselymonitormarkettrendsandengageinstrategicgearboxes.Challengesrelatedtocastingcanincludequalitycontrolsourcingtomitigatethesechallenges.issues,castingdefects,anddelaysinproduction.EnsuringtheavailabilityofskilledpersonnelandmoderncastingfacilitiesisessentialRareearthelements(REEs)arecriticaltoproducepermanentmagnetsformaintainingthedesiredqualityandefficiencyinthemanufacturingusedinwindturbinegenerators.ThepricesofREEs,suchasprocess.Anyshortcomingsinthecastingprocesscanleadtorework,neodymiumanddysprosiumhaveexperiencedwidefluctuationsduetoproductiondelays,andincreasedcostsforwindturbinemanufacturers.factorslikeglobalsupplyanddemanddynamics,exportrestrictions,andgeopoliticalfactors.WindturbineOEMscloselymonitorthepricesConsideringthecontinuousupgradationintheunitsizeofwindturbine,ofREEsastheyimpactthecostandavailabilityofmagnets.itisworthinvestinginadvancedcastingandforgingfacilitiesthatcanaccommodaterapidupgradesinunitsize,designandtechnologyofStrengtheningtransportationandlogisticsforwindturbinemultipleOEMsandcatertothedemandformultipleOEMstogether.installationsImplementrigorousqualitycontrolmeasurestominimizecastingdefectsandensureconsistentproduction.Collaboratewithcasting/forgingEssentialinfrastructuresuchasapproachroads,robustcranes,andexpertsorseekpartnershipswithspecializedcasting/forgingcompaniesefficientpowerevacuationsystems,needstobeputinplace.Bytooptimizetheseoperations.Providingnecessaryfinancialincentivestocollectivelyestablishingsharedfacilities,spearheadedbySpecialtheseindustriescouldrampuptheproductionandreducetheEconomicZones(SEZs)andgovernmententities,thereispotentialtobottlenecksinoverallmanufacturingprocessofwindturbines.lowerpowergenerationcostsandalleviatefinancialstrainonOriginalEquipmentManufacturers(OEMs)andIndependentPowerProducersAdditionally,fluctuationsinrawmaterialpricescanposechallengesfor(IPPs).Enhancingtheefficiencyoftransportationroutesandscheduleswindturbinemanufacturers.Thecostofmaterialssuchassteel,isimperativetomitigatedelaysandensurepunctualdeliveryofwindaluminum,zinc,copper,andcompositescansignificantlyimpacttheturbinecomponents.Strategicinvestmentsinappropriatehandlingoverallmanufacturingcostofwindturbines.Suddenincreasesinrawequipmentandinfrastructureatbothmanufacturingplantsandprojectmaterialpricescansqueezeprofitmargins,makingitdifficultforsitesareessentialtostreamlinetransportationandfacilitateseamlessmanufacturerstomaintaincostcompetitiveness.Variousrawmaterialsinstallationprocesses.tomanufacturewindturbinearecreatingastressonwindturbinemanufacturingcapacityinIndia.SeveralcriticalrawmaterialsareimportedsuchasBalsa-asessentialmaterialusedasreinforcementinblades.43Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Promoteexport-orientedincentivesAccesstoround-the-clockaffordableelectricityIntheglobalmarket,IndianwindturbinesencounterfiercecompetitionManufacturingwindturbinesinvolvesvariousenergy-intensivefromtheirChinesecounterparts,whichoftenhavecostadvantages.Toprocesses,suchascasting,machining,welding,andassembly.TheseaddressthissituationandbolstertheglobalcompetitivenessofIndianprocessesrequireasignificantamountofelectricitytopowerthewindturbinemanufacturers,thegovernmentcouldcontemplatemachineryandequipmentusedintheproductionline.Thepowerimplementingexport-orientedincentives.requirementscanputastrainontheelectricalinfrastructure,especiallyByofferingincentivestailoredtowardexports,thegovernmentwouldifthemanufacturingfacilityislocatedwithlimitedorunreliablepowerprovideIndianwindturbinemanufacturerswithacompetitiveedgeinsupply.Poweroutagesorinterruptionscandisruptthemanufacturinginternationalmarkets.Theseincentivescouldencompassvariousforms,processandleadtoproductiondelays,lowerproductivity,andincreasedsuchasfinancialsupport,taxbenefits,streamlinedexportprocedures,costs.Inconsistentpowersupplycanresultinequipmentdowntime,orevenresearchanddevelopmentgrants,incentivizingmanufacturersmaterialwaste,andreducedefficiency.toenhancethequality,efficiency,andaffordabilityofIndianmodulesfortheglobalmarket.WindturbineOEMsrelyonacontinuousandstableelectricitysupplytomaintainseamlessoperationsthroughoutthemanufacturingprocess.SettingupsharedtestingfacilitiesforwindturbineThecostofelectricityisanimportantfactorforwindturbineOEMs,asitcomponentsonPPPmodedirectlyimpactstheiroperationalexpensesandoverallcostcompetitiveness.Iftheelectricityratesarehigh,itcanincreasetheTestingwindturbinesinIndiaisacomplexendeavorhamperedbymanufacturingcostofwindturbines,whichmayaffecttheOEM'sabilitymultiplechallenges.Thelimitedavailabilityofadvancedtestingtooffercompetitivepricingtocustomers.Thecostofelectricitycanalsoinfrastructureandspecializedtechnicalexpertiseforintricateinfluenceinvestmentdecisionsrelatedtoexpandingmanufacturingcomponentslikegearboxes,blades,andcontrolsystemscontributestofacilitiesorsettingupnewproductionunits.delaysandincreasedcostsinwindenergyprojects.Additionally,theinadequacyofstandardizedtestingprotocolsandregulatoryframeworksAccesstoround-the-clockreliableandaffordableelectricityisessentialspecifictowindturbinescomplicatesthevalidationprocess.Asaresult,forupstreamcomponentsinthevaluechain.Thefinancialhealthofstatethelackofcomprehensivetestingmechanismsextendprojecttimelines.powerutilitiesandelectoralpromisesoffreepowersupplydonotleaveInIndia,mostoftheturbines/componentsareshippedtoDenmark,thefiscalroomforaccommodatingaffordableindustrialtariffs.ANationalNetherlands,Chinaetc.fortesting.Inpartnershipwithacademicandschemetoincentivize/compensatestateutilitiesforreducingindustrialresearchinstitutions,thegovernmentcouldexploretheestablishmentoftariffsorpromotinggreenenergyopenaccesstransactionsforround-anadvancedsharedtestingfacilityforwindturbineswithinthecountry.the-clocksupplycanbeexplored.ImplementingpoliciesthatenableThisinitiativewouldservetoassessturbineperformancedomestically,longerdurationofbankingwouldallowmanufacturerstostoreexcessleadingtoareductioninbothleadtimeandassociatedexpenses.energyandutilizeitwhenneeded,ensuringacontinuousanduninterruptedpowersupplyfromDISCOMs.44Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Domesticvalueadditioninadvancedchemistrycell(ACC)batterymanufacturingIndia’sACCbatterymarkethaspotentialtoexceedUS$~15billion/annumby2030Indianbatterydemandoutlook(conservativescenario)Indianbatterydemandoutlook(acceleratedscenario)1508400151666100435021AnnualDemand(Gwh/Year)30011MarketSize($Billion)AnnualDemand(Gwh/Year)6MarketSize($Billion)20062100102026002026-42022203020222030PassengerEvsCommercialEvsPassengerEvsCommercialEvsE2-wheeler/3-wheelerE-busesE2-wheeler/3-wheelerE-busesFreightStationaryStorage(Grid-scale)FreightStationaryStorage(Grid-scale)Behind-themeter(Res+Comm)ConsumerElectronicsBehind-themeter(Res+Comm)ConsumerElectronicsRail+DefenseMarketSizeRail+DefenseMarketSizeSource:NeedforACCenergystorageinIndia,NITIAayog,202246Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678StationaryBESSmarketaloneis~208GWhby2030,—amassiveopportunityforthedomesticmanufacturingindustryAccordingtotheCentralElectricityStationaryBESSapplicationsforgridAuthority'sOptimalEnergyMixreportfor2030,theregion-wiseestimatedAncillaryservices(shortduration)batteryenergystoragesystem(BESS)►Voltagesupport:maintaingridvoltagewithinspecifiedlimits,tohelpmanagereactivepower.during2029-30is30.5GW/152.5GWh►Frequencyregulation:correctingfrequencydeviationsandmaintainingfrequencywithinlimits.forNorthernregionand11.1GW/55.5►Spinningreserves:Standbygenerationstationsutilizedduringunexpectedpowershortages.ESSwithlongerdischargeGWhforSouthernregion.durationscanbeusedasspinningreserves.Theenergystoragecapacityrequired►Blackstart:energizingpartofthegridduringunplannedblackouts.for2029-30islikelytobe60.63GW►Balancing:fast-responsetimecreatesabalancebetweenloadandgenerationwhentheloadchangesrapidly.Thishelps(18.98GWPSPand41.65GWBESS)withstorageof336.4GWh(128.15tomaintainthestabilityofthegrid.GWhfromPSPand208.25GWhfromBESS).Ason31.03.2023,PSPbasedBulkenergyservices(longduration)capacityof4746MWexistsinthe►Energyarbitrage:Thisstoresenergywhenthepriceislowandsellsenergyduringpeakdemandwhenthepriceishigh.country.PSPprojectstotalling2780MWareunderconstruction.Round-tripefficiencyandoperatingcostplayakeyrolewhenESSisinvolvedinarbitrage.►REintegration:ESSshouldbeabletoabsorbfluctuationstomakethepowersystemmoreflexiblewhenalargeshareofInaddition,PSPcapacityof11,460MWisrequiredtill2030tomeettheintermittentrenewablesintegratesintothegrid.electricitystoragerequirementsofthe►Seasonalstorage:ESSwiththecapabilitytodischargefordays,weeks,ormonthscansupplytheseasonalmismatchescountry.ManyPSPplantsarelikelytoyieldbenefitsby2030inthesoutherninthepowersystem.region,therebymakingitacost-effectivestoragealternativeandthusT&DinfrastructureservicesreducingtheneedofadditionalBESSrequirementinthatregion.►T&Dupgradedeferral:ThisinvolvesusingESStoeitherdeferoravoidtheneedofaT&Dequipmentupgradetomeetdemandgrowth.InthecaseofBESSresource,theinvestmentispreferablyinanorthern►T&Dcongestionrelief:ESSchargingduringoff-peakhoursanddischargingduringpeakloadhelpsinreducingtheregionascomparedtootherregionsduecongestioninthetransmissionnetwork.tosteepereveningpeaks.Therefore,BESSresourceisfoundtobemostcostCustomerenergymanagementserviceseffectiveandoptimallyutilizedifinstalledlocallyinthenorthernregion.►Powerquality:ESSwillhelpinprotectingconsumersfromhighvariationsinvoltage.►Powerreliability:TheESSinstalledclosetoconsumerloadaidscustomerduringanunplannedinterruptionfromtheutility.►Demandshiftingandpeakreduction:ESSsupportsbyreducingpeakdemandandshiftingthedemandtonon-peakhours.47Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678AdvancedchemistrycellbatterytechnologiesandkeyperformancemetricsformarkettransformationSource:MITStudyontheFutureofEnergyStorage,June2022HighenergyExtendedC-ratingforCostofactiveSafetywithReal-timeAtomiclayerdensitybatterylife>fastchargingmaterials<inorganic/solidsensingofdepositionof20US$/kWhactivematerialsbatteries>10,000(>=5C)state/non-batteryontocurrent350wh/kg,cyclesoxidizableactivehealthcollectorfoils1000wh/LconditionmaterialsSource:EYanalysis48Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ACCbatterymanufacturingvaluechain:asnapshotMiningChemicalprocessingActivematerialproductionCellproductionRecyclingExtractionofrawConversionofrawManufacturingofelectrodeIntegrationofelectrodes,Reclamationofvaluablematerials,suchasLi,Co,electrolytes,andseparatorsNi,Mnandgraphitematerialsintointermediatematerials,suchasNMC,materialsfromusedcompoundsLFP,etc.intoasealedunitbatteriesMiningFloatationCopperfoilCrushing/Drying/GrindingSizingAnodeactiveSpheroidizationmaterialandpurifyingSolventsCoaltarpitchMixingExtrusionAdditivesRecyclingNeedlecokeGrindingBakingandBindersimpregnationTabsGraphitizationCathodeactivematerialAnodefilmCellstacking/windingDryingCalenderingCutting/sittingTabweldingElectrolytefilling/sealingFormation/ageingEndoflinetestingAluminumfoilMixingCathodePackagingCoatingfilmCellMiningandphysicalCooreseparationNioreMnoreChemicalprocessingLioreContinuousstirtankreactorFiltered/wash/dryMillingMixwithlithiumcarbonateSinteringkilnCosulfateCoatedseparatorNisulfateSoftpackfilmorcoatedMnsulfatemetalshellsLi2CO3/LiOHElectrolytesolutionElectrolyteElectrolyteMixingElectrolytesaltssolventsSource:EYanalysis49Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Keycomponentsandmaterialsformanufacturinglithium-ionbatteries(LIBs)ApplicationsGridstorage,electronics,etc.►CommerciallyavailableLIBcellcathodeandanodeproductionwillneedElectricvehicleapplicationsactivematerials,suchasNMC,LFP,NCA,LCO,LMO,sphericalgraphite,CellLIBcellmanufacturingfordifferenttypesofelectrodechemistry.Activematerialsynthesiswillrequirebatterygradeprocessedchemicalprecursorsofcriticalmineralcommodities(e.g.,lithiumcarbonate,nickelandcobaltsulfates).►Moreover,Li-ioncellsusepolyolefinasionexchangeseparators.Thismaterialhasexcellentmechanicalproperties,decentchemicalstabilityandlow-cost.Polyolefinsareaclassofpolymerderivedfromolefins(alkenes)throughthepolymerizationofethylene,whichissourcedfrompetrochemicals.Polyolefinscanbemanufacturedusingpolyethylene,polypropylene,oracombinationofbothmaterialsintheformoflaminates.Theseparatormustbepermeablewithporesizerangingfrom30nmto100nm.Therecommendedporosityis30%to50%.ComponentsCathodeAnodeCurrentElectrolyteComponentsofalithium–ioncellcollectorfoilSeparatorCathodeactivematerialSeparatorAnodeactive(NMC/LFP/NCA,etc.)(polyethylene)material(graphite)Electrolyte(LiPF6)NegativecurrentRawMaterialsLithiumNeedlecokeCopperEthylenePositiveLithiumionscollectorNickelCoaltarpitchAluminumcarbonatecurrent(copper)CobaltcollectorMn,Fe,P,etc.GraphitePolypropylene(aluminum)LithiumhexafluorophosphateSupplychainbottlenecksSizeabledomesticsupplychainexistsElectronsSource:EYanalysisSource:how-can-india-scale-lithium-ion-battery-manufacturing-sector-and-supply-chain.pdf(ceew.in)50Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ACCbatteryapplicationsandpolicyinitiativesfordomesticvalueadditionTheGovernmentofIndia’sProductionLinkedIncentive(PLI)BatterystoragemarketattractivenessSchemeforAdvanceChemistryCells(ACC)willhelpinthelocalmanufacturingof50GWhcapacityofLIBcellsandreduceMobileApplications202020252030dependencyonimports.Theschememandates60%domesticPersonal4W-EVsLowMediumHighvalueadditionwithinfiveyearsofcommercialoperations.Commercial4W-EVsHighAdditionally,approx.95GWhofbatterymanufacturingcapacityPersonal2W-EVsMediumHighLowannouncedbyprivateplayersisundervariousstagesofCommercial2&3W-EVsMediumHighdevelopment.ElectricBusesMediumHighHighStationaryApplicationsHighG2Gdialoguesareadvancingwithfriendlycountries(e.g.,MicrogridHighMediumAustralia,Chile,Argentina,Bolivia,etc.)forjointexplorationandApplications/Dieselmining.GovernmentofIndiahassetupKABILtoensureaReplacementconsistentsupplyofcriticalandstrategicmineralsthroughG2Gnegotiationsandacquiringminingassetsabroad.MostGridsupport/AncillaryHighimportantly,IndiahasrecentlybecomethenewestpartnerintheServicesUSledMineralSecurityPartnership(MSP)tobolstercriticalmineralsupplychains.ThepartnershipaimstoacceleratetheRenewableIntegrationMediumHighdevelopmentofdiverseandsustainablecriticalmineralsupplyT&DUpgradeDeferralMediumchains.C&IBehindtheMeterMediumHighResidentialBehindtheMeterLowMediumInthecaseoflithium,ahandfulofcountries(viz.Australia,ChileandChina)makeupmorethan90%ofmineproductionoflithiumSource:NeedforACCenergystorageinIndia,NITIAayog,2022bearingoresinthecurrentscenario.Mostoftherefiningoflithiumoreintousefulchemicals(Li2CO3andLiOH)tomakebatterycomponentsisconcentratedinChileandChina.In2022-23,IndiaimportedINR2262croresoflithium-ion(HScode:85076000)aspertradestatisticsfromthedepartmentofcommerce.Moreresearchisneededtodeterminewhichmineralscanbeextractedeconomicallyfromtherecentlydiscoveredlithiumresources(G3)inIndia.Lithiumgrades/concentrationsaretypicallymeasuredinpartspermillion(ppm)andweightpercentage.Atypicalrunofminespodumeneore(commonlyfoundhardrocklithiumbearingmineral)cancontain~0.5to1%ofLi2O(eq.10,000ppm).51Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinlithiumandlithium-ionLithium(Imports-INRcrore)HSCode:850650Lithium(Exports-INRcrore)HSCode:8506501,200701,000608005040600304002020010--FY18FY19FY20FY21FY22FY23FY18FY19FY20FY21FY22FY23ChinaHongKongIndonesiaGermanyJapanIsraelUAEOthersLithium-ion(Imports-INRcrore)HSCode:850760Lithium-ion(Exports-INRcrore)HSCode:85076025,00080070020,00060050015,00040030010,0002001005,000--FY19FY20FY21FY22FY23FY18FY19FY20FY21FY22FY23FY18SomaliaHongKongTaiwanVietnamJapanGermanyHongKongIndonesiaJapanChinaSingaporeUSAOthersThailandUSChinaOthersSouthKoreaSource:www.dgft.gov.in52Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinlithiumderivativesLithiumOxide/Hydroxide(Imports-INRcrore)HSCode:282520LithiumOxide/Hydroxide(Exports-INRcrore)HSCode:28252060014050012040010080300602004010020--FY18FY19FY20FY21FY22FY23FY18FY19FY20FY21FY22FY23UAESingaporeRussiaGermanyChinaBelgiumOthersUAEUKNetherlandsEgyptQatarSaudiArabiaOthersLithiumCarbonate(Imports-INRcrore)HSCode:283691LithiumCarbonate(Exports-INRcrore)HSCode:283691200FY19FY20FY21FY22FY2390FY19FY20FY21FY22FY231808016070140601205010040308020601040-20-FY18FY18USUKArgentinaBelgiumGermanySloveniaOthersChinaRussiaVietnamUSUAEBangladeshOthersSource:www.dgft.gov.in53Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinotherbatterycriticalmineralsManganeseSulphate(Imports-INRcrore)HSCode:28332940ManganeseSulphate(Exports-INRcrore)HSCode:2833294020010915087100655043-21FY19FY20FY21FY22FY23FY18FY19FY20FY21FY22FY23-NetherlandsFY18GermanyItalyUSAOthersUSBrazilGermanySingaporeOthersBelgiumDenmarkFrancePolandSpainUKCobaltOxide/Hydroxide(Imports–INRcrore)HSCode:282200CobaltOxide/Hydroxide(Exports-INRcrore)HSCode:282200140FY19FY20FY21FY22FY2316FY19FY20FY21FY22FY2312014100121080608406204-2-FY18FY18TanzaniaSouthAfricaMalaysiaFranceFinlandUAENetherlandsOthersChinaBelgiumAustraliaOthersSource:www.dgft.gov.in54Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinotherbatterycriticalmineralsNickelSulphate(Imports-INRcrore)HSCode:283324NickelSulphate(Exports-INRcrore)HSCode:283324100FY19FY20FY21FY22FY23200FY19FY20FY21FY22FY2390180Others8016070140601205010040308020601040-20FY18-FY18BelgiumTaiwanJapanSouthAfricaOthersUAEBangladeshUSSouthKoreaChinaNickelOxide/Hydroxide(Imports-INRcrore)HSCode:282540NickelOxide/Hydroxide(Exports-INRcrore)HSCode:28254050012040010080300602004010020--FY18FY19FY20FY21FY22FY23FY18FY19FY20FY21FY22FY23AustraliaBelgiumChinaJapanSwedenOthersBelgiumChinaNetherlandsOthersSource:www.dgft.gov.in55Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’spipelineforACCbatterymanufacturingprojectsannounced,underpermittingandconstruction,exceedsacapacityof96GWhperannum,withaninvestmentpotentialofINR87thousandcroresPipelineofBESSprojects(MWh)TotalpipelineofACCbatterymanufacturinginvestment(INR.crore)1,6001,5001,4001,2001,0581,000800600400501240402010320200120-ChattisgarhGujaratLadakhAndamanandNicobarLakshadweepRajasthanTelanganaUttarPradeshKarnatakaHaryanaTamilNaduKeralaPipelineofACCbatterymanufacturing/treatmentinIndiaStatePackCell&PackCell/ComponentPackLithiumAssemblyRecyclingRefineryTamilNaduMfg(MWh)(MWh)(Ton/Year)(Ton/Year)Karnataka(MWh)20,00010,00020,00020,50017,00020,000PackRecycling5,000LithiumRefineryCell/ComponentGujarat20,0005,00028,500PackAssemblyTelangana1,20016,50015,000Cell&PackMfgOthers1,40010030,000TotalTotal28,10041,50027,10073,500Source:EYResearch56Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Policyecosystem(existing)forscalingupACCbatterystorageinvestmentsingridstorageandmobilityapplicationsGuidelinesforProcurementand►Forintra-stateprojects:Minimumindividualprojectsizeofpowerratingof1MWandaboveUtilizationofBESSaspartofGT&D►Forinter-stateprojects:Minimumindividualprojectcapacityof50MWandaboveassetsalongwithAncillaryServices►NotapplicableforbusinesscasesinvolvingREsupplywithBESSinhybridsEnergyStoragePurchaseObligations►Progressiveincreasefrom1%in2023-24to4%oftotalelectricitymixby2029-30;Atleast85%ofenergystoredmustbesourcedfromrenewablesViabilitygapfundingforBESSprojects►Supportfor~4000MWhcapacityaddition;GuidelinesunderdevelopmentGSTandStandardcustomsduty►Li-ionbatteries@18%GST►Otherbatteries@28%GSTPLIschemefornichechemistry►Li-ionbatteries@20%standardduty(HSN:85076000)batteries►TotaleffectivetaxrateincludingGSTis~43.96%FasterAdoptionandManufacturingof►PLI~5GWhmanufacturingcapacitiesunderdevelopmentHybrid&ElectricVehiclesinIndia(FAME)►Phase-IIofFAMEIndiaSchemeisbeingimplementedforaperiodoffiveyearsw.e.f.1April2019PLIschemeformanufacturingofACCwithatotalbudgetarysupportofINR10,000crorefordemandsideincentivesbatteries►PhasedManufacturingProgramme(PMP)forEVpartsforeligibilityunderFameIIincentiveclaimsbyGSTOEMsrequiresonlytractionbatterypackstobeassembledinIndiawithcellsandassociatedthermal,batterymanagementsystemsallowedtobeimported.►Localmanufacturingof50GWhcapacityofLIBcellsandreducedependencyonimports.►Theschememandates60%domesticvalueadditionwithinfiveyearsofcommercialoperations►GSTonelectricvehicleshasbeenreducedfrom12%to5%►GSTonchargers/chargingstationsforelectricvehicleshasbeenreducedfrom18%to5%57Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersMandateagradual,time-boundincreaseofdomesticcontentVehiclesmustfulfillothercriteria,includingfinalassemblyinNorthrequirementsfordemand-sideincentivesinmobilityandAmericaandMSRPlimits(generallyUS$55,000;forvans,SUVs,andstationarygridapplicationspickupsUS$80,000).Startingin2024,qualifyingvehiclescannothavebatterycomponentsmanufacturedorassembledbyaforeignentityofAdvancedChemistryCell(ACC)batteriesrepresentthecornerstoneofconcern.Startingin2025,qualifyingvehicles’batteriescannotcontainfuturelow-carbontransportationandenergysystems.India’sdomesticcriticalmineralsextracted,processed,orrecycledbyaforeignentityofACCbatterymanufacturingindustryisrapidlyemergingwithsupportconcern.fromgovernmentinitiativesonbothdemandandsupplyside.Asglobaldemandforlithium-ionbatteriescontinuestorise,IndiahasauniqueIndia’spolicycouldexploreintegrationofdemandsideincentivesunderopportunitytosupportresilientsupplychainsofACCbatteryactiveFAMEinitiativeforthepurchaseofcleanvehicles(EVsandhybrids)materialsrefinedfromcriticalminerals,cells,modules,packassembly,beyond2024.Thisintegrationcouldbecoupledwithstringentdomesticandaimtoestablishself-relianceandreduceimports.valueadditionnormsthatpromoteslocalmanufacturingofcriticalLIBcomponents,activematerialsandsourcingofrefinedcriticalmineralsSomedevelopedcountrieshaveintegrateddemandsideincentivesforincludinglithium.consumersandbusinessestopurchasecleanvehicleswithprogramstoexpanddomesticmanufacturingandsourcingofcriticalmineralsandCurrently,thePhasedManufacturingProgramme(PMP)forEVparts,asbatterycomponents.Inthesecountries,specificrequirementsmustbeeligibilitycriteriaunderFameIIincentiveclaimsbyOEMsrequiresonlymetregardingthesourcingorprocessingofthebattery'scriticaltractionbatterypackstobeassembledinIndiawithcellsandassociatedmineralstoqualifyforEVdemand-sideincentives.Forexample,thermal,batterymanagementsystemsallowedtobeimported.accordingtotheUSInflationReductionActGuidebook,consumersGovernmentledpolicycouldfocusonprovidingaclearroadmapandpurchasingnewqualifyingcleanvehicles,includingbatteryelectric,timelineforrevisingthePMPnormstoincludelocalmanufacturingofplug-inhybrid,orfuelcellelectricvehicles,areeligibleforaCleanLIBcells,activematerialsandsourcingofcriticalmineralsincludingVehicleCredit.ToqualifyforthemaximumUS$7,500credit,thevehicleLithium.Additionally,thequantumofincentiveunderFAMEschemecanmustmeetcertainstandardsforNorthAmericanassembly.Additionally,beallocateddifferently(gradedincentive)forvehiclesthatmeetthebattery’scomponentsmustmeetcertainstandardsforlocalizationnormsforLIBcellsandsourcingofcriticalminerals.manufacturingorassembly;andthebattery’scriticalmineralsmustmeetcertainrequirementsforsourcingorprocessingintheUnitedStatesorfromtrustedtradepartners.US$3,750creditforvehiclesmeetingcriticalmineralsrequirement,withthevehiclerequiredtocontainathresholdpercentageofcriticalmineralsextractedorprocessedintheUnitedStatesorinacountrywithwhichtheUnitedStateshasafreetradeagreementorberecycledinNorthAmerica.AnadditionalUS$3,750creditisofferedforvehiclesmeetingtherequirementthatathresholdpercentageofbatterycomponentsbemanufacturedorassembledinNorthAmerica.58Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ExpediteminingandexplorationactivitiesofcriticalmineralsUniformGST@5%applicationonallACCbatteriesusedinusedinACCbatteriesmobilityandgridstorageapplicationswithrenewableenergyThesupplychainforcriticalminerals,especiallylithium,cobalt,nickelLi-ionbatteriesattract18%GSTand20%standardcustomsdutyandsphericalgraphite,andtheirrefiningforactivematerialsarevitalto(HSN:85076000),whileotherbatteriesattract28%GST.ThetotalachievingdomesticvalueadditioninthemanufacturingofACCbatteryeffectivetaxrateincludingGST,isapproximately43.96%forLi-ionelectrodematerials.Bylocalizingtheminingandrefiningvaluechainofbatteriesmadefromimportedcells.ThesetaxesmakeACCbatterycriticalminerals,Indiacanreduceitsrelianceonimportsandhelpbuildstorageserviceslesscompetitiveinthepresentscenario,hamperingresilienceinglobalsupplychains.domesticmanufacturingandhinderingtheachievementofIndia'srenewableenergygoals.IndiahasbecomethenewestpartnerintheUSledMineralSecurityPartnership(MSP)tobolstercriticalmineralsupplychains.TheImplementingatemporaryreductionorwaiverofcustomdutywouldpartnershipaimstoacceleratethedevelopmentofdiverseandhavefar-reachingbenefitsforthegridscaleenergystoragesectorinsustainablecriticalmineralsupplychains.Apartfromthis,G2GdialoguesIndia.Moreover,afavorabledutystructurewouldmakeACCbatteryareadvancingwithfriendlycountriesforjointexplorationandmining.packassemblinginIndiamorecost-effectiveandcompetitive,GovernmentofIndiahassetupKABILtoensureaconsistentsupplyofattractingbothdomesticandforeigninvestments.Similarly,criticalandstrategicmineralsthroughG2GnegotiationsandacquiringestablishingauniformGSTrateof5%onallACCbatteriesusedinminingassetsabroad.Recently,theIndianParliamentPassedMinesandmobilityandstationaryapplicationswouldbringmuch-neededclarityMinerals(Development&Regulation)AmendmentBill,2023,withfocusandsimplicitytothetaxregime.AuniformGSTratewouldleveltheonCriticalMinerals.Theamendmentintroducesmajorreformsintheplayingfieldformanufacturers,facilitatingtheirdecision-makingminingsector,sixmineralshavebeenomittedfromthelistoftwelveprocessesandencouraginglong-terminvestments.Itwouldalsoatomicminerals,centralgovernmenttoexclusivelyauctionmineralstreamlinetaxcompliance,reducingadministrativeburdensandconcessionsforcriticalmineralsandthestategovernmentstogetpromotingamoreconducivebusinessenvironment.revenue,introducesexplorationlicensefordeep-seatedandcriticalminerals.AlltheseamendmentsexpectedtoprovideaconducivelegalByprovidingcertaintyinthedurationandapplicabilityofthesetaxesenvironmentforattractingFDIandminingcompanies.andduties,thegovernmentcanofferstabilitytomanufacturersoperatingintherenewableenergysector.Thisstabilityallowsmanufacturerstoaccuratelyassesscosts,plantheiroperations,andmakeinformedinvestmentdecisions.Italsoenablesthemtodevelopstrategiestonavigatechangingmarketdynamicsandtoremainresilientinthefaceofuncertainties.Ultimately,thesepolicymeasureswouldnotonlybolsterthegrowthoftherenewableenergysectorbutalsocontributetoIndia'sself-sufficiencyincleanenergyproductionandenhanceitscompetitivenessintheglobalmarket.59Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ProductionlinkedincentivesforactivematerialextractionBoosttheavailabilityofskilledworkersandprofessionalsfromrecycledACCbatteriesAddressingtheshortageofskilledworkforceisessentialforefficientThepolicyshouldfocusonscalingupLIBrecyclinginfrastructuretomanufacturingoperations.Themanufacturingandassemblyprocessescomplementdirectextractioneffortsandsupportthedomesticcriticaloflithium-ionbatteriesrequirespecializedskillsandknowledge.Themineralrequirementsincludinglithium.availabilityofaskilledworkforcewithexpertiseinbatterytechnology,electrochemistry,materialsscience,andmanufacturingprocessesisThiswillalsoaidinpromotingenvironmentallysustainablebatterylimitedinIndia.Bridgingthisskillgapthroughtrainingprogramsanddisposalandwastemanagementpractices.Topromoteefficientlithium-educationalinitiativesisessential.ToaddresstheskilledlaborneedsinionbatteryrecyclinginIndia,itisessentialtoestablisharobustthelithium-ionbatteryindustryinIndia,itisrecommendedtoestablishrecyclinginfrastructurewithadvancedtechnologiesfordismantling,skilldevelopmentprogramsincollaborationwithvocationaltrainingmaterialseparation,andmetalextraction.Thiscanbeachievedbyinstitutes,universities,andindustrystakeholders.Thisshouldbesettingupwell-equippedrecyclingcenterstailoredspecificallyforcomplementedbyfosteringindustry-academiacollaboration,lithium-ionbatteries.Additionally,investinginresearchandgovernmentsupport,continuouslearningopportunities,andthedevelopmentiscrucialtoadvancerecyclingtechnologies,encourageintroductionofindustry-recognizedcertifications.Thesemeasureswillinnovation,andminimizeenvironmentalimpact.Collaborationbetweenhelpbridgetheskillsgap,providepracticaltraining,encourageongoingacademia,industry,andresearchinstitutionscandrivethedevelopmentprofessionaldevelopment,andensureaqualifiedworkforcecapableofofcost-effectiveandinnovativerecyclingmethods.drivinginnovationandmeetingindustrydemands.ImplementinganExtendedProducerResponsibility(EPR)frameworkwillholdbatterymanufacturersaccountablefortheend-of-lifemanagementoftheirproducts,includingcollectionmechanisms,trackingsystems,andproperdisposal.Awarenesscampaignsandeducationalprogramsshouldbeconductedtoeducatestakeholdersabouttheimportanceofrecyclinglithium-ionbatteries,responsibledisposalpractices,andpotentialenvironmentalhazards.Collaboratingwithinternationalpartnerswillprovideaccesstoglobalbestpracticesandexpertise,facilitatingthedevelopmentofrecyclingcapabilitieswithinIndia.60Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678GreenhydrogenandelectrolysermanufacturingecosystemfordomesticproductionandexportsTheglobalhydrogenecosystemisacomplexvaluechainwithmultipletechnologiesevolvingforlowcarbontransitionEnergysourceH2generationConversionDistributionEnd-useIndustryPVWindHydroBy-productImportLiquefactionCompressionH2H2ChemicalsDataCentersTanksCavernsPowerLOHCsAm+moniStorageSteelOtherIndustries1ElectrolysisaPowerGridHydrogenConversionMobilityWasteTransportAviationShipRefinementH2GridGasGridBiogasCarTruckBusGasPyrolysisReformingBiomassSynFuelsMethanationGreenliquidShipTrailerForkliftVanTrainfuelsPowerandheatCCSCCUBiomassCoalOilNaturalGasFuelGasDecentralizedCellsTurbinesHeatingSource:EYanalysis62Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Globalgreenhydrogencapacityadditionprojectionstoreach~21MTPAby2030►Thegrowingfocusonhydrogenapplications,coupledwithnetzeroEU’sdecisiontoshiftawayfromRussiangasdependencyisoneoftheambitions,hasdriventheproductioncapacityforgreenhydrogentoprimarytriggersincreasefivetimescompared2021projections.►InMarch2022,theEuropeanCommission(EC)publishedthe‘REPowerEU’►Theglobaldemandforhydrogenwas94milliontonsin2021andisplantophaseoutEurope’sdependencyonRussianenergyimportsbyexpectedtoreach185milliontonsby2030inthenetzeroscenario.developingstrategies,suchasdiversifyingenergyimportsandboostingSimilarly,greenhydrogendemandisexpectedtoreach63milliontonsrenewableenergy.by2030.►Ithassetatargetofproducing10milliontonsofgreenhydrogen►WiththepipelineofannouncedprojectsuntilSep2022,greenhydrogendomesticallyandimporting10milliontonsby2030.productionisexpectedtoreach21MTPAby2030.►5milliontonsofadditionalproductiontargetfromREPowerEuwould►Thenumberofcountrieswithpoliciesthatdirectlysupportinvestmentinrequireapproximately50GW—60GWofelectrolyser,inadditiontothe44GWhydrogentechnologiesisincreasing,alongwiththenumberofsectorsalreadyrequiredforthe5milliontons.theytarget.CumulativegreenhydrogenproductionEUelectrolysermanufacturingcapacitytargetEUinstalledelectrolysercapacity2030capacityvs.demand(MTPA)(GW/year)90-100GW6317.52144GW0.84.481.75FY222030announced2030greenProjectshydrogendemandFY22FY25Column1Feb21ProjectionsEChassignedajointdeclarationwithmajorEuropeanMeetingREPowerEU’stargetofproducing10MTPA,toJul21ProjectionsSep22ProjectionselectrolysermanufacturerstoincreasethemanufacturingincreaseinstalledelectrolysercapacitybyFY302030netzeroscenariodemandcapacity10timesthecurrentcapacitySource:HydrogenCouncil,IEASource:EuropeanCommission,https://ec.europa.eu/commission/presscorner/detail/en/IP_22_282963Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678NorthAmericaisexpectedtoseeasignificantincreaseingreenhydrogenproductionduetoincentivesprovidedbytheUSInflationReductionAct►TheIRAencouragedinvestmentsinpowergenerationfromHydrogentaxcreditmechanismundertheIRA,2022renewables,emissionsreductiontechnology,andothers.Theactwillprovideinvestmenttaxcredits(ITCs)andproductiontaxcreditsH2SourceCarbonTaxCreditTaxCreditWage/Other(PTCs)forcleanenergygeneration.ItisestimatedthattheIRAwillIntensityAmountAmountBenefitscreateademandfor10milliontonsofcleanhydrogenby2030.kg-PTCITCvalue(%of5xmultiplierCO2e/kg-value/kgoffacilitycost)►PTC:Taxcreditsareprovidedtolow-carbonhydrogenproducersH2H2$0.60basedonthequantityofcarbontheyemitduringproduction.ProducersareeligibleforacreditofuptoUS$3perkgofhydrogen,SMR+2.5-4US$0.121.20%$0.75makinggreenhydrogentobeproducedintheUSoneofthemostCCUSeconomicaloptionsintheworld(aslowasUS$0.73perkg).SMR+1.5-2.5US$0.151.50%►ITC:IRAtocreatea30%creditforenergystoragetechnologyCCUSconstructedbeforeJanuary2025(applicableonlytohydrogen-relatedITCstorage).Nuclear+0.45-1.5US$0.202%$1.00Electrolysis►Thecleanhydrogencreditisa10-yrProductionTaxCredit(PTC)forfacilitiesthatcommenceconstructionby31Dec2032.AlongwithRE0-0.45US$0.606%$3.00theadditionalcreditsacrossthevaluechain(forexample,renewablecredits),itwillenableacreditofmorethan$3/kg.AsanElectrolysisalternativetothePTC,taxpayersmayelectfortheITC(InvestmentTaxCredit)withrespecttocleanhydrogenproductionfacilities,PTC:ProductionTaxCredit;ITC:InvestmentTaxCreditreceivinganITCofupto30%dependingonthecarbonintensityoftheproductionprocess.Further,amultipliermechanismwouldbeSource:EYanalysisfromUSIRAGuidebooktriggeredifproducersbuildnewfacilitieswithinacertainperiodandiftheymeetcertainwageandlaborrequirementsfortheproject.►WithIRAincentives,greenhydrogenisexpectedtobecompetitiveacrosstheUSby2030.Consideringthattaxcreditisforthefirst10yearswhileH2projectsarefor20yearsorso,about60to65%oftaxcreditwouldreflectinLCOH(LevelizedCostofHydrogen).So,a$3/kgtaxcreditwilllowerLCOHbyapproximately$1.9/kg.►Itisexpectedthatcleanhydrogen'scostreductionswilldriveitsuseasalow-carbonfuelforenergyandtransport,andasafeedstocktodecarbonizeindustrialproduction.64Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678GreenhydrogenstandardsforavailingpolicyincentivesGlobalScenarioIndianScenario►The2022BreakthroughAgendareportauthoredbytheInternational►TheMNRENationalGreenHydrogenStandardmandatestherenewableEnergyAgency(IEA),theInternationalRenewableEnergyAgencycharacterofenergyinputforanyproductionpathwayincludingbutnot(IRENA),andtheUNClimateChangeHigh-LevelChampionslimitedtoelectrolysisandconversionofbiomass.recommendedthat“productionrouteswillneedtoachieveverifiablelow-carbonintensitiesthattrendtowardsnearzeroby2030”.►Additionally,thestandardspecifiesthatrenewableenergyusedintheproductionofgreenhydrogenincludeselectricitygenerationfrom►TheClimateBondsInitiativeHydrogenProductionStandard,whichalsorenewablesourcesstoredinenergystoragesystemsorbankedwithcoversemissionsassociatedwithtransportationtothepointofusethegridinaccordancewithapplicableregulations.requireshydrogentobeproducedwithnomorethan1.5kgofCO2eperkgby2030;0.6kgCO2e/kgH2by2040andthenzeroby2050.►Forgreenhydrogenproducedthroughelectrolysis,thenon-biogenicgreenhousegasemissionsarisingfromwatertreatment,gas►TheGreenHydrogenOrganization'sstandardforGreenHydrogen,purification,dryingandcompressionofhydrogenshallnotbegreaterrequiresthathydrogenmadewithrenewablesemitsnomorethan1.0than2kgCO2e/kgH2.kgofCO2eperkghydrogenuptothepointofproduction.Thisisa91%reductioncomparedtogreyhydrogenmadefromfossilfuels.►Forgreenhydrogenproducedthroughbiomassconversion,thenon-biogenicgreenhousegasemissionsarisingfrombiomasstreatment,►TheHydrogenScienceCoalition’sCleanHydrogenDefinitionalsostatesheatgeneration,conversion,gaspurification,dryingandcompressionthatbluehydrogenmadefromfossilgasshouldemitamaximumof1.0ofhydrogenshallnotbegreaterthan2kgCO2e/kgH2.kgofCO2eperkghydrogen.►TheUSInflationReductionActprovidestaxcreditstohydrogenproducedwithemissionsupto4kgCO2e/kgH2.►Canada’srecentlypublishedCleanHydrogenInvestmentTaxCredit(CHITC)mentionsgovernmentsubsidieswillbeavailableforhydrogenproducedwith4.0kgCO2eperkghydrogen.►TheEUrulesforrenewablegreenhydrogenandbluehydrogenrequirea70%reduction(3.4kgCO2e/kgH2)includingtransportationofthehydrogenuptothepointofuse,andtheUK’sLowCarbonHydrogenStandardrequiresa78%reduction(2.4kgCO2e/kgH2)uptothepointofproduction.65Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678HydrogendemandandpricetrajectorytrendsinIndianmarketsHydrogenDemandForecasts(MillionTons)1Projectedpricetrajectoryofhydrogenproduction(US$/kg)28285.51.002650.950.9060.855.030.802480.750.702250.654.50.602010.554.020500.5018170.453.50.401660.350.301460.253.00.201210.152.50.10GreyHydrogenRange1030.0520.002.08520401.5751.0603120304230.50000.020202020202220242026202820302032RefineryMethanolHeavyDutyVehiclesBlueH2GreenH2fromGreenH2fromAmmoniaSteelPowergenerationRTCrenewablesonsiterenewablesShareofGreenH2(%)withT&DwaiverSource:HarnessingGreenHydrogenReport2022,NITIAayog66Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678IndiahasapprovedabudgetaryoutlayofUS$2.5billiontosupportgreenhydrogeninitiatives,includingsettingupofelectrolysermanufacturingcapacityof60to100GWParticularsComponentI:IncentiveschemeforelectrolyserComponentII:IncentiveschemeforgreenhydrogenproductionmanufacturingOutlayforincentiveINR4,440CroresINR13,050CroresschemeImplementingagencySECISECIPrinciplesof1.Supportwillbeprovidedforelectrolyser1.DirectincentiveintermsofINR/kgongreenhydrogenincentivemanufacturing,intermsofRs/kWcorrespondingtoproductionforaperiodof3yearsmanufacturingcapacity2.Beneficiariesundertheschemetobeselectedthrough2.Baseincentiveasfollowscompetitiveselectionprocessa.Year1-INR4,440perkWb.Year2–INR3,700perkW3.IncentiveswillbecappedatINR50/kg–Year1,INR40/kg–Yearc.Year3–INR2,960perkW2andINR30/kg–Year3ofproductiond.Year4–INR2,220perkWe.Year5–INR1,480perkWBidselectionSumofproductsofquotedLocalvalueAdditionFactor(LVA)IncentivedemandedbybidderperkgofgreenhydrogenproductionparameterandPerformanceQuotientover5-yearperiodSelectionprocessBidderswillberankedinthedecreasingorderoftheselectionIntheorderofLeastAverageIncentivedemanded(inRs/kg)takenasparameterforallocationofadmissiblebidcapacitysimpleaverageoftheincentivedemandedforeachofthethreeyearsCapacitiesavailableUnderfirsttrancheof1500MWthefollowingbuckets1.Technologyagnosticpathways(BucketI)–410,000MT/annumofgreenhydrogenforbiddingavailableBiomassbasedpathways(BucketII)–40,000MT/annumofgreenhydrogen1.Bucket1–Electrolysermanufacturingcapacitybased2.onanystacktechnology(1200MW)2.Bucket2-Electrolysermanufacturingcapacitybasedonindigenouslydevelopedstacktechnology(300MW)Capacityallocation1.MaximumcapacityallottableunderBucket1willbe1.UnderTranche1ofMode1–450,000MTperannumofgreen300MWandminimumcapacity100MWhydrogen.2.MaximumcapacityallottableunderBucket2willbe2.UnderBUCKET1,maximumcapacitytobeallottedperbidderwill300MWbe90,000MTperannumandminimumcapacityis10,000MTp.a3.UnderBUCKET2,maximumcapacitytobeallottedperbidderwillbe4,000MTperannumandminimumcapacityis500MTp.aSource:SIGHTprogram,MNRE67Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ReviewofstatewisegreenhydrogenpoliciesaddressinglandandwaterallocationUttarPradeshRajasthanAndhraPradeshMaharashtraGreenHydrogenGreenHydrogenPolicyInvestmentScheme2022GH&GAPolicy2023Policy2023Stampduty(draft)100%100%100%exemption100%100%100%100%Landconversionchargesexemption100%Landtaxexemption0%100%0%100%0%–Landleaserate15,00031,0000%(INR/acre/year)Onlyforcaptive5%increaseevery2yearsIndustrialwatersolarparks0%chargesexemption50%UPPolicy–https://upneda.org.in/MediaGallery/UPGH2_policy_II.pdfAPPolicy–https://www.nredcap.in/PDFs/2023/GO_Ms_No_14_Dt_20_06_2023.pdf.MaharashtraPolicy–MaharashtraintroducesHydrogenpolicy,afirstinthecountryMumbaiNews-TheIndianExpressRajasthanPolicy–https://www.invest.rajasthan.gov.in/policies/rajasthan-investment-promotion-scheme-rips-2022.pdf68Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Gujarat’sPolicy2023forleasingoutgovernmentfallowlandforgreenhydrogenproductionusingnon-conventionalenergysourcessuchassolar,wind,andsolarhybridenergy40yearsleaseperiod0.1to3millionMTPA1lakhacreslandForsettingupsolar,wind,wind-Min.capacityofannualgreenReservedforexpansionofexistingsolarhybridenergyplantshydrogenproductionforsettingupsaltbasechemicalindustryinKutchIncentivescaptiveREplants1lakhhectareslandINR15,000/hectare/year15%increaseeverythreeyearsForstategovernmentcompaniestoAnnualrentoflandallottedbydeveloprenewableenergysourcesgovernmentforREpowerplantIncreaseinlandleaserateEligibility8years50%in5yrs,100%in8yrsINR50Crper0.1milliontonForachieving100%ofcommittedGreenhydrogenproductioncapacitygreenhydrogencapacitytobeachievedSecuritytobedepositedtostategovernmentSource:New-GR-for-Green-Hydrogen-08-05-2023-English_compressed.pdf(eqmagpro.com)69Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ReviewofstatewisegreenhydrogenpoliciesaddressingcaptiveopenaccesschargesUttarPradeshRajasthanAndhraPradeshMaharashtraGreenGreenHydrogenPolicyInvestmentScheme2022GH&GAPolicy2023HydrogenPolicy2023(draft)Intra-statetransmission100%25%5yrs,maxINR1050%chargesexemption50%forfirst3captivepowerplantsLakhs/MW/yrofelectrolyserWheelingcharges50%100%50%50%exemptionforfirst3captivepowerplantsCSSexemption100%100%0%reimbursedfor5years100%Distributioncharges100%0%0%0%exemptionAdditionalsurcharges0%0%0%100%exemptionGridsupportcharges0%0%0%0%exemptionElectricitydutyexemption0%100%100%100%for7yearsfor5yearsBankingprovisionsQuarterlybankingwith6%10%bankingchargewithdrawl100%monthlybankingwith5%MonthlyBankingwith2%bankingcharge.Drawlcannotbemorenotallowedduringpeakhoursascharge.Drawlnotallowedfromchargewithenergybankedthaninjectedduringpeakhours.duringoff-peakToDcan’tbenotifiedbyDISCOMFebruarytoJunewithdrawnduringpeakUPPolicy–https://upneda.org.in/MediaGallery/UPGH2_policy_II.pdfAPPolicy–https://www.nredcap.in/PDFs/2023/GO_Ms_No_14_Dt_20_06_2023.pdfMaharashtraPolicy–MaharashtraintroducesHydrogenpolicy,afirstinthecountryMumbaiNews-TheIndianExpressRajasthanPolicy–https://www.invest.rajasthan.gov.in/policies/rajasthan-investment-promotion-scheme-rips-2022.pdf70Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ReviewofstatewisegreenhydrogenpoliciesgivingcapexandproductionlinkedsubsidiesUttarPradeshRajasthanAndhraPradeshMaharashtraGreenGreenHydrogenPolicyInvestmentScheme2022GH&GAPolicy2023HydrogenPolicy2023(draft)SGSTExemption100%75%100%–reimbursementfor5yearsProductionlinkedGreenureaproductionGreenhydrogenblendingincentivesINR3500/tonofureawith––ingasINR50/kgsubsidy>10%blendingsharefor5yearsForcapacity>50MW:ElectrolyserCAPEX2023–60%,2024–55%–––incentives2025–45%,2026–35%2027–20%,2028–00%GreenhydrogenrefuelingstationsTechnologyacquisition30%CAPEXsubsidy,max.INR4.50Crforthefirst20stationsOthermonetary30%ofCAPEXorINR5CrIncentives––Greenhydrogen-basedpassengerEPFReimbursementvehicle50%ofemployer’s30%CAPEXsubsidy,max.INR60contributiontoEPFandESIlakhsforthefirst500vehiclesUPPolicy–https://upneda.org.in/MediaGallery/UPGH2_policy_II.pdfAPPolicy–https://www.nredcap.in/PDFs/2023/GO_Ms_No_14_Dt_20_06_2023.pdf.MaharashtraPolicy–MaharashtraintroducesHydrogenpolicy,afirstinthecountryMumbaiNews-TheIndianExpressRajasthanPolicy–https://www.invest.rajasthan.gov.in/policies/rajasthan-investment-promotion-scheme-rips-2022.pdf71Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678OpportunityforIndianOEMstocreateworld-classmanufacturingfacilities►InIndia,theexistingcapacityofalkalineelectrolysersisestimatedtobelessthan1GW,whichismainlyusedforchlor-alkaliprocess.►Choiceoftechnologyandaccesstotechnologypartners►Alkalineelectrolysersdominatethemarkettodayandareexpectedtocontinuebeingthemostpreferredtechnology.Oftheothertechnologies,PEMisemergingtobeapromisingelectrolysistechnology.►Today,alkalinetechnologyischeaper,withanaveragecostofUS$700toUS$1,100perkWandhasanefficiencyof~70%(producing0.021kgH2perkWh).PEMtechnologycostsbetween~US$1,200andUS$2,000perkW,havinganefficiencyof~60%(producing0.018kgH2perkWh).AsthePEMtechnologyadvances,itisexpectedtoachieveparitywithalkaline(~US$500perkW)byFY2030.►Playerslookforwardtotechnologydiversification.Forinstance,NELhasexposuretobothalkalineandPEMtechnologies,whichoffersanedgeincaseoneofthetechnologiesprevailsinthefuture.►SolidoxideandAEMtechnologiesareatanascentstagetodaywithsomeplayerslikeBloomEnergy(US)andH2ePower(IN),developingelectrolysersbasedonsolidoxide,whileEnapter(IT)andHydrolit(IL)areafewplayersthataredevelopingAEM.Source:EYReportonshortageofelectrolyzersforgreenHydrogen,2023ElectrolysermanufacturersaregearinguptoincreasethegreenhydrogenproductioncapacityManufacturerHeadquartersTechnologyCurrentCapacity(MW)GrowthITMPowerUKPEM1,000Expansionplans5xMcPhyFrancePEM,Alkaline10013xNelNorwayPEM,Alkaline5005000by202420xBelgium3501300by202423xJohnCockerillAlkaline7510000by202540xPlugPowerUSPEM1,0008000by20255xGermany403000by202513xThyssenkruppGermanyAlkaline1255000by20308xSunfireGermanyAlkaline,SolidOxide38500by202492x751000by203067xSiemensEnergyUSPEM5003500by20254xCumminsDenmarkPEM,Alkaline,SolidOxide305000by203010xTopsoe5002000by20242xOhmiumUSSolidOxide75300by20245xEnapterItalyPEM1001000by202410xUSAEM160400by20246xBloomenergyDenmark1,0001000by203012xGreenHydrogenSystemsNorwaySolidOxide1000by20256xFranceAlkaline5,66812000by203010xHydrogenProAlkaline37,000by2025ElogenPEM60,000by2030OthersPEM,Alkaline,SolidOxideTotalSource:EYanalysis,companypressreleases,secondaryresearch72Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678EfficiencyandcompetitivenessforIndianmanufacturersrequiresecuringrawmaterialsandplanninglargescaleinvestmentsAsthedemandforelectrolysersincreasesinthenextfewyears,theplayerslookforwardtostrategictie-upswithkeyhydrogenproducersacrossdifferentindustrysegments.Thesepartnershipsareexpectedtosupportthedevelopmentofagreenhydrogenecosystem.Manyelectrolysermanufacturersareformingpartnershipswithenergyandutilityplayersasrenewablepowerhubsareinferredtobebettersuitedforgreenhydrogenproductionduetoaccesstorenewableelectricity.PolicypushintheUSandEuropeisexpectedtofast-trackgreenhydrogenadoptionandtherebyacceleratetheenergytransition.Thiswilltranslatetomultibillion-dollaropportunityforelectrolysermanufacturers,andIndiashouldtargettobecomeaglobalhubformanufacturing.KeymineralsandmetalsforelectrolysersSolidOxideAlkalinePEMZirconiumNickelYttriumLanthanuNickelZirconiumPalladiumIridiumPlatinumPalladiummPtKeySuppliersofcriticalmineralsforElectrolysers►Manymineralsandmetalsrequiredforelectrolysersarehighlyconcentratedinspecificgeographies,presentingasupplychainriskto100%manufacturers.90%►CriticalrawmaterialsupplyforPEMishighlyconcentrated,withSouthAfricasupplyingover70%ofplatinumandover85%ofiridiumrequired80%globally.70%►Solidoxideelectrolysersareproducedatalabscaletoday;however,theyshowfuturepotential.Theyfacealargerconcentrationofsupply60%asmorethan90%ofthecriticalmaterialscomefromChina.50%►Therewillbeaneedforelectrolysermanufacturersgloballytoworkwithkeystakeholdersonrawmaterialdependencyissues,suchasstrategic40%sourcingandformingstrongpartnerships.30%Co20%10%0%YLaZrNiPdIrChinaRussiaSouthAfricaCongoSource:EuropeanCommission,USGSSource:EYReportonshortageofelectrolyzersforgreenHydrogen,202373Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678Planforlarge-scaleinvestmentsandboostefficiencywitheconomiesofscaleEconomiesofscaleimpact:potentialcostreductionsinPEMelectrolysersKeyfactorsdrivingcostcompetitiveness1400Electrolysercost12001000ElectrolyserefficiencySystemCostUS$/KW8001MWRenewableelectricitycost200kw600400Lifetimeofelectrolysers200Fullloadhours0101001000101001000WeightedaveragecostofcapitalAnnualProductions(Units/Year)ReductionIncreaseStackBalanceofPlantSource:NREL,IRENA,EYAnalysisEconomiesofscalecanbeInstackmanufacturing,asmoreunitsManufacturingmoreunitsofstackachievedbyincreasingtheofelectrolysersareproduced,theassemblyisexpectedtoresultincostsizeofelectrolysersharedcostofassemblylines,reductionof90%byshiftingfromamanualfacilities.buildings,andstaffcomesdown,toasemi-automatedprocessatavolumeachievingeconomiesofscale.ofabout1GWperyear.74Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’stradescenarioinelectrolysisandelectrophoresisequipmentMachinesandapparatusforelectro-plating,electrolysisandelectrophoresisHSCode:854330400350300250200150100500FY-19FY-20FY-21FY-22FY-23FY-18Imports(INRcrore)Exports(INRcrore)Source:www.dgft.gov.in75Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678India’spipelineofgreenhydrogenandammoniaprojectsexceeds~10milliontons/annum,withover~10GWofelectrolysermanufacturingprojectsLocationofthefacilityElectrolyserGreenGreenHydrogenproductioninvestmentpipeline(INR.Thousandcrore)manufacturinghydrogen/Ammonia(MW/Year)productionSource:EYAnalysis(Tons/year)MadhyaPradesh1005,767AndhraPradesh1,50010,00,388Haryana1,5002,075Ladakh30UttarPradesh7,2505,05,052Karnataka10,35059,00,025HimachalPradesh1,09,516Maharashtra906Rajasthan10,00,000Odisha1,20,000Kerala338TamilNadu11,03,000Gujarat42,493Facilitylocationnotreported2,26,738Total1,00,16,328Source:EYAnalysis76Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersNationalprogramtoincentivizeandcompensatestatePromoteexport-orientedincentivesutilitiesforimplementingannualgridbankingfacilityforcaptiveopenaccessREpowersupplyTheUSIRAledincentivesfortheirgreenhydrogenproductionrendersexportstothatmarketlesscompetitive.EUisanothermajorexportREpowerinputcontributes40%to50%ofgreenhydrogenproductionmarketforIndiancompanies,whichoftenfacecostdisadvantagescosts.TomanageREintermittencyduringatimewhenstorageisbecauseofthegeographicaldistance.Toaddressthissituationandrelativelyexpensive,industrywillneedannualgridbankingfacilityforbolstertheglobalcompetitivenessofIndiangreenhydrogenindustry,round-the-clockREpowersupplytoachieveglobalcostcompetitiveness.thegovernmentcouldconsiderimplementingexport-orientedincentives.Byofferingincentivestailoredtowardexports,thegovernmentwouldGovernmentpolicyandbudgetaryoutlayshouldfocusonincentivizingprovideIndianREplayersandgreenhydrogenproducersacompetitiveandcompensatingstatestoimplementannualgridbankingfacilitiesforedgeininternationalmarkets.Theseincentivescouldpresentitselfingreenenergyopenaccesscaptivetransactions.variousforms,suchasfinancialsupport,taxbenefits,streamlinedexportprocedures,orevenresearchanddevelopmentgrants,incentivizingBlendedinnovativelow-costfinancinginstrumentsmanufacturerstoenhancethequality,efficiency,andaffordabilityofIndiangreenhydrogenanditsderivativesfortheglobalmarket.Robustrisk-mitigationinstruments,deployedatscalebyIFIs(InternationalFinancialInstitutions)andMDBs(MultilateralDevelopmentSettingupshareddesalinationfacilitiesinemerginggreenBanks),alongwithinstitutionalcapacityandreformsinthedevelopmenthydrogenclustersfinanceandbankingsector,involvingprivatesectorstakeholders,canhelpcreateinvestmentplatformsforaccessinglow-costcapital.AttheEstablishshared/commonseawaterandgroundwaterdesalinationplantscruxofthisinitiativeliestheacknowledgmentthatthecostofcapitalpoweredbyrenewableenergytoproducedemineralized(DM)waterforsignificantlyinfluencestheviabilityofmanufacturingendeavours,greenhydrogenproduction.Greenhydrogenproductionrequiresparticularlyinaninfrastructure-intensivesectorlikegreenhydrogenapproximately9to10litersofdemineralizedwaterperkgofH2production.Thefinancialburdenimposedbyhigh-interestdebtcanproductionmeaning20to25litersofrawwaterperkgofH2dependingamplifytheoverallcostofproduction,renderingdomesticallyonthesourceofrawwater.Publicprivatepartnershipscanbeenvisagedmanufacturedproductslesscompetitiveagainsttheirimportedtosetupthesefacilities.counterparts.Torectifythis,thegovernmentmayconsidermechanismstoprovidedomesticmanufacturerswithaccesstolow-costdebt.IndiafaceswaterscarcityinmanyregionsbecauseofexacerbatedclimatechangeandthedemandforDMwaterrequiresadvancedtreatment77Globalchampionsforadvancingrenewableenergyinnovationandmanufacturingprocesses,whichfurtherstrainwaterresources.Theestablishmentofsuchdesalinationplantsrequiressignificantinvestmentsandcarefulwaterresourceandwastemanagementtobalancetheneedsofvarioussectors.Encouragingthedevelopmentofrenewableenergy-powereddesalinationplantscanenhancewateravailabilityforgreenhydrogenprojectsandsupportwaterresourcemanagement.12345678BoosttheavailabilityofskilledworkersandprofessionalsBuildingaskilledworkforcecapableofdesigning,operating,andmaintaininggreenhydrogeninfrastructureiscrucial.Adequatetrainingprogramsandeducationalinitiativesneedtobeimplementedtodevelopaskilledworkforceforthegrowinggreenhydrogensector.Encouragingknowledgesharing,collaboration,andpartnershipsamongindustryplayers,researchinstitutions,andacademiacanacceleratetechnologicaladvancementsandknowledgedissemination.Addressingtheshortageofskilledworkforceisessentialformaintainingefficientmanufacturingoperations.Themanufacturingandassemblyprocessesofelectrolysersrequirespecializedskillsandknowledge.Theavailabilityofaskilledworkforcewithexpertiseinelectrochemistry,materialsscience,andmanufacturingprocessesislimitedinIndia.Bridgingthisskillgapthroughtrainingprogramsandeducationalinitiativesisessential.Toaddresstheskilledlaborneedsinthegreenhydrogenvaluechain,itisrecommendedtoestablishskilldevelopmentprogramsincollaborationwithvocationaltraininginstitutes,universities,andindustrystakeholders.Thisshouldbecomplementedbyfosteringindustry-academiacollaboration,governmentsupport,continuouslearningopportunities,andtheintroductionofindustryrecognizedcertifications.Thesemeasureswillhelpbridgetheskillsgap,providepracticaltraining,encourageongoingprofessionaldevelopment,andensureaqualifiedworkforcecapableofdrivinginnovationandmeetingindustrydemands.78Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678CorporaterenewableenergyprocurementmarketinIndiaImprovedpolicyoutlookandnetzerotransitiongoalsaredrivingcorporateREdemandTheCommercialandindustrial(C&I)renewableenergyopenaccessmarketisgrowinginSource:CorporateREbrief,Q2-2023,BridgetoIndiaresearchalmostallkeyrenewables-richstates.Nearlytwo-thirdsofthecurrentrenewableenergyOAcapacitycameonlineinthelastfiveyears.IncreasingawarenessanddemandfromCommercialIndiaElectricityconsumptionbysectorinBUandindustrial(C&I)customerswasakeydriverofgrowth.Thecentralgovernment’sGreenOAPolicyin2022wasasignificantpositiveregulatorydevelopmentfortherenewableenergyOA1400199520002005201020152020market.TimelyimplementationofthegreenenergyOAPolicybythestateswillhelpfurther1200growthintheyearstocome.C&Iconsumersaccountfor51%oftotalpowerconsumptionin1000Transportthecountry.Gridtariffsfortheseconsumersareinflatedduetocross-subsidizationofotherCommercialandpublicservicesconsumercategories.Directrenewablepowerprocurementaccountsforlessthan10%oftotal800OthersC&Ipowerconsumption.Manyconsumersarekeentoprocurerenewablepowertoreduce600costsandmeetrenewablepurchaseobligationsordecarbonizationtargets.Increasedfocuson400netzeroemissionsarekeydriversforgrowthinrenewablepowerprocurementamong200corporateconsumers.Theintroductionofasinglewindowapplicationprocessforopenaccesswithincreasedoversightfromcentralgovernmentisexpectedtoimprovecapacityadditions.0Interstatetransmissionchargewaiverisexpectedtospurthemarketsignificantlyoverthe1990nextfewyearsdrivenbydemandfromlargeindustrialconsumers.Despiteincreasingrestrictionsonnetmetering,manystatesnowoffermultiplegridconnectivityoptionsforIndustryrooftopsystemsinlinewithcentralgovernmentguidelines.GroupcaptiveandbehindtheResidentialmeterarethepreferredmodelsforadoptionbytheC&Imarket.ThegroupcaptivemodelAgriculture/forestryremainsthemostpreferredmodelforlarge-scaleprocurementasitoffersthehighestsavingsandfacesrelativelylowregulatorybarriers.Behind-the-metersystemshavegainedmarketSource:IEA,2021shareasconsumerslooktomaximizeinstallationsizedespitenetmeteringpolicyconstraints.WindandSolarremainthedominantrenewabletechnologies,butthemarketisincreasinglyadoptingwind-solarhybridroutetoincreaserenewablepenetration.Greenhydrogenandstoragetechnologiesareyettotakeoffduetolowcommercialviability.However,somelargeconsumersareprocuringpumpedstoragepowertoconsumeround-the-clock(RTC)renewablepower.OAprojectdevelopmentbusinesshasbecomeincreasinglyfragmentedduetoincreasinginvestmentinterest.UtilityscaleIPPsarebullishontheOAmarket,primarilytodiversifyofftakeriskawayfromstateDISCOMs.TherooftopsolarCAPEXmarketisalsohighlyfragmented,whereastheOPEXmarketismoreconcentrated.BridgetoIndiaanalysisexpectsatotalcapacityadditionof47GWoverthenextfiveyears,entailingaCAGRof23%.CapacityadditionisexpectedtoremaingeographicallyconcentratedinRErichstatessuchasMaharashtra,TamilNaduandKarnataka,whichremainthemostattractivemarkets.Under-penetratedmarketsinUttarPradesh,Gujarat,Odisha,andChhattisgarharealsoexpectedtoseemoregrowth.Source:CorporateREbrief,Q2-2023,BridgetoIndiaresearch,EYAnalysis80Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678ThecompetitivenessofopenaccesscaptiveREtransactionsforC&Iconsumersislikelytosustainthrough2030andwitnesshighlevelsofgrowthAsperBridgetoIndiaanalysis,Indiaaddedarecord2,205MWcorporaterenewablecapacityinQ22023,up35%QOQ.Totalcorporaterenewablecapacityisestimatedtohavereached32,303MW.ThejumpincapacityadditionwasdrivenbyALMMwaiver,rushtocompleteprojectsbeforeexpiryofGujarat’swind-solarhybrid(WSH)policyincentivesandfallingsolarequipmentprices.87.976.96.67.26.87.47.06.06.465.85.55.45.35.45.25.15.0Rs./kwh54.243210MaharashtraMadhyaPradeshRajasthanTamilNaduGujaratTelanganaUttarPradeshKarnatakaChhattisgarhGridTariffLandedCost(2022)1.GujarathastheFuelsurchargerecoverybeingdoneseparatelyandcurrentlyleviesINR2.60p.uoverandabovethegridtariffforallconsumersexcludingagriculture.Source:JMKResearch&Analytics81Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersHarmonizedadoptionofgreenenergyopenaccessrulesatstatelevelLong-termpredictabilityandconsistencyofopenaccesschargesItiscrucialforallstatesinIndiatoeitheradopttheGreenEnergyOpenForumofRegulators(FoR)playsacrucialroleindevelopingaAccessrulesmandatedbytheGovernmentofIndiaorformulatetheirtransparentmethodologytocalculatetheopenaccesschargestobeownstate-specificopenaccessrulesthataddressthechallengesfacedimposedbyDistributionCompanies(DISCOMs)inaccordancewiththebyopenaccessconsumers.Bydoingso,statescanestablishaGreenEnergyOpenAccessrules.Thismethodologyisofutmoststandardizedframeworkthatensuresconsistencyandclarityforimportanceasitdeterminesthefinancialimplicationsforbusinessesbusinessesseekingtotransitiontoopen-accessarrangements.Theseoptingforopenaccessandprocuringrenewableenergydirectly.rulesshouldclearlyoutlinethetimelinesandguidelinesforgrantingapprovals,providingbusinesseswithatransparentprocessandenablingByestablishingastandardizedandfairapproach,theFoRcancontributethemtoplantheirrenewableenergyprocurementeffectively.tocreatinganenablingenvironmentforthedecarbonizationofindustrialgrowthinIndia.Moreover,theopen-accessrulesshouldincorporatecomprehensiveprovisionsregardingthereasonsforrejectionofopenaccessRationalizingthechargesassociatedwithopenaccessisessentialforapplications.Byexplicitlymentioningthegroundsforrejections,fosteringthetransitiontowardsalow-carboneconomy.ThecurrentbusinessescanhaveabetterunderstandingoftherequirementsandchargesleviedbyDISCOMscanoftenbeprohibitive,actingasatakenecessarymeasurestomeetthem.Additionally,itisessentialfordisincentiveforcommercialandindustrialconsumerstoadopttheserulestoincludeallrelevanttechnicalinformationrelatedtogridrenewableenergyandreducetheircarbonfootprint.TheFoR'sstability.Thisinformationshouldcoveraspectssuchasgridcapacity,methodologyshouldtakeintoaccountvariousfactorssuchasgridloadforecasting,andothergridparametersthatimpactthefeasibilityofinfrastructureinvestments,balancingandsettlementcosts,andsystemopenaccessarrangements.Byprovidingdetailedtechnicalinformation,lossestoarriveatchargesthatarereasonableandreflectiveofthetherulescanensurethatbusinesseshaveaclearunderstandingoftheactualcostsincurred.gridstabilityrequirementsandcanmakeinformeddecisionsregardingtheirrenewableenergyprocurementstrategies.82Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PolicyenablersComplianceandenforcementofRPOandESOonobligatedentitiesDemandaggregationservicesforRERTCsupplytoOAconsumersTheGovernmentofIndia,alongwithstategovernments,hasacriticalAmorecost-effectiveapproachtoreducetheoverallenergystorageresponsibilitytoensuretheeffectiveimplementationofRenewablecostcouldinvolvegovernmentbodiesliketheSolarEnergyCorporationPurchaseObligation(RPO)targetsandestablishclearconsequencesforofIndia(SECI)solicitingbidsandestablishinggrid-levelstoragefacilities.non-compliance.RPOtargetsareessentialmechanismsthatdrivetheByprovidingasteadystreamofrenewableenergytoenergy-intensiveadoptionofrenewableenergysourcesandfacilitatethetransitiontoaindustries,thisstrategynotonlymitigatesstorage-relatedexpensesbutcleanerandmoresustainableenergylandscape.alsosupportstheseindustriesinattainingtheirdecarbonizationobjectives.ToensurethesuccessofRPOtargets,itiscrucialforthegovernmentatboththecentralandstatelevelstoprovidearobustframeworkforPredictablegridbankingregulationsforOAconsumersenforcement.Additionally,thereshouldbeawell-definedmechanismtomonitorandassesscompliancewiththesetargets,ensuringTofacilitatethetransitiontocleanenergy,thegovernmentshouldtransparencyandaccountability.considerintroducingmorelenientbankingguidelines,particularlytailoredtotherequirementsofenergy-intensiveindustries.Equallyimportantistheneedtoclearlydefinetheconsequencesofnon-compliancewithRPOtargets.Theseconsequencesshouldbeproportionateanddesignedtoincentivizecompliancewhilealsoaddressinganypotentialchallengesorlimitationsfacedbyobligatedentities.Itisessentialthattheconsequencesareadequatelycommunicatedtoallstakeholders,emphasizingtheimportanceofmeetingRPOtargetsandthebenefitsoftransitioningtorenewableenergysources.83Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678BiofuelsandcirculareconomypathwaysforenergysecurityBioethanoldemandsupplyscenarioinIndia►By2018,ethanolblendingratesreachedaround4%,followedbyafasterEthanolsupplytrend12.00%uptakeinthesubsequentyears.Asof2021,theGovernmentofIndia500reportedablendingrateof8.1%.FromAug2021toJan2022,ExpressionofInterest(EOI)forsigningLongTermOfftakeAgreements40010.00%(LTOA)withDedicatedEthanolPlantsforethanolsupplysawoilmarketingcompanies(OMCs)sign131LTOAs.Indiaachievedthe8.00%targeted10%ethanolblendinginMay2022,muchaheadofthetarget300dateofNov2022,andhasgoneontopreponethetimelinebyfiveyearsto2025foranambitiousblendingtargetof20%.6.00%200►India’spresentapproachtobiofuelproductionisdominatedby1Gfeedstocks(e.g.,sugarcane,rice,andmaize)andhastoovercome4.00%challengesfromalifecycleperspective.Thelowyieldforsugarcaneandmaizewillrequirelandusechange,whichnecessitatestheexplorationof1002.00%newproductionpathways.00.00%2013201420152016201720182019202020212022Qty.supplied(CroreLitres)BlendingpercentageforPSUsQuantityofSource:FinalReport:EnergyTransitionAdvisoryCommittee,MoP&NG,2023ethanolperFeedstockCost/MToftheMToffeedstockEx-millEthanolfeedstock(Rs.)Price(Rs./liter)Theadvancementsin2Gbioethanolproducedfromlignocellulosicbiomass,Sugarcanejuice/70litres62.65suchascropresidues,woodycropsorenergygrasses,aregainingmomentum.Sugar/Sugar2850Thoughtheystillrepresentlessthan3%oftotalbioethanolproductionglobally,syruptheGHGreductionpotentialishigherthanfor1Gbioethanol.TheenvironmentalimpactsofbioethanolproductionaredependentonfeedstockBMolasses13,500300liters57.61availabilityandconversiontechnology.ThebiochemicalconversionroutemustCMolasses7,123225liters45.69overcometechnologicalandeconomicchallengessuchaspre-treatment,fermentation,hydrolysisandseparation.IndiahasfouroperationaladvancedDamagedFood16,000400liters51.55biofuelplants,includingapilotandademonstrationplant,withacumulativeGrains(Brokenannualproductioncapacityof1.75millionLitersofcellulosicethanol.Rice)Consistentavailabilityoffeedstockfromcropresidues,andtheestablishmentofanecessaryinfrastructureforaggregation,logistics,andhandlingoflargeRiceavailable20,000450liters56.87amountsofbiomass,allwiththeleastcarbonfootprint,willbeasteptoward2GwithFCI15,000380liters51.55ethanolproduction.MaizeSource:NITIAayogRoadmapforEthanolBlending2020-2585Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678CompressedbiogasdemandsupplyscenarioinIndia►Wasteandbio-masssourceslikeagriculturalresidue,cattledung,sugarcane►FermentedOrganicManure(FOM)producedvariesfrom15%to30%ofpressmud,distilleryspentwash,municipalsolidwaste,sewagetreatmentthefeedstockoftheCBGplants.FOMisusefulformaintainingsoilhealth,plantwaste,etc.,producebiogasthroughtheprocessofanaerobicparticularlyorganiccarbon,whichhelpsmicrofloratoflourish.Itisadecomposition.Thebiogasispurifiedtoremovehydrogensulphide(H2S),sourceofnitrogen(N),phosphorus(P),andpotassium(K)andalsohascarbondioxide(CO2),andwatervapor,andcompressedtoformessentialmicroandmacronutrientsthatarevitalforthebalancedCompressedBiogas(CBG)orBio-methane,whichhasmethane(CH4)growthofplants.CreatinganeffectivemarketingstrategyforFOMiscontentofmorethan90%.BiogascanserveasasuitablereplacementforcriticalforCBGPlants.ThepromotionofFOMcancreateanecosystemimportedfossilnaturalgaswithclosetonetzeroemissionswhileboostingoforganic/naturalfarminginthecountry.Further,FOMcanbeenrichedenergysecuritysupportedbycompetitiveeconomics.toPhosphateRichOrganicManure(PROM),whichcanreduceIndia’simportdependencyonphosphatefertilizers.►TheMinistryofRoadTransportandHighways,GovernmentofIndia,videtheGazetteNotificationno.395dated16.6.2015,haspermittedtheusageof►Thevariousfeedstocksofbiogasarewasteandbio-masssourceslikeCBGformotorvehiclesasanalternativetoCNG.CBGcanbeusedinvehiclesagriculturalresidue,cattledung,sugarcanepressmud,municipalsolidusingCNGfuelwithoutmakinganymodificationstothevehicle.CBGhasawaste,etc.CBGproductionvariesaspertechnology,feedstockquality,highpotentialtoreplaceCNGinautomotive,industrialaswellascommercialetc.areas,giventheabundantbiomassavailabilitywithinthecountry.‘SATAT’(SustainableAlternativeTowardsAffordableTransportation)initiativeon►TheGovernmentofIndiahassetatargettoincreasetheshareofgasinCBGwaslaunchedbytheHon’bleMinisterofPetroleum&NaturalGasontheenergymixfromthecurrentlevelsofabout6.5%to15%by2030to1.10.2018.Theschemeenvisagestheproductionof15MMTCBGand50makeIndiaagas-basedeconomy.CBGcanformacriticaldomesticMMTofmanurefrom5,000plants.UndertheSATATscheme,Oil&Gassupplysourcetocontributetothisbuild-up.MarketingCompanies(OGMCs)viz.IndianOil,HPCL,BPCL,GAILandIGLhavebeeninvitingEOIsfrompotentialinvestors/entrepreneurstoprocure►ProductionofCBGshallincreasethegreenenergymix,reduceimportCBG.dependence,createemployment,especiallyinsemi-urbanandruralareasandreducepollution.Thiswillcreatevalueandemploymentinthe►SalientfeaturesoftheSATATschemeruraleconomyacrossthesupplychain,frombiomasscollectiontoplantoperation.Plantownershallberesponsiblefortheinstallation,operationandmaintenanceoftheplant.OilandgasmarketingcompaniesshallofftakeCBG►TheminimumprocurementpriceofCBGwillnotbelowerthanINR46/kgfromtheplant.+applicabletaxesfortheperiodupto31.3.2029.TheRetailSellingPrice(RSP)ofCBGinamarketshallbeatparwiththeRSPofCNG.►OilandgasmarketingcompaniesshallexecuteaCommercialAgreementofUnderMoP&NGpolicyguidelinesonco-minglingofdomesticgasfor15yearswiththeCBGPlantowner,tobeextendedonmutualconsent.supplytoCNG(Transport)andPNG(Domestic)ofCGD,thebiogasprocurementpricesetbyGAILisINR1,082/MMBTU(equivalenttoINR►TherearevarioustechnologiesavailablefortheproductionofCBG.46/kg).Compression&CBGtransportationchargesofINR.8/kgareAnaerobicDigestionisusedfortheproductionofbiogaswhichincludesprovidedadditionally.technologieslikecontinuousstirredtankreactor(CSTR),plugflow,2-stagereactors,UpflowAnaerobicSludgeBlanket(UASB),etc.AftertheproductionSource:FinalReport:EnergyTransitionAdvisoryCommittee,MoP&NG,2023ofbiogas,hydrogensulfideispurifiedthroughferricchloride,ironchelate,biologicalprocess,activatedcarbon,etc.86Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678EthanolandcompressedbiogasproductiontoattractinvestmentofINR40,533croresEthanolproductionpipelineinIndia5,0004,0003,0002,0001,000-AndhraPradeshGujaratTelanganaOdishaPunjabChhattisgarhMaharashtraUttarakhandKarnatakaMadhyaPradeshWestBengalBiharJharkhandUttarPradeshTamilNaduRajasthanJammuandKashmirHaryanaHimachalPradeshEthanolProductionCapacity(KLPD)Investment(INRCrores)CBGproductionpipelineinIndia4,5004,0003,5003,0002,5002,0001,5001,000500-UttarPradeshPunjabKarnatakaRajasthanJharkhandCBG(Tons/Day)Investment(INRCrores)Source:EYanalysis87Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678PMKUSUMSchemeextendtillMarch2026Component–A:Settingupof10,000MWofDecentralizedGridConnectedConsideringthebelowreasonsMNREextendedthePMKUSUMSchemeRenewableEnergyPowerPlantsonbarrenlandofcapacity500kWto2MWtillMarch2026.willbesetupbyindividualfarmers/groupsoffarmers/cooperativesetc.even►DelayinStateGovernmentapprovalfortheprojectoncultivablelandonstiltswherecropscanalsobegrownbelowthesolar►DelayduetolimitedaccesstoinstallationsitesowingtoCOVID-19panelswithinfivekmradiusofthesub-stationsinordertoavoidhighcostofsub-transmissionlinesandtoreducetransmissionlosses.ThepowerpandemicgeneratedwillbepurchasedbylocalDISCOMatpre-fixedtariff►Statesaretoprovideatleast30%subsidyforwhichmatchingstateCFA:ProcurementBasedIncentive(PBI)@40paise/kWhorINR6.60shareisnotavailablelakhs/MW/year,whicheverisless,willbeprovidedforthefirstfiveyearsby►Increaseinsteelprices,GSTandshortageinsupplyofglassaffectedMNREtoDISCOMs,forbuyingthepowerfromfarmers/developersimplementationComponent–B:Installationof17.50Lakhstand-alonesolaragriculture►SlowImplementationbyBankstoprocessloansunderComponentApumps.UnderthisComponent,individualfarmerswillbesupportedtoinstall►LackofavailabilityoflandfordecentralizedsolarprojectsinfewstatesstandalonesolarAgriculturepumpsofcapacityupto7.5HPforreplacement►Non-availabilityofmeteredconnectioninsomestatesledtodelayinofexistingdieselAgriculturepumps/irrigationsystemsinoff-gridareas,wheregridsupplyisnotavailable.Pumpsofcapacityhigherthan7.5HPcanimplementationinsomestates.alsobeinstalled,however,thefinancialsupportwillbelimitedtoa7.5HP►FarmerssharenotcominginunderComponent-C(IPS)capacityMNREissuedbelowmajoramendmentstoeasetheimplementationofComponent–C:Solarizationof10LakhGridConnectedAgriculturePumps.KUSUMschemeUnderthisComponent,individualfarmershavinggridconnectedagriculture►DCRforsolarcellswaivedoffforfeedersolarizationprojectsforworkpumpwillbesupportedtosolarizepumps.Thefarmerwillbeabletousethegeneratedsolarpowertomeettheirrigationneedsandtheexcesssolarawardedtotheimplementingcompanyby20.06.2023powerwillbesoldtoDISCOMsatapre-fixedtariff►CFAisavailableforpumpcapacityupto15HPtotheindividualfarmersCFAtoComponentB&C:CFAof30%ofthebenchmarkcostorthetenderinthenorth-easternstates,hillstatesandislandUTsunderComponent-cost,whicheverislower.StateGovernmentsubsidy30%;Remaining40%byB&Cthefarmer.Innorth-easternstates,Sikkim,J&K,Himachal,Uttarakhand,►NoRequirementforPBGofINR5Lakh/MWunderComp.AofPMLakshadweepandA&NIslands,CFAof50%,StateGovernmentsubsidy30%,KUSUMRemaining20%bythefarmer.►RequirementofBankGuaranteeforthereleaseofCFAunderComp.CofPMKUSUMhasbeenremoved►StatetenderallowedunderComponent-B►Thetimeperiodextendedforimplementationto24monthsforalltheComponents►MultipleextensionsallowedtostatestocompletethesanctionedcapacitiesSource:https://pmkusum.mnre.gov.in/pdf/Progress%20Update%20of%20PM%20KUSUM%20Scheme.pdf88Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing1234567889No.ofSanctionedIndividualsolarPumps50,0001,40040,0001,200Source:https://pmkusum.mnre.gov.in/30,0001,00020,00010,000800600-400200-GlobalchampionsforadvancingrenewableenergyinnovationandmanufacturingAssamKUSUM-C:IndividualPumpsSanctionedSolarCapacity(MW)ArunachalpradeshKUSUM-APMKUSUMSchemeprogressason31July2023GujaratAssamNo.ofInstalledIndividualsolarPumpsJammu&KashmirInstalledSolarCapacity(MW)JharkandChhattisgarh12345678Kerala4,00,000Goa2,50,000Odisha3,50,0002,00,000Punjab3,00,000Gujarat1,50,000Rajasthan2,50,000Haryana1,00,000Tripura2,00,000HimachalPradeshUttarPradesh1,50,000Jammu&Kashmir50,000Uttarakand1,00,000Jharkhand-WestBengal50,000KeralaChhattisgarh-MadhyaPradeshGoaNo.ofSanctionedFeederlevelsolarKUSUM-C:FeederLevelNo.ofPumpsSanctionedMaharashtraKUSUM-BGujaratNagalandNo.ofInstalledFeederlevelsolarHaryanaNo.ofPumpsInstalledOdishaKarnatakaPunjabRajasthanKeralaMadhyaPradeshTamilNaduTripuraMaharashtraOdishaUttarPradeshPunjabArunachalpradeshRajasthanAssamTelanganaGoaUttarPradeshGujaratHaryanaHimachalPradeshJammu&KashmirJharkandKarnatakaKeralaLadakhMadhyaPradeshMaharashtraManipurMeghalayaMizoramNagalandOdishaPunjabRajasthanTamilnaduTelanganaTripuraUttarPradeshUttarakandWestBengalPolicyenablersPromotebiomassaggregationandstorageCreationofamarketecosystemforbiomanureandpromotionofFermentedOrganicManure(FOM)GovernmentisprovidingsubsidiesonbiomassaggregationandstorageequipmentundertheSMAMandstate-specificschemes.Presently,aboutMandatoryofftakearrangementofbiomanurefromCBGPlants@Rs50%subsidyisavailableforbiomassaggregationandstorageequipment5000-6000/tonbychemicalfertilizercompanieswithminimumundertheSMAMscheme.mandatedofftakeofbiomanureasapercentageofchemicalfertilizersina‘BasketApproach.’Stategovernmentsmayprovideanadditionalsubsidyofaminimumof30%tomaketheprocurementofequipmentmoreviable.ThesubsidyExemptionfromretaillicenserequirementforthesaleofFOMinsmallmaybeprovidedupfrontduringtheprocurementofequipmentandmayquantities,includingpackageslessthan5Kgandstocklessthan10MTalsobeextendedtosetupCBGPlants.Promoteengagementofatanygiventime.CreationofnaturalfarmingandorganicfarmingFPOs/CHCsetc.,foraggregationandstorageofbiomass.Createecosystems.TheGovernmentmaydeclarethevicinityofCBGPlantsasawarenessandpromoteactivitiesforbiomassaggregationinthe‘GreenZones’whereonlyFOMmaybeusedfororganicandnaturalcatchmentarea.Deploybiomassaggregationequipmentfarming.Creationofanationalbrand&certificationfororganicand(Cutter+Racker+Baler)inthecatchmentareaofCBGplantsbystatenaturalfoodproducedbyFOM.governments.ProductionlinkedincentivesIdentifyandnotifybiomassclustersforCBGplantsandotherbiomass-basedbiofuelprojectsandgrantofanexclusiveareaforalongtenure.ExtendingCentralFinancialAssistance(CFA)forallcommissionedCBGPlantsaswellasupcomingCBGPlantsforthenext10years.ProvidingProvideincentivesonoperatingexpensesofbiomassaggregationandProductionLinkedIncentive(PLI)@Rs.10/kgofCBGtoencouragestorageequipmentbystategovernments.production.Financialincentiveslikeaccesstocredit,accelerateddepreciation,longtermlandleasesandtaxholidayswouldhelptoLocalgovernmentstoallotlandforadecentralizedstoragefacilityforattractprivateinvestmenttotheCBGsector.thedevelopmentofbiomassdepots.EstablishfeedstockpricingmechanismBlendingmandatesDesignafeedstockpricingmechanismlinkedtobioethanolpricesandProvideCBGblendingmandatestoallCityGasDistribution(CGD)thelogisticalsetupatvariouscollectionpointstoavoidexploitationofentitiesmarketingCNGandPNG.PromotionofCBGandCNGvehiclesinfeedstocksuppliersbythebiofuelproducers.locationswithupcomingCBGplantsandconvertexistingvehiclesandtractorstoCNGbasedvehicles.IssuecomprehensiveguidelinesonmarketingofCBGthroughCNGoutletsandviceversa.Dedicated“GreenHours”canbedesignatedforundertakingsaleofCBGthroughCNGoutlets.90Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678References1.OptimalEnergyMixReport,April15.IndiaTransportEnergyOutlook,29.https://www.energyforum.in/43.RenewablePurchaseObligationsand2023,CentralElectricityAuthority,CEEW,2022EnergyStorageobligationTrajectoryIndia30.https://niwe.res.in/assets/Docu/Inditill2030byMinistryofPower,Govt.16.DevelopingResilientRenewablea's_Wind_Potential_Atlas_at_120m_ofIndiaJuly20222.https://www.mospi.gov.in/sites/defaEnergySupplychainsforGlobalagl.pdfult/files/publication_reports/Energy_CleanEnergyTransition,CEEW,April44.GuidelinesforprocurementandStatistics_2023/EnergyStatisticsIndi202331.https://www.seci.co.in/UtilizationofBatteryEnergyStoragea2023.pdfSystemsaspartofGeneration,17.MNREREProgressreport,March32.AdvancedChemistrycellBatteryTransmissionandDistributionassets,3.IEAIndiaEnergyOutlook,20212023ReuseandRecycleMarketinIndiabyalongwithancillaryservicesbyNITIAayogMinistryofPower,Govt.ofIndia,4.IEA,WorldEnergyOutlook,202218.AnnualSolarReportCard,JMKMarch2022Research,202233.EnergyStorageSystem,Roadmapfor5.https://cea.nic.in/wp-IndiabyIndiaSmartGridForum45.GreenEnergyOpenAccess'Rulestocontent/uploads/baseline/2023/01/19.https://dpiit.gov.in/sites/default/fileaccelerateambitiousrenewableApproved_report_emission__2021_2s/FDI_Factsheet_March_23.pdf34.IndiabudgetSpeechfor2023-24byenergyprogrammesbyMinistryof2.pdfSmt.NirmalaSitharaman,Hon’blePower,Govt.ofIndiaJuly202220.https://www.dgft.gov.in/CP/?opt=trFinanceMinister,Govt.ofIndia6.BRIDGE-TO-INDIA-FICCI-Report-ade-statistics46.RetailsupplytariffordersofvariousFacilitating-Growth-of-Corporate-35.EconomicSurvey2022-23,Govt.ofstatesRenewable-Market-202321.NeedforAdvancedChemistrycellIndiaEnergyStorageinIndiabyNITI47.https://www.iexindia.com/landedcost7.RystadEnergy-BatteriesAayogandRMI36.https://www.blackridgeresearch.comcalculator.aspx?id=%2BVn29DBC1u0whitepaper_May2023/reports/india-battery-market-size-%3D&mid=IT8b%2BZM5cBA%3D22.https://rmi.org/insight/towards-a-share8.20thEPSreportbyCentralElectricitysustainable-battery-manufacturing-48.IndiaWindEnergyMarketOutlook,Authorityindustry/37.https://vahan.parivahan.gov.in/vaha2023-27byGWECn4dashboard/vahan/view/reportview9.GWEC,GlobalWindReport,202223.HowcanIndiaindigeniseLithium-ion.xhtml49.IndiaOutlook2026,GWECbatterymanufacturingbyCEEW,10.ReportonPotentialroleofHydrogenFebruary,202338.https://mnre.gov.in/solar/current-50.https://morth.nic.in/sites/default/fileinIndia,TERIstatus/s/FINAL_CHART.pdf24.Lithium-ionbatterymanufacturing11.StatusquomappingofhydrogenlandscapeinIndia,IEEFAandJMK39.https://mnre.gov.in/wind/current-productionandconsumptioninIndia,Research2022status/IGEF–Germany25.Lithium-ionbatterymanufacturingin40.https://mnre.gov.in/small-12.HarnessingGreenHydrogenReport,IndiahasgotthepowerforEVsandhydro/current-statusNITIAayogandRMI-theGrid,IEEFA,2022https://rmi.org/insight/harnessing-41.BankingRestrictionsonRenewablegreen-hydrogen/26.AllIndiaandStatewiseInstalledEnergyProjectsinIndia,ImpactonCapacity,CEAOpenAccessMarketbyIEEFAand13.IndiaphotovoltaiccapacitysetoJMKResearch,2021surge,IEEFAandJMKResearch27.https://mnre.gov.in/img/documents/uploads/file_f-1673581748609.pdf42.https://jmkresearch.com/india-14.AHybridInput-OutputTableforadded-12-8-gw-solar-capacity-in-India,CSEP,202228.https://www.suzlon.com/fy2023/91Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678References51.https://www.pv-tech.org/indias-60.GWECGlobalWindReport2022.64.StrategyPaperforOffshoreWind72.https://www.niti.gov.in/sites/defaultcorporate-renewables-market-to-Brussels:GlobalWindEnergyCouncil.EnergyInIndia,MNRE-August2023/files/2021-grow-47gw-by-2027-bridge-to-india/https://gwec.net/global-wind-report-6/EthanolBlendingInIndia_compresse2022/65.Shortageofelectrolyzersford.pdf52.NewEnergyOutlook,BloombergNewhydrogenreport,EYP,2023EnergyFinance,202261.“TheRoleofCriticalMineralsinClean73.https://mopng.gov.in/files/uploads/EEnergyTransitions.”International66.https://atb.nrel.gov/electricity/2022TAC_2023_FINAL_PRINT.pdf53.BPEnergyStatistics,2022EnergyAgency./utility-scale_battery_storage54.https://pib.gov.in/PressReleaseIframhttps://www.iea.org/reports/the-role-of-critical-minerals-in-clean-67.https://pmkusum.mnre.gov.in/pdf/PrePage.aspx?PRID=1831289energy-transitionsogress%20Update%20of%20PM%20K55.https://dfpd.gov.in/ebpProgramme_USUM%20Scheme.pdf62.IEA.2021.MineralsusedincleanC.htmenergytechnologiescomparedto68.https://agricoop.nic.in/sites/default/56.https://satat.co.in/satat/#otherpowergenerationsources,IEA,files/NPMCR_1.pdf57.https://mopng.gov.in/en/pdc/investiParishttps://www.iea.org/data-and-statistics/charts/minerals-used-in-69.https://mnre.gov.in/img/documents/ble-projects/alternate-clean-energy-technologies-uploads/file_f-1692332330838.pdffuels/sustainable-alternative-compared-to-other-power-towards-affordable-transportationgeneration-sources70.https://bridgetoindia.com/report/indi58.https://cpcb.nic.in/uploads/MSW/MSa-corporate-renewable-brief-q2-W_AnnualReport_2020-21.pdf63.“Next-generationWindTechnology.2023/59.https://icar.org.in/sites/default/fileshttps://www.energy.gov/eere/wind//Creating-Wealth-From-Agricultural-next-generation-wind-technology71.https://link.springer.com/book/10.1Waste.pdf007/978-3-030-05843-292Globalchampionsforadvancingrenewableenergyinnovationandmanufacturing12345678NotesNotesOurOfficesDelhiNCRKolkataGroundFloor22CamacStreetAhmedabad67,InstitutionalArea3rdFloor,Block‘C’22ndFloor,BWing,PrivilonSector44,Gurugram-122003Kolkata-700016AmbliBRTRoad,BehindIskconHaryanaTel:+913366153400Temple,OffSGHighwayTel:+911244434000Ahmedabad-380059MumbaiTel:+9179660838003rd&6thFloor,Worldmark-114thFloor,TheRubyIGIAirportHospitalityDistrict29SenapatiBapatMargBengaluruAerocity,NewDelhi-110037Dadar(W),Mumbai-40002812th&13thfloorTel:+911147318000Tel:+912261920000“UBCity”,CanberraBlockNo.24VittalMallyaRoad4th&5thFloor,PlotNo2B5thFloor,BlockB-2Bengaluru-560001Tower2,Sector126NirlonKnowledgeParkTel:+918067275000GautamBudhNagar,U.P.Off.WesternExpressHighwayNoida-201304Goregaon(E)GroundFloor,‘A’wingTel:+911206717000Mumbai-400063DivyasreeChambersTel:+912261920000#11,LangfordGardensHyderabadBengaluru-560025THESKYVIEW10PuneTel:+91806727500018thFloor,“SOUTHLOBBY”C-401,4thfloorSurveyNo83/1,RaidurgamPanchshilTechPark,YerwadaChandigarhHyderabad-500032(NearDonBoscoSchool)Elanteoffices,UnitNo.B-613&614Tel:+914067362000Pune-4110066thFloor,PlotNo-178-178ATel:+912049126000Industrial&BusinessPark,Phase-IJamshedpurChandigarh-1600021stFloor,FairdealComplexTel:+911726717800HoldingNo.7,SBShopAreaBistupur,Jamshedpur–831001ChennaiEastSinghbhumJharkhandTidelPark,6th&7thFloorTel:+916576631000ABlock,No.4,RajivGandhiSalaiTaramani,Chennai-600113KochiTel:+9144665481009thFloor,ABADNucleusNH-49,MaraduPOKochi-682304Tel:+914844334000Ernst&YoungLLPCopyright©2023ConfederationofIndianIndustry(CII)Allrightsreserved.EYBuildingabetterworkingworldNopartofthispublicationmaybereproduced,storedin,EYexiststobuildabetterworkingworld,helpingtocreateorintroducedintoaretrievalsystem,ortransmittedinlong-termvalueforclients,peopleandsocietyandbuildtrustanyformorbyanymeans(electronic,mechanical,inthecapitalmarkets.photocopying,recordingorotherwise),inpartorfullinanymannerwhatsoever,ortranslatedintoanylanguage,Enabledbydataandtechnology,diverseEYteamsinoverwithoutthepriorwrittenpermissionofthecopyright150countriesprovidetrustthroughassuranceandhelpowner.CIIhasmadeeveryefforttoensuretheaccuracyclientsgrow,transformandoperate.oftheinformationandmaterialpresentedinthisdocument.Nonetheless,allinformation,estimatesandWorkingacrossassurance,consulting,law,strategy,taxandopinionscontainedinthispublicationaresubjecttotransactions,EYteamsaskbetterquestionstofindnewchangewithoutnotice,anddonotconstituteprofessionalanswersforthecomplexissuesfacingourworldtoday.adviceinanymanner.NeitherCIInoranyofitsofficebearersoranalystsoremployeesacceptorassumeanyEYreferstotheglobalorganization,andmayrefertooneorresponsibilityorliabilityinrespectoftheinformationmore,ofthememberfirmsofErnst&YoungGlobalLimited,providedherein.However,anydiscrepancy,error,etc.eachofwhichisaseparatelegalentity.Ernst&YoungGlobalfoundinthispublicationmaypleasebebroughttotheLimited,aUKcompanylimitedbyguarantee,doesnotnoticeofCIIforappropriatecorrection.Publishedbyprovideservicestoclients.InformationabouthowEYConfederationofIndianIndustry(CII)TheMantoshSondhicollectsandusespersonaldataandadescriptionoftheCentre;23,InstitutionalArea,LodiRoad,NewDelhirightsindividualshaveunderdataprotectionlegislationare110003,Indiaavailableviaey.com/privacy.EYGmemberfirmsdonotpracticelawwhereprohibitedbylocallaws.Formoreinformationaboutourorganization,pleasevisitey.com.Ernst&YoungLLPisone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