The India Energy Storage Alliance (IESA), the country's premier industry body for companies operating in the energy transition space, has submitted its pre-Budget recommendations to the Union finance ministry, outlining ways to bolster the country's energy security and boost manufacturing and investments in the domestic energy storage, electric vehicle (EV), and green hydrogen sectors.
The recomendations point to the necessity of tax holidays, GST reductions, duty exemptions, and other incentives to help India transition to clean power and achieve energy self-sufficiency.
Among IESA's major proposals are:
- tax holidays to boost investment in the energy storage sector
- extension of performance-linked incentives (PLI) for advanced chemistry cell (ACC) battery manufacturing
- incentives to micro, small and medium enterprises (MSME sector) and start-up ecosystem of energy storage
- a roadmap to increase India's gross expenditure of research and development (GERD) to 2 percent of GDP by 2030
- inclusion of a PLI scheme for manufacturing electrolyzers and components in the SIGHT programme, with a dedicated outlay for niche/ advanced green hydrogen production technologies
India has a great opportunity to become a global hub for supply chain of advanced battery manufacturing ecosystem. We expect the upcoming Union Budget 2024 to consider tax incentives which will bring more investments to India's fast-growing energy storage industry.
Dr. Rahul Walawalkar, Founder & President, IESA and President & MD, Customized Energy Solutions, India
IESA, founded in 2012 by Customized Energy Solutions (CES) India, aims to make India a global hub for R&D, manufacturing, and adoption of advanced energy storage, e-mobility, and green hydrogen technologies. It's 170+ member companies -- from large corporates and cleantech startups to research institutes and universities -- operate in industry verticals from energy storage, EV manufacturing and EV charging infrastructure to green hydrogen, microgrids, power electronics and renewable energy.
Commenting on the development, Dr. Rahul Walawalkar, Founder & President of IESA and President & MD, Customized Energy Solutions (CES), India, said: "As the Hon'ble Finance Minister will soon be leading the Budget Session of the Parliament this year, we wish to take this opportunity to draw her kind attention to the industry expectations. India has a great opportunity to become a global hub for supply chain of advanced battery manufacturing ecosystem. We expect the upcoming Union Budget 2024 to consider tax incentives which will bring more investments to India's fast-growing energy storage industry. Also, the rationalization of GST rates for batteries for different applications across e-mobility and stationary storage would result in a reduction of overall system cost immediately. The tax incentives will support the industry by generating immediate demand by providing reduced costs which will enable in the long run domestic manufacturing picking up."
Debi Prasad Dash, Secretary, US-India Energy Storage Taskforce and Executive Director, IESA said, "Our Hon'ble Prime Minister has announced battery manufacturing as one of the champion sectors, which encouraged many start-ups to gear up towards technology transition. Hence, it is important to place separate focus on start-ups of energy storage and EV space."
Dash added: "To benefit Indian investors to capture minimum value addition (requirement as per ACC model bid documents), they have to procure all the essentials from the Indian manufacturers. Dedicated funds are to be allocated for the sector including hardware startups, which need commitment and funding. At present, these hardware start-ups are facing issues in securing funding from the financial institutions. We also request the government to consider funding PPP projects and industry-academic institutes towards advanced technology developments."
What’s next for India’s battery manufacturing industry in 2024? -