pv magazine: There are reports that SimpliPhi is planning to venture into India. Is it true? What exactly do you plan for India?
I was in India about six months ago and the purpose of my trip was to not only meet different investors and strategic partners but also to look at land for a potential manufacturing site in India.
I went to Gujarat as part of a delegation to a national summit of the “Make in India” initiative. Prime Minister Modi’s speech to the invited delegation was valuable as it helped me get first-hand knowledge of the Indian market, the opportunities in the “Make In India” program, and all the new high tech business being developed in Gujarat.
I visited the Adani Ports and Special Economic Zone, met with leaders there, and looked at land. We are looking at the possibility of setting up a manufacturing plant and working with Adani for export to other parts of India and the world, and [in the process] helping them [Adani] to build businesses around manufacturing while adding value to ours.
We are also looking at creating jobs and economic opportunities through this project. For me it’s of personal interest in part because of the time I spent in India years ago when I was in college, and I’ve continued travelling to India since then.
We are still working on developing the manufacturing plant and speaking with investors. And we are really waiting to see what Prime Minister Modi announces about incentives for manufacturers, specifically in clean energy and lithium iron phosphate (LiFePO 4) batteries, to help bring them into India. I heard that the incentives Modi is looking to offer could be as much as 30$/kWh to build a manufacturing plant.
Specifically, LFP batteries are well suited for countries like India which have hot climates, because — unlike cobalt-based batteries—they are not hazardous at high temperatures. In such environments, not just the energy output but the chemistry and the safe operating temperature range are also very important.
pv magazine: Are you looking to set up the plant in Gujarat only, or are there other locations too on your mind?
We have also been looking at several other ports that would allow us to have the manufacturing plant very close by and that don’t fall under free trade zone, so that we can build products and sell them directly into India without the import tariffs that we face with a free trade zone like the Adani port.
pv magazine: India being a nascent market, there is not much clarity on technical feasibility of energy storage technologies. While Lithium is a favourite globally, do you feel it will work for India too?
Absolutely. When you say lithium ion (li-ion) battery, it’s really important to differentiate between the many different chemistries with different properties.
Cobalt is used in the chemistry of most lithium ion batteries, primarily in lithium cobalt oxide (LCO), nickel manganese cobalt oxide (NMC) used by LG Chem, or nickel cobalt aluminum (NCA) used by Tesla.
Cobalt creates heat in Li chemistry, and also lowers the temperature threshold for thermal runaway, meaning that cobalt makes it more vulnerable to thermal runaway, fire and explosions. That’s why you can’t put out the fire of a cobalt-based Li battery with traditional means, and it burns out of control.
Cobalt is also fundamentally toxic and hazardous at every stage, from mining to the landfill, and has been associated with child labor and labor abuses.
In the early 2000s, when lithium battery chemistry was first being developed, the impact of using cobalt wasn’t a focus. Now, companies try to reduce the risk by using cooling systems and extra space, and thermal monitoring. But the inherent chemical hazard remains. That’s why we’ve seen fires in cellphones, laptops, cars, and even aviation systems. Even today in 2019, when you charge your phone or laptop, the battery can run hot and in some cases burst into flames.
The hazards of cobalt increase in larger batteries. That’s why we’ve seen utility-scale Li-cobalt batteries explode. Cobalt poses serious risks and challenges to managing a fully integrated battery system.
When we founded SimpliPhi Power in 2010, we began to work with the newest and safest innovation in li-ion chemistry – lithium ferro (or iron) phosphate (LFP). Unlike LCO, NMC or NCA, LFP chemistry does not include cobalt and therefore does not post safety or toxicity issues.
The LFP chemistry also gives our batteries a more robust performance profile and a longer operational life. We provide a warranty for 10 years. We’re committed to clean renewable energy, so we want a product that doesn’t create safety and toxicity issues.
The LFP chemistry we use in our design is ideal for the Indian market as it’s safe, doesn’t create additional toxicity and has a very long cycle life. The operating temperature range is also much broader at up to 128 degree Fahrenheit (53.3 degrees Celsius), which makes our energy storage systems much more suitable for the hot climate of India.
pv magazine: Besides investments around technology, what kinds of partnerships are you looking at? How do you intend to develop the local skillset?
We have a manufacturing design process—even at our current manufacturing headquarters in the US—wherein we can hire untrained personnel and train them on manufacturing lines in areas such as building, sorting and working with different types of metal alloys. This means we would create more jobs than a fully automated manufacturing plant.
We have a number of different strategic partners, including cell manufacturers, who are also waiting for the Indian government’s plan to attract investments in clean energy storage. So, it is quite possible that cell manufacturers will set up plants here and we would partner with them to manufacture fully integrated batteries and energy storage systems.
pv magazine: What are the countries where you intend to source raw material from?
We are getting into Australia for mining. There are different lithium, iron and phosphate deposits. The good news is that, unlike cobalt, lithium is one of the most abundant elements on the planet.
Lithium could actually be obtained from different parts of the world; the whole supply chain is still developing. So we will be ramping up quite quickly as the electric vehicle market continues to expand and drive the costs down for li-ion batteries across chemistries, including LFP.
pv magazine: How big a scope is there for battery energy storage in India?
The Indian market is vast. In dense urban areas, customer-sited distributed battery systems in apartment houses—rather than large MWh utility-scale batteries—can provide energy security against power outages and at the same reduce the load on the grid.
In the US, as utility rates are high, customer-sited batteries at homes and businesses can offset those high rates. So, batteries between can be used not just for backup power but also for offsetting higher charges during peak demand hours.
We are currently working with three utilities in the US around such projects wherein hundreds of homes have their own individual battery systems so that people have backup power in the event of grid outages.
pv magazine: At pv magazine, we have been receiving a lot of queries from different investors who are keen on the Indian energy storage market. A good number of domestic companies have already plans in place. How do you see the market develop?
We have already seen a lot of consolidation in the energy storage market. Many energy storage companies have gone bankrupt. We have been more competitive because over nearly 10 years, people have seen that our batteries perform better, especially in hot climates. Independent tests have verified this. And as a result, we’ve expanded to more than 43 countries.
As a privately held company we have worked only with strategically aligned investors, and have avoided venture (VC) capital. That means we have been able to carefully control quality and strategy. This has allowed us to become highly profitable, and trusted by both customers and partners.
Raising round after round of VC funding doesn’t necessarily make companies competitive; in fact that often enables and masks wasteful or unwise spending. What makes companies competitive is the performance of their technology and the difference it makes to customers’ lives. Our energy storage systems–the most safe, efficient and reliable available–prove their value over time.
In the last 5 to 6 years, our battery prices have come down by over 50% and continue to fall. In addition, we are constantly innovating to increase the energy capacity, efficiency and cycle life of the battery within the same size and shape. We work with a global network of first rate distributors. As a result of this carefully developed strategy, customers keep coming back to us, bringing new customers with them.
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