Epsilon Advanced Materials: New entrant in the lithium-ion battery space

Headquartered in Mumbai, Epsilon Advanced Materials was founded in 2018 with a vision to become a leading global battery material manufacturer, delivering innovation-centred, high-performance, best-in-quality green battery minerals. The company has operations spanning Europe, North America and Southeast Asia. So far, the company has been funded by the Epsilon Group. It is now evaluating various options to decide whether to continue funding future growth internally, or partner with marquee investors who can not just contribute capital but also aid in growth. In an interview with Renewable Watch, Vikram Handa, founder and managing director, Epsilon Advanced Materials, talks about the company’s key product offerings, on-ground experience and future targets. Edited excerpts…

What are the key services and products off­ered by the company, and what are their applications?

The company manufactures materials for lithium-ion batteries. The lithium-ion battery is a critical component of electric ve­hi­cles (EVs) as it determines the driving range and overall performance of the vehicle. As traditional cars are evaluated based on their fuel efficiency, EVs are evaluated based on their range and performance, making the quality of the battery a critical factor in the success of the vehicle. In this sense, the battery can be seen as more important than fuel, as it is the key to unlocking the full potential of electric transportation.

The key to manufacturing high-performing batteries lies in the quality of materials used in battery components. The battery is made up of four components: cathode, electrolyte, separator and anode. The main focus of the company is on manufacturing the finest battery materials for cathode and anode components. Further, it manufactures various grades of synthetic gra­phite with properties suitable for both high power cells and long-cycle cells.

What has been your experience in the Indian electric mobility market?

The Indian electric mobility market has been growing rapidly in recent years. The government’s initiatives to promote EVs have played a significant role in creating a favourable environment for the battery material industry. The Indian EV market is expected to grow at a compound annual growth rate of around 44 per cent bet­we­en 2020 and 2026. The government has set a target of achieving 30 per cent EV adoption by 2030, which has led to the development of various policies and in­ce­ntives to promote EV adoption.

There are opportunities to provide high-quality battery materials to Indian EV manufacturers. However, it is important to note that the Indian EV market is highly competitive, with both domestic and international players competing for market share. Therefore, it is essential to have a clear un­­­derstanding of the market dynamics, customer needs and competitive landscape before entering the market.

We have been working closely with our clients in the EV industry to develop and supply high-quality, high-performance battery materials. Our clients include EV manufacturers, battery pack assemblers and battery module manufacturers. Most OEMs are facing challenges in sourcing high-quality battery materials for their EVs, and do not want to be dependent on China, the largest producer of battery materials. They were struggling to find a reliable supplier who could provide them with the required quality and quantity of high-performing battery materials.

We are partnering with them to provide high-quality battery materials that meet the specifications. Our team works with their engineering and procurement teams to understand their requirements and de­velop a customised solution that would meet their specific needs. We also provide our customers with ample technical support and guidance throughout the entire process.

What are the key issues in the Indian electric mobility market and what are the solutions to these challenges?

The Indian electric mobility market has the potential to be a game changer in the glo­bal shift towards sustainable transportation. However, the market faces several challenges that must be overcome to ac­celerate the adoption of EVs and drive the growth of the industry. As a battery ma­terial manufacturer, we have a unique perspective on the challenges and potential solutions in the Indian electric mobility market. The projected solutions will be driven by thoughtful collaborations bet­ween all relevant stakeholders operating in the electric battery and EV space.

  • High upfront cost: Interestingly, when you buy an electric car, 50 per cent of the cost is just for the battery pack. Of this, 40 per cent of the cost is for cells, and 15 per cent for the anode. So, making an electric car affordable is largely a matter of lowering battery costs. The hi­gh upfront cost of EVs is a major challenge for the electric mobility market, and it can impact the demand for EV batteries. One solution for battery material manufacturers is to focus on continuously innovating and developing new and advanced battery materials that are cost-effective and efficient in their performance. At Epsilon, we have developed a process where we take waste materials from the steel industry and distil them to ma­nufacture pitch and a variety of intermediate chemicals. This way, we can utilise waste materials that would otherwise be discarded and turn them into va­luable raw materials for our battery production. This, in turn, reduces the upfront cost and is a greener solution.
  • Lack of charging infrastructure: The la­ck of adequate charging infrastructure is another challenge that affects the ad­op­tion of EVs and hence the demand for EV batteries. Battery material manufacturers can collaborate with the government and other stakeholders to in­vest in the development of charging in­frastructure to increase the adoption of EVs. At Epsilon, we are working on solutions that will enhance the efficiency of batteries, thus reducing dependence on frequent charging.
  • Mileage challenges: The limited mile­age of EVs can cause range anxiety am­­­­o­­ng consumers, which affects the de­mand for EV batteries. The chemical composition of batteries determines the­ir performance and longevity. One solution is to develop advanced battery materials that provide greater energy density, which can result in longer ran­ges for EVs. We have developed an an­o­de material, synthetic graphite, which is a high-quality product and is competitive with other players in terms of key anode parameters such as capacity, tap density and efficiency.
  • Limited availability of EV models: The limited availability of EV models in India can impact the demand for EV batteries. Battery material manufacturers should work closely with EV manufacturers to de­velop a wider range of EV models that can cater to the diverse needs and preferences of consumers. It is important to prioritise adaptability in the manufacturing processes. By maintaining a flexible and scalable production system, one can quickly commercialise and adjust to ch­anges in demand, and ensure that one is meeting their customers’ needs. At Epsilon, we are constantly evaluating and improving our production processes to optimise efficiency and reduce waste, ensuring that we deliver high-performing products in the most effective way possible.
  • The limited supply of raw materials: The limited supply of rare earth metals and other raw materials used in the production of EV batteries can impact the availability and cost of batteries. We should focus on developing new technologies that reduce the reliance on rare earth metals and explore alternative sources of these materials to ensure a stable su­pply of raw materials to produce EV batteries. The government is drafting the Critical Minerals Policy to solve this ch­al­lenge. India’s critical minerals policy will aim to ensure a stable and sustainable supply of critical minerals for the country’s economic growth and strategic needs.

In summary, we have an important role to play in addressing the key challenges faced by the Indian and the global electric mobility markets, especially the energy storage industry.

What are the key targets and plans of your company?

Epsilon Advanced Materials has several key targets and plans that we aim to ac­hieve in the coming years. Firstly, the co­mpany plans to invest heavily in research and development of advanced battery materials that are more cost-effective, efficient and sustainable. Further, we plan to set up facilities and collaborate through partnerships in Finland, the UK, Canada and the US. These partnerships will help us strengthen our global presence and build a robust supply chain.

The company has also signed an MoU with the Karnataka government to invest $1.1 billion for establishing battery material manufacturing plants in the state, over a span of 10 years.  More than 90 per cent of graphite anodes are manufactured in China today, and Epsilon Advan­c­ed Ma­terials aims to support India in this energy transition journey with this investment in Karnataka.

We plan to forge strong partnerships with EV manufacturers and other stakeholders in the electric mobility ecosystem to collaborate on the development of new technologies and products that can accelerate the adoption of EVs and promote the growth of the industry.

We are committed to sustainability and responsible business practices, and we aim to minimise the environmental impact of our operations and products through the adoption of circular economy principles, responsible sourcing of raw materials, and the development of recycling and repurposing technologies for end-of-life batteries.