Fluence Considers Setting Up Battery Energy Storage System Manufacturing Base in India
Fluence, a major US-based energy storage solutions provider, is considering establishing a manufacturing base for battery energy storage systems (BESS) in India. This move aligns with India's ambitious renewable energy targets and the growing demand for grid-scale energy storage solutions.
Fluence, a joint venture between Siemens and AES, has been active in the Indian market since 2018, recognizing the country's potential for renewable energy growth and the need for effective energy storage. The company has already made significant strides in the Indian market, including delivering the country's first operational grid-scale energy storage system in 2019.
The company's interest in establishing a manufacturing base in India stems from several factors, including India's commitment to achieving 500 GW of clean power capacity by 2030 and its focus on integrating renewable energy into the grid. Battery storage is considered crucial for balancing the grid and optimizing solar and wind output, making it an essential component of India's renewable energy strategy.
While Fluence aims to localize its products in India as quickly as possible, the process of manufacturing batteries is complex and may take time. According to Julian Nebreda, President and CEO of Fluence, the company plans to fully localize its products in India by the end of 2024, but battery manufacturing may not begin until 2025 or 2026. In the meantime, Fluence intends to import batteries while manufacturing other components of the storage system in India. Batteries account for approximately half the cost of energy storage projects, so this phased approach will allow Fluence to gradually increase its local manufacturing capabilities.
In line with its growth strategy in India, Fluence has already established a Global Innovation Center in Bangalore, which the company says is its largest and fastest-growing hub worldwide. This center focuses on areas such as enclosure, battery and inverter engineering, and software quality assurance, and also supports product development. The technology center is also expected to support Fluence's joint venture with ReNew Power, an independent power producer in India. The joint venture aims to provide localized energy storage solutions to customers across India, including engineering, procurement, and construction (EPC) and asset management services.
The establishment of a manufacturing base in India would further solidify Fluence's commitment to the Indian market and enable it to better serve the growing demand for energy storage solutions. By localizing production, Fluence can reduce costs, shorten lead times, and create jobs in India, contributing to the country's economic growth and its transition to a cleaner energy future.
