Why we invested in eTrnl Energy

Need for Innovation:

The world we see around us today is a by-product of the human quest to improvise. IC engines invented centuries ago are much more efficient today and many such innovations are constantly changing the way humans commute. Being dictated by necessity and the pursuit of making life comfortable, this aspiration is triggering environmental degradation and climate change, which could reach the point of no return due to harmful GHG emissions. As the transport sector alone contributes a quarter of these emissions, the government wants to switch towards cleaner alternatives - weighing heavily on going electric! The EV landscape today is at the cusp of much-awaited innovations to unleash an era of modernism interlinked with environmentalism.

The EV ecosystem is evolving in every aspect with multilateral participation from the government, startups, and established businesses - driving adoption in the true sense. Back in 2021, nearly a quarter of respondents admitted the lack of charging infrastructure is a barrier to EV adoption in the country, as per an industry survey. But as recently as the last quarter, almost 54% of surveyed respondents, were open to buying an EV, however, battery quality was a major concern. This is a paradigm shift in the consumer mindset!

The battery is the prime component of powering EVs. Newer EV manufacturers have a mentality of offering better battery specs in terms of higher range and fast charging capabilities to lure consumers, at the cost of battery efficiency and safety. Increasing reliance on cheap imported battery cells, battery testing not being exposed to actual climatic conditions, and rush to launch products in the market with limited R&D efforts leads to thermal mismanagement causing battery fire-safety incidents. Despite the competition among rival vehicle manufacturers and battery suppliers intensifying towards top-notch battery specs, battery technology is yet to witness an efficient tradeoff between safety, operational efficiency, and economic viability.

e-TRNL Energy’s Battery Proposition:

With a unique value proposition, e-TRNL’s solution primarily helps address battery-cell heat generation at source, tapping into the huge concern of battery safety today. They are introducing chemistry-agnostic and indigenized battery cell technology with a novel 3-dimensional battery cell structure design that offers minimal resistance during charging/discharging cycles. This optimal thermal management capability helps cater to innovation in terms of battery efficiency. The battery technology would be capable of offering 15-min fast charging, higher energy density, and reduced battery weight without suffering from cell life degradation. The patented battery-cell manufacturing process eliminates considerable QC-sensitive and Capex-heavy manufacturing steps offering better pricing economics at scale. It also helps address the grey space of indigenized manufacturing capabilities, aspiring for quality products, and reduced import dependency.

The startup is co-founded by Apoorv Shaligram and Uttam Sen. Apoorv is IIT-Roorkee and Michigan State University alumnus. He has earlier worked with Ather Energy, A123 Systems, SL Graham, and Mahindra Susten on battery-related developments and optimizations. He contributed to the development of Li-Ion pouch cell prototypes, helped set up the fabrication lab, and optimized the fabrication process while working at IIT-B. He jointly holds a patent for his work on low-cost cathode material synthesis. Uttam has done his PG and Ph.D. in energy storage systems from IIT-B. Earlier he worked with Ather Energy and Log9 Materials for setting up in-house labs for battery-cell research and manufacturing & assembly lines for supercapacitors. They have nearly 3 decades of combined experience and intend to usher innovations in the energy storage space.

Market:

The adoption of EVs for personal commutes as well as commercial purposes is increasing exponentially due to shifting consumer mindsets, lower operational costs, and the urge for product experience. EVs on road today has increased by nearly 15000 times, from 2.91k vehicles in FY14 to 10.91k in FY22. As per Vahan Dashboard and JMK Research, EV sales since FY14 have registered 225% y-o-y growth on average, considering the pandemic years! Growth might further magnify given the strong governmental push and rapid tech advancements.

Globally, Li-Ion battery prices have reduced to 1/10th compared to 2010 prices and would decrease further owing to tech innovations and optimizations. The Indian Li-Ion battery market is forecasted to grow at a current CAGR of 15.3% for the next few years and is expected to reach USD 8 Bn by 2030. It would continue to be one of the most commercially viable battery technology at least for the current decade with alternate chemistry discoveries catching pace.

As compared to the global estimated requirements of close to 1700 GWh by 2025, India will need close to 60 GWh battery capacity building driven by mobility requirements. As per secondary research, the combined operational battery manufacturing capacity of the country is close to 8 GWh annually. Traditional and new market entrants have set ambitious goals to grab a share in the budding battery manufacturing ecosystem with the government’s push via the PLI scheme, more details here.

Leading battery manufacturers - Exide and Amara Raja - account for 60% of the market share for Lead-acid battery variants and have announced investment plans of ₹15,500 Cr. for foraying into Li-Ion batteries - setting up R&D labs and manufacturing facilities over the next 8-10 years. Exide earlier formed JV with Switzerland’s Leclanche (Nexcharge) offering access to the market-ready battery and BMS products with required engineering resources but relying on imported battery cells. Recently it inked a long-term partnership with Chinese battery manufacturer SVOLT Energy to focus on R&D efforts and tech transfer for manufacturing Li-Ion cells in India. Along similar lines, Amara Raja has invested in Log9 Materials. Reliance New Energy has acquired UK-based Faradion and Netherland-based Lithium Werks.

Government Interventions:

The government has taken significant steps for promoting EV adoption through various initiatives and addressing concerns towards identifying pre-requisite industry practices for safer on-road products. Amendments to Battery Certification Rules have been made to strengthen battery testing and safety parameters. Promoting E2W adoption by increasing incentives from ₹10k/KWh to ₹15k/KWh under the FAME-2 policy. PLI scheme announcement for Advanced Cell Chemistry (ACC) and the increase in import duties of various EV components stimulate the building of an inclusive local EV ecosystem.

Why we invested in e-TRNL Energy?

We expect the startup to benefit from increasing EV adoption across categories. The product-market timing appears to strike balance between battery efficiency and microeconomic factors. Given the pedigree of the founders and research development-led approach, we are excited to partner with them in realizing this truly global opportunity toward a sustainable energy-powered future! Going forward, catering to anything and everything energy storage is the paramount vision for e-TRNL Energy.

We believe the mobility segment is at an inflection point and would introduce innovations and transformations that will reconfigure the automotive economy and the way we commute today. At CIIE.CO, we have backed other mobility startups including Chara, Delectrik, Cell Propulsion, Nunam, Clean Electric, Taqanal Energy, & ePlane, and are on a continuous lookout for disruptors who bring in different value propositions to solve a specific problem in the evolving landscape through technology backed innovation. We would love to add value to your journey. Write to us at seed.ciie@iima.ac.in and stay tuned for more updates from the innovation continuum.