On September 22, a media report said that Tesla had made plans to produce and sell battery storage systems in India and submitted a proposal to local officials to build a factory.。

"Automobile factory" becomes "energy storage factory"？

Tesla has been in talks with Indian authorities for weeks about setting up a new homegrown electric car factory。But now the plan seems to have changed, from building an electric car factory to a battery energy storage factory。

At a recent meeting in New Delhi, Tesla proposed building a factory in India to produce "Powerwall" as a way to support the country's battery storage capacity, the sources said.。

Tesla's Powerwall is about a meter high and can be hung from a garage or outside a house。The device can store power from solar panels or the grid for use at night or during power outages。

The Powerwall plant is part of Tesla's plans to expand its presence in India, where Tesla will focus on finding residential and industrial customers for its battery storage systems.。

The source also said that Tesla also hopes to seek a number of incentives from the Indian government to build the battery storage plant, but Indian officials have said that the Indian government will not provide incentives.。But Indian officials added that the government could indirectly provide incentives by offering subsidies to people who buy such products, which could also create a fairer business model.。

It is understood that the Indian authorities attach great importance to this matter, and there are even reports that Indian Prime Minister Narendra Modi will ask about the progress of the project.。However, the matter is still under discussion at this stage and the Indian authorities will continue to review the proposal, and it is not yet clear whether the plan will eventually come true.。

At this moment。Last year, Tesla was still trying to get a reduction in import taxes on electric vehicles shipped to India, but the negotiations did not produce effective results and things ended up going nowhere.。But this year, Tesla's attitude suddenly changed and began to consider building a factory in India.。

Tesla's attitude change may be "coveting" India, a market with great potential。India overtook Japan as the world's third-largest car market earlier this year, but the country's domestic electric vehicles currently account for less than 2% of total car sales.。

In order to deeply expand the Indian market, Tesla and the Indian government have had many contacts in recent months。

Back in May, there were reports that Tesla executives had visited India and held talks with officials about setting up a car and battery manufacturing base there.。In June, Tesla CEO Musk met with Modi, during which Musk said Tesla intended to make a major investment in the country.。At the end of July, Tesla representatives went to India to meet with the Indian Minister of Commerce。

After many discussions, the probability of Tesla building a factory in India is also getting bigger and bigger.。As for why Tesla has changed from the original plan to produce electric vehicles locally to the current production of battery energy storage products such as Powerwall, it is mainly related to the national conditions of India.。

If you want to drive a tram, you need electricity first.

Powerwall's march into India has strong practical implications。

Currently, India still relies on coal for electricity。Last year, India faced its worst power crisis in more than six years due to coal transport problems.。

India increases power supply in towns and villages to tackle 'hard to use' electricity。But the government's power supply is far behind the speed of residential electricity.。India still faces peak-hour power shortages amid surging demand。

The lack of widespread adoption of solar energy, coupled with the government's slow progress in increasing installed coal and hydropower capacity, further increases the risk of power outages.。The country aims to increase non-fossil fuel power generation capacity from the current 186GW to 500GW by 2030.。

Under the condition of insufficient power, it is difficult for India's electric vehicle penetration rate to increase substantially。After all, in the case of limited electricity, it is certainly a priority to protect other basic industrial production and residential electricity demand.。Only when the power is increased to a certain extent, can we consider powering the car and release the demand for electric vehicles。

For India, energy storage technology is expensive and the penetration of related equipment is extremely low。Modi learned about Powerwall when he visited Tesla's California campus with Musk in 2015, and he later said he enjoyed discussing how battery technology could help farmers.。

The sources said the two sides are discussing the Powerwall plant construction project, which is expected to initially provide electric energy storage for homes and light businesses.。If the plan achieves good results, Tesla may consider developing a larger power reserve for industry, but it has not been discussed in depth.。

Indian officials also said during discussions on the project that Tesla would have to work to reduce the cost of its battery storage products, adding that the government could help unlock market demand.。

Currently, the Powerwall sells for more than $5,500 in California (with the additional cost of solar panels) under incentive subsidies.。In the United States, Powerwall is eligible for federal tax credits and local state and utility incentives for solar and energy storage.。