South Korea, Indonesia to ink pact to make electric car batteries

Jakarta (ANTARA) – South Korea’s LG Chem Ltd is expected to sign a cooperation agreement with Indonesia this week for developing lithium batteries for electric cars, said Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan.

“This week, if there is no change, LG Korea will also sign a cooperation (agreement) on developing electric car batteries,” he said at a webinar held by UGM on Tuesday.

The cooperation pact follows the signing of another agreement between China’s Contemporary Amperex Technology Co. Ltd (CATL) and Inalum for the development of lithium batteries for electric vehicles.

“So, I said yesterday, CATL was signed, [an agreement was inked] last week between CATL and Inalum for the manufacture of lithium batteries,” Pandjaitan said.

The Indonesian government is continuing to approach many parties, including big players in the electric vehicle battery industry, to invest in Indonesia, he added.

“Now, we are also approaching others, the big players,” he said.

The former Coordinating Minister for Political, Legal and Security Affairs said Indonesia wants to be a key player in the electric vehicle battery industry.

Indonesia has the largest nickel reserves in the world and is now starting to downstream nickel. It is hoped that the production of batteries for electric vehicles can begin by the end of 2023 or 2024.

Indonesia plans to produce NMC 811 (lithium nickel manganese cobalt oxide) batteries, in which nickel ore is the main raw material, the minister informed.

Pandjaitan said that Indonesia hopes to enter the global supply chain for electric vehicles through collaborations with other players in the electric vehicle battery industry.

“We should not only export raw materials, so we only depend on commodity prices. With a policy like this, we will not depend on it (commodity prices),” he noted.

Electric vehicles are considered to be one of the solutions for reducing the use of fossil fuels and maintaining air quality.

Indonesia had issued Presidential Regulation Number 55 of 2019 on Acceleration of the Battery Electric Vehicle Program for Road Transportation in August, 2019.

The regulation was followed by Government Regulation Number 73 of 2019 on Taxable Goods classified as luxury items in the form of motorized vehicles that are subject to Sales Tax on Luxury Goods (PPnBM).

In the fourth part of the regulation, the government regulated the PPnBM rate for four-wheeled motorized vehicles utilizing Plug-In Hybrid Electric Vehicles (PHEV) technology, Battery Electric Vehicles (BEV), or Fuel Cell Electric Vehicles (FCEV).

For this group of vehicles, the government set a tariff of 15 percent, with a tax base of zero percent of the sale price, given that fuel consumption is equivalent to more than 28 kilometers per liter, or CO2 emission levels reach up to 100 grams per kilometer.

A series of rules were then translated through four ministerial regulations. The Minister of Transportation issued Regulation Number 45 of 2020 on Certain Vehicles Using Electric Motor Drives.

The Minister of Energy and Mineral Resources (ESDM) issued Regulation Number 13 of 2020 on the Provision of Electricity Charging Infrastructure for Battery-Based Electric Motor Vehicles (BEV) and the Home Affairs Minister issued Regulation Number 8 of 2020 on Basic Calculations for Imposing Motor Vehicle Taxes and Transfer of Motor Vehicle Title Fees.

Meanwhile, the Minister of Industry (Permenperin) issued Regulation Number 27 of 2020 concerning Specifications, Development Roadmap, and Provisions for Calculating Domestic Component Levels of Domestic Motor Vehicles for BEV.

Source: Antara News