Japan’s Softbank Group is set to invest up to US$3 billion in launching a pilot lithium-ion batteries production facility in Indonesia as part of an “ecosystem” project.
Softbank CEO Masayoshi Son confirmed the move after talks with Indonesian president Joko Widodo and senior ministers, the president’s office announced.
Softbank, which already has investments of around $2bn in the country, wants to work with Indonesia’s Grab corporation to produce batteries for electric vehicles, motorbikes and buses and charging stations, the president’s office said.
No starting date or other details of the battery project were disclosed, but maritime affairs minister Luhut Pandjaitan said there was an agreement the pilot plant should be completed within three years. He said the ecosystem project could also include R&D for domestic production of solar, wind and biothermal technology.
Just days after the Softbank announcement, president Widodo approved a package of incentives aimed at tempting electric vehicle battery makers and auto firms to set up business in the country.
Widodo said Indonesia had all the key “battery ingredients” needed to establish the country as an EV manufacturing hub for the region— and his presidential regulation would offer investors tax breaks and other incentives.
He said batteries were an “essential element” in the production of EVs, adding: “We have all of the minerals, like manganese, cobalt and so on to produce the battery. With business strategies we can arrange and initiate an electric car industry that produces highly-competitive and affordable products as we already have the materials here.”
Widodo acknowledged that developing an electric car industry “may take longer than two or three years”, but he said such vehicles would also help tackle pollution in major cities such as Jakarta.
The president said he had ordered ministers to start by evaluating incentives for the development and use of battery-powered buses and taxis on the streets of Jakarta.
As of 2016, Indonesia had 3.2 billion tonnes of nickel reserves, according to a 2018 report published by professional services firm PWC, based on data from the Ministry of Energy and Mineral Resources.
Meanwhile, local media reported that Indonesia’s state-owned oil and gas firm PT Pertamina also plans to start producing EV batteries.
Last year, Softbank signed a deal to acquire a stake of nearly 10% in Canada’s Nemaska Lithium.
The conglomerate’s renewables division, SB Energy, had previously worked with Mitsubishi UFJ Leasing on a 102MW solar PV project combined with 27MWh of lithium-ion battery storage.