LSIP_Report_Shrish Somani_140101169.doc

Market research for New product launch: Eco Grid ESS

By

Shrish Somani

October, 2015

Market research forNew product launch: EcoGrid ESS

By

Shrish Somani

Under the guidance of

Mr. Siddhartha Mathur Dr. Tripti Ghosh SharmaAssistant Area Manager Assistant Professor – MarketingAcme Cleantech Solutions Ltd. IMT, Ghaziabad

October, 2015

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Certificate of Approval

The following Summer Project Report titled "Market research for new product launch: EcoGrid ESS" is hereby approved as a certified study in management carried out and presented in a manner satisfactory to warrant its acceptance as a prerequisite for the award of Post-Graduate Diploma in Management for which it has been submitted. It is understood that by this approval the undersigned do not necessarily endorse or approve any statement made, opinion expressed or conclusion drawn therein but approve the Summer Project Report only for the purpose it is submitted.

Summer Project Report Examination Committee for evaluation of Summer Project Report

Name Signature

1. Faculty Examiner _______________________ ___________________

2. PG Summer Project Co-coordinator _______________________ ___________________

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Certificate from Summer Project Guides

This is to certify that Mr. Shrish Somani, a student of the Post-Graduate Diploma in Management, has worked under our guidance and supervision. This Summer Project Report has the requisite standard and to the best of our knowledge no part of it has been reproduced from any other summer project, monograph, report or book.

Dr. Tripti Ghosh Sharma Mr. Siddhartha Mathur Assistant Professor - Marketing Assistant Area ManagerIMT, Ghaziabad Acme Cleantech Solutions Ltd.

Plot No.152, Sector 44, Gurgaon, IndiaDate Date

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Abstract

Market research for new product launch: EcoGrid ESS

By

Shrish Somani

For decades, lead-acid battery technology has been the player in providing power backup storage. This requires regular watering to maintain electrolyte levels and harms the environment by releasing lead fumes. Researchers have been looking for smarter solution with green technology and zero maintenance. Lithium ion battery technology provides both. ACME Cleantech solution has implemented the benefits of LIB technology in power backup solution and discovered an innovative product called “EcoGrid ESS” which will work at 95% efficiency which means this ESS will be nearly at par with the cost of grid power to the customer. Apart from LIB technology EcoGrid ESS is a combination of a high end inverter which is capable of providing Power Conditioning and Battery Management System. As lithium ion batteries are imported and not manufactured in India EcoGrid came with a cost disadvantage. Many industries, which required high specification of power backup for an industry level load are ready to pay premium for the unique benefits. But, acceptance of 5 KVA/48V EcoGrid ESS at premium price is yet to be examined.

To validate the acceptance of different value propositions offered by Ecogrid and willingness to buy the product is a prerequisite before launching the product in Indian market. Different power deficient regions were identified and Surveys were conducted. Scope of this project is limited to only Jaipur and Ranchi area over different segments like Medical (Private clinics and hospitals), Hotels/Restaurants, Small and Large commercials etc. Surveys were conducted offline on an one to one basis over a duration of five months in different areas of Jaipur & Ranchi like Vaishali Nagar, C-Scheme, M I Road, Tonk Road, Main Road, Bani Park, Mansarovar etc.

The major findings are:

1) Jaipur has good electrical supply from the grid and power cut-offs are less. On the other hand, Ranchi has major power fluctuation and frequent power cuts.

2) People prefer a power backup solution which not only provides power backup for more time but also has a low charging time.

3) Most of our respondents were not aware about the benefits of LIB technology.4) Backup time offered, low maintenance, charging time and battery life are some major

parameters which people look for while buying a power backup solution.5) Many people are reluctant to high initial investment.

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Acknowledgement

I am deeply indebted to my company mentor, Mr. Siddharth Mathur (Assistance Area Manager, Acme Cleantech Solutions Ltd.) for being immensely helpful during the course of this internship and for guiding me in understanding the various aspects of my project work. His mentoring helped me to structure my thoughts well and bring the project to its present form.

I am thankful to my faculty mentor Prof. Dr. Tripti Ghosh Sharma for his constant support and encouragement throughout the course of internship. The guidance was very vital, in my on learning for the project, and thus eventually leading to producing the required results.

I am also indebted to Library Members, IMT Ghaziabad for maintaining e-resources of the library where I was able to get some very important research papers which helped me during the course of my internship and also a thanks to other members of Acme Cleantech solutions Ltd. for their continuous support and help.

Shrish Somani140101169IMT Ghaziabad

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Table of Contents

Page

Abstract 5Acknowledgement 6Table of Contents 7List of Figures 8List of Appendices 9List of Abbreviations 10

I INTRODUCTION 11

1.1 About the Company 111.2 About EcoGrid 12

1.3 Competitive Analysis 16 1.4 Technical Specifications 18

II RESEARCH PROBLEM 19

III RESEARCH DESIGN 20

3.1 Methodology 203.2 Data Sample 203.3 Data Collection Procedure 203.4 Data Analysis 203.5 Interpretation 21

IV RESULTS AND CONCLUSIONS 27

V RECOMMENDATIONS 28

VI REFERENCES 34

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List of Figures

Figure No. Description Page

1 EcoGrid product description 12

2 Functions of EcoGrid 15

3 Comparison of EcoGrid with DG and Inverter 16

4 Benefits of EcoGrid against DG and Inverter 17

5 Technical Specifications 18

6 Power outage per day in Jaipur/Ranchi 21

7 Power outage cycles per day in Jaipur/Ranchi 22

8 Solution used chart 23

9 Number of batteries in case of Lead Acid battery 24

10 Awareness of use of LiB 24

11 Important parameters while purchasing power backup 25

12 People who suggested power backup solution 26

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List of Appendices

Appendix No. Description Page

1 From Li-ion Cylindrical Cell to Battery Enclosure 29

2 Technical Specifications 29

3 Specification of Single Cell, SUB and Tray 30

4 Temp. Performance: LiB vs. Lead Acid 30

5 Better Chemistry NCM Vs. LFP 31

6 EcoGrid product Description 31

7 Questionnaire 32

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Abbreviations

Abbreviation Description

LIB Lithium ion Battery

ESS Energy storage system

PIU Power Interface Unit

SPM Smart Power Management

DCPH DC Power House

PCM Phase changing material

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CHAPTER I

INTRODUCTION

1.1 About the company

Acme CleanTech Pvt. Ltd. is a leader in the power interface equipment for wireless information transfer in the telecom and alternate energy sector. It has developed several solutions that are Environment friendly, cost effective and energy efficient.ACME group was founded by Mr. Manoj Kumar Upadhyay in 2003 as ACME Tele Power Ltd. and is driven by his vision for intense R&D and new product development. ACME has presence in 8 countries including India and has offices in 18 states in India employing over 10,000 people. Capitalizing on the innovation, technology and manufacturing strengths as well as greater access through its reach ACME has presence in 5 businesses: Telecom, Solar, Defense, Storage System and PUF. Out of these ACME is the forerunner in Telecom and Solar sectors. The Values of the firm have been derived out of its continuous innovative and customer centric nature, which are Customer Centric, Innovation, Respect, Continuous Learning and Execution Excellence.

ACME Telecom: With its extensive reach, ACME Telecom has enabled the telecom sector to reach the farthest and most interior parts of the nation while reducing the carbon emission levels of the telecom sector. ACME’s products have been installed at over 150,000 towers across India, which is about 33% of the market share.

ACME Solar: It is a joint venture between ACME group and EREN and is committed to setting up large grids solar power plants. The company has a portfolio of over 850 MW of solar power plants in different states. It has pioneered the solar thermal power plant based on Tower Technology, the first of its kind in Asia. The company aims at generating 7500 MW by 2017. It also provides small scale solar solution for rooftops.

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1.2 About Eco Grid

(Figure 1: Features of EcoGrid)

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EcoGrid Energy Storage System (ESS) Highlights:

1. Green Technology: Due to use of Lithium-ion based storage technology it is a Green Technology. It is Environment friendly and has a ZERO carbon footprint whereas Lead acid systems and DG sets cause a lot of pollution and health issues as a result of emission of poisonous fumes.

2. Longer Life: The life cycle of LiB is about 10 years which makes LiB system a more stable and long lasting solution in comparison to the LA battery which on an average has a life of 2.5 years.

3. Fast Charging: EcoGrid takes only 1.5-2 hours to fully charge froma state of full discharge which makes it about 4 times faster than its counterparts with same load capacity.

4. Zero Maintenance: EcoGrid actually requires zero maintenance while LA batteries require regular maintenance in the form of water topping, acid topping etc. and DG sets require servicing as well as diesel on day to day basis.

5. Compactness: EcoGrid ESS is a compact and lightweight solution with a very less footprint as compared to DG or similar capacity inverters.

6. Weight: In ESS LiB battery trays weigh only 18 Kg, about a third of LA solutions.

7. Battery Management System (BMS): EcoGrid ESS comes along with in-built battery management system which monitors and operates system Equalization of batteries

8. Depth of Discharge: The LA Battery can be drained up to when 20% charge remains and further use takes the battery in state of deep discharge while EcoGrid can be discharged completely without any deep discharge state.

9. Powered Conditioning: EcoGrid ESS also conditions the power wave and phase to improve the quality of power that is delivered to the load by specifically working to smoothen the sinusoidal A.C wave form and maintain a constant level voltage even over different loads.

10. High Efficiency: In EcoGrid’s efficiency is higher compared to LA system and DG set. DG usually has an efficiency of about 25%, lead acid battery has an efficiency of about 70% .At the same time LiB provides efficiency of 95%. That means ESS is nearly at par with the cost of grid power to the customer.

11. No Health Hazards: Lead acid as well as DG set can cause serious damage not only to the environment but their toxic emissions can also lead to serious health problems and complications like respiratory problems, Asthma and can even lead to Cancer.

12. Aesthetics: EcoGrid is available in a modular trolley which is available in different colors to match the interiors of a home or office.

13. Service: PAN India 24 x 7 service network is available. An ACME technician is available at every 2.5Km and is always just a call away on 24x7 helpline number.

14. Finance: Easy and hassle-free finance on lowest rate of interest available with us through reputed banks.

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EcoGrid is the best solution for most of the power shortage problems both for homeowners as well as business owners. It not only acts as a fool proof backup to utility power, which is prone to the flickers, voltage spikes and power surges that kill high-end AV components. With uninterrupted power output and surge protection for selected circuits, one doesn’t need to worry for its appliances or power —or other systems that sustain your lifestyle and habits—thanks to reliable energy.

EcoGrid solves commercial problems by eliminating the need for a contingency plan on mission critical systems. The system is also an online UPS and eradicates general power problems and improves quality of supply, such as data crashes and failing circuits, thus keeping the machinery safe and customer happy.

EcoGrid ESS helps protect the environment by incorporating solar integration.

EcoGrid ESS is ideal for places like Residential Apartments/Villas Showrooms Banks & ATM Restaurants & Clubs Small Offices Spas & Breweries Educational Institutions Government Buildings Commercial Establishments Specialty Clinics & Pathology Labs Cable Operators Recreation Facilities & Bowling Alleys

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(Figure 2: Functions of EcoGrid)

ACME offers the country’s first of its kind high energy density power back-up solution. EcoGrid Energy Storage System (ESS), provides users with the ultimate reliable power experience, based on a proven sustainable Lithium-ion based storage technology. ACME’s game-changing EcoGrid ESS is a result of continuous innovation to develop revolutionary green technology solutions for varied users for any conceivable need of energy.

EcoGrid ESS is a magnificent addition to the home energy needs that combines the appeal of green energy, the convenience of backup power and the strength of a high-end storage system backing it all up for the uninterrupted running & long-life of appliances that are important to us. This advanced residential energy storage solution is also ideal solution for schools, hotels, offices, hospitals, homes, showrooms, restaurants, spas and much more. ACME’s EcoGrid ESS addresses problems such as these. It ensures continuous power and reliability, by acting as a back-up power supply in the event of grid fluctuations or complete power cuts.

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1.3 Competitive analysis

(Figure 3: Comparison of EcoGrid with DG and Lead Acid Battery)

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(Figure 4: Benefits of EcoGrid against DG and Inverter)

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1.4 Technical Specifications

(Figure 5: Technical Specifications)

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CHAPTER 2RESEARCH PROBLEM

The primary research problem for ACME Cleantech Solutions was to validate its product EcoGrid as a complete power backup solution in Jaipur/Ranchi before making a pan-India launch. Some of the research problems identified during the market research project are listed below: 1) To check the current power condition in Jaipur/Ranchi so as to study the need of 5 KVA/48V power backup solution in near future

2) To find alternative power backup solutions used in Jaipur/Ranchi

3) To identify all the important parameters which influence consumer buying decision

4) To spread awareness of Lithium ion batteries and its benefits in power backup sector

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CHAPTER 3RESEARCH DESIGN

3.1 Methodology

Methodology used was survey based where a pre-determined questionnaire was prepared by the respondents to collect offline data. Respondents conducted the market survey by visiting and collecting data through a one to one interaction. The main aim for using this method was for data collection along with product awareness.

3.2 Data Sample

Survey was conducted in Jaipur/Ranchi in many areas like Vaishali Nagar, C-Scheme, M I Road, Vidyadhar Nagar, Bani Park, Malviya Nagar, Main Road, Tonk Road, Mansarovar, Railway Station Road etc. for five months across varied segments. These areas represented various industries as well as faced different power outages which were studied by the respondents.

After identifying the regions of Jaipur/Ranchi, the next step followed identifying the doctors, owners/staffs of Hotels/Restaurants and owners of Small commercials by convenient sampling. The total sample size taken was of 345 respondents for the study.

3.3 Data Collection Procedure

Primary Data: Quantitative data was collected by questionnaire during the process. Different segments of respondents were targeted for survey during the span of five months. The initial survey was conducted for medical segment which included all private clinics and hospitals were targeted. The medical segment was followed by Hotels/Restaurants, small/large commercials and Residents in various parts of Jaipur/Ranchi. The questionnaire was designed by the respondents with an intention to capture main information only. The questionnaire was created in a manner which was crisp but also gathered all the relevant information. A long questionnaire may irritate the respondent, so it was made short and to the point. The responses which were recorded had been thoroughly analyzed. Conclusions had been arrived at using the responses.

Secondary Data: During our research project, secondary data was used and gathered from various technical journals from India’s power backup industry, literature and Internet.

3.4 Data Analysis

The data collected through Questionnaire was processed through 4 steps: editing, coding, tabulation and analysis. Necessary correction was made to collected raw data to omit Errors(if any), a standard set of codes were followed to convert data in to numerical format for statistical analysis, Large number of heterogeneous data was grouped in to meaningful categories and finally data analysis was carried out.

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Segment Number of surveysMedical 97Hotel/Restaurant 188Small Commercial 99Residential 15Large Commercial 27Educational Institute 17Total 443

3.5 Interpretation

Objective1: To study the need of power backup solution in Jaipur/Ranchi by checking the current power condition

(Figure 6:Power outage per day in Jaipur/Ranchi)

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(Figure 7: Power outage cycles per day in Jaipur/Ranchi)

Interpretations:

1) In Jaipur, 73.4% of respondents are of the view that they face power outage of less than 2 hours per day. Most of the commercial businesses already have a backup generator or inverter installed. People in Jaipur generally don’t use much of power backup solutions as they face less power cuts.

2) Almost 71% respondents say power outage frequency to be once a day. Jaipur has decent power supply which reduces the no. of outage cycles. Duration of power cut is generally for about 8-10 minutes. Due to these conditions, consumers don’t want to upgrade their existing backup solutions and new customers are delaying their purchase as they don’t require it on a daily basis.

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Objective2: To study existing power backup solution used by customers

(Figure 8: Solution used chart)

Interpretations:

1) 60% of respondents surveyed already used Diesel Generator at their commercial place. Only 16.8% of respondents had installed lead-acid battery inverter whereas 15.6% used none of these solutions and around 7% used both these solutions. Most of the respondents preferred Diesel Generators as they provide continuous power backup for long period of time while Inverters provide power backup for limited period of time. Drawback of Diesel Generator is its low efficiency and high maintainance while inverter is also associated with a reoccuring cost of its lead-acid batteries.

2) Ecogrid comes with a specification of 5KVA/48V while Generators are generally of a higher specification than this. Inverters used are of lower specifications usually in the range of 650VA-1.2KVA. Target segment is generator users with specifications close to 5KVA and Inverter users who may upgrade their backup solution to a 5KVA Ecogrid.

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(Figure 9: Number of Batteries in case of Lead Acid battery)

Interpretations:

Among the Inverter and lead acid battery users, 72% of respondents use less than 4 batteries for their inverter. 24% of the respondents use 4 batteries. Each battery is of 12 V connected in a series i.e a 48V system with 4 batteries. Our target market was identified as those 24% who use a battery system of 48V.

Objective3: To gauge awareness of Lithium ion battery in power backup solution

(Figure 10: Awareness of Use of LIB in Powerbackup system)

Interpretations:

Most of our respondents were not aware about the use and benefits of Lithium ion battery in power backup solution. Less than 15% of the total respondents were aware about it but most of them were not aware of the harmful effects of Lead Acid batteries.

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Objective 4: To find important parameters that influence buying decision

Respondents were asked to rank different parameters that influence their decision while buying a power backup solution. Parameters were ranked from 1 to 7 where 1 is the most preferred parameter and 7 is the least preferred parameter.

(Figure 11: Most important Parameter while purchasing a power backup solution)

List of parameters:

Backup Time offered, Footprint (space occupied), Low maintenance, Health hazards, Charging Time, Life of battery, Total price

Interpretations:

1) The most important parameter for respondents was Price (53%), which was followed by Battery Life (11%) and Power backup Time (10%).

2) Customers generally look for cost effective solution which can cater their requirements. They always prefer a solution with the lowest price. Initial cost for procuring that solution has a huge impact on consumer buying behavior.

3) Despite EcoGrid being portable and half the size of a Diesel Generator, it could not become a leading factor in consumer buying behavior (Footprint).

4) Consumers who use inverters are concerned about the power backup time offered. In case of inverters, backup time offered reduces gradually in 3-4 years as batteries begin to dry out and customer needs to replace them.

5) Customers look for low maintenance DG or inverter. In case of DG, they hold an AMC (Annual Maintenance Cost) which overall increases the cost of DG.

6) Health hazards do not influence much in consumer buying decision. Lead acid batteries releases lead fumes which the customers are not aware of.

7) Since power cuts in Jaipur are less, customers are not very concerned about the charging time of battery. However, in a place like Ranchi, power cuts were very frequent as they are not able to charge their batteries at times.

8) Many consumers are aware of the importance of battery life that they expect out of their solution. Less power cuts automatically increases the battery life of a DG/Inverter, which is an added benefit to the warranty/guarantee already provided by the company.

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(Figure 12: People who suggested Powerbackup solution)

Interpretations:

More than 60% of the respondents take theie own decisions based on their requirement. Around 17% of consumers are influenced by shopkeepers in making the final decision. Many consumers even consider referring to their Electricians/Architects for a compatible solution.

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CHAPTER 4RESULTS AND CONCLUSIONS

1) In Jaipur, power conditions are adequate and both frequency and duration of power cuts are less. These conditions deter the existing customers to upgrade their backup solution and deters new customers from purchasing a backup solution. However in case of Ranchi, power outages are more both in terms of duration and frequency. Most of the respondents already have a backup solution installed in the form of small DG or inverters.

2) Another reason why consumer delays purchase of a backup solution is because of the low maintenance cost and operational cost incurred by Jaipur respondents. Less power cuts also result in increased battery life of inverters which further deters the purchase.

3) EcoGrid is a clean and efficient solution to power cuts but cost of the product is almost three times of the current solutions available in market. From our interpretations, price is the most important attribute which shaped a customer’s purchasing behavior. With this high cost, customers showed unwillingness to purchase this product at this point of time.

4) EcoGrid serves a very niche market in 5KVA segment. They have less scope in this segment as diesel generators are either more than 10KVA or less than 5KVA. Also, EcoGrid can provided backup for a limited period of time while generators can supply continuous power for longer durations. In areas where the power cuts are less, it reduces the operational cost of diesel generator and customers remain satisfied with their current solution.

5) Consumers who opt for inverter as their power backup solution prefer it with specification ranging from 650VA to 1.2KVA. This range generally caters to most of their basic commercial needs. Inverter provides power backup of 2-3 hours (depending on the usage) with its charging cycle of 6-8 hours. Inverters also require timely maintenance for water refill. In comparison, EcoGrid provides a lifecycle of 10 years (or 4000 cycles) and has faster charging cycles.

6) The benefits that EcoGrid did not create much effect on consumer purchasing decision. EcoGrid, despite being Green technology and highly efficient as compared to DG and Inverter has a high cost. As price is the primary parameter in decision making, customers showed less concern about the health hazards caused by lead acid batteries.

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CHAPTER 5RECOMMENDATIONS

The following are some recommendations for ACME Cleantech solutions Limited based on the results of the market research:

1) ACME should introduce a product for the lower specification segment. Small commercial and residential places prefer a power backup solution ranging from 650VA to 2.2KVA. This is the category where consumers might be willing to pay higher price for the added benefits of long battery life, efficiency, green technology etc. This segment is the largest in terms of number and ACME should launch a product catering to this particular segment.

2) In order to cater to higher segments (5KVA and above), ACME needs to lower its price of EcoGrid. It is costing three times of the current backup solutions available in the market. Large commercials look for a cost benefit solution which is compatible as well as assist their business.

3) ACME should create a distribution channel or use an existing one to sell EcoGrid. Shopkeepers play a major role in influencing customer decision making. Direct selling may not work for EcoGrid as customers are not aware of the product and are not ready to pay a premium price for it.

4) EcoGrid provides an assured battery life of 10 years and warranty for 3 years. In order to compensate the high cost, they should design a package of services which provides a claim for 10 years of battery life.

5) Specifiers (Architects, Engineers, Interior Designers etc.) play a decent role in influencing product purchase in this category. ACME should target and promote EcoGrid among these specifiers to reach out to customers in need.

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Appendices

Appendix1: From Li-ion Cylindrical Cell to Battery Enclosure

Appendix2: Technical Specifications

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Appendix3: Specification of Single Cell, SUB and Tray

Appendix4: Temp. Performance: LiB vs. Lead Acid

Appendix5: Better Chemistry NCM Vs. LFP

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Appendix6: EcoGrid product Description

Appendix7: Questionnaire

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CHAPTER 6REFERENCES

Books

Zikmund, W.G.; Babbin, Barry J.; Carr, Jon C. and Griffin, Mitch (2013), BusinessResearch Methods, South-Western CENGAGE Learning, USA.

Article in a Newspaper

Business Wire (2014), Research and Markets: Power Backup Market in India 2014, Business Wire, Mar. 27, pp. 5-6.

James Niccolai(2015), Microsoft slashes backup power costs with lithium-ion batteries, Computerworld, Mar. 10, pp. 5-6.

Websites

http://www.acme.in/businesses.php?id=24

http://www.saftbatteries.com/press/press-releases/saft-shows-latest-li-ion-battery-technologies-renewable-energy-storage-and

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