The Cabinet, chaired by Prime Minister Narendra Modi, has approved the proposal for implementation of the Production Linked Incentive (PLI) scheme for advanced battery storage.
Proposed by Department of Heavy Industries (DHI), the “National Programme on Advanced Chemistry Cell (ACC) Battery Storage”, with an outlay of Rs.18,100 crore, aims achieving manufacturing capacity of 50 GWh of ACC and 5 GWh of “Niche” ACC.
The entire demand of ACCs in India is currently being met through imports.
ACCs are the new generation of advanced storage technologies that can store electric energy either as electrochemical or as chemical energy and convert it back to electric energy as and when required.
Application areas
The consumer electronics, electric vehicles, advanced electricity grids, solar rooftop etc. which are major battery consuming sectors are expected to achieve robust growth in the coming years. It is expected that the dominant battery technologies will control some of the world’s largest growth sectors, a government release said.
Current status in India
While several companies have already started investing in battery packs, though the capacities of these facilities are too small when compared to global averages, there still is negligible investment in manufacturing, along with value addition, of ACCs in India.
All the demand of the ACCs is currently being met through imports in India. The National Programme on Advanced Chemistry Cell (ACC) Battery Storage will reduce import dependence. It will also support the Atmanirbhar Bharat initiative.
How the PLI scheme works
ACC battery storage manufacturers will be selected through a transparent competitive bidding process. The manufacturing facility would have to be commissioned within a period of two years. The incentive will be disbursed thereafter over a period of five years.
The incentive amount will increase with increased specific energy density and cycles and increased local value addition. Each selected ACC battery storage manufacturer would have to commit to set-up an ACC manufacturing facility of minimum 5 GWh capacity and ensure a minimum 60 per cent domestic value addition at the Project level within five years.
Furthermore, the beneficiary firms have to achieve a domestic value addition of at least 25 per cent and incur the mandatory investment Rs.225 crore/GWh within two years (at the mother unit level) and raise it to 60 per cent domestic value addition within five years, either at the mother unit, in case of an integrated unit, or at the project level, in-case of “hub & spoke” structure.
Also read: Cabinet Approves PLI Scheme For High-Efficiency Solar Modules
Expected outcomes of PLI scheme
- Setup a cumulative 50 GWh of ACC manufacturing facilities in India under the Programme
- Direct investment of around Rs.45,000 crore in ACC battery storage manufacturing projects
- Facilitate demand creation for battery storage in India
- Facilitate Make-in-India: Greater emphasis upon domestic value-capture and therefore reduction in import dependence
- Net savings of Rs.2,00,000 crore to Rs.2,50,000 crore on account of oil import bill reduction during the period of this programme due to EV adoption as ACCs manufactured under the programme is expected to accelerate EV adoption
- The manufacturing of ACCs will facilitate demand for EVs, which are proven to be significantly less polluting. As India pursues an ambitious renewable energy agenda, the ACC program will be a key contributing factor to reduce India’s Green House Gas (GHG) emissions which will be in line with India’s commitment to combat climate change
- Import substitution of around Rs.20,000 crore every year
- Impetus to R&D to achieve higher specific energy density and cycles in ACC
- Promote newer and niche cell technologies
(Featured photograph sourced from www.advancedbatteriesresearch.com is for illustration only)
