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PLI Scheme For ACC Battery Storage Manufacturing
PLI Scheme For ACC Battery Storage Manufacturing
(http://www.india-briefing.com/)
Under the PLI scheme, selected ACC battery storage manufacturers must set up a production facility within two
years. The selection will be done via a competitive and transparent bidding process. The article outlines the PLI
scheme and eligibility criteria as well as how benefits will be rolled out.
On May 12, 2021, India’s central cabinet approved the proposal for the implementation of Production Linked Incentive (PLI)
Scheme ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ (NPACC). An outlay of INR 18,100 crore
(US$2.49 billion) has been earmarked by the government towards the scheme, which is intended to establish local
manufacturing capacity of 50 Giga Watt Hour (GWh) of ACC and five GWh of Niche ACC capacity.
The main implementing agencies for the scheme are the Department of Heavy Industries and NITI Aayog.
Under the PLI scheme, ACC battery manufacturers will be selected through a competitive and transparent bidding process,
and selected beneficiaries will have to set up a manufacturing facility within two years.
The incentives under the PLI scheme will be disbursed over a fixed period of five years, from the time of commissioning of the
manufacturing facility. This is expected to achieve economies of scale and boost exports, thereby helping large domestic and
international manufacturers in setting up a globally competitive ACC battery set-up in India. This in turn is important for the
growth of the homegrown electric vehicle (EV) industry (https://www.india-briefing.com/news/electric-vehicle-
industry-in-india-why-foreign-investors-should-pay-attention-21872.html/).
Each selected ACC battery Storage manufacturer to set-up an ACC manufacturing facility of minimum 5 GWh capacity,
achieve a domestic value addition of at least 25 percent and incur the mandatory investment INR 225 crore (US$31.02
million) /GWh at ‘Mother Unit Level’ within two years.
The ACC battery manufacturer will need to ensure a minimum 60 percent domestic value addition at the Project level
within five years.
The incentive will be disbursed over a period of five years. It will be paid out on the basis of energy efficiency, sales,
battery life cycle, and localization levels.
The scheme proposes that the relevant state government, central government, and manufacturer enter into a tripartite
agreement where the state government will support the private sector by providing land for setting up the facility,
assisting in procuring permits and licenses, providing trunk infrastructure etc.
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1/27/22, 10:35 PM India’s PLI Scheme for ACC Battery Storage Manufacturing
Under the scheme, a quality and cost-based selection (QCBS) method will be used to evaluate bids where both the
subsidy quoted and the value addition offered by the bidder would be taken into account during the selection process.
The selection process will be competitive and transparent.
Facilitate Make-in-India and Atmanirbhar Bharat, thereby emphasizing domestic value capture and reduction in import
dependence.
Facilitate demand for EVs, which are proven to be significantly less polluting. One of the key agendas for ACC battery
storage will be to reduce India’s Greenhouse Gas (GHG) emissions.
Import substitution of around INR 20,000 crore – INR 25,000 crore(US$2.76 – US$3.45 billion) every year, on account of
oil imports as this scheme is expected to accelerate EV adoption in India.
Impetus to research and development to achieve higher specific energy density and cycles in ACC.
So far, 10 companies have submitted their bids under the scheme. They are:
Lucas-TVS Limited
The selected beneficiary companies will have the liberty to choose suitable advanced technology and the corresponding plant
and machinery, raw material, and other intermediate goods for setting up cell manufacturing facilities.
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1/27/22, 10:35 PM India’s PLI Scheme for ACC Battery Storage Manufacturing
The NPACC PLI scheme will aid local capacity building in core competent technologies to make India a hub of clean energy. It
will reduce excessive dependence on imports, including from China. A boost to local employment is another vital outcome.
This article was first written on May 28, 2021. It was last updated on January 20, 2022.
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