The Union Cabinet on Wednesday approved Rs 18,100-crore production linked incentive (PLI) scheme ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’. This move aims to achieve manufacturing capacity of 50 Giga Watt Hour of ACC and 5 GWh of “Niche” ACC with an outlay of Rs 18,100 crore, the Union Cabinet said. 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. 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.
“The decision will promote Make In India, open up possibilities for Start-ups, create jobs, benefit various sectors like railways, shipping & help India become self-reliant,” said Jagat Prakash Nadda, national president, Bharatiya Janata Party (BJP).
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.
While several companies have already started investing in battery packs, though the capacities of these facilities are too small when compared to global averages, but there still is negligible investment in manufacturing, along with value addition, of ACCs in India.
ACC battery Storage manufacturers will be selected through a transparent competitive bidding process, the central government said. 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.
Each selected ACC battery Storage manufacturer would have to commit to set-up an ACC manufacturing facility of minimum five (5) GWh capacity and ensure a minimum 60% domestic value addition at the Project level within five years. Furthermore, the beneficiary firms have to achieve a domestic value addition of atleast 25% and incur the mandatory investment Rs 225 crore /GWh within 2 Years (at the Mother Unit Level) and raise it to 60% domestic value addition within 5 Years, either at Mother Unit, in-case of an Integrated Unit, or at the Project Level, in-case of “Hub & Spoke” structure, Union Cabinet said.
The scheme will facilitate direct investment of around Rs 45,000 crore in ACC Battery storage manufacturing projects. At least Rs 2,00,000 crore to Rs 2,50,000 crore will be saved on account of oil import bill reduction during the period of this scheme, the Cabinet said.
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,” Centre said adding that the scheme will promote newer and niche cell technologies.
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