Cabinet Approves PLI Scheme For ACC Battery Manufacturing


Under the PLI scheme, the government hopes to achieve direct investment of around Rs.45,000 crore in ACC battery manufacturing

The Cabinet has approved the production-linked incentive (PLI) scheme for the manufacturing of advanced chemistry cells (ACC) battery storage. It has a budgetary outlay of Rs.18,100 crore for achieving a manufacturing capacity of fifty (50) GigaWatt hour (GWh) of ACC and 5 GWh of ‘Niche’ ACC

“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. 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,” the Cabinet said in a statement. 

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 a negligible investment in manufacturing, along with value addition, of ACCs in India, the statement said. 

Under the PLI scheme, the government hopes to achieve direct investment of around Rs.45,000 crore in ACC Battery storage manufacturing projects, and import substitution of around Rs.20,000 crore every year, in accordance with the ‘Atmanirbhar Bharat’ initiative to put greater emphasis upon domestic value-capture. 

It also expects a boost in electric vehicle (EV) adoption following the implementation of this scheme, which would reduce oil imports and help save Rs. 2,00,000 crore to Rs.2,50,000 crore. 

Additionally, the Cabinet said, “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.”

Each selected ACC battery Storage manufacturer would have to commit to set-up an ACC manufacturing facility of a minimum of five (5) GWh capacity and ensure a minimum of 60 per cent domestic value addition at the project level within five years, the statement added. 

Furthermore, the beneficiary firms have to achieve a domestic value addition of atleast 25 per cent and incur the mandatory investment of Rs 225 crore /GWh within 2 Years (at the Mother Unit Level) and raise it to 60 per cent 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.

The incentive amount will increase with increased specific energy density & cycles and increased local value addition.


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