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The Ministries of Heavy Industries (MHI) and New & Renewable Energy (MNRE) have initiated the bidding process for the remaining 10 GWh capacity allocated for Grid Scale Stationary Storage (GSSS) applications under the production-linked incentive (PLI) scheme for Advanced Chemistry Cell (ACC) Battery Storage Production. Bids for the same are in the advanced stage of finalization, MHI sources told BusinessLine. MHI recently completed the Round-2 bidding process, awarding a Letter of Award (LoA) to Reliance Industries Ltd for 10 GWh capacity on September 6, 2024. The signing of the ‘Programme Agreement’ is also in its final stages, according to sources. Background on PLI-ACC Scheme The government approved the PLI-ACC scheme, officially titled the “National Programme on Advanced Chemistry Cell (ACC) Battery Storage Production,” in May 2021. The initiative carries an outlay of ?18,100 crore for a total 50 GWh ACC capacity. In the first round, three companies were selected: ACC Energy Storage Pvt Ltd (AESPL) – 5 GWh Ola Cell Technologies Pvt Ltd (OCTPL) – 20 GWh Reliance New Energy Battery Storage Ltd (RNEBSL) – 5 GWh These firms have signed agreements to establish manufacturing facilities for 30 GWh ACC capacity. Collectively, they have invested ?1,575 crore and generated 889 jobs as of December 2024. Progress on Manufacturing Facilities MHI officials reported that AESPL has completed prototype testing and placed orders for critical plant and machinery. OCTPL has already commissioned 1 GWh ACC capacity and has produced over 40,000 ACCs, with product stabilization currently underway. The company is manufacturing cells using NMC chemistry and is expanding its unit to 5 GWh capacity. Reliance New Energy Battery Storage Ltd (RNEBSL) has completed land acquisition and plans to manufacture both mobility and storage cells. Budget 2025-26 Boosts Domestic ACC Industry The Union Budget for FY26 introduced key support measures for the domestic ACC industry, including exemptions on basic customs duty (BCD) for capital goods, critical minerals, and lithium-ion battery waste and scrap. Analysts believe these measures will enhance domestic manufacturing by reducing raw material and equipment costs while strengthening supply chains for critical battery materials. India currently imports essential minerals like lithium, nickel, and cobalt, which are subject to BCD ranging from 5-10%. The exemption will lower raw material costs, improving manufacturers profit margins and making domestically produced ACC components, cells, and EVs more cost-effective. Additionally, the exemption of 35 new capital equipment items, complementing the previous 22 exemptions, is expected to significantly lower costs for India’s lithium-ion battery manufacturers. With capital goods constituting a major portion of plant setup costs, this move will reduce initial investment requirements and enhance India’s competitiveness against China and South Korea. By aligning with the PLI scheme, these measures support Indias goal of boosting domestic ACC production and reducing reliance on imports. |
