The Government of India in collaboration with the domestic Industries launched Production Linked Incentive Scheme in 2020 to benefit the manufacturing sector and “National Programme on Advanced Chemistry Cell (ACC) Battery Storage” is implemented to gain the production capacity of 50 Giga Watt Hour (GWh) of ACC and 5 GWh of "Niche" ACC. The estimated budget will be INR 18,100 crore, which is already sanctioned by the Cabinet and presided by Prime Minister Shri Narendra Modi. The proposal was initially made by the Department of Heavy Industries of India.
The dominance in the manufacturing market will be created by the development of battery technologies and the countries with major productivity will be the leading economies. The growing sectors of the future like Solar Industries, Electric Vehicles, Advanced Electricity Grids are the segments where the ACC batteries will be used on large scale. The ACC is an innovative battery that can store electrical energy in the form of electrochemical energy or chemical energy, and convert it to electric energy when required.
The ACCs are currently imported in India as the domestic production capacity of the facilities is on small scale in comparison to the global average. Although several organizations in India have started investing in battery manufacturing, the output is still negligible to meet the demands of ACC. The new generation technology of advanced storage system is crucial for the country’s development and the manufacturing of the ACC will add value to the vision of “Atmanirbhar Bharat”.
The Government will conduct the biddings for the Battery Manufacturers who upon selection will be responsible for installing manufacturing facilities within two years. The target of each facility will be of a minimum of 5 GWh capacity and will be responsible for 60% domestic value addition at the project level within five years. Besides, the firms need to accomplish a domestic expansion of at least 25% and responsible for covering INR 225 crore per GWh worth of investment in two years and raise it to 60% in 5 years either at Mother Unit, for an Integrated Unit, or at the Project Level, in event of "Hub and Spoke" structure. The total incentive amount is decided to be disbursed for 5 years.
The perks of the implemented scheme are as follows:
- The Programme helps in the construction of 50 GWh of ACC manufacturing facilities in India.
- The Government offers INR 45,000 crores of direct investment in the programme.
- Increasing the demand for storage batteries in India.
- Meeting the objectives of “Make in India”, strengthening the domestic market and less dependency on imports.
- The manufacturing of ACC will expedite EV adoption in India saving a net amount of INR 2,00,000 crore to INR 2,50,000 crore on the import of oil.
- India is in the process of becoming a country to promote sustainable renewable energy.
- The EV adoption will decrease India's Green House Gas (GHG) emissions which is in line with India's commitment to combat climate change.
- Import replacement of around INR 20,000 crore consistently.
- Improved R&D for achieving higher energy density ACC batteries.
- Technological innovations for advanced and niche batteries.
