The Union cabinet has approved the implementation of the Production Linked Incentive (PLI) scheme for achieving manufacturing capacity of high capacity batteries within the country. The move is aimed at giving a fillip to the electric vehicle manufacturing capabilities within the country.
The scheme will help in the manufacture of 50 Giga Watt Hour (GWh) of Advanced Chemistry Cell (ACC) and 5 GWh of ACC batteries with an outlay of Rs 18,100 crore.
These ACC batteries are used in consumer electronics, electric vehicles, advanced electricity grids, solar rooftops. These are major battery consuming sectors that 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,” the cabinet note said.
According to the government, the manufacturing of ACCs will also facilitate demand for electric vehicles, which are proven to be significantly less polluting.
“It will also lead to net savings of Indian Rs 2,00,000 crore to Rs 2,50,000 crore on account of oil import bill reduction during the period of this programme due to Electric vehicle adoption,” the government officials said.
The manufacturing of ACCs will also 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.
The 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.
Though several companies have already started investing in battery packs, but, their capacities are too small when compared to global averages. There is still is a negligible investment in manufacturing, along with value addition, of ACCs in India. All the demand for the ACCs is currently being met through imports in India.
“The national programme on ACC battery storage will reduce import dependence. It will also support the Atmanirbhar Bharat initiative. ACC battery Storage manufacturers will be selected through a transparent competitive bidding process. 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,” the cabinet statement said.
The government expects the scheme will help in setting up a cumulative 50 GWh of ACC manufacturing facilities in India, with a direct investment of around Rs 45,000 crore in ACC Battery storage manufacturing projects.