The Indian government has approved the proposal of the Ministry of Heavy Industry to implement the production-related incentive (PLI) program of the “National Advanced Chemical Battery (ACC) Battery Storage Program”. The plan aims to realize the production capacity of ACC 50 gigawatt hours (GWh) and’Niche’ ACC 5 GWh, with an investment of Rs 18,100 crore.

• ACC batteries are used in consumer electronics, electric vehicles, advanced power grids, etc.

• The plan is expected to bring a direct investment of 45 billion rupees to the ACC battery manufacturing project

• Producing ACC batteries in India will boost demand for electric vehicles

What is the PLI scheme of the “National Advanced Chemical Battery Storage Plan”?

The Minister of Environment, Forests and Climate Change, Information Broadcasting and Heavy Industry and Public Enterprise Prakash Javadekar mentioned that India is currently importing batteries worth nearly 200 billion rupees for energy storage.

“With PLI, we can not only reduce imports, but also produce batteries that have not yet been produced in the country. These batteries will accelerate the country’s electric transportation. Long-lasting, efficient and fast-charging batteries are needed for a long time. Until now, because we still No batteries are produced, so the field of battery storage has not developed rapidly,” Javadekar said.

The minister said that India is one of the largest solar producers, and the country produces nearly 136 gigawatts of energy. However, if it is not used during the day, energy will be wasted because not much energy is stored. Even for grid balance, battery storage also plays an important role. He said the plan will benefit many sectors, including consumer electronics, railways and shipping, which believe the government has huge potential for battery storage.

ACC is a new generation of advanced storage technology that can store electrical energy as electrochemical or chemical energy and convert it back to electrical energy when needed. These batteries are used in consumer electronics, electric vehicles, advanced power grids and solar roofs, etc. These are the main battery consumption areas and are expected to achieve strong growth in the next few years. The dominant battery technology is expected to control some of the world’s largest growth areas.

The government stated that although several companies have already started to invest in battery packs, the capacity of these facilities is too small compared to the global average, and the manufacturing and value-added investments of ACC in India are still insignificant. At present, all ACC needs can be met by importing from India. The National Advanced Chemical Battery (ACC) battery storage plan aims to reduce import dependence. ACC battery storage manufacturers will be selected through a transparent competitive bidding process. The manufacturing plant will have to be put into use within two years. After that, rewards will be issued within five years.

The amount of excitation will increase with the increase of the specific energy density and period, as well as the increase of the local added value. Each selected ACC battery storage manufacturer must commit to establish an ACC manufacturing facility with a minimum capacity of 5GWh and ensure that at least 60% of the domestic added value at the project level is achieved within five years. In addition, the beneficiary company will have to realize at least 25% domestic value-added and generate a mandatory investment of Rs 225 crore/GWh within 2 years, and increase it to 60% domestic value-added within 5 years, whether in the parent company Still in-if it is a “hub and spoke” structure, it is the case of the integrated unit, or it can be the case of the project level.

Impact of the PLI program

The PLI plan is expected to bring the following results:

• According to this plan, an ACC manufacturing facility with a cumulative capacity of 50GWh was established in India.

• The direct investment in the ACC battery storage manufacturing project is approximately Rs 45 billion.

• Promote the creation of demand for Indian battery storage

• Pay more attention to domestic value acquisition, thus reducing dependence on imports.

• As a result of the adoption of electric vehicles, during the project period, due to the reduction of oil import costs, a net saving of 2 million to 25 billion Indian rupees was achieved. ACC manufactured under this plan is expected to accelerate the adoption of electric vehicles.

• The manufacture of ACC will promote the demand for electric vehicles. Facts have proved that the pollution of electric vehicles has been greatly reduced. As India pursues an ambitious renewable energy agenda, the ACC plan will become a key factor in reducing India’s greenhouse gas (GHG) emissions, which is consistent with India’s commitment to combat climate change.

• There are approximately 20 billion rupees worth of imported substitutes every year.

• Promote research and development to achieve higher specific energy density and ACC cycle.

• Promote newer niche battery technology.

Javadekar further mentioned that in addition to purchasing official electric vehicles, the Ministry of Heavy Industry has also established 2,800 EV charging stations nationwide.

The automotive industry welcomes this move

Sohinder Gill, Director General of the Association of Electric Vehicle Manufacturers (SMEV) said: “We thank the government for approving the PLI program to promote battery storage. This will strengthen our “Made in India” program and attract electric vehicles in the next 1-2 years. A huge investment in the automotive industry. Batteries account for a large part of the cost of any electric vehicle. Therefore, the right policy measures will help us guide the industry to achieve green growth while exponentially increasing our manufacturing capacity. Once we fully start battery manufacturing in the country Business, due to increased accessibility, will lead to a reduction in the purchase cost of electric vehicles.”

Akshay Singhal, founder and CEO of Log 9 Materials: “The newly approved PLI plan will bring great benefits to India’s self-reliance in the field of energy storage. In Log 9, we promote the development of advanced battery technology to the government and contribute to research and development. The long-term vision of providing special power is particularly impressive. One of the important requirements for the success of the plan is to encourage peripheral manufacturing companies to develop capabilities and provide value-added materials for local battery manufacturing in India.”

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