The Indian government is set to release tenders for the Advanced Chemistry Cells (ACC) Production-Linked Incentive (PLI) scheme targeting a 20 GWh capacity by December. This move allows a second chance for those who didn’t qualify initially to benefit from incentives for establishing battery storage capacity in India, and also the Ministry of Heavy Industries aims to conclude consultations with the Ministry of New and Renewable Energy by December with the application process for new bids starting afterward.
In the first round of Ola Electric, Reliance New Energy and Rajesh Exports secured incentives, committing a total investment of ₹27,000 crore. However, a 20 GWh capacity initially awarded to Hyundai was deemed not bona fide leading to a new round of bidding.
The upcoming round is expected to maintain criteria around localization of cell manufacturing, starting at 25% in the first year and reaching 60% in the fifth year. The minimum bidding capacity is likely to remain at 5 GWh. The government anticipates increased participation with over 15 applicants expressing interest. Additionally there are plans for a new PLI scheme for niche chemistries like solid state, zinc based and iron-air batteries with a 5 GWh capacity next year.
Suzuki Motor Co. and Tata Motors might participate in the second phase of bidding, contingent on changes in localization criteria or penalty provisions. Global lithium-ion battery firms like Panasonic, Samsung, and LG Che along with domestic players like Amara Raja and Exide are expected to submit fresh bids. India currently relies heavily on imports for lithium ion cells, mainly from China, South Korea, Germany And Japan.
In conclusion, the Indian government’s imminent release of tenders for the Advanced Chemistry Cells Production-Linked Incentive scheme marks a strategic move to bolster domestic battery storage capacity. The upcoming round, with stringent localization criteria aims to rectify issues from the initial phase and attract broader participation. As the nation strives to reduce dependence on foreign markets for lithium-ion cells, key players both domestic and global are poised to engage. This initiative aligns with India’s commitment to fostering sustainable and advanced technologies, paving the way for a robust and self reliant energy storage ecosystem in the future.