DHI Issues Notification On Advanced Chemistry Cell (ACC) Battery Storage

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Ministry Of Heavy Industry And Public Enterprises (Department of Heavy Industry) has issued a notification on Production Linked Incentive (PLI) scheme, ‘NATIONAL PROGRAMME ON ADVANCED CHEMISTRY CELL (ACC) BATTERY STORAGE’ for implementation of giga-scale ACC manufacturing facilities in India. Through this Scheme, the Government of India intends to optimally incentivize potential investors, both domestic and overseas, to set- up Giga-scale ACC manufacturing facilities with emphasis on maximum value addition and quality output and achieving pre committed capacity level within a predefined time-period.

Key features of the scheme are as follows:

1. The scheme envisages setting up of a cumulative ACC manufacturing capacity of fifty (50) GWh for ACCs and an additional cumulative capacity of (5) GWh for Niche ACC Technologies.
2.  Incentives will be offered only to those firms (hereinafter called the “Beneficiary Firm”) that have been allocated ACC production capacity (with cumulative capacity for all beneficiary firms combined together 50 GWh) under the said Programme through a transparent mechanism by inviting the Request for Proposal (RFP). The beneficiary firm will have to commit to set up a minimum of five (5) GWh of ACCs manufacturing facility. The total annual cash subsidy to be disbursed by the Government will be capped at 20GWh per beneficiary firm.
3.  In addition to 50 GWh of cumulative ACC capacity, 5GWh of cumulative capacity would be offered to “Niche” ACC technologies of higher performance with a minimum threshold capacity of500 MWh. This initiative would also be technologically agnostic. Only the higher performance parameters would be the prerequisite for being eligible.
4.  The manufacturing facility as proposed by the beneficiary firm under the RFP would have to be commissioned within a period of 2 years. The subsidy will be disbursed thereafter over a period of 5 years.
5.  The beneficiary has to ensure achieving a domestic value addition of at-least 25% and incur the mandatory investment (₹ 225 crore /GWh) within 2 Years (at the Mother Unit Level) and raise it to 60% domestic value addition within 5 Years, either at Mother Unit, in-case of an Integrated Unit, or at the Project Level, in-case of “Hub & Spoke” structure (the “Project”), as will be specified in the Request for Proposal (RFP).
6.  To ensure a Single-Window mechanism for the potential investors, a state-level grand- challenge will be initiated, including provision for encumbrance-free land, trunk infrastructure facilities, power at rationale rate to the potential investors for attracting the Projects in their states.

The amount of subsidy to be disbursed would be calculated as following: Applicable subsidy amount per kilowatt hour X (multiplied) Percentage of value addition achieved during the period X (multiplied) Actual sale of Advanced Chemistry Cells (in KWh), as shall be specified in the RFP.

The Eligibility Criteria will be specified in the RFP.

The total incentive pay out over the period of 5 years of the Scheme will be Rs. 18,100 crore. The breakup of fund allocation year wise, for the scheme’s duration is tabulated below –(All amounts are in Rs. Crore)