As many as 10 companies, including Reliance New Energy Solar, Hyundai Global Motors, Ola Electric Mobility, Larsen & Toubro and Mahindra & Mahindra, have pledged to invest under the Rs 18,100-crore production-linked incentive (PLI) scheme for advanced chemistry cell (ACC) battery storage.
Together, these companies have proposed to create a capacity of 130 gigawatt hours (GWh), about 2.6 times of the capacity that is to be awarded under the scheme, the ministry of heavy industries said on Saturday, highlighting the “encouraging response” to the programme. The other contenders are Lucas-TVS, Amara Raja Batteries, Exide Industries, Rajesh Exports and India Power Corp.
Under the scheme, the government seeks to boost local manufacturing of advanced chemistry cell to bring down prices of battery in the country, which will reduce the cost of electric vehicles as well. It is expected to ultimately lead to a potential drop in crude oil imports and also raise the share of renewable energy at the national grid level.
The scheme is designed to be technology-agnostic. The beneficiary firm will be free to choose suitable advanced technology, machinery, raw materials and other intermediate goods for setting up cell manufacturing facility to cater for any application.
The government had sought application until Friday for the scheme and the technical bids were opened on Saturday. The manufacturing facility would have to be set up within a period of two years. The incentive will be disbursed thereafter over a period of five years on the sale of batteries manufactured in India, the ministry said.
This scheme, along with an already-launched PLI programme for auto industry (Rs 25,938 crore) and Faster Adaption of Manufacturing of Electric Vehicles scheme (Rs 10,000 crore) will “enable India to leapfrog from traditional fossil fuel-based automobile transportation system to environmentally cleaner, sustainable, advanced and more efficient electric vehicles-based system”, the heavy industries ministry said.
This is part of the 13 PLI schemes, announced by the government in the wake of the Covid-19 pandemic in 2020, to lure mainly large corporations to expand manufacturing, bolster supply chains and boost exports. The total incentives under the PLI schemes, covering sectors including telecom, electronics, auto part, pharma, chemical cells and textiles, were initially estimated at Rs 1.97 lakh crore over a five-year period.