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ACC PLI – key milestone in a long journey, just begun

Dr Rahul Walawalkar, President – IESA & Managing Director – CES India

In a major milestone for the energy storage industry, in March 2022 the Indian government announced the winners of the Production Linked Incentive (PLI) scheme for advanced battery manufacturing. This scheme will support the manufacturing of 50GWh of advanced chemistry cells (ACC) in India by 2027.

As we take the 1st step in the journey to realize our dream of India becoming a global hub for R&D and manufacturing of advanced energy storage technologies, it is important to look at the several steps that laid the groundwork. Back in March 2016, India Energy Storage Alliance (IESA) proposed a manufacturing policy for energy storage technologies to NITI Aayog. Subsequently, in 2017-18 the National Energy Storage Mission drafted by the Ministry of New and Renewable Energy (MNRE) and NITI Aayog's Transformative Mobility Mission, were brought together to shape the ACC PLI. The interest taken by Prime Minister Narendra Modi and the steadfast leadership of Amitabh Kant has been instrumental in shaping the vision.

During the past two years, there were concerns raised - Does India need 50GWh battery manufacturing? Will there be enough interest in PLI? Should the government simply allocate money for subsidizing EVs and keep importing batteries? However, IESA had strongly emphasized that India cannot replace the dependency on imported oil with that imported batteries.

The ACC-PLI in its final shape and form as we see today is the result of the painstaking effort and time taken by the NITI Aayog team in understanding industry recommendations – hundreds of stakeholder meetings were held to ensure that the final scheme strikes a fine balance between requirements of various stakeholders from Giga factory companies, OEMs and companies in the manufacturing supply chain ecosystem.

What is noteworthy is that the ACC PLI scheme mandates a minimum of 60 percent domestic value addition. This is why, in December 2021, IESA launched the India Battery Supply Chain Council (IBSCC) to ensure India not only sets up the supply chain to meet demand by Indian Giga factories but also global Giga factories. The global advanced battery manufacturing is predicted to cross 3000GWh by 2030, and IESA believes that there is a tremendous opportunity for Indian supply chain companies to become key global players in the coming decade.

IESA believes that there is a tremendous opportunity for Indian supply chain companies to become key global players in the coming decade

After achieving this crucial industry milestone, there is now no time to relax. The next couple of years is critical for India to focus on technology partnerships, skill development, and capacity building to support the Giga factories as well as the complete supply chain needed for global battery manufacturing.

We do hope you all will join us in New Delhi, as we celebrate the 10th anniversary of IESA during the India Energy Storage Week hosted by us, from May 1 to 6, 2022. 

Author : Dr. Rahul Walawalkar
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