Indian Economy
National Programme on Advanced Chemistry Cell Battery Storage
- 17 May 2021
- 3 min read
Why in News
The Union Cabinet has approved a Rs. 18,100-crore Production Linked Incentive (PLI) scheme for manufacturers of Advanced Chemistry Cell (ACC) battery storage, to reduce imports.
- The scheme is called the National Programme on Advanced Chemistry Cell Battery Storage (NPACC). It is under the Ministry of Heavy Industries & Public Enterprises.
Key Points
- PLI Scheme:
- It aims to give companies incentives on incremental sales from products manufactured in domestic units.
- It invites foreign companies to set units in India, however, it also aims to encourage local companies to set up or expand existing manufacturing units.
- The PLI Scheme has also been approved for sectors such as automobiles, pharmaceuticals, IT hardware including laptops, mobile phones & telecom equipment, white goods, chemical cells and textiles, etc.
- Advanced Chemistry Cell (ACC):
- ACCs are the new generation of advanced storage technologies that can store electric energy either as electrochemical or as chemical energy and convert it back to electric energy as and when required.
- Such battery storages will cater not only to electric vehicles but also to the consumer electronics industry and electricity grids.
- About NPACC Scheme:
- The plan is to set up 50 gigawatt hour (GWh) manufacturing capacity for ACC batteries by attracting investments totaling Rs. 45,000 crore.
- Requires each selected ACC battery Storage manufacturer to set-up an ACC manufacturing facility of minimum 5 GWh capacity, achieve a domestic value addition of at least 25% and incur the mandatory investment Rs.225 crore /GWh within 2 Years.
- Furthermore, the beneficiary firms need to ensure a minimum 60% domestic value addition at the Project level within five years.
- The incentive will be disbursed over a period of five years. It will be paid out on the basis of sales, energy efficiency, battery life cycle, and localization levels.
- Expected Benefits from NPACC Scheme:
- Facilitate demand creation for battery storage in India.
- Facilitate Make-in-India and Atmanirbhar Bharat.
- Facilitate demand for Electric Vehicles (EVs), which are proven to be significantly less polluting.
- A key contributing factor to reduce India's GreenHouse Gas (GHG) emissions.
- Import substitution of around Rs. 20,000 crore every year.
- Impetus to Research & Development to achieve higher specific energy density and cycles in ACC.
- Promote newer and niche cell technologies.
