India Gears Up for Second Round of Tenders in Advanced Chemistry Cells PLI Scheme

India Gears Up for Second Round of Tenders in Advanced Chemistry Cells PLI Scheme

New Tender Opportunities for ACC PLI Scheme

The Indian government is set to launch a new round of tenders for the Advanced Chemistry Cells (ACC) Production-Linked Incentive Scheme with a capacity of 20-GWh by December 2023. This initiative opens opportunities for companies that either missed out in the initial round or were unable to apply, to partake in the scheme aimed at boosting battery storage manufacturing in India.

First Round Recipients and Capacity Reallocations

The first round of the ACC PLI scheme saw Ola Electric, Reliance New Energy, and Rajesh Exports secure incentives for lithium-ion and sodium-ion cell manufacturing, with a collective investment commitment of Rs 27,000 crore. However, a 20 GWh capacity initially allotted to a Hyundai subsidiary was later disqualified, leading to this new call for bids.

Upcoming Round Criteria and Expectations

The heavy industries ministry, in consultation with the ministry of new and renewable energy, is finalizing the tender process details. The criteria for localization of cell manufacturing, starting at 25% in the first year and increasing to 60% by the fifth year, are expected to remain stringent. The minimum bid capacity is also likely to stay at 5GWh. The government anticipates a more robust response in this round, with over 15 potential applicants.

Incentives for Niche Battery Technologies

Additionally, the government plans to introduce incentives for niche battery technologies like solid-state, zinc-based, and iron-air batteries. A capacity of 5GWh for these technologies is expected to be sanctioned for incentives next year.

Potential Participation by Major Automakers

Major automakers like Suzuki Motor Co. and Tata Motors, which have committed significant investments in cell manufacturing units in Gujarat, might enter the bidding process in the second phase. Their participation hinges on potential changes in the localization criteria or penalty provisions.

India’s Current Lithium-Ion Cell Import Dependency

Currently, India heavily relies on imports for lithium-ion cells used in electric vehicles, predominantly sourcing from China, as well as South Korea, Germany, and Japan. With no existing domestic facilities, this scheme aims to reduce the dependency on foreign markets and strengthen India’s position in the global battery manufacturing sector. icon

    Subscribe to the most timely news about the metals market

    Metals Wire's weekly digest for mining and processing industry professionals, investors, analysts, journalists.