Govt begins process for self-reliance in green energy; global bids invited for setting up new units

In a major boost to the green energy industry in India in the realm of ‘Aatmanirbhar’ Bharat, the Centre has invited global bids to set up greenfield giga-scale Advance Chemistry Cell (ACC) manufacturing units in the country, which will be commissioned within two years.

News18 has a copy of the bid document floated on October 22. All the demand of the ACCs is currently being met through imports in India, making the country dependent on China and Taiwan for lithiumion cells. The government now wants firms, either local or foreign or a consortium, to execute the project of setting up ACC manufacturing units “to ensure overall energy security for the nation in the long run,” as per the bid document.

The government will facilitate an enabling ecosystem for the same, including signing of tripartite agreements between a company, a Special Purpose Vehicle (SPV) of the Centre and the state governments. The bids will be opened in January next year.

The bid document says each bidder would have to commit to set-up an ACC manufacturing facility of minimum 5 GWh capacity with Value-Addition of minimum 25 percent within two years and minimum 60 percent within five years. The selected firm will establish the project with investment of minimum Rs 250 crore per GWh, which will be excluding the cost of land, the document says.

The project will be covered under the Production Linked Incentive (PLI) Scheme and an incentive totaling Rs 18,100 crore will be offered for setting up these units, as per a cabinet decision in May. The subsidy disbursement will start after a period of two years.

ACCs are new generation technologies that can store electric energy either as electrochemical or as chemical energy and convert it back to electric energy as and when required.

“Globally, manufacturers are investing in these new generation technologies at commercial scale to fill the expected boom in battery demand through 2030. These technologies shall comprise of ACCs and integrated advanced batteries,” says the bid document.

“The Government of India, pursuant to the Programme, seeks to obtain self-reliance in production of ACC and support indigenous manufacturing of ACC. This s aimed at assisting ongoing concerns of the indigenous manufacturing facilities,” it says.

The government this May had approved a PLI scheme — ‘National Programme on ACC Battery Storage’ — for achieving manufacturing capacity of fifty (50) Giga Watt Hour (GWh) of ACC and 5 GWh of “Niche" ACC with an outlay of Rs 18,100 crore. The programme aims at reducing import dependence, with electric vehicles, advanced electric grids and solar rooftops expected to see robust growth in coming years.

The government has then said that ACC manufacturers will be selected through a transparent competitive bidding process. The manufacturing facility will have to be commissioned within two years and the incentive will be disbursed over a period of five years through a cash subsidy.

The government says there will be direct investment of around Rs 45,000 crore in ACC Battery storage manufacturing projects through this project. A Cabinet note on the project said it will lead to net savings of Rs. 2,00,000 crore to Rs.2,50,000 crore on account of oil import bill reduction during the period of this programme due to EV adoption as ACCs manufactured under the Programme is expected to accelerate EV adoption.

“The manufacturing of ACCs will facilitate demand for EVs, which are proven to be significantly less polluting. The ACC program will be a key contributing factor to reduce India’s Green House Gas emissions to combat climate change. There will be import substitution of around Rs 20,000 crore every year,” the cabinet note had said.