National Programme on Advanced Chemistry Cell (ACC) Battery Storage

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  National Programme on Advanced Chemistry Cell (ACC) Battery Storage

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• The story: The Union Cabinet 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.
• Points to note: The government is determined to push manufacturing in India, and has tried the Make in India programme since 2014. Now, since 2020, the new PLI scheme has been brought in to give subsidies to corporates. 

1. The PLI scheme 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 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.
2. 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.

• NPACC: The plan is to set up 50 gigawatt hour (GWh) manufacturing capacity for ACC batteries by attracting investments totaling Rs.45,000 crore. It 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. 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: It will facilitate demand creation for battery storage in India, and also help the Make-in-India and Atmanirbhar Bharat programmes. It will push demand for Electric Vehicles (EVs), which are proven to be significantly less polluting, and will help reduce India's GreenHouse Gas (GHG) emissions. It will do import substitution of around Rs. 20,000 crore every year. It will promote newer and niche cell technologies.
• Knowledge centre: 

1. PLIS - In order to boost domestic manufacturing and cut down on import bills, the central government in March 2020 introduced a scheme that aims to give companies incentives on incremental sales from products manufactured in domestic units. The idea of PLI is that since the government cannot continue making investments in these capital intensive sectors as they need longer times for returns, what it can do is to invite global companies with adequate capital to set up capacities in India. The kind of ramping up of manufacturing that India needs requires across the board initiatives, but the government can’t spread itself too thin. The total outlay for all the PLI schemes is ?1.97 lakh crore over a five-year period. 
2. Make in India - The Make in India initiative was launched by PM Modi in September 2014 as part of a wider set of nation-building initiatives. Devised to transform India into a global design and manufacturing hub, Make in India was a response to a critical situation. By 2013, the much-hyped emerging markets bubble had burst, and India’s growth rate had fallen. The promise of the BRICS Nations (Brazil, Russia, India, China and South Africa) had faded, and India was tagged as one of the so-called ‘Fragile Five’. PM Modi brought this programme to put new life into manufacturing. However, by 2021, the share of manufacturing in GDP has remained stuck at just 15%, and not moved up. 

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