Energy storage is the missing link in India's renewable energy transition. Examine the role of the PLI scheme for Advanced Chemistry Cells in addressing this gap.

Solar and wind generate power only when the sun shines or the wind blows. Without storage, adding more renewable capacity means wasted output and an unstable grid. The National Programme on Advanced Chemistry Cell (ACC) Battery Storage is a ₹18,100 crore PLI scheme approved in May 2021 to build 50 GWh of cell-making capacity in India [2]. It is India's main supply-side answer to the storage gap, but so far it has delivered much less than it promised.

Why storage is the missing link

• Intermittency: batteries shift daytime solar power to the evening peak and keep the grid stable.
• Rising demand: the Ministry of Power's VGF Tranche-II gives ₹5,400 crore for 30 GWh of battery storage [4]. MHI cites a "rapidly growing need" for storage [1].
• Import dependence: cell and critical-mineral supply is concentrated in a few countries, so a supply shock abroad becomes a power shock at home.

Role of the PLI ACC scheme

• Output-linked incentive: paid only on cells made and sold, spread over five years, so the fiscal risk is low [2].
• Domestic value chain: firms must build at least a 5 GWh plant and reach 60% domestic value addition within five years [2].
• Grid-focused tranche: a 2026 global tender reserves 10 GWh for Grid-Scale Stationary Storage and has drawn 22 bids [1].
• Transparent selection: an online two-stage QCBS process on the CPP Portal scores quality as well as price [1].
• Strategic aim: energy security and technological self-reliance, framed under Viksit Bharat @2047 [1].

Limitations

• Award–delivery gap: 40 GWh has been awarded to four firms, but only about 1 GWh was installed by February 2026 [3].
• Few strong bidders: Round-2 selected only one beneficiary [3].
• Upstream gap: 60% value addition needs a domestic minerals and materials chain that does not exist yet.
• Supply–demand disconnect: VGF storage projects go to the lowest tariff bid, with no link to cells made under the PLI [4].

Way forward

• Give more QCBS technical marks for proven cell-making experience.
• Set public, dated milestones for land, equipment orders, a trial line and commercial production.
• Phase in a modest preference for domestic cells in VGF tenders, alongside the National Critical Mineral Mission and battery-recycling rules.

The PLI ACC scheme rightly targets the cell, the core of any storage system, and its grid-storage tranche links industrial policy to the energy transition. India can import cells now for speed and build at home for security. Tighter milestones and an assured market can turn bids into gigafactories, advancing SDG 7 and India's net-zero 2070 goal.