PLI SCHEME FOR ADVANCE CHEMISTRY CELLS

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PLI Scheme for Advanced Chemistry Cells (ACC) — UPSC Study Note

1. At a Glance

• National Programme on Advanced Chemistry Cell (ACC) Battery Storage is a Production-Linked Incentive (PLI) scheme to build 50 GWh of domestic ACC manufacturing capacity with an outlay of ₹18,100 crore [S1][S2].
• Administered by the Ministry of Heavy Industries (MHI), it underpins India's EV, renewable storage, and energy-security push [S1].
• Relevance: GS-III (Indian economy, infrastructure, manufacturing, energy) — flagship of Atmanirbhar Bharat in critical/strategic technologies.

2. Why in the News

• PIB release dated 06 February 2026 reported scheme progress: cumulative investment of ₹3,237 crore and 1,118 jobs generated under the scheme as of 31.12.2025 [S1].
• Spill-over effect noted: at least 10 non-PLI manufacturers have announced cumulative capacity of about 178 GWh in India [S1][S2].

3. Background & Evolution

• May 2021: Union Cabinet approved the National Programme on ACC Battery Storage under PLI with ₹18,100 crore outlay [S1][S2].
• March 2022: First-round allotment of 50 GWh to four successful bidders [S3].
• 2022: Three companies signed Programme Agreements with MHI [S3].
• 2024: Reliance New Energy Battery Ltd signed Programme Agreement for 10 GWh capacity awarded under re-bid [S3].
• March 2024: Ola Cell Technologies commenced pilot production at a 1 GWh Giga-scale plant [S2].
• By Dec 2025: 40 GWh of the 50 GWh target awarded across four beneficiary firms [S1][S2].

4. Core Static Facts

• Scheme name: National Programme on Advanced Chemistry Cell (ACC) Battery Storage [S1].
• Ministry: Ministry of Heavy Industries (NOT MNRE / MeitY / DPIIT) [S1].
• Outlay: ₹18,100 crore [S1].
• Target capacity: 50 GWh ACC + (separately) 5 GWh "Niche" ACC technology [S2].
• Awarded so far: 40 GWh to four firms [S1].
• Beneficiary firms: Reliance New Energy Solar/Battery Ltd, Ola Electric Mobility Pvt Ltd, Hyundai Global Motors Co. Ltd, Rajesh Exports Ltd [S2].
• Mandatory domestic value addition: minimum 25% at the time of disbursement, rising to 60% within 5 years (scheme guidelines).
• Investment till 31.12.2025: ₹3,237 crore; Jobs: 1,118 [S1].
• Non-PLI announced capacity: ~178 GWh by ≥10 manufacturers [S1].

5. Multi-Dimensional Analysis

Economic - Targets import substitution — India imports virtually all lithium-ion cells, mainly from China/Korea/Japan. - Catalyses ₹18,100 crore public outlay → multi-billion private capex; long incentive horizon (5 years from commissioning). - 178 GWh announced beyond scheme participants signals successful demonstration effect [S1].

Strategic / Geopolitical - Reduces dependence on Chinese cell imports; aligns with critical-minerals supply-chain diversification (KABIL, Australia–India critical minerals partnership). - Supports India's commitments under G20 Bali energy-transition declarations and net-zero by 2070.

Environmental - Domestic ACC manufacturing is a precondition for scaling EVs, grid-scale storage, and integration of intermittent renewables under the 500 GW non-fossil target by 2030. - Technology-agnostic design encourages low-carbon chemistries beyond Li-ion (sodium-ion, solid-state).

Scientific / Technological - "Advanced Chemistry Cells" = next-gen storage technologies storing electricity as electrochemical/chemical energy and reconverting on demand. - Linked R&D push via DST, DRDO (LIBs for defence), and ARCI-Hyderabad.

Administrative - Bidding-based selection; capacity allocated by competitive auction (lowest incentive bid). - MHI signs Programme Agreements with beneficiaries; disbursement linked to actual sale of cells with mandated DVA.

6. Recent Developments (last 12-18 months)

• March 2024: Ola Cell Technologies began pilot production (1 GWh) — first Indian-origin PLI awardee to start cell production [S2].
• 2024: Reliance New Energy Battery Ltd Programme Agreement signed for 10 GWh re-bid capacity [S3].
• 31 Dec 2025 cut-off: ₹3,237 crore invested; 1,118 jobs created under the scheme [S1].
• Feb 2026 PIB update: 40 of 50 GWh awarded; 178 GWh announced outside PLI [S1].

7. Prelims Hooks

• PLI ACC scheme is implemented by the Ministry of Heavy Industries, not MNRE or MeitY [S1].
• Scheme outlay: ₹18,100 crore [S1].
• Capacity target: 50 GWh of ACC manufacturing [S1].
• Approved by Union Cabinet in May 2021 [S1].
• Out of 50 GWh, 40 GWh awarded to 4 firms as of Dec 2025 [S1].
• Beneficiary firms: Reliance, Ola Electric, Hyundai Global Motors, Rajesh Exports [S2].
• Reliance New Energy Battery Ltd was awarded 10 GWh under re-bid in 2024 [S3].
• Cumulative investment under scheme till 31.12.2025: ₹3,237 crore [S1].
• Employment generated under scheme till 31.12.2025: 1,118 [S1].
• Non-PLI announced capacity: 178 GWh by ≥10 manufacturers [S1].
• Minimum domestic value addition under scheme: 25% at start, 60% within 5 years.
• "ACC" = energy stored in electrochemical or chemical form and re-converted to electricity on demand.
• Ola Cell Technologies began pilot production in March 2024 [S2].

8. Mains Relevance

• GS-III: Indian Economy – Infrastructure (Energy); Mobilisation of Resources; Indigenisation of Technology; Industrial Policy.
• GS-II: Government policies and interventions for development in various sectors.
• Plausible question stems: 1. "Discuss how the PLI scheme for Advanced Chemistry Cells advances India's twin goals of energy security and net-zero transition." (250 words) 2. "Evaluate the role of Production Linked Incentive schemes in reducing India's strategic import dependence, with reference to ACC batteries and critical minerals." (250 words) 3. "Domestic battery manufacturing is the missing link in India's EV revolution. Examine." (150 words)

9. Related Topics to Study Next

• FAME-II & PM E-Drive Scheme — demand-side EV push complementing supply-side PLI.
• National Critical Mineral Mission (KABIL) — upstream raw-material security for cells.
• PLI for Auto & Auto Components — sister MHI scheme; often confused.
• Battery Swapping Policy (NITI Aayog draft) — ecosystem completion.
• National Green Hydrogen Mission — parallel energy-transition PLI architecture.
• EV30@30 & India's Net-Zero 2070 commitment — overarching policy goals.
• Battery Waste Management Rules, 2022 (MoEFCC) — circular-economy dimension.
• Semiconductor & Display Fab PLI (MeitY) — comparative PLI for strategic tech.

10. Common Errors / Trap Areas

• Wrong ministry: scheme is under MHI, not MNRE, MeitY, or DPIIT [S1].
• Confusing outlay: it is ₹18,100 crore, not ₹1,810 crore or ₹1.81 lakh crore (the latter is the aggregate of 14 PLI schemes).
• Confusing target with achieved: target is 50 GWh; only 40 GWh awarded; far less commissioned.
• Mistaking beneficiaries: Hyundai Global Motors Co. Ltd (a domestic firm) ≠ Hyundai Motors (Korea).
• "ACC" is technology-agnostic — not limited to lithium-ion; includes sodium-ion, metal-air, solid-state.

11. Sources

• [S1] PLI SCHEME FOR ADVANCE CHEMISTRY CELLS, PIB, 06 Feb 2026 — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2224542 — (tier 1)
• [S2] PLI-ACC SCHEME, PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2225877 — (tier 1)
• [S3] Programme Agreement Signed with Reliance New Energy Battery Ltd for 10 GWh under PLI ACC, PIB — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2104281 — (tier 1)