PRODUCTION-LINKED INCENTIVE FOR ACC BATTERY MANUFACTURING

1. At a Glance

• National Programme on Advanced Chemistry Cell (ACC) Battery Storage — a Production-Linked Incentive scheme to build 50 GWh of domestic ACC manufacturing capacity, administered by the Ministry of Heavy Industries (MHI) [S1][S3].
• Total outlay ₹18,100 crore, approved by Union Cabinet in May 2021 [S3][S5].
• Critical for UPSC: intersects energy security, EV transition, critical minerals, Atmanirbhar Bharat, climate goals (Panchamrit).

2. Why in the News

• 6 Feb 2026 (PIB): MHI confirmed that under Round-2, Reliance New Energy Battery Ltd. signed the Programme Agreement on 17.02.2025 for 10 GWh; appointed date 01.07.2025; scheme period 7 years including a 2-year gestation [S1].
• Cumulative investment of ₹3,237 crore and employment of 1,118 reported by beneficiary firms up to 31.12.2025 [S3].

3. Background & Evolution

• May 2021 — Union Cabinet approved the PLI ACC Scheme (₹18,100 cr / 50 GWh) [S5].
• Jan 2022 — 10 bids received with ~130 GWh capacity against 50 GWh on offer [S2].
• Mar 2022 — Round-1 allotment to four firms (Reliance New Energy, Ola Electric, Hyundai Global Motors, Rajesh Exports) using QCBS mechanism [S2].
• Jul 2022 — Three Programme Agreements signed (Hyundai's allotment later annulled) [S2].
• 2023–24 — Re-bid of 20 GWh (Round-2) since only 30 GWh was effectively contracted [S3].
• 17 Feb 2025 — Reliance New Energy Battery Ltd. signed Round-2 agreement for 10 GWh [S1].
• 01 Jul 2025 — Appointed date for Round-2 begins [S1].

4. Core Static Facts

• Scheme name: National Programme on Advanced Chemistry Cell (ACC) Battery Storage [S1].
• Nodal Ministry: Ministry of Heavy Industries (NOT MNRE / MeitY) [S1].
• Outlay: ₹18,100 crore [S1].
• Target capacity: 50 GWh of ACC + 5 GWh "Niche" ACC (original design) [S5].
• Approval: Union Cabinet, May 2021 [S5].
• Selection method: Quality and Cost Based Selection (QCBS) [S2].
• Scheme tenure (Round-2): 7 years from appointed date 01.07.2025; 2-year gestation [S1].
• Cumulative awarded capacity: 40 GWh to 4 firms (Reliance New Energy Solar; Ola Electric Mobility; Hyundai Global Motors; Rajesh Exports) [S3].
• Round-2 beneficiary: Reliance New Energy Battery Ltd., 10 GWh [S1].
• What ACC means: New-generation advanced storage technologies that store electric energy as electrochemical/chemical energy and convert back when needed [S5].

5. Multi-Dimensional Analysis

Economic - Reduces import dependence on Li-ion cells (India imports nearly all cells); projected oil-import savings of ₹2,00,000–2,50,000 crore via EV adoption [S3]. - Triggered ~178 GWh of announced capacity by non-PLI manufacturers as well [S3].

Strategic / Geopolitical - Targets critical mineral value chain (Li, Co, Ni) currently dominated by China; aligns with KABIL and Critical Minerals Mission. - Supports Atmanirbhar Bharat in clean-energy hardware [S5].

Environmental - Enables EV penetration, grid-scale storage for renewables (Panchamrit: 500 GW non-fossil by 2030; net-zero by 2070). - ACC includes Li-ion, sodium-ion, metal-air, flow batteries — technology-neutral [S5].

Administrative - Two-round bidding; Round-1 (30 GWh signed), Round-2 (10 GWh signed), 10 GWh still to be re-tendered [S2][S3]. - Disbursement linked to domestic value addition (DVA) ramp-up and committed capacity utilisation.

6. Recent Developments (12–18 months)

• 17 Feb 2025 — Reliance New Energy Battery Ltd. signed Round-2 Programme Agreement (10 GWh) [S1].
• 01 Jul 2025 — Round-2 appointed date [S1].
• 31 Dec 2025 — ₹3,237 cr invested; 1,118 jobs created cumulatively [S3].
• 06 Feb 2026 — MHI status update to Parliament/PIB reiterating outlay and round status [S1].

7. Prelims Hooks

• Nodal Ministry: Ministry of Heavy Industries [S1].
• Outlay: ₹18,100 crore; capacity: 50 GWh [S1].
• Scheme approval year: 2021 [S5].
• Round-1 bids received: 10 bids totalling ~130 GWh [S2].
• Selection method: QCBS (Quality & Cost Based Selection) [S2].
• Round-1 firms: Reliance New Energy, Ola Electric, Hyundai Global Motors, Rajesh Exports [S2].
• Round-2 sole signatory: Reliance New Energy Battery Ltd., 10 GWh, signed 17.02.2025 [S1].
• Round-2 scheme tenure: 7 years with 2-year gestation from 01.07.2025 [S1].
• Cumulative awarded capacity: 40 GWh out of 50 GWh [S3].
• Investment realised (till 31.12.2025): ₹3,237 cr; jobs 1,118 [S3].
• Announced non-PLI capacity in pipeline: ~178 GWh over 5 years [S3].
• ACC is technology-agnostic — covers Li-ion, sodium-ion, metal-air, flow batteries [S5].

8. Mains Relevance

• GS-III — Indian Economy (industrial policy, infrastructure), Science & Technology (energy storage), Environment (clean energy transition).
• Syllabus: "Government Budgeting", "Effects of liberalisation on the economy", "Indigenisation of technology", "Conservation, environmental pollution".
• Plausible stems: 1. "Discuss how the PLI scheme for ACC battery storage can anchor India's energy transition while reducing strategic mineral vulnerabilities." 2. "Evaluate the design and outcomes of the PLI ACC Scheme so far. Why has the full 50 GWh not been contracted?" 3. "Critically examine the role of Production-Linked Incentives in achieving Atmanirbhar Bharat in clean-energy hardware."

9. Related Topics to Study Next

• PM E-DRIVE / FAME-II — demand-side EV push complementing PLI supply side.
• KABIL & Critical Minerals Mission (2025) — upstream Li, Co supply.
• National Green Hydrogen Mission — adjacent clean-energy PLI.
• PLI for Auto & Auto Components (₹25,938 cr) — sister MHI scheme.
• Battery Waste Management Rules, 2022 — EPR for end-of-life ACCs.
• National Electric Mobility Mission Plan (NEMMP) 2020.
• Panchamrit / India's NDCs — climate context.
• Semiconductor PLI (ISM) — comparison of high-tech PLIs.

10. Common Errors / Trap Areas

• Wrong ministry — it is MHI, not MNRE or MeitY.
• Outlay confusion — ₹18,100 cr (not ₹76,000 cr, which is Semicon PLI).
• Capacity figure — 50 GWh (often mistaken with 30 GWh awarded in Round-1 only).
• ACC ≠ only lithium-ion — it is technology-neutral.
• Round-2 beneficiary is Reliance New Energy Battery Ltd. (a distinct entity from "Reliance New Energy Solar Ltd." of Round-1).

11. Sources

• [S1] PLI ACC — Round-2 status (06 Feb 2026) — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2224552 — (tier 1)
• [S2] Allotment of 50 GWh / 10 bids ~130 GWh / QCBS — https://www.pib.gov.in/PressReleasePage.aspx?PRID=1809037 ; https://pib.gov.in/PressReleasePage.aspx?PRID=1790139 ; https://www.pib.gov.in/Pressreleaseshare.aspx?PRID=1846078 — (tier 1)
• [S3] ACC Batteries & Domestic Capacity / 40 GWh awarded / ₹3,237 cr investment — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2202973 ; https://www.pib.gov.in/PressReleasePage.aspx?PRID=2246037 — (tier 1)
• [S4] Reliance New Energy Battery Ltd. 10 GWh signing — https://www.pib.gov.in/PressReleasePage.aspx?PRID=2104281 — (tier 1)
• [S5] Cabinet approval (May 2021) of National Programme on ACC Battery Storage — https://www.pib.gov.in/PressReleasePage.aspx?PRID=1717938 — (tier 1)