⚡ Quick Read
- What happened: The Ministry of Heavy Industries confirmed that land acquisition is complete for 40 GWh of battery manufacturing capacity awarded to Rajesh Exports, Ola Electric, and Reliance New Energy under the PLI-ACC scheme.
- Why it matters: While land is secured, only 1 GWh of the 50 GWh target is currently commissioned, signaling a critical transition phase for developers and EPCs in the battery supply chain.
- Watch: Monitor the pace of plant commissioning by major players to gauge when domestic battery supply will stabilize for large-scale energy storage projects.
Background and Context
The Indian government’s Production Linked Incentive (PLI) scheme for Advanced Chemistry Cell (ACC) battery storage, approved in May 2021, represents a cornerstone of the nation’s energy transition strategy. With a total financial outlay of INR 18,100 crore, the program aims to establish 50 GWh of domestic manufacturing capacity. The primary objective is to reduce India’s heavy reliance on imported battery cells and position the country as a global manufacturing hub for energy storage solutions.
Key Details
The Ministry of Heavy Industries recently informed the parliament that land acquisition has been successfully completed for 40 GWh of the awarded capacity. The allocation of this capacity is distributed among three major beneficiaries: Ola Electric (20 GWh), Reliance New Energy (15 GWh), and Rajesh Exports (5 GWh). Reliance New Energy’s allocation includes 5 GWh from the initial round and an additional 10 GWh from the second round of allocations.
Despite the progress in land acquisition, the actual operational output remains in its nascent stages. Currently, only 1 GWh of the total capacity has been commissioned, which is attributed to Ola Electric. The scheme provides flexibility to manufacturers, allowing them to select project sites based on business strategy, logistics, and infrastructure availability rather than mandating specific geographical locations.
What This Means for EPCs and Developers
For EPC contractors and solar developers, the progress in land acquisition is a positive indicator that the manufacturing ecosystem is moving from the planning phase to the construction phase. As these gigafactories begin to scale, developers can expect improved access to domestically produced battery cells, which may eventually lead to more competitive pricing for Battery Energy Storage Systems (BESS) projects. However, the current gap between awarded capacity and commissioned capacity suggests that large-scale domestic supply may not be immediately available for near-term projects.
What Happens Next
The industry will now shift its focus toward the commissioning timelines of the remaining 39 GWh of capacity. Stakeholders should closely monitor the construction progress of the Reliance and Rajesh Exports facilities. As these plants come online, the domestic availability of ACC batteries is expected to accelerate, potentially lowering project costs and easing supply chain bottlenecks for grid-scale storage deployments across India.
