The Ministry of Heavy Industries (MHI) has issued a request for proposals to select manufacturers to set up 10 GWh manufacturing capacities for Advance Chemistry Cell (ACC) under the Production Linked Incentive (PLI) program.

The tender follows MHI’s announcement that it would re-issue the tender for the unallocated 20 GWh capacity under the ‘National Program on ACC Battery Storage.’

In 2021, the government had approved the technology-agnostic PLI program to implement 50 GWh of ACC manufacturing with an outlay of ₹181 billion (~$2.18 billion).

The initial bidding for the ACC Energy Storage PLI Program concluded in March 2022, with Ola Electric Mobility, Hyundai Global Motors, Reliance New Energy, and Rajesh Exports securing bids to set up 50 GWh capacity. However, Hyundai Global Motors opted to withdraw from bidding, leaving behind an unallocated capacity of 20 GWh.

The last date to submit bids is April 22, 2024. Bids will be opened on April 23.

The tender has a maximum budgetary outlay of ₹36.2 billion (~$435.63 million).

Selected bidders must commit to setting up an ACC manufacturing facility with value addition of a minimum of 25% within two years from the appointed date and a minimum of 60% value addition within five years from the appointed date. They must also establish a manufacturing capacity of 5 to 10 GWh within five years from the appointed date, and only then will they be ranked from the highest to the lowest based on their technical score.

The subsidy disbursement will commence only once the proposed committed capacity and value addition levels are achieved, and the sale of the ACC begins. The disbursement will be phased over a five-year window, payable quarterly, as per the program agreement signed between the government and the selected bidder.

Bidders must pay a non-refundable sum of ₹450,000 (~$5,415) as the bidding cost. They must also submit a bid security amount of ₹100 million (~$1.2 million) in the form of a bank guarantee issued by a nationalized bank or a scheduled bank in India with a net worth of at least ₹10 billion (~$120.35 million).

The bidding process will be held online through a transparent two-stage process under the quality and cost-based selection mechanism.

If the bidder is not an Alternative Investment Fund or Foreign Investment Fund, they should have a minimum net worth of ₹2.25 billion (~$27.08 million) per GWh.

If the bidder is an Alternative Investment Fund or Foreign Investment Fund, it should have a minimum annual capital for investment of ₹2.25 billion (~$27.08 million) per GWh at the close of the preceding financial year.

Bidders can bid for any capacity if their net worth is at least ₹15 billion (~$180.54 million).

Bidders who have participated in the previous tender issued in 2021 will also be eligible to participate in this tender, provided that the maximum capacity that may be allocated to such bidders, inclusive of the capacity allocated previously, does not exceed 20 GWh.

Qualification is open to persons from any country. If the bidders belong to any other country other than India, 25% or more of the aggregate issued subscribed and paid-up equity share capital in the bidder or its member is held by persons resident outside India. Alternatively, at any subsequent stage after the bid date, there is an acquisition of 25% or more of the aggregate issued, subscribed, and paid-up equity share capital or control by persons resident outside India.