ACC PLI beneficiary companies seek extension; govt may consider it

Firms cite equipment delays from China for missing ACC PLI milestones; govt mulls extension request, penalties imposed for breaching December 2024 deadline

Reliance Industries Ltd (RIL), Ola Cell Technologies, and Rajesh Exports—beneficiaries under the battery storage Production-Linked Incentive (PLI) scheme—have sought a one-year extension from the government after failing to meet investment and domestic value addition conditions under the National Programme on Advanced Chemistry Cell (ACC) battery storage, according to government and industry sources.

 

Though the government has not taken a final decision, it may consider granting an extension, a government official said.

 

This development follows the imposition of penalties on all three beneficiaries for failing to meet the December 2024 milestone to set up a manufacturing plant within two years of signing the final agreement, despite having received all necessary approvals from both state and central governments.

   

It has now been three years since these three companies were awarded 30 GWh of capacity under the ACC PLI scheme. Ola Electric Mobility was allotted 20 GWh, Rajesh Exports 5 GWh, and Reliance New Energy 5 GWh.

 

The delays have been attributed to supply chain disruptions. The companies have informed the Ministry of Heavy Industries (MHI) that delays in sourcing critical equipment and machinery—primarily from China—have disrupted progress. The upstream supply chain, including plant and equipment essential for battery cell manufacturing, has reportedly been affected by export curbs and shipment delays from China.

 

With a financial outlay of ₹18,100 crore, the ACC PLI scheme was announced in 2021 to support the development of 50 GWh of domestic cell manufacturing capacity. According to the scheme’s guidelines, beneficiaries must achieve at least 25 per cent domestic value addition and invest ₹225 crore per GWh at the mother unit level.

 

Delays in execution attract penalties amounting to 0.1 per cent of the performance security per day of delay. This translates to ₹12.5 lakh per day for Ola Electric and ₹5 lakh per day each for Reliance New Energy and Rajesh Exports. These amounts are to be deducted from future incentives payable under the scheme.

 

“Three beneficiaries under the ACC PLI have approached the minister for an extension of about a year. No final decision has been made yet—it is under consideration,” the official said, adding that any extension or relaxation would be granted only after a detailed review.

 

A senior executive at RIL anonymously confirmed the development, but an email sent to an RIL spokesperson did not elicit a response till press time.

 

An Ola Electric spokesperson neither confirmed nor denied the development but stated: “Ola Electric has been the first to set up its Gigafactory in India and has successfully developed the cutting-edge 4680 Bharat Cells completely in-house. We currently have an installed capacity of 1.4 GWh and are rapidly accelerating towards the 5 GWh milestone. We commenced trial production at our Gigafactory in March 2024 and secured BIS certification for our lithium-ion cells in May 2024.”

 

“We have announced commercial production of our cells beginning Q1 FY26 and are on track to meet the set timelines. Ola Electric will be the first to commercially manufacture lithium-ion cells in India under the government’s ACC PLI scheme. We continue to have regular discussions with MHI regarding updates on our progress and milestone timelines,” the spokesperson added.

 

Meanwhile, Rajesh Exports and the secretary and spokesperson of MHI did not respond to queries.