Reliance New Energy, Ola Electric Mobility Private Limited and Rajesh Exports Limited have signed up under the government’s Rs 18,000-crore production-linked incentive scheme for manufacturing advanced battery cells.

The companies were among four bidders selected by the government in March to build a total of 50 gigawatt hours (Gwh) of battery storage capacity under a production-linked incentive programme.

Union minister for heavy industries Mahendra Nath Pandey said: “This will be favourable to EV ecosystem and the energy storage market as it will support the demand for EVs and attract investment in this sector.

“Today big companies are investing in battery manufacturing in India. We should support them and make India a truly global manufacturing hub.”

The government last year finalised the scheme to encourage companies to make battery cells locally as it seeks to establish a domestic supply chain for clean transport and renewable energy storage to meet its decarbonisation goals.

The companies must set up their battery manufacturing facility within two years after which they will be eligible for incentives.

These will be paid over a five-year period based on the sale of batteries manufactured in India, the government said in its statement.

In addition to the capacities allocated by the ministry of heavy industries under the PLI programme, private players are expected to create battery manufacturing capacity to the tune of around 95 GWh, it added.

The government has approved the PLI Scheme under the ‘National Programme on Advanced Chemistry Cell (ACC) Battery Storage’ for achieving a manufacturing capacity of 50 Giga Watt Hour (GWh) of ACC with a budgetary outlay of Rs 18,100 crore.

Under the said initiative, it aims to achieve greater domestic value addition, while at the same time ensuring that the levelised cost of battery manufacturing in India is globally competitive.