Tender launched for 50 GWh battery cell output with subsidy support

Global bids are invited to set up giga-scale advanced-chemistry battery cell manufacturing units in India under the government’s production-linked incentive scheme. To be eligible for the government subsidy, the bidder would have to commit to setting up a minimum of 5 GWh capacity. Bidding is open until December 31.

October 27, 2021 Uma Gupta

The maximum cumulative allocation to a single bidder shall be 20 GWh, in blocks of 1 GWh.

Image: Yann Forget, Wikimedia Commons

The Government of India, through the Ministry of Heavy Industries, has invited bids to develop a cumulative 50 GWh of advance-chemistry battery cell manufacturing units in India under its production-linked incentive scheme. The selected bidders would be supported with fiscal benefits in the form of a cash subsidy for production.

To be eligible for the government subsidy, the bidder would have to commit to setting up an advance-chemistry cell manufacturing facility between 5 GWh and 20 GWh capacity within five years from the date of appointment. Further, it must commit to a value-addition of a minimum 25% within two years from the appointed date and a minimum of 60% within five years from the appointed date, at the mother unit level in case of an integrated unit, or the project level through indigenous manufacturers, in a hub and spoke structure.

The respective State governments shall also provide incentives for implementation of the project, through the execution of a tripartite agreement between the special-purpose vehicle formed to set up the unit, the State government, and the Central government.

The selection among the qualified bidders would be made based on technical evaluation followed by financial bidding.

Bidders shall be shortlisted based on the technical evaluation. In the second stage, a financial evaluation will be carried based on the subsidy support sought by the bidder. The subsidy is capped at a maximum of INR 2,000/kWh. Any bid quoting a subsidy of over INR 2,000 shall be rejected. Bids will finally be ranked according to their combined technical and financial scores. The bidder achieving the highest combined score will be allocated the capacity first, and so on till a cumulative capacity of 50 GWh per year has been allocated.

The subsidy disbursement shall commence once the proposed committed capacity and value addition are achieved and the sale of the advanced chemistry cell begins. It shall be phased out over a five-year window, payable quarterly.

Bids can be submitted by December 31. Technical bids shall open on January 3, 2022, and financial bids on January 21. The letter of award will be issued to successful bidders on February 4.

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