Renewable energy industry demands expansion of ALMM framework to boost domestic production

The Indian renewable energy industry has requested the central government to expand efforts to boost domestic production beyond solar modules and wind turbines to include Battery Energy Storage Systems (BESS) and other critical components. Santosh Kumar Sarangi, Secretary of the Ministry of New and Renewable Energy (MNRE), stated on Thursday that the industry has sought an arrangement similar to the 'Approved List of Models and Manufacturers' (ALMM) framework for other components.

This demand comes at a time when India seeks to reduce its import dependency, particularly on China, for key components of the renewable energy supply chain. Furthermore, China has proposed controls on the export of equipment used in the production of solar components such as cells and wafers, making this demand more pertinent.

During the 'India Renewable Energy Summit', Santosh Kumar Sarangi noted that the issue of reducing dependency on certain geographical areas was frequently raised in discussions with industry executives and investors. He said, “The lesson here is that we must continue to move forward on the path of progress in renewable energy. The discussions at the CEO Roundtable mentioned reducing critical dependency on specific geographical areas. If we are dependent on certain geographical areas for certain items, we need to think about manufacturing in that segment.”

The ministry held a roundtable conference with renewable energy industry CEOs and investors on Wednesday. Sarangi added that industry executives have praised the ALMM framework applied to solar modules and wind turbines and have requested similar arrangements for other components, including battery storage systems. He assured that MNRE will certainly work on whatever is necessary to promote domestic production.

Under the ALMM framework, government-supported projects are required to purchase specified equipment only from approved domestic manufacturers. ALMM-I and ALMM-II cover locally produced solar modules and cells, respectively. The ALMM list for wind includes quality-certified turbines permitted for use in utility-scale projects. While the arrangements for modules and wind turbines are operational, the requirement for solar cells has been deferred until 31 December 2026 due to supply constraints.

These measures act as non-tariff barriers and, combined with government incentives, have significantly increased India's domestic solar manufacturing capacity. Currently, the country has over 200 GW of module manufacturing capacity and 50 GW of cell manufacturing capacity. The ministry has also announced plans to bring wafers and ingots under this framework from June 2028.

Reducing import dependency for the battery supply chain has also become a priority, as India is primarily dependent on China. To strengthen energy independence and security, the government aims to develop a domestic ecosystem for battery storage. In a step towards this direction, the Union Cabinet on Wednesday approved the Viability Gap Funding (VGF) scheme for grid-scale energy storage systems, which will provide financial assistance of ₹14,500 crore between FY27 and FY31.

The scheme aims to develop an additional 92 GWh of grid-scale energy storage capacity across the country. This new capacity will be approximately 170% of India's current grid-scale storage capacity and will help meet the country's 411 GWh requirement by FY32. Battery Energy Storage Systems are extremely important for integrating renewable power into the grid.

All these details have emerged according to a report by Mint.