India's battery energy storage capacity grows over 4-fold to 219 MW in Q1: Mercom Capital

India's Battery Energy Storage Capacity Surges Over Four-Fold to 219 MWh by March 2024

New Delhi: India's battery energy storage capacity grew more than four-fold to 219 megawatt hours (MWh) as of March 2024, according to a report by Mercom Capital.

As of March 2023, India's overall battery energy storage capacity stood at 47.6 MWh, the US-based research firm stated in its report on Wednesday.

Policy measures such as the deviation settlement mechanism, grid connectivity regulations, and ancillary services regulations are being issued to ensure efficient renewable integration and grid stability, the report noted.

These measures are driving the demand for utility-scale energy storage, the report titled "India's Energy Storage Landscape" highlighted.

The Viability Gap Funding (VGF) program aims to install 4 gigawatt hours (GWh) of battery energy storage systems (BESS), supported by a budget of Rs 37.6 billion (USD 452 million).

The VGF, energy storage obligations (ESO), and bidding guidelines for energy storage projects—whether standalone or combined with renewable energy—are boosting the country's pipeline of energy storage projects.

According to the report, India began adding energy storage capacity in 2013 with small pilot projects, and as of March 2024, the country's cumulative installed energy storage capacity stood at 219.1 MWh.

Notably, 120 MWh of the installed capacity was added in the January-March period of this year alone.

Solar photovoltaic (PV) systems combined with BESS accounted for 90.6 percent of the total installed capacity.

"India is an emerging market for energy storage, still in the early stages of development. Despite rapid growth in renewable energy, energy storage has lagged, potentially leading to curtailment and a lack of grid flexibility and stability. To meet energy transition goals and manage the exponential increase in renewable energy, the government must prioritize energy storage to avoid issues faced by other countries with growing intermittent power but insufficient storage capacity," said Mercom Capital Group CEO Raj Prabhu.

The highest BESS capacity was installed in Chhattisgarh, accounting for 54.8 percent of the cumulative installed capacity, the report stated.

The country's operational pumped hydro storage capacity totaled 3.3 GW as of March 2024, with nearly 76 percent of the country's operating capacity located in Telangana and West Bengal.