Set to Grow: Energy storage developments and outlook

Energy storage developments and outlook

The world is rapidly moving towards decarbonisation of industries as well as greening of the power grid. While the ongoing energy transition presents several opportunities for governments, in­dustries, the environment and mankind, it also creates difficulties – intermittency of renewable energy systems being the big-gest one. Energy storage systems work well to address this issue of intermittency. In fact, the development of battery energy storage systems (BESS) has gained mo­mentum in recent years, given their crucial role in maintaining grid balance during peak and off-peak periods and ensuring a continuous and reliable supply of power from renewable energy sources. They are also an important energy source for supporting EV charging infrastructure in the country. Moreover, energy storage finds significant applications across industries, such as in data centres and manufacturing units, which are increasingly taking the decarbonisation route.

Hybrid projects, which integrate solar, wind and other renewable energy sour­ces, are now being developed with energy storage systems in order to ensure round-the-clock power supply. Going forward, these models are likely to be adopted more ra­pidly, thereby, increasing the need for gr­ea­­ter development in the sector, in terms of technologies, manufacturing capabilities as well as government incentives.

Recent developments

The year 2022 has witnessed the onset of several key developments and projects as­sociated with energy storage. A month-wise round-up has been presented below, beginning from the most recent:

August 2022: With several deals, tenders and projects, the month of August was packed with major developments in the energy storage sector. A programme ag­­ree­ment under the production linked In­centive (PLI) scheme for advanced che­mistry cell battery storage was signed by Reliance New Energy Limited, Ola Electric Mo­bility Private Limited and Rajesh Ex­ports Limited. These companies will re­cei­ve subsidies under the PLI scheme, provided the manufacturing facility is set up within two years. The mo­nth also saw the conclusion of the Solar En­er­gy Corpora­tion of India’s (SECI) auction for setting up pilot projects of 500 MW/ 1,000 MWh standalone BESS on a build-own-operate-transfer model. JSW Renew Energy Five won the entire capacity with a bid of Rs 1.08 million per MW.

Further, Maharashtra State Electricity Dis­tribution Company Limited invited bids for a long-term contract to purchase 250 MW of flexible and schedulable power from grid-connected renewable energy proje­cts with an energy storage facility. The Ka­r­­gil Renewable Energy Development Agency also issued a request for proposal for the supply, installation and commissioning of solar tubular-gel type battery banks to be deployed in varying capacities across different locations in Kargil, Leh. On the e-mobility front, Suzuki announced the setting up of an electric vehicle (EV) battery manufacturing facility at an investment of Rs 73 billion in Hansalpur, Gujarat.

July 2022: Expanding its geographical ho­ri­zon, NTPC issued a tender for 150 MW/150 MWh BESS’s for three locations in Cuba. Further, Hero Future Energies was de­clared the winner in the Kerala State Elec­tricity Board’s tender for construction of a 10 MW/20 MWh grid-connected energy storage plant. Besides, a $500 million investment was announced by Ola Electric for the es­tablishment of a state-of-the-art battery innovation centre in Bengaluru.

During the same month, the Ministry of Po­­wer (MoP) released the Renewable Pur­­­chase Obligation and Energy Storage Obligation Trajectory till 2029-30 as per which an energy storage obligation has been specified for solar- or wind energy-ba­sed storage. The prescribed storage ob­ligation is 1 per cent in 2023-24 and will increase up to 4 per cent in 2029-30. It will only be considered fulfilled when at least 85 per cent of energy stored in a system an­nually is from renewable sources.

June 2022: Hindustan Petroleum Corpo­ration Limited announced a project in An­dhra Pradesh entailing the establishment of a 100-150 MW wind-solar hybrid project with a BESS on vacant land for captive use. A tender was issued to select co­­n­­s­ultants for a feasibility study.

May 2022: Under a major storage tender issued by SECI, Sungrow collaborated with Tata Power Solar Systems Limited to build a large BESS plant in Phyang, Leh. The storage plant will have a capacity of up to 60.56 MWh. The Greenko Group an­nounced its plans to build an intelligent “En­ergy Cloud Storage Platform” with 50 GWh of daily storage capacity by 2025 and 100 GWh by 2027.

April 2022: NTPC Limited invited bids for the engineering, procurement and construction of a grid-connected BESS with 10 MW and 40 MWh rated AC discharge capacity at a 33 kV switchgear inter­co­n­n­ec­tion point in Ramagundam, Telan­ga­na. Further, SECI issued a request for se­le­ction document for developing two BESS projects at a single location in the vicinity of Fatehgarh-III substations grid-substation of the interstate transmission system network in Rajasthan. O2 Power, an India-based renewable energy producer, sig­­n­ed an MoU with Powin, a US-bas­ed battery energy storage company, to su­pply battery storage solutions for the Indian renewable energy sector.

March 2022: The MoP notified the Guide­lines for Procurement and Utilisation of BESS as part of Generation, Transmission and Distribution Assets, along with An­cillary Services to facilitate the procurement of BESS in the country.

February 2022: The Greenko Group and Ayana Renewable Power entered into a partnership to provide stand-alone storage capacity in India. Under the agreement, the companies aim to create robust and despatchable renewable energy solutions for industrial and distribution companies in India, including a round-the-clock po­wer supply of up to 1 GW. To this end, the Greenko Group has offered 6,000 MWh of storage capacity in total.

January 2022: The year took off with a partnership announced between Fluence, a global energy storage technology and se­rvices provider, and ReNew Power to form a new company to cater to India’s ra­pidly growing energy storage market.


According to a 2022 report by Baker Mc­Kenzie, the year 2021 was good for the global energy storage industry with over 12.4 GW of new capacity addition, registering an increase of over 150 per cent fr­om the 2020 levels. The rise was stark co­n­sidering the supply chain disruptions and restrictions to mobility during the Co­vid-19 pandemic. Going forward, as the world continues to pu­sh for decarbonisation to meet the goal of net zero emissions, the need for en­ergy storage will continue to rise. Ac­cording to Wood Mackenzie, 346.2 GW/964 GWh of new energy storage ca­pacity is expected to be added globally between 2021 and 2030, with the majority of this in the US and China. India too has embarked on a journey to build a robust energy storage industry in the coming years. According to a recent re­port by NITI Aayog, India’s battery storage capacity has been estimated to reach 600 GWh by the end of this decade. The growing emphasis on green mobility initi­a­tives, supportive government policies, climate commitments, demand for consumer electronics and the overall decarbonisation efforts for the power grid are key drivers for the adoption of energy storage. The report also suggests that the annual demand for batteries grew at a compound annual gro­wth rate (CAGR) of 25 per cent between 2010 and 2020, reaching roughly 730 GWh. However, the demand is estimated to rise fourfold to 3,100 GWh annually by 2030, reflecting a 16 per cent rise in CAGR between 2020 and 2030.

Net, net, the development of a robust domestic battery manufacturing ecosystem is crucial for meeting the anticipated demand for energy storage in the country. Moreover, focusing on the development of BESS technologies, supported by an affirming policy environment, wo­uld go a long way in ensuring that India’s endeavour to reach 500 GW of non-fossil fuel-based energy by 2030 is successful.

By Kasvi Singh