Grid-Scale Energy Storage Systems Are The New Evolution for Energy Sector

 In the next decade, Energy Storage Systems (ESS) is tipped to make its mark in the power industry. The most recent standalone ESS tenders from Solar Energy Corporation of India and NTPC are poised to increase capacity and augment the growth of the regional ecosystem.  

India’s goals for renewable energy will depend heavily on energy storage solutions and not just home-based energy storage but grid-level storage systems. This will require strong regulatory backing, including a time-based target.

ESS: New Business Model For the Industry

Future tenders for energy storage systems will probably include new business models like energy trading, emphasizing alternative technologies, and demand for the use of locally made batteries.

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The present auctions confront several technical, procurement, and regulatory difficulties because ESS technology is still in its infancy in India. 

A comprehensive national ESS policy with a time-based aim will considerably address the primary challenges the domestic industry is now facing and serve as a key engine of growth. In the next Energy Storage Systems project tenders, one can anticipate the inclusion of new business models and requirements for domestic content.

There will also be a substantial need for Energy Storage Systems installations if solar and wind power output are to expand to the 450 GW target set by the Indian government by 2030. 

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To fulfill the anticipated peak electricity demand for 2029–2030, the Central Electricity Authority (CEA) has initiated research on how to balance the energy sources while taking all technical and financial considerations into account. The report estimates that by 2030, India will require at least 10 GW of pumped hydro storage (PHS) and 27 GW / 108 GWh of grid-scale battery energy storage (BESS).

Government Support to Energy Storage Systems

The government has developed several programs and policies to support the sector in light of the significance of ESS. Interstate transmission system (ISTS) fees have been canceled by the government for ESS projects that are completed before June 2025. The government will release standard BESS bidding criteria in March 2022 and is also developing a national energy storage policy. Major obstacles to India’s ESS sector will be greatly reduced by a coherent national policy. A time-based target in future legislation may also serve as a major engine for the expansion of the ESS sector, just as it did for the development of renewable energy.

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Stakeholders anticipate a lowering of GST rates and import taxes under this future policy, particularly during the early years of the ESS market’s development. Simultaneously, the 50GWh production-linked incentive (PLI) scheme for advanced chemical cells has helped to increase local manufacturing in the sector (ACC). The project cost Rs. 18,100 crores.

Grid-scale tendering will be essential for the development of the ESS market, much as it was for the development of renewable energy (solar/wind) in India. The history of grid-scale ESS tenders in India up to this point is examined in this research. Over the past five years, Energy Storage Systems tenders have changed with the introduction of cutting-edge and modern tenders including round-the-clock (RTC), peak power, and the current standalone ESS. For the first time in India, standalone ESS and on-demand use are combined in the most recent ESS tenders released by Solar Energy Corporation of India (SECI) and National Thermal Power Corporation Limited. The two tenders will hasten the development of subsequent tenders and serve as a prototype project for policymakers.

However, ESS technology is now still in its infancy in India, therefore these solo ESS tenders will probably meet technical, procurement, and legal difficulties. For instance, a 6-hour ESS solution is required for the NTPC tender. BESS is not a practical alternative for solutions longer than 4 hours, but PHS has a far longer lead time than the project commissioning schedule. The recent increase in battery prices, which have been steadily declining for the past ten years, presents additional risk.