Why DERC Favors 2-Hr Battery Energy Storage Over a 4-Hr One For Delhi

In response to BSES Rajdhani Power Ltd. (BRPL)’s recent petition seeking in-principle approval for bidding to commission a 12.5 MW/25 MWh Battery Energy Storage System (BESS) at the 33/11 kV Shivalik Grid, the Delhi Electricity Regulatory Commission (DERC) has considered and approved BRPL’s proposal for a 2-hour BESS configuration.

The Commission, in its analysis, found that a 2-hour BESS is adequate for peak shaving, demand variability management, frequency response, and congestion relief at the distribution level. In contrast, longer-duration assets (4-hour and above) provide system-level firming, evening peak coverage, and flexibility during extended periods of low renewable generation. This indicates that both 2-hour and 4-hour BESS projects have distinct operational advantages.

In the petition, DERC has mentioned, "The Petitioner has already commissioned a 20 MW/40 MWh BESS at 33/11 kV Kilokari Grid, which has demonstrated encouraging operational and commercial performance. Building upon this experience the Petitioner now proposes to install a BESS capacity of 12.5 MW/25 MWh within the Shivalik Grid.  The petitioner proposes to conduct the bidding in terms of the BESS Guidelines and no deviation from the same is being sought."

This project is expected to generate an estimated benefit of approximately Rs.11.50 Cr annually over the 12-year project life. This is done while considering value streams such as energy arbitrage, capex deferral, ancillary services and improved reliability.

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DERC observed that a 2-hour BESS is sufficient for peak shaving, frequency response, and congestion relief at the distribution level. It also complies with the Ministry of Power and CEA advisories, which recommend at least 2-hour storage for such applications. Moreover, DERC acknowledged that a mix of 2-hour and 4-hour systems could effectively meet cumulative 4-hour storage requirements.

Furthermore, the proposed BESS is expected to relieve stress on Delhi Transco Limited (DTL) feeders, enhance localized reliability through its islanding capability, and replicate the Kilokari project’s success in improving service quality for consumers.

Reason For Choosing 2 Hr BESS over 4Hr BESS

• The BESS requirement on a normative 4-hour basis can be effectively met through a prudent mix of 4-hour and 2-hour systems.
• A 2-hour BESS is adequate for peak shaving, demand variability management, frequency response, and congestion relief at the distribution level, while longer-duration assets (4-hour and above) provide system-level firming, evening peak coverage, and flexibility during extended periods of low renewable generation.
• The proposal builds on proven success. For instance, NTPC’s subsidiary NVVN awarded a 500 MW/1,000 MWh battery energy storage system (BESS) tender to five developers, with the lowest tariff of Rs 2.16 lakh/MW/month awarded to Solar19 Cleantech Ltd for a 50 MW project.
• Moreover, in this context, while the CEA projected that BRPL should have a total of 281 MW of 4-hour battery storage capacity by FY 2028–29, the Ministry of Power has clarified that states have the flexibility to implement BESS projects in either 2-hour or 4-hour configurations, as long as they ensure the contractual use of at least 6,300 cycles over the project period.
• This means that the total storage requirement (on a normative 4-hour basis) can be met through a mix of 4-hour and 2-hour systems, depending on local needs and operational benefits.