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Battery energy storage systems in India: New kid on the block

Battery energy storage systems in India: New kid on the block


With India aiming to set up 175 GW of renewable energy capacity by 2022, deploying BESS will only aid network operators, mitigate renewable resources’ variability, and reduce congestion on the grid

Earlier last month, Tata Power, AES Corporation, and Mitsubishi Corporation inaugurated India’s first 10 megawatt (MW) grid-scale battery-based energy storage system in Delhi. The unveiling of this energy storage facility is a significant step forward in revolutionising India’s power systems and augmenting the grid efficiency to match up with the global trend of upcoming energy storage systems.It is predicted that by 2035, developing nations will represent about 80 per cent of the total energy production and consumption, and an extensive share of the required capacity will probably be derived from renewable sources. While the cost of renewable energy generation has been declining, integrating and efficiently expending the energy resources, especially in areas where the grid infrastructure is inadequate, will require support systems such as integrated energy storage infrastructure. Each nation’s energy storage potential is usually reliant on the combination of energy resources present, physical infrastructure available including grid position, regulatory framework, energy supply, demand trend, and population demographics of such nation. Energy storage market worldwide is presently constrained by various barriers, which include lack of understanding of storage technology, regulatory framework, significant upfront investments, value recognition, absence of subsidised financing and availability of skilled and experienced workforce to manage energy storage systems.

Despite these prevalent challenges, energy storage as an innovative solution is increasingly being sought globally to meet the emerging requirements of the developed as well as the developing nations. And installation of battery storage energy system (BESS) is increasing dramatically as energy markets are being transformed to allow for the use of more diversified resources. Reports that are generally available forecast that the global BESS market is expected to exceed more than $9 billion by 2024 at a compound annual growth rate of 34 per cent. BESS are crucial for enabling the effective integration of renewable energy and unlocking the advantages of local generation and a clean, robust energy supply, with value being demonstrated to grid operators for management of the variable generation of renewable energy.

With India aiming to set up 175 gigawatt (GW) of renewable energy capacity by 2022, deploying BESS will only aid network operators, mitigate renewable resources’ variability, and reduce congestion on the grid. The growing renewable power capacity clubbed with appealing business for electric vehicles will strengthen the rationale behind BESS. Recent amendments brought about by CERC in the ‘Connectivity Regulations’ and the inauguration of the first grid-connected BESS have drawn the attention of industry to energy storage systems in India and their imperative role in the Indian context. Initial steps have also been initiated by certain state governments to develop storage capacities. Recent news reports have highlighted the initiative of Haryana Electricity Regulatory Commission seeking Haryana Power Purchase Centre to study the financial viability of a solar project coupled with battery energy storage system, while another report has claimed development of a 14 MW solar project with an aggregate battery storage capacity of 42 megawatt hour (MWh) in Leh and Kargil. Although, the above news has not been officially validated but indications themselves are evidence of the positive interest the state governments have in energy storage projects.

Indian corporates have also exhibited a keen interest in the development of energy storage projects and are pursuing this innovative solution. Recently, Sterlite Power submitted its bid for two projects invited by the Salt River Project (SRP) in Arizona, USA for a cumulative capacity of 400 MW. Sterlite proposes to provide for SRP’s capacity and energy needs, including ancillary services. Given the immense potential in the energy storage sector and its perfect integration with the growth of renewable energy sector, it may be apt to quote a Forbes news report which states, “Cheap batteries mean that wind and solar will increasingly be able to run when the wind isn’t blowing and the sun isn’t shining”. Success of energy storage system will, however, have to be backed by the government and the government will have to consider providing policy incentives in line with practices in countries such as South Korea, as a result of which South Korea overtook the US in 2017, to become the largest battery energy storage market globally.

Deployment of BESS may not be the ultimate resolution to the rising electricity demand in India with installed capacity likely to cross 600 GW by 2030, but its potential also cannot also be undermined, especially when BESS can play a pivotal role in addressing the call for better demand response in India.

[Kaif Ahmed, principal associate at Cyril Amarchand Mangaldas also contributed to this piece]

DISCLAIMER: The views expressed are solely of the author and ETEnergyworld.com does not necessarily subscribe to it. ETEnergyworld.com shall not be responsible for any damage caused to any person/organisation directly or indirectly.

About Ajay Sawhney

Ajay Sawhney is a Partner at Cyril Amarchand Mangaldas Projects and Project Finance Practice. He has over 15 years of experience.

Source: energy.economictimes.indiatimes
Anand Gupta Editor - EQ Int'l Media Network


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