Growing Markets for Grid-Connected Battery Storage in India

This policy brief by RMI argues that while battery energy storage systems (BESS) costs in India have dropped by 65 percent over two years, the market remains constrained by regulations that only recognize a single value stream. The document advocates for regulatory reforms to allow 'value stacking'—monetizing energy, resource adequacy, ancillary services, and infrastructure deferral—to ensure grid reliability amidst rising temperatures and record power demand.

• India experienced record power demand on May 30, 2024, reaching 250 GW, which led to the greatest peak power shortfall since 2010 and caused nearly 600 transformers to fail in Kerala during a summer heatwave.
• BESS tariffs in India have decreased by 65 percent in the last two years, with further cost reductions expected from industry maturation and government initiatives like the Production Linked Incentive Schemes and Viability Gap Funding.
• Current Indian market regulations primarily recognize only one value stream for BESS—shifting net demand to reduce system energy costs—which forces an "energy only" dispatch strategy and limits remuneration.
• Optimizing BESS across a full value stack—including resource adequacy, ancillary services, transmission and distribution (T+D) deferral, and energy—could result in profit margins between 24 and 70 percent across three reported cost levels.
• The Central Electricity Authority's cost-optimized model for the 2030 grid incorporates more than 40,000 MW (200,000 MWh) of new BESS to maintain grid reliability.

APA

RMI (2024). Growing Markets for Grid-Connected Battery Storage in India. https://rmi.org/resources/growing-markets-for-grid-connected-battery-storage-in-india/

Chicago

RMI. Growing Markets for Grid-Connected Battery Storage in India. 2024. https://rmi.org/resources/growing-markets-for-grid-connected-battery-storage-in-india/.

Wikipedia

{{cite report |author=RMI |title=Growing Markets for Grid-Connected Battery Storage in India |date=1 October 2024 |url=https://rmi.org/resources/growing-markets-for-grid-connected-battery-storage-in-india/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2024growing, author = {{RMI}}, title = {{Growing Markets for Grid-Connected Battery Storage in India}}, institution = {RMI}, year = {2024}, month = oct, url = {https://rmi.org/resources/growing-markets-for-grid-connected-battery-storage-in-india/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }