1 hr ago
India’s Battery Storage Push Faces Viability Concerns
Batteries can save electricity made by the sun and wind so it can be used later.
India wants more of these batteries to help make renewable power dependable.
But some companies offered very low prices to win projects, and experts say those prices may not cover the real costs.
Battery prices also rose after changes in China, making some projects harder to afford.
Some projects have been cancelled or sent out for new bids, which can delay construction.
One large power company, NTPC, ended a contract after saying the contractor did not make enough progress.
New bids have sometimes come in at higher prices that industry representatives say are more realistic.
Experts say projects need workable prices and careful rules so they can be completed safely and on time.
India Energy Storage Alliance data shows 24 GWh of battery storage projects were cancelled or re-tendered during 2018–2026.
Industry experts warn that as many as one-third of projects bid so far may be unviable, particularly after bids below ₹2 per kWh.
Of 22.43 GWh awarded under the government’s viability gap funding plan, financial closure had been achieved for only 5 GWh, according to power ministry data cited in the article.
NTPC terminated GR Infraprojects’ ₹413-crore contract for a 400-MWh project, citing failure to meet contractual obligations and make required progress.
Retendered projects have drawn higher tariffs, including a reported increase from ₹1.97 to ₹2.35 per unit; India had installed 13.47 GWh of BESS capacity by September end.
- Who
- Indian battery storage developers, government agencies, power companies, and industry representatives.
- What
- Battery energy storage projects face cancellations, re-tenders, and concerns about whether low bids can be financially viable.
- Where
- India, including projects in Maharashtra and West Bengal.
- When
- The article reports project data for 2018–2026 and figures as of September end; it also describes cancellations and decisions in May and June.
- Why
- Experts cite aggressive low bidding, rising battery cell prices linked to policy changes in China, and project developers’ difficulty achieving financial closure.
Lowest-cost bidding
Viability-focused bidding
How tenders should select projects
Lowest-cost bidding
Some developers bid at very low tariffs to win contracts, amid expectations that battery prices would keep falling.
Viability-focused bidding
Industry representatives argue that tenders should prioritize capable, efficient bidders and sustainable tariffs rather than simply selecting the lowest quote.
How to address project failures
Lowest-cost bidding
A Ministry of New and Renewable Energy official said existing tender provisions and contract terms, including bank guarantees, are expected to deter irresponsible bidders and support timely implementation.
Viability-focused bidding
Industry voices call for stronger, well-designed policy and technical qualification frameworks, and for penalties and other measures that encourage responsible bids.
Key facts
- Cancelled or re-tendered capacity
- 24 GWh during 2018–2026, according to the India Energy Storage Alliance.
- National storage target
- The Central Electricity Authority target is 208 GWh by the end of the decade.
- VGF award progress
- Of 30 GWh covered by the plan, letters of award were issued for 22.43 GWh; 5 GWh had achieved financial closure, according to power ministry data cited in the article.
- Indicative viable tariff
- Industry sources cited in the article said BESS tariffs need to be at least ₹2.4 per kWh to be considered viable.
- NTPC contract termination
- NTPC ended GR Infraprojects’ ₹413-crore contract for a 400-MWh project at Mouda; it said securities of about ₹91 crore were encashed.
- Installed capacity
- 13.47 GWh of BESS capacity had been installed in India by September end.
- Pipeline
- Around 153 GWh was at various stages of regulatory approval or construction, as of September end.
Quotes
NTPC official
An NTPC official speaking anonymously.
“Initially, several frivolous players came up and placed very low bids in order to win tenders. NTPC has cancelled a contract and also revoked the bank guarantee.”
livemint.com
“This is a learning stage, but norms should be put in place to select efficient and capable players, rather than focusing on the lowest tariff quoted.”
livemint.com
Sources
Related news
India’s Battery Storage Buildout Lags Behind Solar Energy Needs
India Approves ₹1.86 Lakh Crore Green Energy Corridor-III
India’s Green Grid and Battery Scheme Wins UN Backing
India’s Battery Storage Additions Surge 83-Fold in H1 2026
India’s Green Energy Corridor-III Targets Grid Bottlenecks
Premier Energies, RCT Group Plan 12 GWh Battery Facility Telangana
Pace Digitek Shares Jump 11% as BESS Order Highlights Growth
Stocks in Focus September 30: Tata Steel, KSB, Power Mech
IRFC, Ola, NCC, Tata Stocks in Focus Tuesday
Pace Digitek Subsidiary Wins Rs 488 Crore BESS Order
