MNRE Finalises BESS Mechanisms For ‘Round-the-Clock’ Renewable Energy

MNRE Finalises BESS Mechanisms For 'Round-the-Clock' Renewable Energy

A meeting was held by Union Minister for Power and New & Renewable Energy RK Singh on February 22 regarding finalising the structure for operationalizing the scheme for Viability Gap Funding (VGF) for the development of Battery Energy Storage Systems (BESS) with a capacity of 4,000 Megawatt Hours (MWh).

The minister emphasised that the price of Battery Energy Storage Systems (BESS) has come down in recent years. He stated that the government will encourage setting up BESS capacity to meet the fast-growing needs of power demand as well as energy transition. While addressing the meeting, Singh also commented, “A situation will arise in the future where we have extra solar energy during the day and extra wind energy during the evening, which would go to waste if the adequate storage system is not deployed to store and utilize it when needed.”

Further, noting that the role of government is to create enabling structures so that investment can come in, the Minister said that he wants this system to fructify in a manner that provides energy at those times of the day and year when the nation needs it the most. It was discussed that the BESS should be able to deliver electricity during periods of peak demand while at the same time stabilizing the grid. The power shall be supplied through different market segments in power exchanges. The charging of BESS would be done primarily from renewable sources during times when power generated from solar and wind sources is available.

Senior officers from the Ministry of Power, Ministry of New & Renewable Energy, Central Electricity Authority, Solar Energy Corporation of India, Grid India, and NTPC Vidyut Vyapar Nigam Ltd. (NVVN) were also present in the meeting.

Along with that, various models for procuring the BESS, such as those based on energy contracts and capacity contracts, were discussed in the meeting. The pros and cons of these models were discussed, along with the challenges associated with their implementation. Various sites in states rich in renewable energy were discussed as potential locations for BESS, to get maximum benefit from the storage system.