Govt Releases Framework For Promoting Energy Storage

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The Ministry of Power has now released a detailed framework for promoting energy storage systems (ESS) in the country. The framework includes the promotion of battery storage systems as well as pumped storage systems. 

The ministry guidelines advocated for a Viability Gap Funding (VGF) of up to 40 percent of the project’s capital cost to make it more affordable. It also said that this VGF could be granted if these projects are commissioned within 18 to 24 months. 

It also asked the governments concerned to allow exemptions in electricity duty, stamp duty, land charges and others in their jurisdiction to expedite their deployment. It also asked the governments to allow concessional Green Finance for ESS adoption. 

The latest guidelines also said that its connectivity to the grid in Inter-State Transmission Systems (ISTS) and Intra State Transmission Systems should be taken on a priority basis.

“The Central Electricity Authority (CEA) and the Central Transmission Utility (CTU) may include ESS while planning the ISTS system. The State Transmission Utilities (STUs) may also follow this while planning their intra-state transmission system,” the norms said.

The ministry’s latest norms also said that the future renewable projects must consider storage facility for a portion of their generation. “In order to ensure adequate storage capacity to supply reliable power, new RE projects (excluding Hydro Projects) with an installed capacity of over 5 MW or as specified by the Central Government may be mandated to install ESS (of at least 1 hour storage) for minimum 5% of the RE capacity. Further Hydro Projects may be encouraged to have minimum pondage capacity to manage variability and peak demand,” the order said. 

It also batted for the promotion of a PLI scheme for the sector besides prescribing maintenance of quality and standards for battery storage systems through a scheme similar to ALMM.

“In order to maintain quality and standards for Battery Energy Storage Systems, the Central Government may consider issuing an “Approved List of Models and Manufacturers (ALMM) for BESS” for power sector applications, similar to the list of ALMM for Solar Photovoltaic Modules issued by the Ministry of New and Renewable Energy (MNRE),” the norms said.