Ministry of Power Advises REIAs to Incorporate 2-Hour Co-Located ESS in Future Solar Tenders
The Ministry of Power has advised renewable energy agencies and state utilities to include a minimum 2-hour energy storage system (ESS), equivalent to 10 percent of solar project capacity, in future tenders to enhance grid stability and reliability.
February 19, 2025. By Mrinmoy Dey
“This requirement will help mitigate intermittency issues and provide critical support during peak demand periods. A suitable compliance mechanism may also be explicitly mentioned in the bid document to ensure the availability of storage during non-solar hours,” mentioned the advisory.
Distribution licensees may also consider mandating 2-hour storage with roof top solar plants as well. “This will improve reliability of supply at the consumer end and distribution licensees will also feel the relief from over-injection during solar hours,” stated the advisory.
It further added that by implementing the proposed storage clause, approximately 14 GW/28 GWh of storage can be installed by 2030. “The recent decrease in battery prices may also help reduce the power purchase costs during evening hours when solar generation is unavailable and energy rates in the exchange are high,” it said.
The storage system can be run either in single-cycle operation where it is charged using the co-located solar power and discharged during evening hours, or in double cycle operation, where in addition to solar power, it can also be charged using energy from the grid during low demand hours and discharged during peak hours – especially non solar hours.
“The integration of storage systems with solar power projects would not only support grid stability but also provide long-term economic benefits, such as improving the evening time utilisation of transmission lines constructed for evacuating solar power, thereby reducing transmission requirement and charges, improving energy security, and enhancing the overall efficiency of renewable energy systems,” it said.
The Ministry proposed these changes to ensure grid stability, reliability, and optimal energy utilisation in line with India’s ambitious target of increasing the non-fossil fuel capacity of the country to 500 GW by 2030 in which solar power will play a major role. ESS can help address the intermittency challenges of RE projects, by storing excess energy for use during low RE hours, thus ensuring a more reliable and stable grid.
The current installed capacity of ESS as on December 31, 2024 is 4.86 GW which includes 4.75 GW of Pumped Storage Projects (PSP) and 0.11 GW of Battery Energy Storage System (BESS) projects.
As per the National Electricity Plan published by the Central Electricity Authority, in order to integrate the 364 GW of solar and 121 GW of wind capacity by 2031-32, India would require 73.93 GW/411.4 GWh of storage capacity – 26.69 GW/175.18 GWh from PSP and 47.24 GW/236.22 GWh from BESS.
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