Why BRPL chose 2-hour BESS over 4-hour systems for its Delhi grid stations
The Delhi Electricity Regulatory Commission (DERC) has granted in-principle approval to BSES Rajdhani Power Limited (BRPL) for the installation of a 97.5 MW/195 MWh Battery Energy Storage System (BESS) across five grid stations in South and West Delhi. The project is expected to serve around 266,000 consumers.
In its order, the Commission permitted BRPL to proceed with competitive bidding for the project under the Ministry of Power’s Guidelines for Procurement and Utilization of Battery Energy Storage Systems dated March 10, 2022. However, it directed the utility to justify the financial viability of the project when seeking adoption of the discovered tariff.
Project details
The proposed BESS will be installed at the 66/11 kV G4 Dwarka (5 MW/10 MWh), G3 PPK Bindapur (15 MW/30 MWh), Hari Nagar (7.5 MW/15 MWh), Sagarpur (30 MW/60 MWh) and DTL Pappankala 2 (40 MW/80 MWh) grid stations.
BRPL will not incur any capital expenditure for the project. Instead, it will select a developer through competitive bidding to own, develop and operate the BESS, after which the discovered tariff will be submitted to DERC for approval. The Energy and Resources Institute (TERI) has been appointed as the bid process manager.
The utility has estimated a single-part tariff of Rs 0.50 crore per MW per year for the project.
Rationale for 2-hour storage
During the proceedings, the Commission sought clarification on BRPL’s decision to adopt a two-hour BESS instead of four-hour systems.
BRPL submitted that the proposed grid stations experience network overloading for about two hours during peak summer demand, making a two-hour system more effective in providing full peak load relief. The utility also cited space constraints at the substations, higher utilisation through more charging and discharging cycles, and greater suitability for ancillary services and frequency response.
The utility further referred to similar two-hour BESS projects being implemented by Rajasthan Rajya Vidyut Utpadan Nigam Limited (RUVNL), Chhattisgarh State Power Distribution Company Limited (CSPDCL) and under CERC-approved projects.
Financial assessment
BRPL has estimated annual benefits of around Rs 88.35 crore over the project’s 12-year operational period through energy arbitrage, ancillary services, reduction in gas-based power procurement, resource adequacy compliance, peak load management, deferred network augmentation and potential carbon credit revenues.
However, DERC observed that these projected savings depend largely on future differences between peak and off-peak electricity prices in power exchanges, which are inherently uncertain over a 12-year period.
Accordingly, the Commission directed BRPL to demonstrate, at the tariff adoption stage, that the project remains financially viable after accounting for volatility in charging and discharging prices. It also directed the utility to consider the value of the BESS assets that will be transferred to BRPL at the end of the 12-year contract period without additional payment.
Kilokari experience
The Commission noted that BRPL’s earlier 20 MW/40 MWh BESS at the 33/11 kV Kilokari Grid had demonstrated encouraging operational and commercial performance. That project was approved at a monthly capacity charge of Rs 4.8 lakh per MW and was found to be cost-effective compared with similar procurements undertaken by Solar Energy Corporation of India Limited (SECI) and Gujarat Urja Vikas Nigam Limited (GUVNL).
Next steps
BRPL will now initiate the competitive bidding process and subsequently approach the Commission for adoption of the discovered tariff. DERC clarified that the current order constitutes only an in-principle approval and that final tariff approval will depend on the outcome of the bidding process and the financial justification submitted by the utility.
The featured photograph is for representation only.
