Grid storage technologies in India

Under India’s Nationally Determined Contribution (NDC) to the Paris Agreement, the country aims to achieve 50% of cumulative installed power capacity from non-fossil fuel sources by 2030 and reduce the emission intensity of GDP by 45% from 2005 levels. Meeting these targets requires a shift in how electricity is generated, stored, and dispatched.

Reliable electricity depends on the ability to store and dispatch power on demand. Pumped-storage hydropower (PSH) has traditionally been the backbone of India’s grid storage. PSH is cost-effective and technologically mature, though its expansion is limited by geographic and hydrological constraints.

Lithium-ion (Li-ion) batteries offer flexibility, commercial readiness, and cost competitiveness. They can be deployed across the grid, in behind-the-meter (on-site) applications, and for sectoral storage such as e-mobility and industrial use. Emerging technologies like flow batteries, compressed-air energy storage (CAES), and gravity-based systems are being explored to improve long-term grid flexibility.

Storage requirements and targets

The Central Electricity Authority’s (CEA) National Electricity Plan 2023 estimates that India will require 82.37 GWh of grid storage by 2026–27, including 47.65 GWh from PSH and 34.72 GWh from batteries. The Ministry of Power’s VGF guidelines (June 2025) specify 37 GWh of BESS capacity by 2027. By 2031–32, storage demand could reach 411.4 GWh, with batteries contributing over half. By 2047, India will need 2,380 GWh (540 GWh PSH and 1,840 GWh batteries) to support decarbonization and the 2070 net-zero goal. NITI Aayog’s ESS Roadmap suggests cumulative stationary storage—including data centres, telecom, and e-mobility—could exceed 2,700 GWh by 2032.

Policy push for BESS deployment

In June 2025, the Ministry of Power announced a major Viability Gap Funding (VGF) scheme, allocating Rs 5,400 crore from the Power System Development Fund (PSDF) to develop 30 GWh of BESS capacity. The scheme provides Rs 18 lakh per MWh and covers 15 states and NTPC.

States like Rajasthan, Gujarat, and Maharashtra receive 25 GWh (4,000 MWh each) to meet storage obligations, while NTPC is allocated 5 GWh to optimize existing thermal infrastructure and meet non-solar hour demand. Projects must be commissioned within 18 months through tariff-based competitive bidding (TBCB). This complements 13.2 GWh of BESS already approved under earlier VGF schemes.

Additional measures include Energy Storage Obligations (ESO), requiring obligated entities to maintain storage capacity rising from 1% in FY 2023–24 to 4% by FY 2029–30, with at least 85% sourced from renewable generation. CERC is revising grid codes to integrate storage systems and enable technology-agnostic ancillary services, while state policies support behind-the-meter and industrial storage, and integration with renewable energy purchase obligations (REPOs).

Technology landscape and costs

Li-ion batteries dominate near-term deployment due to versatility, declining costs, and multiple revenue streams such as peak shaving, frequency regulation, and energy arbitrage. PSH remains crucial for bulk, long-duration storage, though new projects face site and environmental constraints. Flow batteries, CAES, and gravity-based systems provide alternative pathways for long-duration storage.

Levelized cost estimates guide technology choice. IIT Roorkee finds PSH costs about Rs 3.91/kWh (excluding pumping), while Li-ion currently ranges from Rs 13,600–Rs 20,000/kWh. With scale-up, policy support, and domestic manufacturing, Li-ion costs could fall to around Rs 5,500/kWh by 2030. PSH has low carbon intensity, while battery deployment requires careful sourcing and recycling of critical materials.

Supply chain security

India depends heavily on imported battery materials such as lithium, cobalt, nickel, and vanadium, with over 80% of Li-ion cells imported from China, Japan, and South Korea. To reduce risks, India is pursuing partnerships with resource-rich countries like Chile, Peru, and Argentina.

Domestic recycling is expanding. Advanced recycling technologies can recover up to 95% of lithium, 98% of cobalt, and 90% of nickel from end-of-life batteries. The Battery Waste Management Rules, 2022, impose extended producer responsibility, while incentive schemes promote critical mineral recovery from e-waste, supporting a circular economy for storage materials.

Demonstration projects and integration

India’s first 10 MW/10 MWh Li-ion battery project, commissioned by TPDDL in Delhi in 2019, demonstrated technical feasibility. Behind-the-meter storage combined with rooftop solar is growing in commercial and industrial sectors, while residential adoption is expected to increase as costs decline.

Pilot projects for flow batteries and CAES are underway to test long-duration storage, safety, and economic viability. Coordinated deployment across grid, transport, and industry can convert intermittent renewable generation into dispatchable power, supporting India’s 24×7 renewable electricity ambition. Integration with demand response and vehicle-to-grid (V2G) systems allows storage to absorb excess renewable energy and reduce reliance on peaking plants.

CEA estimates that by 2030, India could install 34 GW (assuming 4-hour duration, equivalent to 136 GWh) of battery storage alongside 18.9 GW of PSH. The recent 30 GWh VGF scheme provides momentum for large-scale deployment. Grid storage is a core component of India’s low-carbon power infrastructure. Achieving round-the-clock renewable electricity will require a mix of Li-ion batteries, PSH, emerging technologies, and supportive policies, enabling a flexible, resilient, and sustainable grid aligned with India’s 2070 net-zero target.

The featured photograph is for representation only.