The Indian energy storage market is rapidly evolving, characterized by clear policy guidance and robust growth momentum. With the dual factors of policy incentives and market demand, the energy storage sector in India is opening vast avenues for development.
Policy Support and Explosive Market Demand
Currently, India’s energy storage policy is well-defined, indicating a promising increase in demand. The government has set stringent requirements for energy storage systems, mandating that new photovoltaic projects must incorporate a battery storage system with a capacity of 10% and a duration of 2 hours. This requirement acts as a catalyst, with an estimated addition of 14GW/28GWh in storage demand expected by 2030, creating a significant market opportunity for energy storage companies.
National Planning and Large Projects Unfolding
From a national power planning perspective, India’s approach to energy storage is ambitious. Projections indicate that energy storage demand could exceed 73GW, with the target for Battery Energy Storage Systems (BESS) set at 47.24GW/236.22GWh. As large-scale centralized bidding projects continue to emerge, market dynamics are being invigorated, and the industry is poised for exponential growth.
Rise of the Residential Market and Unlimited Potential for Distributed Storage
The residential and distributed energy markets are also entering a phase of rapid development. The PM Surya Ghar subsidy program has led to an additional 3.29GW of installed capacity, significantly boosting the residential/rooftop solar market. This surge in installations is driving up the demand for distributed energy storage, with sectors such as home storage and small commercial storage emerging as new growth areas.
Simultaneous Policy Benefits and Industrial Upgrades
The VGF scheme provides up to 40% capital cost subsidies for BESS projects, significantly alleviating initial investment pressures. This policy not only attracts more companies to engage in energy storage project construction but also promotes the commercial application of storage technologies, accelerating industry development.
Distributed Energy Subsidies and Localization Strategies
In the distributed energy sector, the Indian government offers subsidies of up to 96% for rooftop solar systems of ≤2kW, effectively promoting the widespread adoption of distributed storage. At the same time, policies are being implemented to localize the production of components and batteries, aiming to create a complete energy storage industry chain, enhance the competitiveness of local enterprises, and achieve industrial upgrades.
The Indian energy storage market is currently in a golden period of rapid development. Ongoing policy reinforcement and the release of market demand present unlimited possibilities for the industry. For companies, seizing policy opportunities and strategically positioning themselves in the market is essential for achieving long-term growth in this promising landscape.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/indias-energy-storage-market-emerging-regulatory-framework-and-growing-demand/
