India’s Renewable Energy Storage Challenge: BESS, Pumped Hydro & Grid Stability

India is rapidly expanding renewable energy capacity, but inadequate energy storage infrastructure is emerging as a major challenge for grid stability and energy security.

Status of India’s Renewable Energy

• Rising Renewable Energy Capacity: Renewable energy accounts for nearly 53% (283 gigawatts) of India’s total installed power generation capacity of about 532 GW.
• Solar Energy Dominance: Solar energy contributes more than 150 GW, making it the largest component of India’s renewable energy mix.
• Non-Fossil Fuel Expansion Target: India aims to achieve 500 GW of non-fossil fuel energy capacity by 2030 under its climate commitments.
• Long-Term Energy Transition Vision: The Central Electricity Authority projects non-fossil fuel capacity to rise to nearly 786 GW by 2035-36.
• Growing Importance of Storage Systems: India plans to achieve 174 GW/888 GWh of total energy storage capacity by 2035-36 through Battery Energy Storage Systems and Pumped Hydro Storage Projects.

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What is Energy Storage

• Energy storage refers to technologies that store surplus electricity generated from renewable sources and release it when energy demand exceeds generation.
• Need in Renewable Energy Transition: Renewable energy sources such as solar and wind are intermittent because generation depends on sunlight and weather conditions.

Types of Energy Storage

• Battery Energy Storage Systems (BESS)
  • Battery Energy Storage Systems are technologies that store electricity chemically and release it when electricity demand exceeds supply.

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• • Features
    • Lithium-ion batteries, especially Lithium Iron Phosphate batteries, are the most widely used technology due to high efficiency and declining costs.
    • Battery systems provide fast response time and support short-duration energy storage.
    • They can be deployed at grid-scale, industrial and household levels.
    • Battery systems require comparatively less land than large hydro-based storage systems.
  • Applications
    • Battery Energy Storage Systems help integrate intermittent renewable energy such as solar and wind into the electricity grid.
    • They support grid stability, frequency regulation and peak load management.
    • They are used for electric vehicle charging infrastructure and backup power supply systems.
    • They enable round-the-clock renewable energy supply for commercial and industrial consumers.
• Pumped Hydro Storage Projects (PHSPs)
  • Pumped Hydro Storage Projects store energy by pumping water from a lower reservoir to a higher reservoir using surplus electricity.
  • Features
    • During peak demand, stored water is released through turbines to generate electricity.
    • Pumped Hydro Storage is suitable for long-duration and large-scale energy storage.
    • These projects have long operational life and lower operating costs after installation.
    • They provide high storage capacity and support grid reliability.
  • Applications
    • Pumped Hydro Storage Projects help balance fluctuations in renewable energy generation.
    • They support large-scale electricity storage for national grids and industrial demand.
    • They improve energy security by ensuring power availability during peak consumption periods.
    • They play an important role in achieving India’s renewable energy and decarbonisation targets

Key Challenges Regarding Storage of Renewable Energy in India

• Intermittency of Renewable Energy: Solar generation stops after sunset while wind energy fluctuates with weather conditions, creating supply-demand mismatches.
• Grid Stability Concerns: Insufficient storage capacity increases risks of grid instability, power shortages and renewable energy curtailment during peak demand periods.
• Low Existing Storage Capacity: India currently has only around 0.27 GW Battery Energy Storage System capacity and about 7.2 GW Pumped Hydro Storage capacity.
  • Global deployment of energy storage systems is expanding rapidly, with installed Battery Energy Storage System capacity estimated at around 270 GW and 108 GW added in 2025 alone.
  • China leads global energy storage deployment, accounting for nearly 60% of new BESS additions and about 66 GW of PHSP capacity.
• Dependence on Imported Battery Cells: India imports nearly 75-80% of lithium-ion battery cells, increasing vulnerability to geopolitical risks and price volatility.
• High Financial and Infrastructure Costs: Large-scale deployment of storage systems requires significant investment, advanced technology and transmission infrastructure upgrades.
• Limited Long-Duration Storage Availability: India lacks adequate long-duration storage systems needed for round-the-clock renewable energy supply to industries and urban centres.

Way Forward

• Expand Domestic Manufacturing Ecosystem: India should strengthen indigenous battery manufacturing under schemes like PLI to reduce import dependence and improve energy security.
• Accelerate Pumped Hydro and Battery Deployment: Faster implementation of Pumped Storage Projects and Battery Energy Storage Systems is necessary for large-scale renewable integration.
• Promote Grid Modernisation and Innovation: Smart grids, advanced forecasting systems and diversified storage technologies should be developed for efficient energy management.
• Encourage Public-Private Investments: Stable policy frameworks and financial incentives can attract private investment in energy storage infrastructure and research.

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Conclusion

Developing robust energy storage systems is essential for ensuring grid stability, energy security and the success of India’s clean energy transition.

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