Norms issued for procurement and utilisation of battery energy storage systems

The Ministry of Power has issued the guidelines for procurement and utilisation of battery energy storage systems (BESS).

The guidelines are aimed at facilitating procurement of BESS, as part of individual renewable energy power projects. It also aims to firm up power supply, increase energy output and extend the time of supply from an individual RE project or a portfolio of RE projects along with providing grid support and flexibility services for the grid.

According to government, the norms would ensure transparency and fairness in procurement processes and provide standardisation and uniformity in processes and a risk-sharing framework between various stakeholders, involved in the energy storage and storage capacity procurement, thereby encouraging competition and enhanced bankability of the projects.

In a written reply to a question in Rajya Sabha, Union Minister for Power R.K. Singh on Tuesday said: "The standard bidding guidelines for procurement and utilization of Battery Energy Storage Systems has been finalised."

According to the ministry, there should be eight defined business models for energy storage, including a revised and new model, whereby BESS developers or owners can sell a particular duration of storage from their asset and be compensated for it as capacity.

The guidelines were notified on March 10, 2022.

The minister also said that state-run Solar Energy Corporation of India Limited (SECI), released an expression of interest for setting up of 1000 MWh (BESS) on October 14, 2021.

He also noted that the ministry has prepared a report on 'optimal generation capacity mix' for 2029-30. The report identifies pumped hydro storage system (PSP) and BESS as the commercially deployed solutions for providing requisite storage capacity.

As per the report, a battery energy storage capacity of 27,000 MW/108,000 MWh (4-hour storage) is projected to be part of the installed capacity in 2029-30.