India’s First Commercial Utility-Scale Battery Energy Storage System Project Receives Regulatory Approval with GEAPP’s Support

New Delhi | 08 May 2024 — In a significant step forward for India’s energy transition, the Delhi Electricity Regulatory Commission (DERC) has granted regulatory approval of India’s first commercial standalone Battery Energy Storage System (BESS) project. This groundbreaking initiative is supported by The Global Energy Alliance for People and Planet (GEAPP’s) concessional loan amounting to 70% of the total project cost and is in partnership with IndiGrid and BSES Rajdhani Power Limited (BRPL). India is a first-mover country in the BESS Consortium, a multi-stakeholder coalition launched by the GEAPP Leadership Council, which is focused on scaling just energy transitions worldwide.

The approved project, a 20 MW/40 MWh BESS, will be strategically installed at BRPL’s 33/11 kV Kilokari substation and is on track to be the fastest BESS project to be commissioned, with a record time of 18 – 20 months from conceptualization to implementation.
BESS, a key enabler for energy transitions, is crucial for India and other countries to realize their transition goals. Located at a high demand sub-station, the project will improve the power quality and enable 24/7 reliable power in the area for over 12,000 low-income consumers. In collaboration with its alliance partners, GEAPP is targeting 1GW of BESS commitments in India by 2026, aligning with India’s ambitious goal of deploying 47 GW of BESS by 2032.

“The regulatory approval of the BRPL BESS project marks a significant milestone in our efforts to integrate renewable energy sources into the grid and enhance reliability for our consumers. This project exemplifies our commitment to embracing cutting-edge technologies to meet the evolving needs of our customers while advancing towards a cleaner, more sustainable energy future,” said a BSES spokesperson.

India’s urgent need for BESS integration in the distribution grid is underscored by the country’s substantial Variable Renewable Energy (VRE) penetration, which exceeds 12% in certain regions. The BRPL BESS project is the first commercial standalone BESS project at the distribution level in India to receive regulatory approval for a capacity tariff and will play a pivotal role in facilitating the uptake of low-cost VRE by the New Delhi Utility (BRPL).

The project’s significance extends beyond its innovative tariff model. With a levelized annual tariff of INR 57.6 lakh per MW, nearly 55% lower than the previous benchmark (INR 130 lakh/MW/year), the project sets a new standard for BESS affordability in India.
The BRPL BESS project boasts a comprehensive Monitoring, Evaluation, and Learning (MEL) plan aimed at sharing key insights and learnings with other Indian DISCOMs, state regulators, and power sector stakeholders in India and across Asia, Africa, Latin America and the Caribbean. This knowledge-sharing initiative underscores GEAPP’s commitment to driving innovation and scalability in the energy sector in India and emerging markets worldwide.

GEAPP’s role in the project extends beyond financing. Through technical and commercial expertise, GEAPP collaborated closely with BRPL to demonstrate the value of BESS at the DISCOM level. The concessional loan provided by GEAPP ensures an end tariff that is attractive to regulators, paving the way for future BESS projects in the country.

The benefits of the BESS project for DISCOMs are multifaceted, ranging from reduced power procurement costs and enhanced grid stability to deferred capacity upgrades and improved resource adequacy. Furthermore, the project sets a regulatory precedent for BESS integration, unlocking the pathway for future projects across the country.

Commenting on the development, Saurabh Kumar, Vice President – India, GEAPP said, “We are proud to support the pioneering BRPL BESS project, which demonstrates the viability of battery energy storage solutions and sets a new standard for affordability in the energy sector. Through our concessional financing and strategic partnerships, we are driving innovation and sustainability in India’s energy landscape.”

The project SPV – Kilokari BESS Pvt. Ltd will be paid by BRPL through a fixed-capacity tariff (in INR/MW/month terms), on availability basis irrespective of the actual consumption, demonstrating its efficacy, and making it attractive for potential investors. The SPV is owned by IndiGrid and Ampere-hour Energy.

“We are delighted to have achieved the key milestone of regulatory approval for our first utility-scale standalone BESS project in an unprecedented timeframe. BESS is a key focus area for us, recognizing its indispensable role in shaping the future of clean energy in India. We are very happy to partner with BRPL and GEAPP and are committed to deliver this project on committed timelines with their consistent support,” commented Harsh Shah, CEO of IndiGrid.

As an ideal replicable example for other geographies, this project’s business model demonstrates the viability of third-party-owned BESS solutions supported by concessional financing. This model, combined with rigorous monitoring and knowledge-sharing mechanisms, provides a blueprint for sustainable energy deployment worldwide that can be shared with interested countries, developers, and other partners through the BESS Consortium.

About Global Energy Alliance for People and Planet (GEAPP)

The Global Energy Alliance for People and Planet (GEAPP) is an alliance of philanthropy, governments in emerging and developed economies, and technology, policy, and financing partners. Our common mission is to enable LMIC’s shift to a clean energy, pro-growth model that accelerates universal energy access and inclusive economic growth, while supporting the global community to meet critical climate goals during the next decade. As an alliance we aim to reduce 4 gigatons of future carbon emissions, expand clean energy access to one billion people, and enable 150 million new jobs. With philanthropic partners, IKEA Foundation, The Rockefeller Foundation, and Bezos Earth Fund, GEAPP works to build the enabling environment, capacity, and market conditions for private sector solutions, catalyze new business models through innovation and entrepreneurship, and deploy high-risk capital to encourage private sector solutions, and assist just transition solutions. For more information, please visit www.energyalliance.org and follow us on LinkedIn.

About BSES Rajdhani Power Limited

BSES Rajdhani Power Limited (BRPL) is a joint venture between Reliance Infrastructure Limited and Govt of NCT of Delhi with a 51%:49% shareholding. Spanning a geographical area of around 691 sq kms, BRPL is the largest of the three private distribution companies (discoms) in Delhi. The company supplies electricity to over 3 million customers, covering a population base of over 12 million in South and West Delhi.

About IndiGrid

IndiGrid [BSE: 540565 | NSE: INDIGRID] is the first Infrastructure Investment Trust (“InvIT”) in the Indian power sector. It owns 37 power projects, consisting of 46 transmission lines with more than ~8,468 ckms length, 13 substations with ~17,550 MVA transformation capacity and ~855 MWAC (~1.1 GWp) of solar generation capacity. IndiGrid has assets under management (AUM) of over ~₹ 282 billion (~USD 3.4 billion). The investment manager of IndiGrid is wholly owned by KKR.

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