The energy storage systems market in India is set for a significant boom across the value chain, with SBI Capital Markets reporting that various government directives and elevated demands are expected to drive this growth. By 2031-32, India is projected to increase its energy storage capacity by 12-fold, reaching 60 GW. The decreasing cost of energy storage technologies is a key factor contributing to their widespread adoption in the country.
One of the main challenges in the energy sector is the inherent mismatch between surplus capacity and power demand profiles, which can lead to grid instability. This underscores the need for energy storage systems to help balance supply and demand. Battery Energy Storage Systems (BESS) and Pumped Storage Projects (PSP) are two key and complementary technologies that are expected to dominate the energy storage market in India.
BESS is predicted to be the dominant technology in the energy storage sector, thanks to its locational flexibility, technological improvements, lower tariffs, improved discharge characteristics, and rapid response time. However, the report also highlights the challenges faced by India due to its reliance on imports for battery cells and components, which are currently highly concentrated in China. The government has recognized the importance of indigenization in this sector and has introduced production-linked incentives for advanced cell chemistry.
The energy transition in India is a crucial aspect of the country’s plan to reduce its dependence on fossil fuels and increase its renewable energy capacity. Green hydrogen and other renewable energy sources are seen as key solutions to achieving this goal. The government aims to reach 500 GW of non-fossil electricity capacity by 2030 and generate half of all energy requirements from renewables.
Overall, energy storage systems play a vital role in navigating the energy transition in India. With the market set for significant growth and government support for indigenization, the country is well-positioned to capitalize on the opportunities presented by the energy storage sector. The focus on green energy and climate mitigation is not only a priority for India but also a global trend that is gaining momentum. By investing in energy storage technologies, India can significantly reduce its reliance on traditional sources of power and move towards a more sustainable energy future.
