The surge comes amid aggressive state level bidding and growing investor interest, backed by central policy incentives. 

India has marked a significant leap in its renewable energy journey, recording the highest-ever monthly addition in energy storage capacity in July. States tendered 8.1 GWh of battery and hybrid storage projects during the month, the highest on record signalling robust momentum in the country’s push toward clean and reliable power.

The surge comes amid aggressive state level bidding and growing investor interest, backed by central policy incentives. The latest solar-plus-storage auctions, which included four hours of dispatchable storage, discovered a record-low tariff of Rs 3.13 per unit, a sharp dip from the previous Rs 3.32 per unit underscoring rising competition and improved cost economics.

India’s battery storage sector has gained fresh impetus with the launch of the Viability Gap Funding (VGF) scheme for Battery Energy Storage Systems (BESS), supported by the Power System Development Fund. The scheme targets up to 30 GWh of new storage capacity, over and above the existing 13.2 GWh. Since the application window opened earlier this year, nearly a third of the targeted capacity has already been tendered.

States including Rajasthan, Gujarat, and Maharashtra have led recent auctions, with bids offering large-scale capacities of 2 GWh and 4 GWh. Tariffs for standalone storage have also seen a downward trend, falling to Rs 3.59 lakh per MW per month, compared to Rs 4.41 lakh six months ago.

The continued drop in tariffs is fueling project viability, particularly for round-the-clock (RTC) renewable energy supply and grid balancing during peak evening hours. Battery storage is also helping states meet their renewable purchase obligations (RPOs) and firm up intermittent solar and wind output.

With policy clarity, declining costs, and state-level urgency converging, industry players expect India’s storage market to see accelerated buildout in the coming quarters.