Beyond Convention: Is It Time for Battery Storage?

Over the past decade, commercial and industrial (C&I) businesses have significantly driven the adoption of solar energy. India added 6.9 GW of open-access (offsite C&I) solar capacity in 2024, representing a 77 % year-over-year surge from the 3.9 GW installed in 2023. This expansion brought the cumulative C&I open-access capacity to 20.2 GW by year-end.
However, solar energy has inherent limitations—generation is restricted to daytime hours and varies with weather. As power needs grow more complex, Battery Energy Storage Systems (BESS) are becoming the next logical step in India’s clean energy journey.

The Growing Importance of Battery Storage in 2025

India is at a crucial inflection point in its energy transition. With over 220 GW of non-fossil fuel capacity as of March 2025 (including large hydro and nuclear), the country is well on its way toward its 500 GW non-fossil target by 2030. But with solar and wind being variable by nature, energy storage integration is essential for ensuring reliability and grid stability.

The current cumulative installed BESS capacity in India is just ~0.4 GWh, but the pipeline is promising: 34 GWh of energy storage (BESS + pumped hydro) is under execution as of April 2025. Additionally, India’s Ministry of Power mandates an Energy Storage Obligation (ESO), starting at 1% in FY 2023–24 and rising to 4% by FY 2029–30, requiring 85% of that storage to come from renewables.

To meet the projected 82 GWh of storage needed by 2026–27 and over 400 GWh by 2031–32, battery storage is not just viable—it’s imperative.

Why BESS is Gaining Momentum

Grid Stability & Energy Reliability
BESS allows solar or wind energy to be stored during excess generation and dispatched during peak demand or grid outages. This ensures 24×7 power reliability, which is especially critical for high-dependency industries like data centers, pharmaceuticals, or manufacturing.
Enhanced Renewable Penetration
Storage mitigates the intermittent nature of renewables and enables “energy shifting”—using daytime solar power during nighttime consumption.
Cost Optimization for Businesses
Energy storage enables arbitrage: storing cheap solar-generated electricity and using it during high-tariff periods.

Evaluating Battery Storage Suitability for Your Business

Energy Consumption Patterns – Examine peak demand charges, a substantial component of electricity bills. BESS enables strategic energy arbitrage by storing surplus solar-generated energy during low-cost periods and using it during high-cost peak hours, significantly lowering overall energy expenditure.
Reliability and Power Quality – Consider sensitivity to power disruptions and fluctuations. BESS provides instantaneous backup power, essential for sectors like data centers, pharmaceuticals and continuous-process industries. Transitioning from diesel generators to battery storage aligns with corporate sustainability targets and mitigates environmental compliance risks.
Regulatory Incentives and Obligations – Stay updated on government incentives, subsidies, or mandatory energy storage requirements. Notably, India’s Energy Storage Obligation (ESO) mandates a gradual increase from 1% in FY 2023–24 to 4% by FY 2029–30, requiring at least 85% of storage from renewable sources. Leveraging such regulatory support enhances economic viability and planning certainty.
Financial Viability and Return on Investment (ROI) – Perform detailed financial assessments considering upfront investment costs, operational savings, potential ancillary revenue streams and battery lifespan (typically 8–15 years). Given falling battery costs and improving technology, investing in battery storage presents increasingly attractive economics by 2025.
Technical and Physical Readiness – Evaluate available installation space, electrical infrastructure readiness and necessary safety protocols. Engaging experienced solution providers ensures compliance with safety standards and enables customized, effective battery storage solutions.

Technological Advancements Driving Adoption

New battery technologies are rapidly emerging. Sodium-ion batteries, for instance, offer high efficiency at a lower cost and reduce dependency on imported lithium and cobalt. Advanced Chemistry Cell (ACC) technologies under the PLI scheme are further pushing domestic manufacturing.

Policy Support: What’s Driving Battery Storage in India

India’s aggressive storage integration is backed by forward-looking policy frameworks:

Initiative	Impact
Energy Storage Obligation (MoP)	1% in FY24, increasing to 4% by FY30, with 85% sourced from renewables
Viability Gap Funding (VGF)	₹37.6 billion to support 13.2 GWh of BESS by 2027
ISTS Charge Waiver	No transmission charges for BESS and PSP until June 2025
PLI Scheme for ACC Battery Storage	₹18,100 Cr allocation for giga-scale battery manufacturing
Battery Waste Management Rules	Enforces OEM accountability and safe recycling practices
ESS Roadmap (2019–2032)	Strategic framework by NITI Aayog for national storage rollout

Challenges to Be Aware Of

Despite its promise, battery storage comes with challenges :

High upfront costs, especially for lithium-ion systems
Dependence on critical minerals sourced from geopolitically sensitive regions
Battery disposal and safety concerns, like thermal runaway
Grid readiness and interconnection delays, particularly in older substations

Conclusion: Is It Time for Your Business to Go Beyond the conventional?

Yes—2025 is the tipping point.

While solar remains the cornerstone of India’s renewable journey, battery storage is fast becoming its most important ally. For C&I businesses, BESS offers operational resilience, cost savings, and a hedge against grid volatility. With strong policy support, falling costs, and rising ESG pressures, now is the time to evaluate and embrace storage-backed solutions.

Early adopters won’t just reduce their carbon footprints—they’ll secure energy leadership for the future.

This is a rapidly evolving space, and we’re right at the forefront. Get in touch at contact@hexaclimate.com—we’re here to power your journey toward net zero.

Beyond Convention: Is It Time for Battery Storage?