MNRE Clarifies ALMM Rules for Solar+BESS Projects

In the age of clean energy transition, battery energy storage systems (BESS) are becoming a cornerstone of India’s renewable infrastructure. As industries, data centers, and commercial facilities explore pairing solar power with BESS to ensure round-the-clock energy availability and cost savings, questions around policy compliance are inevitable. One such question was recently addressed by the Ministry of New and Renewable Energy (MNRE)—a clarification that brings much-needed clarity on how solar+BESS projects are treated under the Approved List of Models and Manufacturers (ALMM).

This article explores the clarification in simple terms and dives deep into its impact on private developers, EPC contractors, and the future of energy storage-linked solar in India.

First, What is ALMM and Why Does It Matter?

The Approved List of Models and Manufacturers (ALMM) is a government-curated list of solar PV module and cell manufacturers whose products are approved for use in grid-connected solar power projects in India. Introduced to ensure quality, transparency, and the promotion of domestic manufacturing, the ALMM has become a critical checkpoint for developers and EPC companies.

Any solar project that feeds into the grid—either directly or indirectly—must use modules (and sometimes cells) from this approved list. Exemptions exist, but they are clearly defined, and misunderstanding the exemption rules can cause major project delays or non-compliance issues.

The Real-World Confusion: What Was the Industry Asking?

With the growth of battery-backed solar projects, especially in the private sector, developers started asking two key questions to the MNRE:

Q1. If a private company sets up a solar power plant only to charge a BESS, is it exempt from ALMM rules?

Q2. Can such a solar+storage setup be considered a “Behind the Meter” (BTM) project, and hence be automatically exempt from ALMM requirements, as outlined in the MNRE’s Office Memoranda (O.M.) dated October 7, 2022, and December 9, 2024?

These questions are more than technical—they impact project cost, timelines, choice of vendors, and even bankability.

MNRE’s Clarification—Made Simple

In its recent clarification, MNRE answered both these questions clearly:

Q1: Can a solar plant charging a BESS be exempt from ALMM?
Answer: Only if the BESS itself is exempt from ALMM obligations for solar cells under MNRE’s latest guidelines.
So, the exemption for the solar plant is not automatic—it is linked to whether the battery project qualifies for an exemption.

Q2: Can such a system be called “Behind the Meter” and avoid ALMM?
Answer: No, not if the battery system is (or will be) feeding electricity into the grid, directly or indirectly.

MNRE explained that a true “Behind-the-Meter” (BTM) system is one where:

Power is generated and used on-site by the consumer(s), and
No part of it goes to the grid.

However, if the solar+BESS setup can potentially export power to the grid now or in the future, it doesn’t qualify as BTM.

Hence, it must comply with ALMM rules.

Let’s Break That Down Further

Imagine a private manufacturing unit installs a 1 MW solar plant with a 2 MWh BESS.

If the BESS stores energy only for internal use (like running the factory at night) and never feeds the grid, it may be treated as BTM.

But if the BESS is part of a scheme where excess energy is exported to the grid—even once a week—it is no longer BTM, and ALMM applies.

ALMM Applicability Now Tied to BESS Status

MNRE went a step further and clarified a conditional linkage:

If the BESS project is exempt from ALMM for PV cells, then the solar plant charging it is also exempt.

If the BESS is not exempt, then the solar system is not exempt either—both must use ALMM-approved cells and modules.

This approach makes ALMM compliance project-dependent rather than component-dependent—a significant shift for EPCs and developers.

Why This Clarification Was Needed

As solar+BESS projects increase, developers are seeking to optimize their supply chain and project economics.
Many were assuming automatic exemptions based on the intended use of the battery system, without clearly considering future grid interaction.

This led to a gray area and project designs that were technically hybrid but treated as exempt from ALMM—potentially creating legal and policy gaps.

By making this clarification, MNRE has:

Reinforced the importance of grid interaction as a key factor in ALMM applicability.
Made developers more accountable for system configuration and compliance.
Prevented misuse of BTM classification for grid-serving projects.

Implications for the Industry

This clarification is more than policy housekeeping—it signals a maturing approach to solar+BESS governance in India. Here’s what it means for key stakeholders:

For Developers:

Project planning now needs a detailed compliance check early in the design phase.
A project’s future grid-export potential can no longer be ignored—intent matters.

For EPC Contractors:

Vendor selection for modules and cells will depend on the ALMM status of the entire system.
EPCs must guide clients properly on ALMM obligations, especially when dealing with BESS.

For Investors:

Clearer policy means reduced regulatory risk but also calls for deeper due diligence.
Financial models must account for ALMM-approved product pricing when not exempt.

What’s Ahead?

With the Indian government aggressively pushing for 24/7 clean power and expanding its energy storage mission, solar+BESS projects are expected to multiply—especially in C&I (commercial and industrial) spaces.

This clarification from MNRE is timely and strategic. It signals:

The tightening of policy enforcement around grid-connected systems.
A move toward more robust classification of energy storage models.
Less ambiguity, which means better industry discipline.

Final Thoughts

The solar+BESS space is exciting but complex. As MNRE rightly pointed out, not every project that looks like Behind-the-Meter qualifies as one. Intent, design, and grid interaction all matter—and so does regulatory alignment.

This clarification is not a hurdle but a helpful compass. It will encourage developers to think long-term, plan carefully, and ensure that India’s clean energy infrastructure is not only scalable but also reliable and policy-compliant.