India plans to make energy storage procurement mandatory for electricity distribution companies (discoms) as the government seeks to reduce renewable energy curtailment and address power shortages during evening and night-time hours. Power Secretary Pankaj Agarwal said the government aims to finalise the proposed rules by March 2027, with the required storage capacity still under discussion.
The proposed mandate will require power distributors to procure energy storage alongside renewable electricity purchases, marking a shift from the existing advisory framework for renewable energy developers to a mandatory requirement. The move is expected to strengthen investment in battery energy storage systems (BESS), pumped storage hydropower and other emerging storage technologies.
India Plans Mandatory Energy Storage Requirement
Speaking at the Bharat Renewable Energy Summit in New Delhi, Agarwal said the government was working on the details of the proposed storage obligation, including the quantum of capacity that electricity distributors would need to procure.
Under the existing framework, renewable energy developers are advised to integrate storage into their projects. The proposed policy would make energy storage procurement mandatory, enabling utilities to store surplus electricity generated during periods of high renewable output and utilise it when generation declines.
The government is also preparing additional renewable energy tenders linked to energy storage, Agarwal said.
Renewable Curtailment and Evening Power Shortages Drive Storage Push
The proposed mandate comes amid growing concerns over the mismatch between renewable energy generation and electricity demand. Solar generation peaks during daytime hours, while wind output varies depending on weather conditions. Electricity demand, however, often remains high during evening and night-time periods when solar generation falls.
Without sufficient storage capacity, grid operators are forced to curtail renewable electricity during periods of surplus generation, even as conventional power plants continue to meet demand during peak hours.
Around 11% of solar electricity generated in India during the hottest months of 2026 was reportedly lost due to grid curtailment, despite electricity demand reaching record levels.
India has more than 300 GW of non-fossil fuel-based power generation capacity, but coal-fired plants continue to play a significant role in meeting evening and night-time demand due to limited storage infrastructure.
Government Expands Support for Energy Storage Projects
The proposed storage procurement mandate follows the government’s decision to extend capital subsidies for energy storage projects, including battery systems, pumped hydropower and emerging technologies.
Energy storage is increasingly viewed as essential for integrating higher volumes of solar and wind power into India’s electricity grid. Storage systems can absorb excess renewable electricity during periods of high generation and discharge it when supply is constrained.
They can also improve the utilisation of existing transmission infrastructure and reduce the need for additional grid investments.
The proposed mandatory procurement framework, alongside financial support and storage-linked renewable energy tenders, is expected to strengthen India’s grid-scale energy storage market and support the integration of renewable power into the electricity system.
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