New Delhi: The development of a 4,000 MWh Battery Energy Storage System (BESS) is expected to reduce carbon emissions by 1.3 million metric tons (MMT) per year, said Union Minister for Power and New & Renewable Energy, RK Singh in a written reply to a question, in Rajya Sabha.
This comes following the Union Cabinet’s approval of the scheme for Viability Gap Funding (VGF) for the development of BESS, as decided in their meeting on September 6, 2023.
The minister informed that under this scheme, projects will be approved over a three-year period from 2023-24 to 2025-26, with the disbursement of funds extending until 2030-31 across five tranches. The anticipated cost for the BESS system ranges between INR 2.40 to INR 2.20 Crore/MWh for the development of 4,000 MWh capacity, totaling a capital cost of INR 9,400 Crores, supported by a budget of INR 3,760 crore.
The central government will provide up to 40% of the capital cost for BESS as VGF. The selection of public and private sector entities for the development of BESS will be done through a bidding process conducted by implementing agencies, in accordance with the provisions of the scheme and bidding guidelines.
Highlighting the significance of this development, the minister stated that the BESS, when charged with renewable energy, will contribute to a substantial annual reduction in carbon emissions. Additionally, this storage system will provide up to 4,000 MWh of energy during peak hours for utilization by Discoms and other beneficiaries.
This initiative is part of the government’s efforts to enhance sustainable energy solutions and reduce the environmental impact of energy consumption in India.
