The report “The age of storage: Batteries primed for India’s power markets” by EMBER highlights that battery participation in power markets, without long-term contracts, has often been viewed as a low-return business riddled with uncertain revenue streams. But India’s evolving electricity landscape has created an environment where battery energy storage systems (BESS) can earn strong returns from power exchanges, while offering critical system-level support to the grid.
Batteries are increasingly recognised as the multitool of the power sector transition. A flexible solution capable of addressing various challenges emanating from a high-renewables grid, from storing low-cost renewable energy to ensuring real-time grid stability, batteries solve several problems. Yet their large-scale deployment has, until recently, been constrained by high upfront costs and uncertain revenue streams.
As more variable renewable energy enters India’s electricity grid, coinciding with sharp declines in battery costs, new business cases are emerging for BESS. One particularly promising opportunity is battery participation in India’s wholesale power and ancillary services market. Price volatility in the day-ahead market segment of the power exchanges is becoming the norm. Electricity prices are now regularly crashing during solar hours and surging during the evenings and nights.
Access the report here
