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India’s rapid addition of renewable power capacity is increasing the need for battery energy storage systems and pumped storage projects, while domestic battery-cell manufacturing remains far below projected demand. Industry stakeholders said the country currently has only around 2 GWh of commissioned cell manufacturing capacity against an estimated 260 GWh demand pipeline from competitive tenders in 2026. Storage is increasingly required to manage fluctuations in solar generation and provide electricity during non-solar hours. NTPC has been allocated 5 GWh of battery storage capacity under the Viability Gap Funding scheme. Research by Wood Mackenzie indicates India could take more than a decade to become self-sufficient in battery storage.
India’s expanding renewable energy capacity is creating an immediate requirement for larger energy storage systems, with industry stakeholders pointing to a substantial mismatch between the country's projected storage needs and its ability to manufacture battery cells and critical components domestically.
Battery energy storage systems (BESS) and pumped storage projects are becoming increasingly important as renewable generation expands and electricity demand rises. Solar power, in particular, produces electricity during daylight hours, while consumption often remains high after generation from solar plants declines. Storage can help bridge that timing gap by retaining surplus electricity for use when renewable generation is unavailable.
Hanish Gupta, founder and Managing Director of Sunkind India, said the country's increasing renewable capacity was making storage an essential part of the power system. Vinay Rustagi, Chief Business Officer at Premier Energies, similarly identified batteries and other storage technologies as important for managing the variability associated with solar generation.
The scale of the manufacturing shortfall remains significant. India's domestic battery-cell manufacturing capacity currently stands at around 2 GWh, representing less than 1% of the approximately 260 GWh demand pipeline expected from competitive tenders during 2026.
Piyush Goyal, CEO and co-founder of Volks Energie, said domestic cell production was not keeping pace with storage requirements and that closing the gap would take several years. He also argued that dependence on imported components should not become a reason to delay deployment of storage projects, given the immediate requirement for grid balancing as renewable capacity increases.
The issue extends across the battery supply chain rather than being limited to finished cells. India remains dependent on overseas sources for several critical components and materials required to manufacture batteries at scale.
NTPC is among the companies incorporating storage into its infrastructure planning. Chairman Gurdeep Singh said energy storage could enable renewable electricity generated during daylight hours to be retained and subsequently supplied when solar generation is unavailable.
NTPC has been allocated 5 GWh of battery energy storage capacity under the Viability Gap Funding scheme. The allocation is intended to help optimise existing thermal generation and transmission infrastructure while supporting reliable and economical electricity supply during non-solar periods.
The country's storage challenge has also been highlighted by international research. Wood Mackenzie said in its latest assessment that India could require more than a decade to achieve self-sufficiency in battery storage because of the considerable difference between expected demand and domestic manufacturing capabilities.
The research estimated India's commissioned cell manufacturing capacity at only 2 GWh in 2026. China's cumulative capacity, by comparison, stands at around 2,695 GWh. China also controls between 85% and 98% of global capacity across major stages of the battery supply chain, including cathodes, anodes, separators and electrolytes.
The manufacturing gap has implications for India's plans to expand renewable generation while maintaining grid reliability. Storage capacity needs to grow alongside renewable installations so that electricity generated intermittently can be shifted to periods of higher demand.
For India, the immediate requirement is therefore to expand storage deployment while domestic manufacturing capacity develops. Industry stakeholders have indicated that both objectives will need to progress simultaneously, with imported components continuing to support near-term deployment while local production capacity is built up.
Source- PTI
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