The Indian government has announced the financing of the viability gap (VGF) of INR 54 billion ($ 631.5 million) to support 30 GWh of battery energy storage systems (BES), which allocates the capacity among 15 states and the State Power Producer NTPC. The scheme offers INR 1.8 million/MWh and requires that projects will be put into use within 18 months by competing bidding.
The Indian Ministry of Power has announced the second tranche of its VGF scheme to support the development of 30 GWH Bess, with a total budget of INR 5.4 billion. The financing comes from the Power System Development Fund.
The scheme will offer financial support to 15 states and NTPC, which allocates INR 1.8 million/MWh for each project. Of the total goal of 30 GWH, 25 GWH will be divided over 15 states to meet their energy storage needs, while 5 GWH will be assigned to NTPC to optimize the existing thermal generation and transmission infrastructure and deliver electricity reliable and cost-effective during non-Solar hours.
The allocation of the state is as follows:
Rajasthan, Gujarat, Maharashtra with 4 GWH each
Karnataka, Andhra Pradesh with 2 GWH each
Tamil Nadu, Madhya Pradesh, Telangana, Uttar Pradesh with 1.5 GWh each
Haryana, Kerala, Punjab, Chhattisgarh, Odisha, Uttarakhand with 500 MWh each
The VGF is paid in three phases:
20% after the financial closure of the project
50% for commissioning
30% after a year of operation from the commissioning date
Projects must be taken into use within 18 months of the signing of the Battery Energy -Storing Purchasing Agreement (SPA) or Power Purchase Agreement (PPA). The projects are awarded through a rate -based competitive bid process.
According to the Central Electricity Authority (CEA), India requires 37 GWH of BESS capacity by 2027 and 236 GWH by 2031-32. So far, 13.2 GWH of Bess capacity has been approved under the current VGF scheme.
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