Following a record year for energy storage procurement in 2025, projects awarded since mid-2023 are expected to enter service in 2026, reflecting a typical development time of 18 to 24 months.
India’s energy storage system industry is expected to move from tender to implementation by 2026, according to a new report from the India Energy Storage Alliance (IESA).
As of December 31, 2025, a total of 224 GWh of energy storage capacity had been tendered, of which 92 GWh was in battery energy storage systems and 132 GWh in pumped hydro storage. Of that total, 95 GWh are in various stages of implementation, 80 GWh remains under tender and 47 GWh of tenders have been cancelled.
The report notes that 2025 was an unprecedented year for tender activity, with 69 tenders for a total of 102 GWh during the year. That volume was almost equal to the combined total of procurements between 2018 and 2024. The projects awarded since mid-2023 are expected to enter service in 2026, in line with standard project development timelines of 18 to 24 months.
“All eyes will remain on whether the performance of these projects is in line with what has been committed,” said Debmalya Sen, President of IESA. “2026 will be the year when a number of projects enter the operational phase. The next challenge is financing these projects, especially those with low rates.”
According to the report, only 0.7 GWh of battery energy storage capacity was operational in India in 2025, while another 2 GWh is expected to come online by December 2026.
However, the report warns that aggressive pricing has raised concerns about the viability of projects.
“Currently, only a few projects from the glut of tenders have secured financing,” Sen added. “Whether all projects will see the light of day remains a question until they are delivered.”
IESA has identified March 2026 as a key milestone, when Adani is expected to commission a 1,126 MW and 3,530 MWh battery energy storage system project in Gujarat. Rajasthan is expected to float a tender for a major solar-plus-battery project at Pugal Solar Park in January. The commercial and industrial segment is also starting to develop, after Juniper Green Energy commissioned a 60 MWh large battery project in December.
“The transition from tender to execution in 2026 represents a turning point for India’s energy storage sector,” said Vinayak Walimbe, Managing Director of Customized Energy Solutions. “While the aggressive rate compression we have seen in 2025 demonstrates market confidence, the real test will be in delivering these projects at promised prices, amid uncertainties over battery costs and financing constraints. Success in 2026 will require not only competitive bidding, but also operational excellence, innovative financing structures and supply chain resilience. The industry must now prove that India can deliver at scale what it has successfully tendered.”
The report also highlights policy support, including a second tranche of viability gap financing worth INR 5,400 crore to support 30 GWh of standalone battery projects, in addition to a requirement for 20% domestic value addition. Interstate Transmission System fee waivers have been extended through 2028 for pumped storage and solar-plus-battery projects. Several states have introduced additional requirements, including Rajasthan’s mandate that renewable projects of more than 5 MW include energy storage, and Bihar’s target of 6.1 GWh of storage capacity by 2030.
IESA warned that uncertainties remain, especially around battery costs. The report notes that stricter trade policies and export restrictions on battery materials could undermine the assumptions underlying the ultra-low tariffs awarded in recent procurements.
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