India's Green Energy Transition

India’s power sector has been witnessing a large share of renewable energy (RE) being integrated into the grid. This is expected to grow at a high pace in the future as well. With increasing RE share, storage, especially pumped-hydro energy storage (PHES), plays a key role in dispatching the energy from RE resources, peak load shaving, frequency regulation, voltage support, providing round-the-clock support, and balancing the grid, among others.

India, which is the second-largest coal producer and both the third-largest producer and consumer of electricity in the world, has committed to an RE-dominant future with an ambitious target of 450 GW of RE capacity by 2030. With the global push for clean energy and falling RE costs, there is no backing away from this goal now. Given this, what is the contribution that state generating companies (GENCOs), mainly operating thermal capacity, can make for this transition to be successful?

State-owned electricity distribution companies (DISCOMs) continue to be plagued with financial problems. This is so despite efforts by both central and state governments to bail out the beleaguered DISCOMs with rescue packages. In a last-ditch effort, the Central Government announced INR 3.05 lakh crore in the Union Budget 2021–22 to redeem the utilities.

There is an urgent need to ramp up utility-scale energy storage solutions in the power grids of most countries. This surge in demand for energy storage is being experienced due to renewable capacity increment and its intermittencies. Pumped-hydro energy storage (PHES) is one of the most promising solutions. However, PHES systems are significantly more expensive than conventional hydro power plants. Therefore, some countries are providing funding support of various kinds to attract investors and developers towards this sector.

Existing pumped-hydro-energy storage (PHES) plants in India are inadequately utilised and hence have low economic benefits. With high renewable energy (RE) penetration expected in the coming years, energy storage systems will gain prominence. One of the most economical, available, mature, and bulk energy storage mechanisms is PHES. However, PHES plants are capital-intensive and topographically dependent.

India’s clean energy transition is largely driven by the ambitious target of installing 450 gigawatts (GW) of renewable energy (RE) by 2030. While such huge RE deployment can pose several operational and technical challenges for the grid, energy storage can mitigate them.

India is planning to install 450 GW of renewable energy (RE) generation capacity by 2030. A major share of RE comes from solar and wind energy sources. These are highly intermittent sources of energy, and the generation of power from these cannot be accurately predicted. Moreover, power from these RE sources cannot be dispatched based on real-time demand. This is where utility-scale energy storages, with the ability to manage grid-balancing issues, come in. Among these, pumped-hydro energy storage (PHES) is a mature technology.