Tamil Nadu targets 10 GWh BESS deployment over three years

Tamil Nadu has set a target for 2.5 GW/10 GWh of battery energy storage system (BESS) capacity deployment over three years, according to Saur Energy. The state utility, TNPDCL, plans to procure 2,500 MW/10,000 MWh of BESS capacity in the first phase of this initiative.

Procurement prices for the storage systems will be discovered through competitive bidding. These prices remain subject to approval by the Tamil Nadu Electricity Regulatory Commission (TNERC) before finalization.

Procurement and Policy Framework

The state’s policy framework remains active for three years from its notification or until the 10 GWh target is commissioned, whichever occurs first. Eligibility extends to projects that submit applications on or after the notification date, as well as those commissioned on or after April 1, 2027. This timeline ensures the regulatory window aligns with the phased deployment schedule.

Operational control of the storage systems will be governed by the State Load Despatch Centre (SLDC). Grid injection from these facilities must follow SLDC directions.

Substation Requirements and Incentives

• Current renewable energy (RE) pooling substations are required to deploy battery energy storage system (BESS) capacity equal to 5% by the fiscal year 2027–28.
• A further 5% BESS capacity is to be added at these sites by FY 2028–29, resulting in a total cumulative requirement of 10% with a four-hour discharge capability.
• BESS installations co-located with existing facilities are eligible for a complete 100% exemption from transmission and wheeling fees, contingent upon TNERC approval.
• Independent BESS projects with a minimum capacity of 1 MW also qualify for a 100% waiver on transmission and wheeling charges.
• The policy promotes the addition of BESS capacity to existing solar and wind projects that have a capacity of 1 MW or more.

Current Projects and Alignment

Tamil Nadu currently has four BESS projects underway, providing a foundation for the state’s broader deployment targets. Two of these are substantial facilities developed under the Viability Gap Funding (VGF) Scheme. One offers 500 MW of power with 1,000 MWh of storage, while the other provides 375 MW of power and 1,500 MWh of storage, supported by the PSDF. The remaining two projects are smaller solar-plus-BESS installations, each rated at 15 MW of power and 45 MWh of storage.

These ongoing initiatives align with the Ministry of Power (MoP) guidelines and the Electricity (Amendment) Rules, 2025.

Background

On 13 October, Luminity disclosed that VSL PowerHive intends to set up a battery energy storage system (BESS) manufacturing facility in Oragadam, close to Chennai, as outlined in a previous article. In a distinct update from 15 October, the publication noted that Vikram Solar obtained a contract to supply 187 MW of photovoltaic modules for installations in Karnataka and Tamil Nadu, per the corresponding coverage.

Regulatory Compliance and Operational Constraints

The policy explicitly supports compliance with Energy Storage Obligations (ESO) while aiming to reduce renewable energy curtailment. For co-located projects, the 100% transmission and wheeling charge waiver applies only to systems charged exclusively from the associated renewable plant and accommodated within its sanctioned transmission capacity. Total grid injection, including BESS discharge, must not exceed the sanctioned capacity of the associated renewable energy project at any time. The framework also enables cost optimisation through Storage-as-a-Service models. TNPDCL will provide charging energy for procured BESS projects in accordance with applicable regulations.