Depleting conventional energy reserves and climate change due to fossil fuel usage have made it a necessity to shift focus towards green energy- mainly solar. Although, reliable and green, solar energy source is not available throughout 24 hours of the day. Therefore, the merit behind investing in energy storage is as relevant as investing in solar energy adoption.
Understanding the equation, the world is rapidly moving towards energy storage development. For example, developing solar markets like- Chile, South Africa, Brazil, and India are expected to show over 40% growth in energy storage market in next decade. Consistently falling battery cost is going to support this growth by reducing storage system cost by 14% per year. As a growing solar power market, India must move ahead in investing in solar power storage industry.
States in India that are leading solar power revolution such as- Gujarat, Telangana, Rajasthan, Tamil Nadu, AP etc are moving towards using energy storage for better reliability of the solar energy adoption. Also, states that have been using diesel generator are showing interest in using solar energy with storage capacity by comparing the cost savings in the future.
Government of India’s National Energy Storage Mission has made headway in aligning different solar energy systems in one platform such as- electric vehicles. With Li-ion technology cost falling consistently, solar energy storage demand is expected to rise higher in upcoming years. India has recently tendered a major solar PV + energy storage project (20 MW SPV + 28 MWh storage) in Andaman. Several more are in the pipeline in FY 2019-20.
Government of India is also focusing on providing electricity to rural households accompanied with solar power storage solutions. And it plans to install 10,000 micro/mini grids with energy storage in recent year.
Drivers of Energy Storage Market in India
Energy storage can keep the excess energy (unused harvested energy during the day) for later use (at night). This energy can be re-directed into the grid at night to satisfy the energy demand. And India’s focus towards country wide solarisation is the primary driver that is making energy storage industry development a necessity.
Besides, energy storage facility can stabilize the grid, which is a necessity in India where power grid is not very robust. And introducing renewable energy in such a scenario, without energy storage will only increase the issues and deprive people from getting energy when needed.
Additionally, lack of an energy grid in rural areas and the benefits that solar introduces in these areas make energy storage in demand. These are some of the major drivers for adopting solar energy storage technologies in India.
Challenges in the Path
High upfront cost of availing solar energy storage is the primary challenge that India is facing. Although, lead acid based batteries are affordable in comparison to Li-ion batteries, lead acid based batteries have a short lifespan in Indian climate (5 years approx.).
It is a fact that cost of Li-ion batteries is consistently falling and estimated to fall for another 2 years, and hopefully declining price will increase demand and establish manufacturing setups in India. But, currently, there are no major Li-ion cell manufacturers in the country. India needs strong policies and investment solutions to support better energy storage usage to ultimately facilitate faster solar adoption rate.
With strong lead based battery manufacturing infrastructure already existing in India, it is the right time for the country to focus on Li-ion technology development making better investments. Offering low-cost financing facility and developing regulatory frameworks can work in the country’s favour towards green energy transition, championing solar energy.