India’s battery energy storage capacity is poised to surge nearly tenfold in 2026 to about 5 GWh (gigawatt-hour), up from 507 MWh (megawatt-hour) in 2025, says India Energy Storage Alliance (IESA).

The total capacity commissioned up to the end of 2025 was 708 MWh. An IESA analysis says 2026 will mark a critical inflexion point as the industry moves from tendering to execution. About 60 GWh of projects are expected to enter the implementation phase, following a record year in 2025 when cumulative capacity surged 84% to 224 GWh.

"All eyes will remain on whether the performance of these projects is in line with what was committed, as many projects will enter the operational phase in 2026. The next challenge is financing of these projects, especially the ones with low tariffs," said Debmalya Sen, President of IESA.

Tariffs for standalone two-hour BESS fall

Tariffs for standalone two-hour Battery Energy Storage Systems (BESS) plummeted during 2025, dropping from ₹2.21 lakh per MW per month in early 2025 to ₹1.48 lakh per MW per month by year-end in APTRANSCO’s tender. Tariffs for solar-plus four-hour BESS projects also declined to ₹2.70–2.76 per kWh, with over 50 new bidders entering the market, intensifying competition.

The aggressive pricing has raised persistent questions about project viability, said Sen. "At present, the number of projects which have received financing is only a few from the plethora of tenders and whether all projects see the light of day will often be questioned till they are delivered."

Adani will commission one of the world’s largest single-location BESS projects

Adani will commission one of the world’s largest single-location BESS projects—a 1,126 MW/3,530 MWh facility in Gujarat—by March.

Rajasthan's tender for India's largest solar-plus-BESS project at Pugal Solar Park is expected this month while Juniper Green Energy's pioneering 60 MWh merchant BESS installation is slated for commissioning by December.

"The transition from tendering to execution in 2026 represents a watershed moment for India's energy storage sector," said Vinayak Walimbe, Managing Director of Customized Energy Solutions. “While the aggressive tariff compression we witnessed in 2025 demonstrates market confidence, the real test lies in delivering these projects at promised price points amid battery cost uncertainties and financing constraints,” he added.

The government gave the second tranche of viability gap funding worth ₹5,400 crores, supporting 30 GWh of standalone BESS while mandating 20% domestic value addition for VGF projects. Interstate Transmission System charge waivers were extended until 2028 for pumped storage and solar-plus-BESS projects. States have accelerated commitments with Rajasthan mandating 5% energy storage for renewable projects above 5 MW and Bihar targeting 6.1 GWh by 2030. The pumped storage hydro segment gained significant momentum, with the competitive bidding pipeline expanding to 132 GWh from 50 GWh in 2024. JSW and UPPCL signed a 1.5 GW/12 GWh Pumped Hydro PPA at ₹77.2 lakhs/MW/year in Uttar Pradesh.

Battery strorage

Battery energy storage capacity seen rising tenfold in 2026: IESA