The Indian government has approved a Viability Gap Funding (VGF) scheme for the development of Battery Energy Storage Systems (BESS) with a capacity of 4,000 MWh, providing up to 40% of the capital cost.
The Union Minister for Power and New and Renewable Energy has announced that the Government has authorized the scheme for Viability Gap Funding (VGF) for the development of Battery Energy Storage Systems (BESS) with a capacity of 4,000 megawatt hours (MWh).
The Central Government will provide VGF up to 40% of the capital cost for BESS under the project. Public and private sector entities will be chosen through a bidding procedure performed by the Implementing Agency(ies) in accordance with the terms of the Scheme and Bidding Guidelines for the development of BESS.
The projects under the plan will be permitted over a three-year period (2023-24 to 2025-26), and in order to pass on the program to Discoms' consumers, at least 85% of the electricity from VGF-funded BESS projects must first be supplied to Discoms before being made accessible to others.
The selection of developers under the VGF plan has not yet begun.
This information was provided by the Union Minister for Power and New and Renewable Energy, Shri R. K. Singh, in a written reply to a question in Lok Sabha on December 21, 2023.