Government Weighs Localisation Mandate for Battery Storage in Renewable Projects

The Union government is considering a proposal to mandate battery storage systems for renewable energy projects feeding electricity into the grid, as well as standalone energy storage facilities. The plan would require these systems to include a minimum share of domestically manufactured components.

This move aims to reduce India’s reliance on imports during a critical phase of its clean energy transition. Officials have indicated that discussions are at an early stage and no final decision has been taken yet.

Proposed Localisation Norms and Scope

Under the proposal, at least 50% local content may be mandated for components such as battery and energy management systems, containers and inverters used in Battery Energy Storage Systems (BESS). Battery cells would be excluded from this requirement, focusing localisation efforts on non-cell components.

The government is also considering introducing an approved list of manufacturers and models for BESS, similar to the framework already used in the solar sector. These measures aim to create a structured approach for indigenisation while maintaining quality standards.

Industry Consultations and Readiness

The power ministry has recently held consultations with state-owned firms, including NTPC and Solar Energy Corporation of India, alongside private players. These discussions focused on industry readiness and potential timelines for implementing localisation norms.

Officials emphasised that deliberations remain preliminary and stakeholder feedback will shape the next steps. The consultations reflect the government’s intent to balance policy objectives with practical considerations for market participants.

Strategic Drivers Behind the Proposal

The localisation push is driven by multiple factors, including reducing import dependence and enhancing grid security. Cyber risks linked to imported power electronics, particularly from China, have raised concerns among policymakers.

Officials have highlighted that dozens of cyber-attack attempts are reported daily on the national grid, making vendor whitelisting and domestic sourcing critical for security. These measures are increasingly being viewed as national security imperatives alongside economic objectives.

Investment Targets and Cost Implications

India has set a target of achieving 47 GW of battery storage capacity by 2032, requiring investments of around ₹3.5 trillion. Non-cell components that may fall under localisation norms account for roughly 35% of the cost of large-scale battery systems.

While former power secretary Alok Kumar cautioned that aggressive mandates could raise tariffs and slow adoption in the short term, analysts believe phased implementation with adequate lead time could mitigate cost pressures. The proposal builds on an earlier mandate requiring 20% localisation for storage projects under the viability gap funding scheme, signalling a gradual approach.

Read More: Ola Electric Rolls Out ‘Shakti’ From Gigafactory, Enters Residential Energy Storage Market.

Conclusion

The government’s plan to mandate domestic content in battery storage systems for renewable projects reflects a strategic effort to strengthen India’s clean energy ecosystem. By focusing on non-cell components and introducing approved vendor lists, the proposal aims to balance localisation with operational feasibility.

Industry consultations and phased implementation indicate a cautious approach to managing cost and adoption challenges. If implemented, the policy could reshape supply chains and reinforce India’s energy security objectives.

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