India’s Energy Storage Market Poised for 10x Surge to 5GWh in 2026

India’s battery energy storage system (BESS) market is approaching a decisive turning point, with installations projected to accelerate sharply in 2026.  

After several years dominated by policy formulation and tender announcements, the sector is now entering a phase of large-scale execution, signalling growing maturity in the country’s renewable energy ecosystem. 

Capacity Expansion and Execution Pipeline 

According to the report from the India Energy Storage Alliance, Battery energy storage capacity additions are expected to rise from about 507 MWh in 2025 to nearly 5 GWh in 2026, reflecting a rapid scale-up of commissioned projects.  

This expansion is being driven by a strong execution pipeline built over multiple years of competitive tendering. Several awarded projects have already moved into commissioning stages, while others are in advanced phases of construction, highlighting a transition from planning to on-ground delivery. 

Key Projects and Market Pricing Trends 

The coming year will see the rollout of landmark installations, including large standalone and hybrid projects across key states.  

High-profile developments such as Adani’s large-scale BESS deployments in Gujarat and Rajasthan’s solar-plus-storage initiatives are expected to play a crucial role in shaping market confidence.  

At the same time, aggressive bidding has altered market dynamics, with tariffs for standalone two-hour battery storage systems falling sharply over the past year, reflecting increased competition and improving cost efficiencies. 

Policy Support and Financing Challenges 

Government support has been a critical catalyst for growth, with measures such as viability gap funding of ₹5,400 crore and waivers on interstate transmission charges enhancing project viability.  

These incentives have encouraged participation from developers and investors alike. However, access to financing remains a key challenge, particularly for projects secured at lower tariffs, where tighter margins raise concerns over long-term financial sustainability. 

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Conclusion 

As India integrates higher levels of renewable energy and seeks to strengthen grid stability, the sharp rise in battery energy storage installations in 2026 could prove transformative. While execution risks and financing constraints remain, the scale of upcoming deployments underscores the sector’s growing role in supporting future demand growth and advancing the country’s decarbonisation objectives. 

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