Tamil Nadu Industry Body Backs New Energy Storage Policy to Cut High Power Costs

The Tamil Nadu Electricity Consumers' Association has welcomed the State's new Battery Energy Storage System policy, stating that recent reliance on costly short-term power purchases shows an urgent need for storage solutions.

Policy Details

The policy aims to set up at least 2.5 GW or 10 GWh of battery storage over three years. New solar and solar-hybrid projects of one MW and above must install battery storage equal to at least 10% of their installed capacity with a four-hour discharge capability. Eligible standalone and co-located projects will get a complete waiver of transmission and wheeling charges for 10 years. The TNPDCL plans to buy 2,500 MW or 10,000 MWh of storage capacity through competitive bidding in the first phase to help manage peak demand and integrate renewable energy.

Association Demands

Association President L. Santhosh said storage systems should target expensive evening peak-hour purchases. He added that lower power costs should reflect in tariffs for industrial and commercial consumers. Projects must use competitive bidding, and High Tension consumers need incentives to build captive storage systems. He also called for regular monitoring and public disclosure of savings, battery efficiency, and operating costs.

Context

Battery storage helps grids save extra solar and wind power during peak generation hours so it can be used later when demand rises. This reduces the need for utilities to buy expensive power from the spot market at short notice.