TN unveils battery storage policy, mandates storage capacity in new renewable energy projects

CHENNAI: Tamil Nadu has unveiled its Battery Energy Storage System (BESS) Policy 2026, targeting the creation of 10,000 MW of battery storage capacity by 2029, while making battery storage mandatory for new solar and wind energy projects with a capacity of 1 MW and above. The policy also provides a 10-year waiver of wheeling and transmission charges to attract investments in battery storage projects.

Electricity and Law Minister R Nirmalkumar launched the policy and a dedicated Renewable Energy Application Portal on Tuesday. The two initiatives are aimed at improving grid stability, reducing dependence on expensive power purchases during peak hours and simplifying approvals for renewable energy projects.

Under the new policy, developers setting up solar and solar-hybrid projects with a capacity of 1 MW and above will have to install battery storage equivalent to at least 10% of the project's capacity, with a minimum four-hour energy discharge capability. The same requirement will apply to new wind energy projects.

The government has also extended the battery storage requirement to existing renewable energy projects. Existing solar and wind developers will have to install storage capacity equivalent to 5% by 2027-28 and another 5% by 2028-29, taking the total requirement to 10%. The installations will be made at pooling substations.

Addressing the launch, Nirmalkumar said the policy had been formulated over the past three to four months to ensure that excess renewable energy generated during the daytime could be stored and utilised during periods of higher demand.

"At present, Tamil Nadu has around 14,000 MW of installed solar capacity and 9,000 to 10,000 MW of wind capacity. However, we are unable to utilise around 3,000 to 4,000 MW of solar power during the daytime. We have been paying for power that cannot be fully utilised. Battery storage will help us store this excess power and use it when required," he said.

The minister said the government had decided to waive wheeling and transmission charges for 10 years to encourage investments. The discharged power from battery storage projects would be procured by Tamil Nadu Power Distribution Corporation Limited (TNPDCL).

The policy is intended to make Tamil Nadu a major destination for battery storage investments. It will remain in force for a maximum of three years or until the targeted 10 GW-hour battery storage capacity becomes operational, whichever is earlier, according to the policy announcement.

The minister said the government would identify suitable land and substations and assess transmission capacity before floating tenders for individual projects. Investments would be distributed across locations based on land availability, grid capacity and load-flow studies rather than concentrating large storage projects in a single location.

He also said the government would introduce additional schemes and engage with major investors, including battery manufacturers, to achieve the target.

Online portal to streamline approvals

The Renewable Energy Application Portal, launched alongside the policy, will bring the entire grid connectivity approval process for renewable energy projects under a single online platform.

Developers can register, submit applications and documents, pay fees and track the status of their applications online. The portal will cover the process from developer registration to connectivity approval, reducing the need for physical visits to multiple offices.

The minister said the new system would also enable officials to monitor applications, field inspections and approvals centrally, while providing applicants with individual timelines after field inspections.

He said the government had restructured the existing arrangements by replacing two centres at Tirunelveli and Udumalpet with five centres covering five zones to speed up the processing of applications.

"We will monitor applications closely to prevent developers from obtaining allocations and transferring them after a year or two without implementing projects. The new system will ensure transparency and allow us to track the progress of every application," he said.

The minister added that pending applications involving violations would be kept on hold, while other applications would be processed under the revised policy.