CHENNAI: The Tamil Nadu Electricity Regulatory Commission (TNERC) has approved the capacity charges for establishing 375 MW or 1,500 MWh Battery Energy Storage Systems at 11 Tamil Nadu Transmission Corporation Limited (TANTRANSCO) substations across the State.
In an order dated February 26, 2026, the Commission approved a capacity charge of Rs 3,15,000 per MW per month for Eagle Infra India Ltd, Maharashtra, which has been allotted five standalone storage units with a total capacity of 175 MW or 700 MWh. It also cleared Rs 3,16,000 per MW per month for OPG Power Generation Private Ltd, Tiruvallur, which will establish five units with a similar capacity of 175 MW or 700 MWh.
Onward Solar Power Private Ltd, Delhi, which matched the lowest discovered rate, has been allotted one unit of 25 MW or 100 MWh at Rs 3,15,000 per MW per month. Together, the three companies will set up the entire 375 MW capacity.
The projects will be implemented under the Build Own Operate model for 15 years under the Union government’s Viability Gap Funding scheme supported through the Power System Development Fund. The storage systems are configured for four-hour discharge and can operate up to 1.5 cycles a day to meet Tamil Nadu’s morning and evening peak demand.
A total of 21 bidders participated in the tender, of which 19 qualified for the financial bid stage. Following an e-reverse auction, the lowest tariff was discovered at Rs 3,15,000 per MW per month. Two bidders fell within the prescribed range of the lowest rate, and a third matched it to complete the tendered capacity.
The storage systems will be installed at substations, including Karamadai, Anaikadavu, Thappagundu, Thatchankurichi, Tiruvarur, Palladam, N Subbaiahpuram, Alagarkoil, Othakalmandapam, Kamudhi and Thuvakudy.
According to the Tamil Nadu Green Energy Corporation Limited (TNGECL) submissions, the projects will store surplus solar power during the day and supply electricity during peak hours. The effective cost of peak power through the storage systems, including input energy, has been estimated at Rs 6.16 per unit, compared with peak purchase rates of up to Rs 10 per unit, resulting in a saving of Rs 3.84 per unit. Over the 15-year contract period, the total estimated savings are about Rs 4,730 crore.
The Commission permitted TNGECL to issue letters of award and execute agreements with the selected bidders, directing TNPDCL to use the storage capacity strictly for grid support and peak demand management.