The renewable energy (RE) capacity in India is projected to rise significantly over the current decade, increasing the share of RE power—including large hydro—to about 40% of total electricity generation by FY2030. Achieving this ambitious target will require robust energy storage systems (ESS) to address the intermittency of wind and solar power. At present, ESS deployment is primarily driven by Battery Energy Storage Systems (BESS) and Pumped Storage Hydropower (PSP) Projects. ICRA expects the energy storage sector to require an investment of around Rs. 1.4 trillion for BESS capacity addition by 2030, reflecting the scale of opportunity and commitment needed to support renewable integration.

Exhibit: Projected power generation mix as per the NEP released by CEA and ICRA’s estimate

Source: ICRA Research, CEA; capacity estimate by CEA for Mar-2027 and March-2032 is as per the NEP; capacity estimate by CEA for Mar-2030 is as per the optimal generation mix report released by CEA; Electricity demand growth is assumed to grow at 5% between FY2025 and FY2030