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Centre Approves ₹14,500 Crore Energy Storage Scheme for 92 GWh Capacity

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Union Cabinet approves ₹14,500 crore funding for 92 GWh energy storage projects, including battery and pumped hydro systems.

By News National Editorial Team

New Delhi, November 5, 2026

The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved a ₹14,500-crore Viability Gap Funding (VGF) scheme to support the development of 92 gigawatt-hours (GWh) of grid-scale energy storage capacity across India.

The initiative aims to strengthen the country's electricity infrastructure, improve renewable energy integration and provide a more reliable power supply.

According to the Prime Minister's Office, the scheme will operate during the financial years 2026–27 to 2030–31.

The government expects the programme to support new energy storage infrastructure and encourage greater domestic manufacturing.

How Will the 92 GWh Capacity Be Developed?

The approved programme includes three major components:

Energy storage technology

Proposed capacity

Pumped hydro storage

60 GWh

Battery energy storage systems

30 GWh

Emerging storage technologies

2 GWh

Total

92 GWh

The projects are expected to attract an estimated total investment of approximately ₹97,600 crore.

Why Does India Need Energy Storage?

India is rapidly expanding its solar and wind power generation capacity.

However, renewable energy production depends on weather conditions and the availability of sunlight and wind.

Energy storage systems can store electricity when generation is high and release it when demand increases or renewable generation falls.

This can help improve grid stability and reduce dependence on conventional electricity generation for balancing supply and demand.

Boost for Domestic Manufacturing

One of the important features of the scheme is its domestic manufacturing requirement.

Battery energy storage projects will be subject to a minimum Domestic Content Requirement of 40%.

The requirement is intended to encourage Indian manufacturing, reduce dependence on imported components and create opportunities for domestic companies.

What Does This Mean for Consumers?

The government expects the programme to support more reliable electricity supplies and improve the utilisation of renewable energy.

It could also create opportunities for infrastructure companies, energy developers, battery manufacturers and engineering businesses.

However, the actual impact on electricity prices and supply reliability will depend on project implementation, investment, construction timelines and operating costs.

The initiative forms part of India's broader efforts to strengthen energy security and build a more flexible electricity system.

Source: Prime Minister's Office, Government of India. Prime Minister of India

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