Mumbai, July 13 -- India is rapidly expanding battery storage to provide round the clock renewable power, with about 260 gigawatt-hour (GWh) of energy storage projects at various stages of development across the country. Developers and lenders at an industry event in New Delhi said tariffs for battery storage are seen rising as higher input costs make low-priced projects harder to sustain.
The president of the India Energy Storage Alliance (IESA) said tariffs for standalone battery storage projects had fallen sharply over the last two years on expectations that battery cell costs would continue to decline and that the recent cost rise had put many projects at risk. Installed battery storage capacity rose more than 11-fold to 8.7 GWh in the first half of 2026 from 0.78 GWh at the end of 2025, and IESA said it expects capacity to reach 10 GWh by the end of 2026. That pace remains far lower than the country's renewable generation capacity of about 283 gigawatt (GW).
Speakers attributed higher battery costs to the withdrawal of export incentives by China and to rising prices of lithium, copper and aluminium linked to the Iran war, which have increased input prices for developers. State Bank of India said some projects that had secured funding had not progressed as battery prices rose and suppliers no longer honoured earlier price commitments. A deputy general manager at SBI noted that in 2025 the lowest tariff quote seen was Rs 148,000 per megawatt (MW) per month and that at current battery prices such levels appeared unsustainable.
Companies have been offering lower tariffs to win state government contracts, a strategy that industry participants warned could undermine financing and delivery. The clean energy arm of a major conglomerate cautioned against a race to the bottom and argued that tariffs must be realistic to ensure projects can secure financing, be built on time and meet quality standards. Higher input costs are therefore likely to reshape the pipeline and determine which projects proceed to completion.
Published by HT Digital Content Services with permission from Construction World.