Mumbai, June 26 -- The Uttar Pradesh Electricity Regulatory Commission (UPERC) approved a joint proposal from the Uttar Pradesh Power Corporation Limited (UPPCL) and the Madhya Pradesh Power Management Corporation Limited (MPPMCL) on 16 June 2026 for long?term procurement of energy through a Battery Energy Storage System (BESS). The order allows the two utilities to procure 1,130 MWh through competitive bidding for 15 years. The project will connect via the Inter?State Transmission System (ISTS), with an ISTS waiver conditional on commercial operation by 30 June 2028.

The arrangement allocates use by season, with Uttar Pradesh using the system from May to October and Madhya Pradesh from November to April, to optimise utilisation and reduce costs. UPPCL supplied a financial analysis indicating joint procurement would yield material savings for Uttar Pradesh, estimated at between Rs one point three four and Rs two point three nine per unit compared with a standalone approach. The commission approved the model subject to competitive tariff discovery and return for final procurement approval.

The project will receive support under the Ministry of Power's Viability Gap Funding (VGF) scheme at a rate of Rs 1.2 mn per MWh or up to thirty per cent of project cost, whichever is lower, with total VGF estimated at Rs 1,356 mn to be disbursed in five stages. At least fifty per cent of the project cost must be domestic content, including locally developed Energy Management System software. The system will have a four?hour discharge, about 6,300 charging and discharging cycles over the contract term and battery degradation capped at two per cent annually.

MPPMCL will lead the tender and has sought a three?month extension from the central government to finish the process, while UPERC directed UPPCL to adhere to required timelines. The commission presented the project as contributing to India's renewable targets and to grid stability as solar and wind generation expands.

Published by HT Digital Content Services with permission from Construction World.