India Energy  Storage Systems  (ESS) Market Capacity, Growth & Outlook  (2026-2034)
                     India Energy 
Storage Systems 
(ESS) Market
Capacity, Growth & Outlook 
(2026-2034)
Strategic analysis of grid modernisation, renewable integration, and battery 
technology evolution
MARKET OVERVIEW
Capacity Expansion 
Trajectory
8.9 GW 16.2 GW
2025 Market Capacity 2034 Forecast
Current installed base reflecting Projected capacity driven by grid 
strong renewable integration modernisation and storage 
momentum mandates
6.84%
CAGR (2026-2034)
Steady growth trajectory supported by policy frameworks and declining costs
Market Forecast: Capacity Growth
Compound Annual 
Growth Rate
6.84%
2026-2034 Forecast Period
Sustained expansion driven by renewable 
energy targets, grid stability 
requirements, and declining battery costs 
across all market segments.
Study Timeline & Methodology
Historical Period Base Year Forecast Period
2020-2025 2025 2026-2034
Analysis of past market performance Current market assessment and Projected growth trajectory and 
and capacity additions baseline capacity evaluation capacity expansion modelling
Our comprehensive methodology combines historical data analysis, current market assessment, and forward-looking projections to 
deliver actionable insights for investors and stakeholders in India's energy storage sector.
Key Insights
Critical Takeaways
500 GW Renewable Target by 2030
India's ambitious renewable capacity goal is driving unprecedented 
demand for energy storage solutions to manage intermittency and 
ensure grid stability across solar and wind installations.
Shift to Lithium-ion Dominance
Battery Energy Storage Systems (BESS) using lithium-ion technology 
are rapidly becoming the preferred solution, displacing traditional 
storage methods due to superior efficiency and declining costs.
Grid Stability Requirements
Increasing renewable penetration necessitates advanced storage 
infrastructure for frequency regulation, voltage support, and load 
balancing to maintain reliable power supply nationwide.
MARKET DRIVERS
Demand Drivers
Renewable Energy Integration
Managing solar and wind intermittency through 
storage solutions
Government Incentives
Viability Gap Funding (VGF) schemes supporting 
storage deployment
EV Ecosystem Growth
Electric vehicle expansion driving battery 
technology advancement
Growth Factors
Economic & Strategic Expansion
Decreasing Li-ion Battery Ancillary Grid Services Rural Electrification Projects
Costs
Growing need for frequency regulation, 
Rapid cost reduction in lithium-ion voltage support, and peak shaving Government initiatives bringing reliable 
technology making storage economically services to maintain grid stability with power to remote areas through 
viable for large-scale deployment across increasing renewable penetration. distributed energy storage and microgrid 
utility and commercial segments. solutions.
Sustainability & 
Technology
1 Second-life Battery Applications
Repurposing EV batteries for stationary storage, extending 
lifecycle and reducing environmental impact whilst creating 
cost-effective storage solutions.
2 Pumped Hydro Storage Revival
Renewed focus on pumped storage projects leveraging India's 
topography for large-scale, long-duration energy storage 
capabilities.
3 Advanced Battery Management Systems
Sophisticated BMS technology optimising performance, safety, 
and longevity of storage installations through real-time 
monitoring and control.
MARKET TRENDS
Shaping the Future
The Indian energy storage market is witnessing transformative 
1 2 trends that will define the sector's trajectory through 2034. 
Hybrid renewable energy projects combining solar, wind, and 
Hybrid Energy Flow Battery 
battery storage are becoming the norm, offering superior grid 
Storage Projects Adoption
integration and reliability.
Long-duration storage for Flow batteries are emerging as a viable alternative for long-
Integrated solar, wind, grid-scale applications duration storage applications, particularly for utility-scale 
and BESS installations
projects requiring 4-8 hour discharge capabilities. Meanwhile, 
the Production Linked Incentive (PLI) Scheme is catalysing 
domestic manufacturing, reducing import dependence and 
3
creating a robust local supply chain.
Domestic Cell Manufacturing
PLI Scheme driving local production capacity
Technology Segmentation
Battery Energy Storage Systems (BESS)
Fastest Growing Segment
Lithium-ion dominated systems offering rapid response times, high efficiency, and declining 
costs. Ideal for frequency regulation, peak shaving, and renewable integration across utility 
and commercial applications.
Pumped Hydro Storage
Largest Installed Base
Mature technology with proven reliability for large-scale, long-duration storage. India's 
existing pumped storage capacity provides critical grid stability, with new projects under 
development.
Thermal Storage
Concentrated solar power (CSP) plants utilising molten salt and other thermal storage media 
for dispatchable renewable energy, particularly relevant for industrial process heat 
applications.
Mechanical Storage
Emerging technologies including compressed air energy storage (CAES) and flywheel 
systems offering niche applications for specific grid services and industrial requirements.
Application Analysis
Market Distribution by Application Segment
Dominant Segment: Grid 
Support
Transmission & Distribution applications 
represent the largest market segment, driven 
by utility-scale storage requirements for 
renewable integration, frequency regulation, 
and grid stability services.
Behind-the-Meter (C&I) installations are 
growing rapidly as commercial and industrial 
consumers seek energy cost optimisation, 
demand charge reduction, and backup power 
capabilities.
Residential applications remain nascent 
but show promise with declining system costs 
Grid Support Behind-the-Meter Residential and increasing consumer awareness of 
energy independence and backup power 
benefits.
End-User Analysis
Utilities
Major Procurers via Competitive Tenders
State and central utilities leading storage deployment through SECI, NTPC, 
and state DISCOMs. Large-scale BESS projects for renewable energy zones 
and grid stability services dominate procurement.
Non-Residential (Industries & Data Centres)
Commercial & Industrial Segment
Manufacturing facilities, data centres, and commercial establishments 
adopting storage for demand charge management, power quality 
improvement, and operational resilience. Growing segment driven by 
energy cost optimisation.
Residential
Emerging Consumer Market
Homeowners increasingly interested in rooftop solar-plus-storage systems 
for energy independence, backup power during outages, and electricity bill 
reduction. Market growth constrained by upfront costs but improving 
economics.
REGIONAL ANALYSIS
Regional Market Distribution
South India
Leading region with highest renewable 
penetration, particularly wind energy in 
Tamil Nadu and Karnataka driving storage 
deployment
South India
High renewable 
penetration; wind & 
solar in TN, KA
Regional West India
Market West India
Distributi Industrial demand Industrial powerhouses Gujarat and 
on centers in Gujarat and Maharashtra Maharashtra showing strong C&I storage 
North India adoption alongside utility-scale projects
Large solar parks 
concentrated in 
Rajasthan
North India
Rajasthan's massive solar parks creating 
significant storage demand for managing 
intermittency and grid integration
Competitive Landscape
Market Structure & Key Players
Exide Tata Power Amara Raja AES India
Industries
Integrated utility Major battery Global energy 
Leading battery player with manufacturer storage leader 
manufacturer significant diversifying into bringing advanced 
expanding into renewable and energy storage BESS technology 
advanced lithium- storage project systems and and project 
ion and energy portfolio lithium-ion expertise
storage solutions technology
Panasonic
International 
technology 
provider offering 
advanced battery 
cells and storage 
solutions
The competitive landscape features a mix of established Indian battery manufacturers, integrated utilities, and international technology 
providers, creating a dynamic ecosystem driving innovation and cost reduction.
Recent Industry 
Developments
Large-scale BESS Tenders
SECI and NTPC have issued multiple gigawatt-scale battery storage 
tenders, signalling aggressive capacity addition plans. Recent awards 
include 1,000 MWh standalone storage projects and renewable-plus-
storage hybrid tenders.
Lithium Discovery in J&K
Discovery of significant lithium reserves in Jammu & Kashmir represents 
a strategic breakthrough, potentially reducing import dependence and 
strengthening domestic battery manufacturing ecosystem.
New Gigafactory Announcements
Multiple domestic and international players announcing battery cell 
manufacturing facilities under PLI Scheme, with combined capacity 
exceeding 50 GWh, transforming India's battery production landscape.
REPORT HIGHLIGHTS
Comprehensive Analysis Framework
What's Included Strategic Opportunities
• Historical capacity analysis (2020-2025) This comprehensive report provides investors, manufacturers, 
• Detailed forecast modelling (2026-2034) and policymakers with actionable insights into India's rapidly 
• Technology segmentation and trends evolving energy storage market.
• Application and end-user analysis
Detailed segment breakdowns across technology types, 
• Regional market distribution
applications, and end-users enable precise market entry 
• Competitive landscape assessment
strategies and investment decisions.
• Policy and regulatory framework
• Investment opportunities and risks Regional analysis highlights geographic opportunities, whilst 
competitive landscape assessment identifies partnership and 
acquisition targets in this high-growth sector.
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consulting firm delivering actionable combining primary interviews, investors, and government agencies 
intelligence across industries and secondary data, and proprietary for strategic decision-making
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Contact Information
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Email: [email protected]
Investment Outlook
Strategic Considerations for Stakeholders
Market Entry Timing
Optimal window for investment as costs decline and policy support strengthens
Partnership Opportunities
Collaboration between technology providers, utilities, and developers creating value
Technology Differentiation
Advanced BMS, flow batteries, and second-life applications offering 
competitive advantages
Long-term Growth
Sustained expansion trajectory supported by renewable 
targets and grid modernisation
Policy & Regulatory Framework
India's energy storage sector benefits from a comprehensive 
policy ecosystem designed to accelerate deployment and build 
domestic manufacturing capabilities.
Financial mechanisms including Viability Gap Funding and 
the Production Linked Incentive Scheme are reducing project 
costs and attracting investment into battery cell 
manufacturing.
Regulatory reforms enabling storage participation in 
ancillary services markets and mandating storage alongside 
renewable projects are creating sustained demand.
The National Energy Storage Mission provides strategic 
direction, targeting significant capacity additions whilst 
fostering indigenous technology development and reducing 
import dependence.
Conclusion
India's Energy Storage Revolution
India's energy storage market stands at an inflection point, poised for substantial growth from 8.9 GW in 2025 to 16.2 GW by 
2034, representing a 6.84% CAGR. This expansion is underpinned by ambitious renewable energy targets, declining battery costs, 
and robust policy support.
The convergence of technological advancement, manufacturing localisation through the PLI Scheme, and strategic lithium 
discoveries positions India to become a global energy storage hub. Utilities, industrial consumers, and residential segments all 
present compelling opportunities for investors and technology providers.
As grid modernisation accelerates and renewable penetration deepens, energy storage will transition from a niche solution to a 
fundamental infrastructure component, essential for India's energy security and climate commitments.
16.2 500 6.84%
GW Capacity by 2034 GW Renewable Target Market CAGR