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Battery Energy Storage System

2023 SEP 8

Preliminary   > Science and Technology   >   Energy   >   Energy

Why in news?

  • The Indian government has approved viability gap funding (VGF) to cover up to 40% of the total capital cost for the establishment of a 4,000 MWh battery energy storage system (BESS) in the country.
  • This initiative is aligned with India’s renewable energy goals, as the country has seen significant growth in solar and wind energy capacity, meeting 25% of its energy demand from renewables, including large hydro plants.

About Battery Energy Storage System:

  • Battery Energy Storage System (BESS) is a system that stores electrical energy in batteries for later use.
  • BESS stores surplus electricity when available and discharge it when demand is high or during power outages.
    • The BESS aims to enable the use of stored renewable energy during peak hours, promoting round-the-clock renewable energy supply.
  • The scheme supports India’s ambition to achieve 50% of its energy requirements through renewable and non-fossil energy sources by 2030, while also contributing to carbon emissions reduction.


  • Batteries (lithium-ion, lead-acid, etc.)
  • Inverters for converting DC to AC power
  • BMS (Battery Management System) for monitoring and managing battery health and performance.


  • Grid stabilization and frequency regulation.
  • Energy shifting to optimize energy consumption.
  • Backup power during outages.
  • Integration of renewable energy sources.


  • Smoothing out intermittent renewable energy generation
  • Reducing peak demand and associated costs
  • Enhancing grid reliability
  • Supporting renewable energy adoption.
  • BESS can reduce greenhouse gas emissions by improving energy efficiency and integrating renewable energy sources.


With reference to Viability Gap Funding (VGF), consider the following statements:

1. It is a grant provided to support projects which are economically justified but lack financial viability.

2. A private sector company shall be eligible for VGF only if it is selected based on open competitive bidding.

Which of the statements given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2