Recent tenders for battery energy storage systems (BESS) in India have brought about such low bid levels that the industry experts are now warning about the viability of projects that are proposed in such a way. India’s record-low battery storage bids, which are often below ₹1.5 per kilowatt-hour (kWh), have raised questions about the economic feasibility and safety of projects intended to be carried out at such low prices.

Weak Economics Threaten Long‑Term Viability

Since 2021, India has put to tender storage capacity to the tune of 83 gigawatt-hours (GWh). Of these, only roughly 36 GWh have been granted; about 15.4 GWh are still up for tender, 18 GWh are at the construction stage, and projects totalling approximately 8 GWh have been cancelled.

By September 2025, the deployment is still far behind the targets, with just 500 megawatt-hours (MWh) of battery storage operational. The extremely low bidding prices – in some instances, industry experts consider the bid to be only one-third of what the result should be imply that the financial margin for the developers becomes very small or is negative, and this, in turn, weakens the sustainability of the projects.

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Quality and Safety Concerns Loom Large

Experts warn that cutting costs so drastically might result in the use of cheap batteries of a lower quality with a shorter lifespan, which is a big issue for India’s hot and humid climate. Since numerous tenders do not have strictly laid out technical requirements for eligibility, companies that lack experience in the energy sector and have usually been known for being financial investors have, in some cases, taken the positions of bidders.

The risk is that the projects in question may fail to meet the performance standards in the long run and, in the worst case, they may overheat or catch fire – a problem that lithium-ion battery installations under extreme conditions face worldwide.

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Implications for India’s Clean‑Energy Ambitions

The general viability concern has become a major factor in slowing down battery storage deployment at a time when India is still planning to expand renewable capacity to 500 gigawatts (GW) by 2030.

Without powerful and dependable storage capacities, it is significantly more difficult to integrate large-scale intermittent renewable energy such as solar and wind. Industry bodies like India Energy Storage Alliance (IESA), amongst others, urge the government to introduce a stricter set of guidelines for tenders, technical eligibility criteria, as well as the domestic battery manufacturing incentives, so as to guarantee safety and long‑term viability.

To sum up, India’s record-low battery storage bids seem to have produced the opposite effect that was intended. The quality, safety, and long-term viability concerns of storage projects have become more prominent alongside the economic feasibility ones. Unless there is an upgrade in policy and tender frameworks, these low‑cost bids could very well be the reason why India’s clean‑energy transition is slowed rather than accelerated. ​‍​‌‍​‍‌​‍​‌‍​‍‌

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