New Delhi [India]: Keeping in mind the rising demands for energy and to meet its target to achieve 50 percent of the needs through renewable energy, the central government, in its weekly cabinet held on Wednesday, decided to provide viability gap funding to companies for setting up battery energy storage systems.
India aims to meet its 50 percent energy needs through renewable sources by 2030.
Addressing a press conference after the cabinet meeting, Union minister Anurag Thakur said the government will spend Rs 3,760 crore and it will be a 100 per cent central grant.
Viability gap funding is given to support infrastructure projects that are economically justified but fall marginally short of finances.
The viability gap funding is capped at 40 per cent of the total capital cost of the project.
“Battery energy storage systems are key to fullfiling rising energy demands,” said Thakur.
“We don’t have the capacity. This viability gap funding will help add 4,000 MW hours battery energy storage systems by 2025-26,” he said.
Power distributing companies (discoms) will be the first to receive such viability gab funding, he told reporters.
At the COP26 summit in Glasgow in 2021, Prime Minister Narendra Modi had committed to an ambitious five-part ‘Panchamrit’ pledge, including reaching 500 GW of non-fossil electricity capacity, to generate half of all energy requirements from renewables, to reduce emissions by 1 billion tons by 2030.
India also aims to reduce the emissions intensity of GDP by 45 per cent. Finally, India commits to net-zero emissions by 2070.
India meets a sizable portion of its energy needs through imports, and new energy sources are seen as an avenue to reduce the dependence on imported fuel.