Energetica India Magazine - September 2022

mand for electric vehicles, stationary storage and consumer electronics will mainly drive the adoption of battery storage. Robust energy storage tech- nologies can help facilitate a smooth transition towards renewable energy, providing commercially scalable and sustainable solutions. World Bank estimates 27 to 62 Million EVs in India by 2030; up to 15% elec- tric personal cars; an investment of up to INR 214,000 Million for CI; 25% of all e3W fleets using swappable batteries in 5 years !! The ongoing transition to clean ener- gy has spurred new technologies, new markets and new opportunities for in- vestors seeking to invest in a sustain- able future and earn solid returns on their investments. Energy storage, a critical component of the clean ener- gy future, is gaining notice by utilities, large-scale energy users and investors. Today, as the world reels from energy shocks stemming from Russia’s inva- sion of Ukraine and grapples with the ongoing consequences of global warm- ing, investors seeking opportunities in the clean energy space are moving towards the massive opportunity pre- sented by energy storage. While a net-zero grid is achievable, the decisions regulators make in the months ahead will not only determine how effectively and affordably our country confronts its capacity short- fall—they will shape the grid and de- termine its carbon footprint for the next generation and how that will help us in building community benefits— from lower greenhouse gas emissions, better local air quality and energy re- silience, to the massive job and invest- ment opportunities—as well as provide greater price stability. Financing Completes the Picture With hundreds of megawatts of storage already in the system, India has ample hands-on experience setting aside sur- plus electricity when it’s generated for use during times of peak demand. A decarbonized grid will need far more storage, distributed much more widely across the Indian states. Governments should not be solely responsible for getting storage and a menu of other es- sential grid enhancements in place. Fi- nancial institutions like Public Sector Banks, FIIs, Local, VC and Investment Banks have already shown an ability to finance battery storage and are ready and eager to do more. As we know every financial institution hates stranded assets. That means the solution to India’s electricity supply crunch depends on an intersection between good and smart public poli- cy and banking, with the central and states keeping key policies fairly consis- tent over long periods of time to build confidence in the stability of project cash flows. Attracting private sector capital into the marketplace will complete the pic- ture of a net-zero future. But, as not- ed, in order to attract that capital into projects there must be policy certainty (trust we have one of the best policies in place but needs certain sensitiv- ities). The other side of that story is that with great (market) power comes a great potential for good. A government with the policy and regulatory clout to cast a pause over a powerful, emerging market can just as easily make deliber- ate decisions to assist in derisking the investments that drive that market. This derisking is critical because, as a regulated financial institution, we are limited in how much risk we can take with our depositors’ capital. Therefore, the choices made by the government and regulators are critically important for a financier like the public sector and FIISs. Investing in a net-zero future is in our DNA, but we can only take on investment risk to the extent that reg- ulations permit. Investments in the energy transition will enable society’s shift towards low- cost renewable energy to minimize climate change and deliver returns for years to come. The LDES will be the lynchpin of that clean energy future, enabling wind and solar to provide base load power and fully retire fossil fuel generators. The opportunity is commensurate with the need for LDES solutions as LDES technologies attract unprecedented interest from govern- ments, utilities and transmission oper- ators. This sector presents both short and long-term benefits which will de - liver not only a return on investment, but a lower cost, more sustainable and more secure energy system. India’s Net Zero commitment by 2070 will require the achievement of near- term goals starting with the 2030 re- newables target. Large corporates and industries are also looking to reduce their carbon footprint and increasingly opting for corporate renewable PPAs. Further, the government is looking to decarbonise other emission-intensive and hard-to-abate sectors which will in- crease the demand for renewable power. energetica INDIA- September_2022 53 STORAGE