Maharashtra Proposes BESS Framework with 5 MW InSTS, 1 MW Distribution Thresholds
Maharashtra Electricity Regulatory Commission has proposed 2026 BESS regulations for Maharashtra, setting minimum thresholds of 5 MW for InSTS-connected systems, 1 MW for distribution-connected systems and two-hour storage duration, alongside procurement and charge exemptions for eligible standalone BESS.
September 23, 2026. By Mrinmoy Dey
The draft regulations seek to facilitate renewable energy integration, resource adequacy, peak demand management and grid resilience while defining the roles and obligations of generators, transmission and distribution licensees, standalone BESS developers, open-access consumers and prosumers.
The proposed framework recognises generation-linked, transmission and distribution-linked, standalone and consumer-side BESS models. Generation-linked systems can be deployed alongside renewable or conventional generating stations for renewable energy integration, grid support and auxiliary consumption, while transmission and distribution-linked BESS can be used for congestion and peak demand management, energy banking and deferring network augmentation.
Standalone BESS would be treated as a distinct asset class, enabling participation in ancillary services and electricity markets as well as energy arbitrage. Consumers and prosumers would also be permitted to deploy storage for self-consumption and demand management, while a Lead ESS could aggregate multiple storage systems to provide grid services.
MERC has proposed competitive procurement of BESS capacity or services by regulated entities through transparent bidding under Section 63 of the Electricity Act. The framework also allows procurement under Section 62 in exceptional circumstances, subject to prior approval from the Commission. Procurement could additionally be structured under a Battery-as-a-Service model based on availability-linked fixed charges.
The draft regulations propose financial relief for standalone BESS used exclusively for intermediate energy storage. Electricity drawn for such storage would be exempt from transmission charges, distribution demand charges, wheeling charges, cross-subsidy surcharge and additional surcharge, provided the stored electricity is subsequently consumed within Maharashtra.
For grid connectivity, standalone BESS seeking connection to the Intra-State Transmission System (InSTS) would require a minimum capacity of 5 MW, while systems connecting to the distribution network would need a minimum capacity of 1 MW. The proposed minimum storage duration is two hours. Projects that have commenced construction or achieved financial closure before the regulations are notified would be treated as compliant and exempt from these minimum thresholds.
The framework also places technical, safety, metering and cybersecurity requirements on BESS developers and operators. Projects would be required to comply with applicable standards and regulations issued by the Central Electricity Authority (CEA), Bureau of Indian Standards (BIS) and MERC, along with cybersecurity requirements prescribed by CERT-In and the Ministry of Power. End-of-life management, repurposing and recycling of battery systems would also have to comply with applicable environmental regulations.
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