# India Approves $1.53 Billion Funding for 92 GWh Energy Storage New viability gap funding scheme aims to boost grid-scale storage and local manufacturing. - **Source:** [pv magazine](https://www.pv-magazine.com) - **Published:** 2026-11-06 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/c58e3fb1-f2d7-4bdb-9446-97b8bfe9dae6 ## Strategic Financial Support The Indian cabinet, led by Prime Minister Narendra Modi, approved a $1.53 billion viability gap funding scheme. This initiative allocates INR 14,500 crore to support grid-scale energy storage projects between fiscal 2026-27 and 2030-31. The program specifically targets infrastructure projects that are economically beneficial but require government grants to become commercially viable. ## Ambitious Capacity Targets The scheme aims to develop 92 GWh of new energy storage capacity across India. This expansion represents a 170% increase over the country's current grid-scale storage levels. These projects are essential for meeting the projected national requirement of 411 GWh of storage capacity that India anticipates needing by the fiscal year 2031-32. ## Diverse Storage Technologies Planned capacity includes 60 GWh from pumped hydro storage and 30 GWh from battery energy storage systems. Additionally, 2 GWh will be sourced from alternative energy storage technologies. These projects are expected to attract a total private and public investment of INR 97,600 crore, significantly boosting the national energy infrastructure development pipeline. ## Competitive Allocation Mechanism Energy storage capacity under this new scheme will be allocated through a tariff-based competitive bidding process. Public and private electricity distribution companies are eligible for funding for BESS and pumped hydro projects. Meanwhile, projects involving alternative energy storage technologies will be open to development by both public and private sector entities. ## Boosting Domestic Manufacturing The government intends to strengthen the domestic manufacturing ecosystem by providing demand-side financial support. To ensure local industry growth, battery energy storage system projects must adhere to a minimum domestic content requirement of 40%. This policy aims to reduce India's reliance on imported components while creating new opportunities for local industrial players. ## Complementing Supply-Side Incentives This new funding scheme is designed to complement existing supply-side incentives already in place for battery manufacturing. By combining these financial tools, the government hopes to create a more robust and self-reliant energy sector. The initiative specifically targets the creation of a flexible and resilient electricity system capable of managing future demand. ## Renewable Energy Integration Accelerating the deployment of grid-scale storage is critical for India's renewable energy integration goals. By addressing the inherent variability in renewable power generation, the storage systems will reduce the current reliance on conventional power plants. This transition is expected to balance electricity supply and demand more effectively across the national grid. ## Long-Term Economic Impact The viability gap funding mechanism serves as a bridge to attract private investment into essential public-private partnership projects. By mitigating financial risks, the government expects to catalyze significant infrastructure growth. This strategic move positions India to handle a higher share of intermittent renewable energy while fostering a sustainable and modernized power grid. ## Sources covering this story - https://www.pv-magazine.com/2026/11/06/cabinet-approves-inr-14500-crore-viability-gap-funding-scheme-for-development-of-92-gwh-grid-scale-energy-storage-systems/ — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._