Tata Power unit signs deal with ADB for grid enhancements and BESS in Delhi

Tata Power said that its distribution arm Tata Power Delhi Distribution Limited (TPDDL) has signed a deal with the Asian Development Bank (ADB) to improve the power distribution in Delhi with grid enhancements and battery energy storage system (BESS).

In this connection, the parties entered into an agreement for the Asian Development Bank to subscribe to non-convertible debentures for INR 1.5 billion ($18.2 million) for grid enhancements, and a grant of $2 million to partly fund the acquisition and integration of a pilot battery energy storage system, which will have a capacity of 10MWh.

According to Tata Power, the senior secured financing will be used for commissioning an entirely new 66/11-kilovolt grid. It will also be used for enhancing and expanding transformers, feeder lines, substations, and switching stations, as well as for installing smart meters and replacement of old electric devices and meters.

The battery energy storage system is the first South Asian grid-scaled energy storage facility that is based on distribution transformers. It will allow the storage of electricity which can be distributed at any time, thereby decreasing grid instability and giving the flexibility to integrate intermittent solar and wind energy sources.

Tata Power unit signs deal with ADB for grid enhancements and BESS in Delhi. Photo courtesy of Ameyajkamat/Wikimedia Commons.

The funding grant for the BESS is made through Goldman Sachs and Bloomberg Philanthropies’ Climate Innovation and Development Fund (CIDF) and is managed by ADB.

In 2022, India’s Ministry of Power set a target of 4% for battery storage capacity of all electricity consumed by 2030. To achieve this goal, India would need a total capacity of battery energy storage in the range of 182GWh before 2030.

The financing provided by ADB via CIDF for the pilot BESS will allow proof of concepts and lessons learned from TPDDL in order to build a further 50MW of storage capacity.

CIDF, which was launched in late 2021, is a mixed finance facility established through initial funding of $25 million donation by Bloomberg Philanthropies and Goldman Sachs. The fund is expected to attract up to $500 million in public and private investment in the direction of sustainable low-carbon development, and also in the transition to cleaner energy across South as well as Southeast Asia.

Suzanne Gaboury — ADB Director General for Private Sector Operations said: “Power distribution is a crucial link in the electricity supply chain, and at times one of the most vulnerable. Mainstreaming a battery energy storage system at the distribution transformer level will better integrate renewable energy sources and contribute to a more disaster-resilient power distribution system for Delhi.

“As Asia’s Climate Bank, ADB supports India’s climate goals through innovative technologies and the catalyzing of private capital to finance green projects.”

TPDDL is a joint venture of Tata Power Company Limited and the Delhi government.

It has a customer base of 1.9 million connections and an operational area of 510 square kilometers. In 2002, it was granted a licence for distribution and transmission of electricity across the northwest and north regions of Delhi.

Dr Praveer Sinha — Tata Power CEO and Managing Director said: “The battery energy storage system plays a crucial role in building a resilient grid and paves the way for a future-ready power distribution network.

“We thank ADB for administering this grant for the integration of the pilot BESS with TPDDL’s network. This will enable us in ensuring high-quality power supply for consumers and help integrate clean energy into the power supply mix.”