The Delhi Electricity Regulatory Commission (DERC) has approved the tariff and authorized the execution of a Battery Energy Storage System Agreement for a 12.5 MW/25 MWh grid-scale battery energy storage project at the 33/11 kV Shivalik grid substation. The order was issued on September 9, 2026, following a petition filed by BSES Rajdhani Power Limited (BRPL) under the Electricity Act, 2003.
The project will be developed on a Build, Own, Operate, and Transfer (BOOT) basis and is aimed at supporting rising electricity demand and improving renewable energy integration across South and West Delhi. The storage system is expected to provide peak shaving, grid stabilization, capacity augmentation deferral, and emergency backup for critical distribution loads.
The competitive bidding process was managed by The Energy and Resources Institute (TERI), which acted as the independent bid manager. After the technical evaluation, three bidders qualified for the final stage. An e-Reverse Auction was subsequently conducted, resulting in the selection of REConnect Energy Solutions Limited as the successful bidder.
REConnect Energy Solutions offered a levelized annual capacity charge of ₹35.91 lakh per MW, excluding applicable taxes. According to BRPL, the tariff is around 37.6% lower than the cost of its earlier battery storage pilot project at Kilokari, which was approved in 2024 at more than ₹57 lakh per MW. The reduction reflects improved market competition, optimized project design and stronger price discovery through competitive bidding.
The Shivalik project is being planned in response to sustained growth in local electricity demand. Peak loads in the area have recorded a compound annual growth rate of more than 5% over the past six years. The battery system will use advanced grid-forming inverters with virtual synchronous machine capabilities and inertia controls, enabling the facility to provide additional grid support beyond conventional energy storage.
Under the service-based agreement, BRPL will not be required to make an upfront capital investment in the storage facility. The utility will pay the agreed capacity charges, while it will remain responsible for providing the energy required to charge the battery system.
DERC also reviewed the operational experience of BRPL’s Kilokari project, including energy arbitrage, network fee savings and operational efficiencies. The Commission noted that these benefits generated a net annual benefit for consumers.
As part of its approval, DERC directed BRPL to correct certain drafting issues before signing the final agreement, including provisions relating to definitions and liquidated damages. The Commission also ordered that all financial and operational gains from energy arbitrage must be passed on to consumers through a reduction in power purchase costs. BRPL will have to submit semi-annual reports on arbitrage performance and annual assessments of the project’s net consumer benefits.
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