The overarching purpose of this blog is to identify the various levels of the Australian government’s Grid Scale BESS, Individual Household BESS and other further policies for BESS at a residential scale, then compare this to the government policies that the Indian government has adopted for solar powered RE in residential scale and BESS at grid scale, to then be able to make suggestions for how methods from this Australian government policy may lend assistance to future Indian government policy or series of policies, whether at a central or state level, to support the supply of BESS as an ESS to residential scale rooftop solar, such as reduce barriers that suppliers, contractors and/or consumers may face when seeking to include BESS with rooftop solar installation to residential homes.


India is a signatory to the Paris Agreement, and as the third-biggest global emitter of greenhouse gases, it has committed to an updated Nationally Determined Contribution (NDC) of 45% below 2005 levels by 2030 and a net zero target by 2070. Like Australia, a large contribution of greenhouse gas emissions in India is derived from fossil fuel sources and needs to transition to non-fossil fuel-based sources such as Renewable Energy (RE) to reduce greenhouse gas emissions. However, India, uniquely compared to Australia, off the back of rapid population growth, has had to deal with an equally quickly growing electricity market, which doubled between 2005 and 2022.

The Indian government has set an ambitious target to meet its Sustainability Development Goal (SDG) 7 under the Paris Agreement of 50% cumulative installed capacity from non-fossil fuel-based energy resources by 2030 (equating to roughly 500 GW), which is ambitious in light of the sustained fast and exponential growth of the electricity market.

When originally announced at COP26, this RE estimate included an installed capacity of 280 GW of solar power and 140 GW of wind power in RE by 2030. Indian government continues to expand its transition to RE with recent policy announcements supplementing its original goals having a focus on solar-powered RE: on 12 March 2024 from the Ministry of Coal looking to achieve a net-zero electricity consumption plan for Coal/Lignite PSUs through ramping up RE capacity to over 9GW by 2030 utilising rooftop solar and ground-mounted solar across mining facilities and on 23 January 2024 from the Indian Prime Minister with a Pradhanmantri Suryodaya Yojana scheme to expand the rooftop solar scheme introduced in 2014 to over 10 million residential households to have rooftop solar (roughly 640 GW of solar powered RE) and save money off the electricity bill of households.

Supplementary to, but of just as significant importance to the Indian government’s transition to RE sources, are energy storage systems (ESS). As identified by the Ministry of New and Renewable Energy, ESS has various benefits in supporting RE, including:

  • help in bringing down the variability of generation in RE sources;

  • improving grid stability;

  • enabling energy/ peak shifting;

  • providing ancillary support services;

  • enabling larger RE integration;

  • bringing down peak deficit and peak tariffs;

  • reducing of greenhouse gas emissions;

  • deferral of transmission and distribution capex; and

  • energy arbitrage, etc.

It is anticipated by the Central Electricity Authority (CEA) that ESS capacity for 2029-2030 will be 60.63GW which will include 18.98 GW from Pumped Storage Plants (PSP) and 41.65 GW from Battery Energy Storage System (BESS), translating to a storage of 336.4 GWh, with 208.25 GWh from BESS, mostly to be installed in India’s Northern region.

On 6 September 2023, the central government unveiled a grant scheme for 4,000 MWh of BESS projects by 2030-31 with up to 40% of the capital cost from a Viability Gap Funding (VGF) with an intent to bring down the cost of BESS and increase commercial viability. The scheme to date has been used for standalone BESS and BESS connected to RE at a grid-scale only.

With the above context in mind, it is identified that where the Indian government’s policies may potentially be expanded in the future to further assist in facilitating its already ongoing successful transitioning to RE and fill a possible gap in government policy is a policy or series of policies to support the use of BESS as an ESS in residential solar powered RE.

Australian federal and state/territory governments have been deliberating this type of government policy for using BESS as an ESS for the residential solar-powered RE in recent years and have identified and deployed two broad methods to resolve the issue:

(1) Grid Scale BESS is a neighbourhood or community battery at about 100kW to 5MW placed in a central place in the community, which is connected to the housing in the area with rooftop solar for storage and use during peak times and may include a community dividend payment made where the grid uses the stored energy.

(2) Individual Household BESS is a smaller size BESS at about 10 kW installed into a consumer’s house with the rooftop solar where excess energy is stored and used later by the consumer or sold back to the electrical services provider.

Both methods have different government policies, actually implemented by federal and state/territory governments or currently being debated in the Australian parliament, to support the commercial viability of BESS uptake in residential solar RE.

As the overarching purpose of this blog, the intent is to identify the similarity and differences of these various levels of Australian government’s Grid Scale BESS and Individual Household BESS policies, actual and in debate for residential scale, compared to the government policies that India has adopted for solar powered RE at a residential scale and BESS at grid scale to then be able to make suggestions for how methods from this Australian government policy may lend assistance to future Indian Government policy for BESS in residential scale.

Part I focuses on a comparison of the Australian government policies, and BESS market for Grid Scale BESS to the BESS grid-scale market in India, and Part II then focuses on Government policies and BESS market for Individual Household BESS in Australia compared to the current solar-powered RE schemes for residential scale in India. Part III then identifies some other policy considerations that are not within the two primary categories that may be considered as alternatives.

Part IV then makes suggestions based on methods from Australian government policy in Part I-III, which may lend assistance for the introduction in India of a future government policy or series of policies, whether at a central or state level, to support the supply of BESS as an ESS to rooftop solar such as to reduce barriers for uptake of BESS that suppliers, contractors and/or consumers may face when seeking to include BESS with rooftop solar installation to residential homes.

Part I: Grid Scale BESS

Grid Scale BESS are ordinarily owned by electricity distribution businesses or third parties such as Government, community energy groups, electricity retailers, aggregators or private investors. This means that the consumer does not have to pay the costs of the BESS, and with the exception of Victoria, which has a community dividend scheme, any power sold to the grid network service providers with arbitrage or other savings generated are the benefit of the owner and not the consumer. In exchange for the benefit of owning the BESS, the owner and not the consumer is taking the risks of constructing, operating and maintaining the BESS, such as:

  • costs for installing the BESS;

  • sourcing labour hire;

  • safety risks of high voltage, arc-flash/blast or fire when installing the BESS;

  • Inadequacy or difficulty in sourcing raw materials required to make the BESS and

  • Hazardous or contamination that BESS may cause for human health or the environment

The benefit for the consumer of the Grid Scale BESS is they have the benefit of access to stored other houses’ excess power generated and collectively will have reduced power bills arising from less reliance on the grid, particularly with the BESS benefiting for during off-peak periods. They are also usually aesthetically enhanced through local artwork painted over the battery.

The initial step to creating a Grid Scale BESS is the Government takes a feasibility test and/or creates a business case to determine the need for the Grid Scale BESS and query the model including procurement in the community. In Australia, this is not only from a cost and efficiency perspective compared to alternative solutions but also considering other local environmental and social objectives, such as whether the community or organisation is trying to reduce greenhouse gas emissions, increase local solar panel exports or improve energy reliability. Feasibility and business case by Government is supported by engagement with stakeholders in the community.

Once established the need for the Grid Scale BESS and model including procurement, the Federal and State/Territory Governments announce grant money and a round of auctions where various tenderers may bid to win the project. This is dealt with through grant schemes. For example, the Commonwealth Government of Australia announced an AUD$200 million community batteries program to deploy 400 community batteries (approximately 100,000 households) through the Department of Industry, Science and Resources Business Grants Hub and the Australian Renewable Energy Agency’s Community Batteries fund. Victorian Government recently announced AUD$42 million to install 100 neighbourhood batteries across the state with a new round of action to begin August 2024. Queensland recently announced AUD$179 million for its third and fourth stages of the local network-connected batteries program to deliver 12 additional 4MW/8MWh batteries and trail two flow batteries. Western Australia currently has 13 community batteries across its network and is due to announce further auctions soon.

The Australian Grid Scale BESS policy above, on a high level Is not dissimilar to the VGF that has been deployed for BESS at a grid scale in India. Two differences that the Author observes may potentially exist in India’s approach under the VGF is a greater focus than Australia’s on the commercial viability (in other words, the lowest cost bid tendered at auction in the VGF is always going to be successful) and the procurement model that is utilised for the VGF is either the Build-Own-Operate (BOO) or Build-Own-Operate-Transfer (BOOT) only.

Part II: Individual Household BESS

In Australia, many of the rooftop solar RE contractors offer the consumers an option in a quoted package option to include an Individual Household BESS. The consumer is also able, through a combination of comparing quotes from rooftop solar RE contractors and considering data services which provide details on household energy usage, whether that be through their electricity services provider, government or a private company, is then able to make an informed choice on whether or not they would like to install the Individual Household BESS with the rooftop solar. Consumers, like the community, may be motivated by only the cost of installation compared to the savings on bills and/or other social and environmental factors.

There are currently no grant or loan schemes that exist at a Federal or State/Territory level for Individual Household BESS in Australia. The consumer is expected to pay the cost of the Individual Household BESS upfront to the rooftop solar RE contractors in exchange for the supply and installation of the Individual Household BESS.

The consumer then gets the entire benefit of the Individual Household BESS: there is no obligation to share with another household as they are the owner, and there is a potential for any power to be sold to the grid network services provider with arbitrage or other savings generated to be the benefit of the consumer. The consumer also shares the risk of the maintenance and operation once installed, in that the rooftop solar RE contractors will ordinarily provide a manufacturer’s warranty, builder’s implied warranties and insurances (such as domestic building insurance) required under building laws of the jurisdiction and protections under consumer law which, subject to negotiation of the parties, generally the consumer’s will take risk beyond this to maintain and operate the rooftop solar.

In early 2022, an independent party representative tabled to parliament to, albeit unsuccessfully, to expand Australia’s highly successful rooftop solar Small-scale Renewable Energy Scheme to cover batteries such as the Individual Household BESS, with an intent to reduce the household upfront cost of installing an Individual Household BESS therefore increase their uptake and reduce power bills. This was proposed under a Renewable Energy (Electricity) Amendment (Cheaper Home Batteries) Bill 2022 and would have introduced the creation and issuance of Small-scale technology certificates (STCs), which are assignable to an agent such as rooftop solar RE contractors in return for a lower purchase price, and the STCs have accountability, reporting and oversight by a regulatory authority. The failure of the bill may have been due to the Federal Government’s preference for Grid Scale BESS.

Some State/Territory Governments have since made available a rebate or loan scheme available to eligible consumers for Individual Household BESS. For example, in Queensland, there is a battery booster rebate depending on income earned by the household, amongst other requirements. In South Australia, there is a SA House Battery Scheme where consumers can obtain low-interest financing options and a solar battery rebate for installing residential batteries.

Under India’s Pradhanmantri Suryodaya Yojana scheme, it is administered Federally rather than state-based like in Australia. Consumers are to go through the steps to apply for rooftop solar. If eligible, the consumer, like in Australia, may be granted a rebate and/or obtain a loan. In India, the consumer has more choices from various private banks at different terms, including low-interest rates, maximum loan tenure and loan amounts, whereas in Australian loans, the government loan option available may not be as flexible or favourable on some terms like maximum loan tenure and loan amounts comparatively, although some state/territory governments offer interest-free loans.

Rooftop solar RE contractors in India, known as Empanelled Vendors, apply through and create an account in the national portal. The consumers are presented with details of Empanelled Vendors, including their rates, when submitting their applications and speak with a Government representative about quotes and installation by the Rooftop solar RE contractors and can monitor progress through an app, whereas in Australia, consumers are expected to search for different Rooftop solar RE contractors (but may have a private compare of market services available online or government advertisements in media to assist in informing their decision) and then engage the Rooftop solar RE contractors themselves.

Part III: Further Alternative Policy Considerations

The Grid Scale BESS and Individual Household BESS approaches, whilst are very popular solutions to ESS in Australia for residential scale, they are not the only solutions for use on a residential scale, and it is noteworthy that in Australia, there are other alternatives that have also been used by the government that may be cheaper, easier, more efficient, or better suited to achieving commercial, environmental and social objectives such as:

  • Improving energy efficiency in the household;

  • Changing household energy use patterns;

  • Other forms of ESS;

  • Power purchase agreements between the grid network service providers and consumers;

  • Network upgrades;

  • Network demand management;

  • Dynamic operating envelopes; and

  • Pumped hydro.

Other policy considerations in India not arising from the Australian government include:

  • Government Schemes: in addition to grants, reduced import duties aimed at fostering the import of Grid Scale BESS and/or Individual Household BESS, and/or production-linked incentives (PLI) aimed at improving the domestic battery manufacturing capacity of Grid Scale BESS and/or Individual Household BESS.

  • Technology Advancements: Addressing market challenges with a focus on other alternative technologies like innovative integrating charging solutions that work with both solar panels and for Electric Vehicles (EVs), supercapacitors, and robust Battery Management Systems (BMS).

  • Collaboration: Collaborative efforts between government, industry, and academia, coupled with technological advancements, will assist in driving the proliferation of ESS in India. Continued research and development, compliance with standards, and market participation will accelerate India’s transition towards a sustainable and resilient energy future.

An in-depth discussion of these alternative policy considerations is beyond the scope of this blog.

Methods from Australian Government Policy and Debate for BESS That May Lend Assistance To Indian Government Policy

The Author opines India has a potential gap in state and central level government policy to support the expansion of ESS, particularly the use of BESS in residential scale solar powered RE, and implementing a government policy or series of government policies to fill this gap would build on India’s already successful transition from fossil fuels to non-fossil fuels including RE and assist in achieving its NDC and sustainability development goals under the Paris Agreement.

Consumers in India, like Australia, may be interested in having available affordable and reliable BESS for installation with a rooftop solar, whether as a Grid Scale BESS or Individual Household BESS as, for the same reason as utility-scale BESS, this can have various benefits, including reducing household costs and bring other social and environmental benefits for consumers.

Parts I and II discussed the two main methods of policies deployed in Australia in Grid Scale BESS and Individual Household BESS with a comparison to similar Indian government policy which, along with Part III, which highlighted other further alternative policy considerations deployed in Australia, all have been utilised to reduce household costs and bring other social and environmental benefits for consumers in Australia which may lend assistance to India’s own government policy for ESS, particularly the use of BESS in residential scale solar powered RE.

Firstly, as identified in Part I, with Grid Scale BESS, the VGF may be expanded into BESS for residential scale and would have similarity to the method of how community (neighbourhood) batteries in Australia are considered for feasibility, tendered and then awarded to market by the government for its Grid Scale BESS. India may consider whether there is a benefit in bridging the highlighted potential differences in government policies requiring the Indian government, when awarding tenders to consider other social and environmental factors pertinent to the state communities and not just the lowest cost and if the BOO and BOOT models are the only models to use for Grid Scale BESS or whether other procurement models may also be suitable or better suited in certain circumstances.

Secondly, as identified in Part II, with Individual Household BESS India’s Pradhanmantri Suryodaya Yojana scheme may be expanded to include an offer of BESS with the residential scale solar-powered RE. The question for this change to be introduced may be a matter of appetite from lenders to fund with their loans, government to provide an incentive rebate and difficulties that may be faced by the Empanelled Vendors to import such as tariffs and/or create its own local manufacturing. Local manufacturing can be improved, such as with PLI for the Individual Household BESS. The Indian government may start by consulting the stakeholders in the market to gain an understanding of the appetite for Individual Household BESS.

Finally, the Indian government may also consider other further alternative policy considerations listed above in Part III, which have been used by Australian governments to support the BESS deployed in residential scale RE, as these may be cheaper, easier, more efficient, or better suited alternative policies to achieving commercial, environmental and social objectives in India. For example, other forms of ESS may be an attractive option compared to BESS in the southern regions of India where BESS is known to be not as effective and efficient as other ESS. Further, other government schemes, technological advancements and collaboration should also be carefully considered. For example, a deal could be struck between the Indian government and Tesla for a permanent concession of tariff on EVs, which includes innovative charging solutions like the integrated battery Powerwall 3 that stores energy from both an EV and solar panel.

Authors and Designation:

Benjamin Hicks is an Australian qualified legal practitioner with part of his portfolio of projects he assists with being commercial scale and grid-scale solar farms and/or BESS. He holds an LLB (Hons) and BCom from Deakin University and MConstrLaw from the University of Melbourne. The author would like to thank the editorial team for inviting him to provide this guest blog and acknowledge their valuable contribution in expediting the research for and editing this guest blog.


The views and opinions expressed by the author herein are solely those of the author and do not necessarily reflect those views and opinions of any firm or client he performs services for.

Editorial Team:

Managing Editor: Naman Anand
Editor in Chief: Abeer Tiwari and Muskaan Singh
Senior Editor: Kopal Kesarwani
Associate Editor: Kaushiki Singh
Junior Editor: Nalin Arora

error: Content is protected !!