Prof. Jyoti Parikh, Executive Director; Dr Navpreet Saini, Senior Research Analyst; and Ritwik Ray Chaudhuri, Research Analyst; IRADe
India’s ambitious renewable energy targets, including 500 GW of non-fossil fuel-based capacity by 2030 and net-zero emissions by 2070, are driving a significant shift in the energy landscape in recent years. We have also witnessed an increasingly higher shares of solar and wind in the energy mix. The intermittency and variability of renewable sources such as wind and solar create challenges for grid stability, as they do not provide even eight to ten hours of consistent and reliable supply. Therefore, the system requires a range of energy storage solutions.
At present, two distinct types of reliable energy storage solutions are available at a grid scale. Battery energy storage (BES) for short duration (daily) and pumped hydro energy storage (PHES) for longer duration. Each offer a unique and different solution to address energy storage. The BES solution is modular, with less gestation period but for shorter duration (hours), and currently more expensive and has a life of 10-12 years. It heavily depends on imported minerals, but the technology is still evolving and economics may improve further. However, PHES depends on natural water resources such as reservoirs and has a long lifetime of 40 years, but has long construction periods of eight to ten years, high upfront investments. The PHES offers a longer operational lifespan (40-100 years) compared to battery storage, which typically lasts only 10-12 years and requires periodic replacement. PHES is more cost-effective (Rs 7-8 per kWh) and environment friendly with negligible hazards, relying on natural resources such as water. In contrast, battery storage has a higher cost (Rs 10-11 per kWh). While PHES excels in long-duration energy storage (6-12 hours), battery storage offers flexibility for shorter durations (3-6 hours).
The conventional PHES is river-based, which is also known as open-loop PHES (OLPHES) or on-river. To expand storage options, a different variant has surfaced, closed-loop PHES (CLPHES) or off-river, with a high potential. The reservoirs can be natural or man-made; only one needs to have enough water that could be pumped up during non-peak hours using other renewable sources, so that it can later generate power to meet the demand during periods of low wind or solar non-availability. The same water can circulate to generate power with 80-85 per cent efficiency. The sites on the natural rivers are limited and subject to higher uncertainties of water supply and climate hazards.
This article argues that considering the need for storage expansion to many more locations, the CLPHES needs a greater push because it is a promising energy storage solution for India. A comparison between the two are presented in the table.
The CLPHES mainly depends on the one-time stock of reservoir water as the driving force and has assured water supply at all times that could come from rainwater harvesting, waste water, or even sea water. Only make-up water is needed for evaporation losses. It is safer and easier to build without the natural flowing water to worry about and avoids huge environmental damages done by the conventional hydropower and a lot safer to build. It can operate with control and safety.
India has significant untapped potential for the CLPHES, estimated at over 119.3 GW, where Maharashtra, Andhra Pradesh and Tamil Nadu present substantial opportunities for development. Figure 1 highlights the distribution of CLPHES potential across various Indian states and regions. The total exploitable potential is nearly 120 GW across 95 identified sites, with the highest potential concentrated in Maharashtra (25.35 GW) and Andhra Pradesh (21.67 GW).
In India, the Central Electricity Authority (CEA)’s National Electricity Plan 2022-32 estimates that the country could add around 31.8 GW of PHES capacity by the end of 2031-32. In addition, the CEA has received nearly 50 proposals for 62 GW CLPHES by the private sector alone, even while the formal policy guidelines are under preparation. Currently, there is significant enthusiasm among both public sector undertakings and private utility-scale developers. Major players such as NEEPCO, NHPC, SJVN, THDC, Adani Green, Greenko and JSW Renewables are actively showing interest and participating in the development of pumped hydro projects.
The CEA has issued a draft guideline and declared CLPHES as renewable sources with waiver of interstate transmission charges, notification of energy storage obligation and proposed viability gap funding support. The CEA has developed the “Jalvi Portal” to streamline and digitalise the appraisal process for PHES projects to ensure faster approvals, improve transparency and permit efficient project planning.
However, challenges such as complicated and prolonged approval procedures need to be addressed to tap the potential within this critical segment. To address the challenges of energy transition, grid management and sustainability goals are the primary reasons why the CLPHES is essential for India. Incentives similar to those provided to BES and production-linked incentives are not available for CLPHES. Unless a few projects come up and we have working models that provide comfort to project developers and investors, investments would be lukewarm despite commercial interest. Awareness and capacity building among decision-makers such as regulators, system planners, investors, project developers and community of power experts can mobilise more projects that can minimise reliance on imported minerals and enhance national energy independence.
Conclusion
Currently, India has an estimated 119.3 GW of untapped CLPHES potential across 95 sites, especially in Maharashtra and Andhra Pradesh, offering immense opportunities for expansion. Compared to natural river systems, it has lower environmental impact, larger access to water resources such as from rain water harvesting, treated waste water, or sea water, and higher site flexibility and minimal impact on local communities, as it does not alter natural water ecosystems. As the renewable energy generation increases, the contribution of solar, wind and biogeneration far exceeds hydro generation and that may call for a wider availability of storage at all times and locations.
Currently, hydropower accounts for only 10 per cent of the generation, while other renewables are expanding rapidly. Investing in CLPHES can ensure dependable 24×7 power supply, positioning India to meet its clean energy goals, while strengthening energy security, grid reliability and environmental sustainability. The strong advantages are that CLPHES expands different choices of locations and water resources. If floating solar is attempted in future, it would even have a generating source at the same site, even if partially. There could be some hitches and barriers, which need to be understood by actually expediting implementation of some of the submitted projects on a mission mode and fast-track with required incentives and implement others with better understanding. Considering it has no import content and more jobs, it should get high levels of incentives, at least for the next five to ten years.