ADB and TATA Power sign an agreement to improve electricity distribution in India

The Asian Development Bank (ADB) and Tata Power Delhi Distribution Limited (TPDDL), the distribution arm of Tata Power Co., have arrived to an agreement to subscribe non-convertible bonds in the amount of 1,500 million Indian rupees (equivalent to 18 million dollars).

The purpose of the grant will be to improve electricity distribution in India through grid upgrades, and a $2 million grant to partially fund the purchase and integration of a pilot Battery Energy Storage System (BESS).

The secured principal funding will be used to commission a new 66/11 kilovolt network, upgrade and expand transformers, substations, feeder lines, and switching stations, install smart meters, and replace outdated electrical equipment and meters.

The 10 megawatt-hour (MWh) BESS is South Asia’s first grid-scale energy storage project at the distribution transformer level.

It will allow electricity to be stored and supplied on demand, reducing grid instability and providing the necessary flexibility to integrate intermittent solar and wind energy resources.

The grant to fund BESS is provided by Goldman Sachs and Bloomberg Philanthropies’ Climate Innovation and Development Fund (CIDF), and administered by ADB.

“Power distribution is a crucial link in the electricity supply chain, and sometimes one of the most vulnerable. The incorporation of a battery energy storage system in distribution transformers will better integrate renewable energy sources and contribute to make Delhi’s power distribution system more resilient to disasters,” said Suzanne Gaboury, ADB Director General of Private Sector Operations.

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

The ADB forecasts 5% growth for Uzbekistan in 2023 and 2024

“The battery energy storage system plays a crucial role in building a resilient grid and paves the way for a future-proof power distribution network,” added Praveer Sinha, CEO and General Manager of Tata Power.

“We are grateful to the ADB for managing this grant for the integration of the pilot BESS into the TPDDL grid. This will allow us to ensure high-quality power supply for consumers and help integrate clean energy into the power supply mix.”

In 2022, India’s Ministry of Energy set a target for battery storage capacity of 4% of total electricity consumption by 2030. To reach that target, India would need a total battery storage capacity of 182 gigawatts -time for 2030.

The ADB funding through the CIDF for the BESS pilot will provide a proof of concept and lessons learned by TPDDL to implement a planned additional 50 MWh of BESS capacity.

Launched in September 2021, the CIDF is a blended funding facility managed by the ADB, established with an initial philanthropic commitment of $25 million from Bloomberg Philanthropies and Goldman Sachs.

The fund has the potential to unlock up to $500 million in private sector and government investment in support of sustainable low-carbon economic development and help catalyze a clean energy transition in South and Southeast Asia.

TPDDL is a joint venture between Tata Power Company Limited and the Government of the National Capital Territory of Delhi. It has more than 3,200 employees and a customer base of 1.9 million connections.

Its operating area covers 510 square kilometers with clients from the industrial, commercial, domestic and agricultural segments. In 2002, TPDDL obtained a 25-year license to distribute and transmit electricity in the North and North-West regions of Delhi. Tata Power is one of the largest integrated power companies in India.