Asian Development Bank (ADB) and Tata Power Delhi Distribution Limited (TPDDL), the distribution arm of The Tata Power Company Limited (Tata Power) , entered into an agreement to subscribe to non-convertible debentures for Rs 1.5 billion equivalent to $18.2 million to enhance Delhi’s power distribution through grid enhancements, and a $2 million grant to partially finance the purchase and integration of a pilot Battery Energy Storage System (BESS), the company announced through an exchange filing.
The senior secured financing will be used to commission a new 66/11-kilovolt grid, augment and expand transformers, substations, feeder lines, and switching stations, install smart meters, and replace obsolete 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 enable electricity to be stored and delivered on demand, reducing grid instability, and providing the flexibility to integrate intermittent solar and wind energy resources. The grant to finance the 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 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,” said ADB’s Director General for Private Sector Operations Suzanne Gaboury. “As Asia’s Climate Bank, ADB supports India’s climate goals through innovative technologies and the catalyzing of private capital to finance green projects.”
“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,” said by Dr. Praveer Sinha, CEO & Managing Director, Tata Power.
In 2022, India’s Ministry of Power targeted battery storage capacity of 4% of total electricity consumption by 2030. To reach that goal, India would need a total battery energy storage capacity of 182 gigawatt hours by 2030. ADB’s financing through CIDF for the pilot BESS will provide proof of concept and lessons learned by TPDDL to implement a planned additional 50 MWh of BESS capacity.
Launched in September 2021, CIDF is a blended finance facility managed by ADB, established with an initial $25 million philanthropic commitment from Bloomberg Philanthropies and Goldman Sachs. The fund has the potential to unlock up to $500 million in private sector and governmental investments 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 and the Government of the National Capital Territory of Delhi. TPDDL supports over 3200 employees and has a customer base of 1.9 million connections. Its operational area spans 510 square kilometres with customers across industrial, commercial, household, and agricultural segments. In 2002, TPDDL was awarded a 25-year license to distribute and transmit electricity in Delhi’s north and northwest regions. Tata Power is one of India’s largest integrated power companies.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.
