International Finance Corporation partners with IndiGrid to develop India’s first grid-scale battery energy storage system, advancing green finance framework and responsible business infrastructure. ESG BROADCAST shares key takeaways.
In a landmark development for India’s clean energy transition, the International Finance Corporation (IFC), part of the World Bank Group, has announced a strategic investment partnership with IndiGrid, India’s first publicly listed power sector infrastructure investment trust. The initiative will develop the country’s first grid-connected Battery Energy Storage System (BESS), marking a critical milestone for India’s renewable energy and grid reliability ambitions.
The project, estimated at a capacity of 250 MWh, will be implemented in the national capital region, where demand for flexible power infrastructure is growing rapidly. As per the announcement, IFC will invest $75 million (approximately ₹625 crore) in IndiGrid to support this pioneering infrastructure, with the potential to mobilise additional capital from other institutional investors.
This initiative represents India’s first private sector-led utility-scale BESS under a public-private framework, addressing a key regulatory and technical bottleneck in the renewable energy ecosystem. The battery system will provide critical grid-balancing services by storing excess power generated during low-demand periods and releasing it during peak hours. This will enhance the overall flexibility and reliability of India’s power grid, which currently grapples with supply-demand mismatches and increasing renewable integration.
According to IFC, this investment aligns with its strategy to catalyse climate-resilient infrastructure in emerging markets, while helping countries meet their net-zero targets. IndiGrid, managed by KKR-backed Sterlite Investment Managers, aims to commission the project by 2026, following the award of a 20-year Storage Service Agreement (SSA) by the Solar Energy Corporation of India (SECI) under a competitive bidding process.
“The grid-scale battery project is expected to serve as a template for future energy storage tenders and will help unlock private capital in India’s clean energy value chain,” IFC noted in its press release.
The investment also complements India’s 2030 target of achieving 500 GW of non-fossil fuel capacity and aims to support transmission reforms and renewable integration being spearheaded by the Ministry of Power and Central Electricity Authority.
The project will also yield broader sustainability co-benefits by reducing curtailment of solar and wind generation, enabling higher renewable penetration, and contributing to decarbonisation of peak-hour thermal generation. Moreover, it marks IFC’s first equity investment in energy storage globally, reflecting growing investor confidence in India’s energy transition story.
Strategic significance lies in establishing a replicable commercial model for battery storage within India’s power sector, bolstering investor participation, and enhancing long-term ESG compliance and grid decarbonisation goals. The partnership signals a move towards a market-based energy storage ecosystem, as India continues to pursue ambitious climate targets and operational resilience.
ESG BROADCAST will continue monitoring the updates related to this topic. Stay tuned to be updated on the related policy and pivotal regulatory shift.
