KPI Green Energy Limited has announced that its subsidiary, Sun Drops Energia Private Limited, has received a Letter of Intent (LoI) from Gujarat Urja Vikas Nigam Limited (GUVNL) for the development of standalone Battery Energy Storage System (BESS) projects with an aggregate capacity of 445 MW / 890 MWh in Gujarat.
The projects will be developed under the Independent Power Producer (IPP) model and will be located across multiple sites in the state. The development marks a significant milestone for the KPI Green Energy Group as it enters the utility-scale energy storage segment.
Project Overview
The LoI has been awarded under a tariff-based competitive bidding process for Standalone BESS Projects – Phase VII, supported by Viability Gap Funding (VGF) through the Power System Development Fund (PSDF).
Key project details include:
- Storage capacity: 445 MW / 890 MWh
- Project type: Standalone BESS (IPP model)
- Location: Multiple sites across Gujarat
- Awarding authority: GUVNL
- Support mechanism: VGF via PSDF
- Sector: Renewable Energy / Energy Storage
The company disclosed the receipt of the LoI in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Strategic Firsts for KPI Green Energy Group
This project represents two major firsts for the KPI Green Energy Group. It is the company’s first utility-scale IPP-based battery energy storage project and also its first BESS project awarded by a major government entity.
With this award, the Group formally expands into grid-scale energy storage, adding a new asset class to its existing renewable energy portfolio, which already includes solar, wind, and hybrid power projects.
Role of Standalone BESS in Grid Stability
Standalone BESS projects operate independently of renewable generation assets such as solar or wind plants. These systems are designed to store electricity during off-peak hours and supply power during periods of peak demand, helping balance supply and demand on the grid.
At the scale awarded to Sun Drops Energia, such projects play a critical role in:
- Enhancing grid reliability
- Supporting peak load management
- Facilitating higher renewable energy penetration
- Reducing curtailment of renewable power
- Improving overall power system flexibility
As India increases its share of variable renewable energy, standalone battery storage is becoming an essential component of modern power infrastructure.
Policy-Backed Growth in Energy Storage
The award under Phase VII of the standalone BESS tender reflects the growing policy focus on energy storage as a strategic enabler of India’s clean energy transition. Government-backed mechanisms such as VGF are aimed at accelerating early adoption of large-scale storage projects and ensuring commercial viability.
Gujarat has emerged as one of the leading states in implementing energy storage projects, aligned with its broader renewable energy and grid modernisation initiatives.
Why This Development Matters
The LoI awarded to Sun Drops Energia underscores the increasing opportunities for renewable energy companies to diversify into energy storage. For KPI Green Energy, the project:
- Strengthens its position in policy-backed infrastructure development
- Expands its portfolio beyond generation assets
- Enhances long-term revenue visibility through regulated projects
- Aligns with national priorities for grid stability and clean energy integration
The project also reflects growing confidence in the company’s execution capabilities within the evolving clean energy ecosystem.
Industry Outlook
India’s energy storage market is expected to scale rapidly over the coming decade as renewable capacity additions accelerate and grid balancing requirements increase. Utility-scale standalone BESS projects are likely to see sustained growth, supported by competitive bidding frameworks and government incentives.
Developers with diversified renewable portfolios and strong execution track records are expected to play a key role in building this next layer of critical power infrastructure.
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