India’s government is considering a new Localisation policy that would require wind and solar power projects — as well as standalone battery storage installations — to use at least 50% locally manufactured components in their Battery Energy Storage Systems (BESS). This draft proposal aims to reduce dependence on foreign imports and strengthen domestic industry capacity as the country expands renewable energy deployment.
What the Local Content Rule Would Cover
Under the plan being discussed by the Ministry of Power, BESS components such as battery management systems, containers, inverters and energy management units may need to meet the 50% local content requirement. However, the policy could exclude battery cells — one of the most technically complex and often imported parts — at least in the initial phase to avoid supply bottlenecks.
Approved Manufacturers List
Officials are also exploring an approved list of local manufacturers and models, similar to systems used in the solar sector. This list would help ensure that only vetted Indian products qualify under the localisation rule, driving quality standards and giving priority to domestic suppliers in public and private tenders.
Drivers: Energy Security and Import Dependence
A key motivation behind the proposed policy is to cut import reliance, especially from major exporters like China, which dominates global supply chains for renewable energy components and critical minerals. Reducing dependence is seen as crucial for national energy security and grid resilience.
Industry Response and Next Steps
Consultations are underway with state-owned and private firms, but no final decision has been made yet. Some analysts caution that localisation mandates could raise costs in the short term if domestic capacity isn’t fully ready — while industry stakeholders emphasize phased implementation with clear timelines.
