World Bank working on proposal for $1 bn support to India's BESS, e-mobility sectors

The World Bank and State Bank of India (SBI) are in talks for a $1 billion line of credit to aid the country's energy transition, according to media reports.

The funds will support the deployment of battery energy storage systems (BESS) around the country and help promote a shift to electric mobility, the Mint newspaper reported, quoting two sources it did not identify. The World Bank confirmed such a proposal was in the works, but said the proposed project was "under preparation" and that details were "being finalized".

The World Bank's proposal is aimed at attracting early investments into India's BESS and e-mobility sectors and mobilizing private and commercial capital for the projects, in line with President Ajay Banga's plans to tap private funds to finance the global energy transition.

Indian officials estimate the country would need around $52 billion by 2030 to meet its energy storage targets.

Battery energy storage projects, or BESS, are pivotal to supporting India's electricity grids as the country transitions to clean generation sources such as solar and wind. These are intermittent in nature, necessitating storage capacity to back up power produced during generation hours.

India aims to add 50 GW of clean energy capacity a year with a total of 500 GW by 2030, and the Central Electricity Authority (CEA) estimates the country will have close to 50 GW of battery storage capacity by the end of the decade.

Ghanshyam Prasad, Chairperson of the CEA, told a COP28 event at the India Pavillion last year: "Without energy storage, no country can think of energy transition."

The World Bank's $1 billion amount will be disbursed in tranches. Its usage will help reduce the country's greenhouse gas emissions from the conventional mobility sector, thus improving air quality while also reducing the country's dependence on imported fossil fuels. India is looking to accelerate its shift to electric mobility, with the government launching news schemes to attract global manufactures and promote EV purchases among consumers. 

Last year, the World Bank approved $1.5 billion to support low-carbon energy generation in India, including supporting the National Green Hydrogen Mission.