BESS Series · Part 2 of 3 · Tamil Nadu
BESS Project Tenders in Tamil Nadu: TNGECL, NLC India & the VGF Pipeline
Part 2 of our 3-part BESS series tracks every major Tamil Nadu battery storage tender — who's bidding, where projects will be built, how much capacity is in the pipeline, and how Viability Gap Funding (VGF) is making it bankable.
In this part
- • TNGECL's 4,000 MWh BESS roadmap
- • NLC India Renewables — first 500 MWh award
- • 375 MW / 1,500 MWh tender at 7 substations
- • Central VGF support and bid economics
- • TANTRANSCO substation land at ₹1/year
- • Upcoming pipeline & opportunities for IPPs
TNGECL's 4,000 MWh BESS roadmap
Tamil Nadu Green Energy Corporation Limited (TNGECL) is the state's nodal agency for renewable and storage procurement. Its current plan targets 4,000 MWh of battery storage rolled out in phases, paired with the state's expanding solar and wind portfolio.
NLC India Renewables — first 500 MWh award
Capacity
250 MW / 500 MWh
Developer
NLC India Renewables
Substations
3 sites, South TN
Cycle profile
2 cycles/day
Projects will be built at the Ottapidaram, Annpankulam, and Kayathar 230 kV substations — close to existing Tuticorin/Tirunelveli solar and wind generation.
375 MW / 1,500 MWh standalone tender
TNGECL's follow-on Request for Selection covers 7 standalone BESS projects totalling 375 MW / 1,500 MWh, each capable of 1.5-cycle daily charging/discharging. Successful bidders sign long-term Battery Energy Storage Purchase Agreements (BESPAs) with TNGECL.
| Tender / Project | Capacity | Status |
|---|---|---|
| NLC India BESS | 250 MW / 500 MWh | Awarded |
| TNGECL standalone RFS | 375 MW / 1,500 MWh | Bidding |
| Future TNGECL phases | ~2,000 MWh | Planning |
| Co-located RE + BESS | Per CEA 10% advisory | Rolling |
Central VGF support & bid economics
Under the Centre's Viability Gap Funding scheme, projects receive 30% of capital cost or ₹27 crore per MW, whichever is lower. Combined with ISTS waivers (for projects commissioned up to June 2028) and PLI-backed domestic cells, TN tariffs have come in around ₹2.0 – 2.5 lakh per MW per month — competitive with peaking thermal.
TANTRANSCO substation land at ₹1/year
To accelerate deployment, TANTRANSCO has approved leasing substation land to BESS developers at a nominal ₹1 per project per year. A feasibility study of 1,091 substations (765 kV, 400 kV, 230 kV) has identified suitable sites across the state.
Opportunities for IPPs and integrators
- EPC and O&M contracts for the 1,500 MWh standalone fleet.
- Co-located BESS bolt-ons for existing TN solar and wind parks.
- Behind-the-meter aggregator models for C&I customers.
- Second-life battery and recycling tie-ups under TNERC end-of-life rules.
FAQs
How much BESS capacity is Tamil Nadu tendering?
TNGECL has a 4,000 MWh BESS plan. The first 500 MWh was awarded to NLC India Renewables, and a 375 MW / 1,500 MWh tender for seven standalone projects was floated in 2025–26. More phases are expected as the National Framework for ESS targets ramp up.
Where are the Tamil Nadu BESS projects located?
Most early projects are at TANTRANSCO substations in the southern Tamil Nadu solar/wind belt — Ottapidaram, Annpankulam, and Kayathar (Tuticorin/Tirunelveli). TANTRANSCO has approved leasing substation land at ₹1 per project per year.
What is VGF and how does it help BESS bidders?
Viability Gap Funding from the Government of India provides 30% of the capital cost or ₹27 crore per MW (whichever is lower) for grid-scale BESS. This lowers the bid tariff and makes Tamil Nadu's tenders financially attractive to private developers.
Can private companies own BESS in Tamil Nadu?
Yes. Under the National Framework for ESS and TNERC draft rules, BESS can be developed, owned, leased, or operated by any qualified IPP, consumer, or DISCOM. Tariff-based competitive bidding is the default procurement route.
Continue the BESS series
Read Part 1 on TNERC regulations, or jump to Part 3 for installation and eligibility.
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