The Rajasthan Electricity Regulatory Commission (RERC) has issued draft regulations to establish a comprehensive regulatory framework for the planning, procurement, deployment, and utilization of battery energy storage systems (BESS).

Stakeholders can submit their suggestions/objections to the draft RERC (Battery Energy Storage Systems) Regulations, 2025, by November 14.

Eligible Entities

These regulations will apply to all licensees, generating companies, renewable energy developers, power aggregators, and BESS service providers.

The regulations also cover consumers and other entities involved in the planning, procurement, deployment, operation, or utilization of BESS within the state of Rajasthan.

The regulations are intended to be technology-neutral and will apply to all forms of BESS that meet the required technical and performance standards.

BESS Developers

Under these regulations, BESS may be developed and owned by a wide range of entities, including distribution licensees, transmission licensees, generation companies, and independent power producers.

It can also be developed by the state load dispatch center, standalone BESS providers, renewable energy developers, aggregators, or any other third-party investors.

The BESS must be of at least 1 MW and have backup for at least two hours. The BESS must be connected at 11 kV above the interjection point.

However, the minimum sizing of the project will not apply to BESS at the distribution transformer level or for behind-the-meter projects.

The BESS may be deployed as co-located with renewable energy and conventional power projects, or as grid-connected standalone storage. It may also be embedded in distribution or transmission networks, behind the meter at the consumer level, or integrated with electric vehicle infrastructure for vehicle-to-grid services.

The BESS can be used either as a standalone or as part of the generation, transmission, or distribution system. It may also be used for integrating the consumer’s load independently or with behind-the-meter, co-located renewable energy projects.

It can be developed, owned, leased, or operated by a generating company, a transmission licensee, a distribution licensee, a consumer, a system operator, or an independent battery energy storage service provider.

The BESS may also be used to provide services such as frequency regulation, spinning reserves, voltage support, black start services, and demand response services.

If the BESS is not co-located but owned and operated by the generating station or licensee, or consumers, the BESS project will retain the legal status of the owner. However, for scheduling, dispatch, and other purposes, it will be treated as a separate storage element.

Energy Arbitrage

BESS owned or operated by consumers will be permitted to participate in energy arbitrage.

All procurement of BESS capacity and services by the licensee will be undertaken through a tariff-based bidding process.

BESS projects engaging in energy arbitrage may be either a standalone system or a co-located system.

Consumers can utilize a behind-the-meter storage project for self-consumption to supply to distribution companies (DISCOM) during peak hours. The Commission may allow such projects to provide power at an incentivized tariff.

The Commission may approve a single part of a multi-part tariff for BESS projects used for ancillary services.

The regulations also allow obligated entities or consumers to claim the renewable purchase obligation/renewable consumption obligation benefit for power consumption through BESS projects.

The BESS providers must submit real-time data to state load dispatch centers (SLDC) as prescribed.

Role of Licensees

The DISCOMs and the state transmission utility (STU) will plan the requirement of energy storage capacity within their respective areas of operation, in consultation with the SLDC.

The Commission must approve the proposed storage plan along with an investment plan.

The draft regulations also allow the aggregation of BESS resources from multiple sites to provide services to the SLDC/transmission company/DISCOM/generating company.

The SLDC will determine the technical and financial criteria to register as a BESS aggregator.

The regulations also allow eligible entities to enter into commercial agreements with licensees or other market participants for the provision of BESS services.

The DISCOMs will also publish potential sites at the 11 kV voltage level in their 33/11 kV substations for establishing BESS of the required capacities based on feeder-level solarization on their websites.

DISCOMs must also register ancillary service providers and aggregators.

All expenditure incurred on the BESS can be recovered by DISCOMs through the annual revenue requirement (ARR) under specified heads for power purchase or capital expenditure.

The transmission licensees must include BESS in their planning and investment plans and file proposals for Commission approval.  They can recover the cost of installing BESSs through the transmission business’s ARR.

The distribution and transmission licensee will be exempted from procuring BESS capacity or services through a transparent bidding process if the BESS is installed and owned by the licensee.

The transmission licensee shall prepare a standard agreement format for procuring ancillary services and obtain the Commission’s approval before entering into agreements.

Role of Nodal Agency

The nodal agency, the SLDC, will verify governor settings of thermal generators and assess the requirement of primary, secondary, and tertiary reserve ancillary services from BESS.

The SLDC will also specify eligibility criteria for BESS resources to provide ancillary services based on technical criteria and operational performance, and publish these on its website within three months from the date of notification of the regulations.

In consultation with state transmission utility and licensees, the SLDC will prepare and publish on its website the eligibility criteria for the registration of ancillary service providers within three months from the date of notification.

The SLDC must also prepare a procedure for scheduling, metering, accounting, settlement, and commercial mechanisms for the operationalization of ancillary services through BESS, for approval by the Commission, within six months.

It will also monitor the performance of BESS, including state of charge, round-trip efficiency, and its availability.

Developers may establish BESS at any point in the system after obtaining due approvals and participate in the ancillary services market, and may register with the relevant licensee to provide such services.

Behind-the-Meter Storage Projects

All consumers will be permitted to establish behind-the-meter BESS up to their contract demand, with or without solar power projects. Such consumers will be required to register their BESS installations with the DISCOMs through the online portal developed and maintained by the SLDC.

No prior permission or formal connection agreement with the DISCOM will be required for the installation of the BESS.

If the solar plus storage system is already installed or proposed under net metering, net billing, group net metering, or virtual net metering, the hybrid system as a whole will be governed by the regulatory framework under which the solar plant is registered.

Consumers or prosumers having eligible behind-the-meter BESS will be permitted to participate in the demand response and similar programs, either directly or through an aggregator.

The DISCOMs will also develop programs for vehicle-to-grid/grid-to-vehicle concepts through smart chargers. However, eligible participants may require the installation of a smart meter and communication infrastructure capable of real-time data acquisition and transmission.

Recently, RERC notified the third amendment to its Grid-Interactive Distributed Renewable Energy Generating Systems Regulations, opening up virtual and group net metering across consumer categories, codifying charge waivers, and adding battery storage incentives.

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