NEW DELHI
:
Oil and Natural Gas Corp. (ONGC) Ltd is in talks with global entities including Malaysia’s Gentari to form a joint venture in energy storage, chairman and chief executive Arun Kumar Singh said, as the energy giant makes strides in its energy-transition journey.
ONGC would look at both battery storage and pump storage projects (PSP), Singh said in an interview. Gentari is the green-energy arm of Malaysia-headquartered Petroliam Nasional Berhad (Petronas).
“In energy storage, we are hoping for something big. It will be a JV (joint venture) model. We are already in talks. We have been talking to them (Gentari). There are two-three more people (global entities),” he said.
ONGC has already mapped out a ₹1 trillion investment plan for energy transition till 2030. The ONGC chairman said in case energy storage is identified as a priority area for the company, the exploration and production major may drive the entre dedicted capital expenditure towards storage. “If we need to prioritize this segment, it may be complete ₹1 trillion for battery,” Singh said.
Storage will be a key focus in ONGC’s energy transition plans, Singh said, pointing to the “infinite” opportunity in India in this space. Given the sector’s growth prospects and the state-run company’s large capital base, a capital-intensive sector like energy storage would be ideal for ONGC to invest in, he said.
Queries emailed to a Gentari spokesperson remained unanswered till press time.
Talking of the business opportunities across renewable-energy verticals, he said: “The bigger opportunity, to my mind, in renewable is now not necessarily in solar. The bigger part is storage, energy storage, combination of many things (battery and PSP) and that is primarily a capital-intensive space. So, that is the natural space for ONGC because the kind of capital ONGC has, nobody can have that much depth.”
Power genertion is a segment with several entities; but it is in segments such as energy storage with high capital intensity and a few companies that ONGC finds attractive, as the Maharatna treats it as a moral responsibility to give back to the country, he said.
The company, which aims to achieve net-zero emissions by 2038, currently has a portfolio of 36.52 megawatts (MW) of installed solar-power capacity and 153MW of wind-power capacity. In FY23, it produced 44.42 million units and 204.8 million units of solar and wind energy, according to its annual report for FY23.
On 16 August, Mint reported that ONGC is also in the fray for Finnish state-run power utility Fortum Oyj’s Indian solar projects totalling 185MW along with other suitors.
As part of its diversification process, ONGC has tied up with the Rajasthan government to set up a 5 gigawatts (GW) solar-power plant that would support the production of green hydrogen and green ammonia.In carbon capture, utilizaion and storage (CCUS), it has tied up with Equinor to explore opportunities in offshore wind and green hydrogen, among others.
ONGC’s focus on energy-storage projects comes at a time of sharp focus on the policy front. In April, the Centre released guidelines to promote development of pumped-storage projects. The government is also working on a viability gap funding scheme for battery energy storage systems with a capacity of 4,000MWh (megawatt hour) and a production-linked incentive scheme for grid-scale storage.
Last year, the power ministry issued guidelines for procurement and utilization of battery energy storage systems as part of generation, transmission and distribution assets, along with ancillary services.It also notified the Energy Storage Obligations (ESO) of 4% of the total consumption of electricity by 2029-30 for power distribution companies, in line with the renewable purchase obligation in a bid to boost demand.
ONGC’s annual report als stressed on energy storage systems: “Through ongoing research and development efforts, renewable energy sources, energy storage technologies and energy management systems are becoming more efficient and affordable.”