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Ministry of New and Renewable Energy Pushes for Stronger Ancillary Markets to Stabilize Grid

The Ministry of New and Renewable Energy (MNRE) is set to begin consultations aimed at strengthening ancillary service markets in the clean energy sector to improve grid reliability. The ministry has taken up the matter with the Central Electricity Authority (CEA), according to MNRE Secretary Santosh Kumar Sarangi.

The proposed initiative focuses on expanding market-based mechanisms for essential grid support services such as frequency regulation, voltage control, and black start capabilities. Black start systems enable rapid restoration of the grid in the event of a total shutdown, helping bring power systems back online within seconds.

Sarangi emphasized the need to deploy advanced technologies to support renewable energy integration. These include grid-forming inverters, battery energy storage systems, synchronised condensers, static synchronous compensators (STATCOMs), and capacitor banks. Such tools can help manage the variability associated with renewable power generation and ensure system stability.

The move comes as grid integration challenges increasingly emerge as a potential constraint to India’s renewable capacity expansion. With rising penetration of variable renewable energy, maintaining frequency and voltage within permissible limits has become more complex.

The CEA is currently preparing a discussion paper on ancillary services markets, which is expected to outline ways to create structured opportunities for ancillary service providers.

Alongside ancillary services, the ministry is also prioritizing alignment between renewable energy capacity additions and transmission infrastructure development. As renewable generation scales up, battery energy storage systems are expected to play a critical role in smoothing supply fluctuations and enhancing grid resilience.

Globally, several power markets operate dedicated capacity markets for ancillary services. In India, policymakers are evaluating the feasibility of introducing a capacity market framework and strengthening system balance reserves to ensure reliable and efficient grid operations as renewable energy penetration rises.