Renewable Energy Market in India (2025-2030)

Market insights:

Power generation sources in India encompass traditional methods such as coal, lignite, natural gas, oil, hydroelectric, and nuclear energy, alongside sustainable non-conventional sources like wind, solar, agricultural biomass, and domestic waste. This extensive variety allows India to address its growing energy demands while promoting sustainability and reducing reliance on any single energy source.

At present, India ranks third in the Renewable Energy Country Attractive Index.

The renewable energy market is constantly expanding through efficient collaboration between the government and the private sector

Market trends:

India has experienced significant growth in solar power installations, driven by favorable government policies, decreasing costs of solar panels, and increased investor interest

The government's ambitious target of achieving 450 GW of solar power capacity by 2030 has propelled large-scale solar projects and distributed solar installations across the country

Market drivers:

The cost of solar photovoltaic (PV) and wind energy has decreased significantly, making them competitive with fossil fuels. For instance, the lowest tariff for solar energy was recorded at ₹2.30 per kWh in June 2022 during a tender process. Projections suggest that by 2030, solar electricity could potentially be as low as ₹2.30 per kWh and even reach ₹1.90 per kWh with improved technology and capacity utilization. Advances in battery storage technology reduce the intermittency challenges of renewables.

The Indian government has implemented ambitious renewable energy targets and strategic policies that have significantly contributed to the sector's growth. This includes incentives for solar and wind energy projects, which have led to increased investments and installations. For instance, the PM Surya Ghar Muft Bijli Yojana provides significant subsidies for rooftop solar installations, offering up to 60% subsidy for systems up to 2 kW and 40% for systems between 2-3 kW, capped at 3 kW.

Key deterrents to the growth of the market:

• Renewable energy projects have a decentralized nature and require proper system planning and integration in the operation of transmission networks.
• The key purpose of the current transmission lines is to transmit the energy from regional generation units to load centers.
• RE projects are often set up in remote areas, away from large cities, and result in weak transmissibility.
• The distance and voltage levels, therefore, increase with the installation of REs plants far away from the load centers.
• Plans to develop large solar projects in Leh have been cancelled due to such weak transmission infrastructure.
• Hence, to increase penetration levels, it is required to find an optimal network topology for uninterrupted system performance.