India's Renewable Energy Capacity Set to Hit 250 GW by March 2026

New Delhi: India’s renewable energy capacity, including large hydropower projects, is expected to reach 250 gigawatts (GW) by March 2026, rising from the current 201 GW as of September this year, a recent report highlighted. This growth is driven by an impressive project pipeline exceeding 80 GW, boosted by a surge in tendering activities in the 2023-2024 fiscal year.

The government’s push for renewable energy was marked by a 50 GW annual bidding target set in March 2023, leading to continued robust tendering efforts this fiscal year. These developments have paved the way for significant capacity additions in the coming years.

The healthy pipeline of projects and favorable prices for solar PV cells and modules are expected to drive renewable energy additions to over 26 GW in the fiscal year 2024-2025, up from 19 GW in the previous year.

“This figure is anticipated to further rise to 32 GW in the 2025-2026 fiscal year, with solar energy leading the charge. The upcoming expiration of the waiver on inter-state transmission system (ISTS) charges in June 2025 will also be a key factor,” said Girishkumar Kadam, Senior Vice President and Co-Group Head of Corporate Ratings.

In addition to large-scale projects, the report predicts significant contributions from the rooftop solar sector and commercial and industrial segments.

The expansion in renewable energy over the next five years is set to increase the share of renewables plus large hydropower in India’s total electricity generation, from 21% in the fiscal year 2023-2024 to over 35% by 2030.

“In this scenario, the development of sufficient energy storage solutions is essential to manage the intermittent nature of renewable energy sources,” said Kadam.

There is also a growing focus by central agencies on awarding projects that provide round-the-clock (RTC) and reliable, dispatchable energy supplies, reducing the risks linked with the variable nature of renewables. This can be achieved by integrating hybrid renewable projects with energy storage systems, the report noted.

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