ICRA, an Indian credit rating agency, says India could add 22 GW of solar capacity in fiscal 2025 and 27.5 GW in fiscal 2026, bringing the country’s total installed PV capacity to 131.5 GW by March 2026 coming, compared to 82 GW on March 31. 2024.
ICRA, an Indian credit rating agency, said India’s renewable energy capacity could rise to 250 GW by March 2026, up from 201 GW by September 2024. This growth will be driven by an 80 GW project pipeline, following enhanced tendering in 2024.
Solar capacity will reach 132 GW by March 2026, with an installed capacity of 91 GW by September 2024. ICRA said it expects annual solar additions of 22 GW in 2025 and 27.5 GW in 2026.
Senior Vice President Girishkumar Kadam noted that strong project pipelines and favorable solar panel prices will drive the addition of renewable energy, especially as interstate transmission waivers end in June 2025.
ICRA said it expects significant contributions from the rooftop and commercial and industrial (C&I) solar segments to capacity additions in India, but delays in land acquisition and transmission connectivity remain execution issues, which could hamper growth, Kadam said.
ICRA said renewable energy capacity in India is likely to increase over the next five years, increasing the share of renewable energy and large hydropower plants in national electricity generation from 21% in 2024 to more than 35% in 2030.
To integrate this growing share, ICRA projects India needs 50 GW of energy storage by 2030, from battery energy storage and hydropower plants.
“The significant decline we have seen in tariffs for BESS projects over the past eight months, driven by the sharp decline in battery prices, is expected to improve adoption of the storage projects,” Kadam said.
Central nodal agencies focus on awarding renewable energy projects that provide 24-hour, robust, adjustable power to reduce the intermittent risk of renewable energy. These projects, often hybrid with energy storage, can help meet demand reliably.
Agencies, together with the railways, have completed auctions for almost 14 GW of such projects. Tariffs remain competitive, with bids ranging from INR 4.0/kWh to INR 5.0/kWh, compared to more than INR 6.0/kWh for coal-based projects. ICRA noted that these projects will face trade market tariffs due to oversizing and expected excess power generation.
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