India’s installed renewable energy capacity is the fourth largest in the world. The Government is committed to increased use of clean energy sources and is already undertaking various large-scale sustainable power projects and promoting green energy heavily. In addition, renewable energy has the potential to create many employment opportunities at all levels, especially in rural areas.
India has low conventional energy resources compared to its required energy needs driven by a huge population and a rapidly increasing economy. However, India can harness the huge potential of solar energy as it receives sunshine for most of the year. It also has vast potential in hydropower which is being explored across states, especially in the Northeast. India is the only country among the G20 countries that is on track to achieve its targets under the Paris Agreement.
As of November 2023, Renewable energy sources, including biomass, waste to power and waste to energy, have a combined installed capacity of 132.69 GW.
According to the International Energy Agency (IEA), India's installed renewable energy capacity will reach 174 GW in 2023, accounting for about 37% of the country's total energy supply. The report indicates that India has exceeded its target of installing 175 GW of renewable energy capacity by 2022, with a projected capacity of 280 GW by 2025.
As of November 2023, Renewable energy sources, including biomass, waste to power and waste to energy, have a combined installed capacity of 132.69 GW. Installed renewable power generation capacity has increased at a fast pace over the past few years, posting a CAGR of 15.4% between FY16 and FY23. India has 125.15 GW of renewable energy capacity in FY23.
India's installed renewable energy capacity is expected to increase to about 170 GW by March 2025 from the level of 132 GW as of October 2023, according to research agency ICRA.
As of November 2023, 43.9% of the total power installed capacity is from non-fossil-based sources, which fulfils the target of 40% by the end of 2022.
The electricity generation target (Including RE) for the year 2023-24 has been fixed as 1750 Billion Units (BU). i.e. growth of around 7.2% over the actual generation of 1624.158 BU for the previous year (2022-23). The generation during 2022-23 was 1624.158 BU as compared to 1491.859 BU generated during 2021-22, representing a growth of about 8.87%.
Power generation from solar and wind projects is likely to be cost-competitive relative to thermal power generation in India in 2025-30. In the first half of 2022, India saved US$ 4.2 billion in fuel costs through solar power generation and 19.4 million tonnes of coal.
Power generation from renewable energy sources (not including hydro) stood at 26.65 billion units (BU) in October 2023, up from 30.41 BU in October 2022.
Power generation from renewable energy sources stood at 243.60 billion units (BU) between April-October 2023, up from 243.49 BU in the same period in the previous year.
According to the data released by the Department for Promotion of Industry and Internal Trade (DPIIT), the non-conventional energy space in India has become highly attractive for investors and received an FDI inflow of US$ 15.36 billion between April 2000-September 2023. Since 2014, the renewable energy sector in India has seen investments totalling more than Rs. 5.2 lakh crore (US$ 70 billion).
According to research by the Council on Energy, Environment and Water's Centre for Energy Finance (CEEW-CEF), India's total installed power generation capacity reached 416 GW in FY23, of which 125 GW (30%) came from renewable energy (RE) and 47 GW (11%) comes from hydro.
India was ranked fourth in wind power capacity and solar power capacity, and fourth in renewable energy installed capacity, as of 2021.
Around US$ 2.8 trillion will be invested in energy in 2023 globally. More than US$ 1.7 trillion is going to clean energy, including renewable power, nuclear, grids, storage, low-emission fuels, efficiency improvements and end-use renewables and electrification.
In November 2023, AmpIn Energy Transition announced an investment of Rs. 3,100 crore (US$ 372.6 million) to establish renewable energy projects exceeding 600 MW and an integrated manufacturing facility for solar cells and modules across the Eastern region. The funding will be focused in West Bengal, Bihar, Odisha, Jharkhand, Chhattisgarh, and the Northeastern States.
Adani Green Energy Ltd. (AGEL) has acquired SB Energy India for US$ 3.5 billion to strengthen its position in the renewable energy sector in India. Reliance Industries has announced an investment of Rs. 75,000 crore (US$ 10.07 billion) in the green energy segment.
With regards to government initiatives, in the Union Budget 2022-23, the allocation for the Solar Energy Corporation of India (SECI), which is currently responsible for the development of the entire renewable energy sector, stood at Rs. 1,000 crore (US$ 132 million). The government also allocated Rs. 19,500 crore (US$ 2.57 billion) for a PLI scheme to boost the manufacturing of high-efficiency solar modules.
India has launched the Mission Innovation CleanTech Exchange, a global initiative that will create a whole network of incubators across member countries to accelerate clean energy innovation. Prime Minister Mr. Narendra Modi pledged to boost India's renewable energy generation capacity to 500 GW and satisfy half of India's energy needs through renewable sources by the year 2030 at the Cop-26 Summit in Glasgow.
The Government of India wants to develop a ‘green city’ in every state of the country, powered by renewable energy. The ‘green city’ will mainstream environment-friendly power through solar rooftop systems on all its houses, solar parks on the city’s outskirts, waste-to-energy plants and electric mobility-enabled public transport systems.
It is expected that by 2040, around 49% of the total electricity will be generated by renewable energy as more efficient batteries will be used to store electricity, which will further cut the solar energy cost by 66% as compared to the current cost. The use of renewables in place of coal will save India Rs. 54,000 crore (US$ 8.43 billion) annually.
India’s renewable energy sector is expected to attract investment worth US$ 80 billion in the next four years.
References: Central Electricity Authority, Ministry of New and Renewable Energy, Media Reports, Press Releases
Note: Conversion rate used in November 2023: Rs. 1 = US$ 0.012