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					</table><p>With the government reducing the Goods and Services Tax (GST) on several rooftop solar system components, installation costs under the PM Surya Ghar: Muft Bijli Yojana have declined by up to 10%, according to industry sources.</p>
<p>In September 2025, the Ministry of Finance <a href="https://www.mercomindia.com/project-development-to-become-cheaper-as-government-cuts-gst-on-solar-cells" target="_blank" rel="noopener">reduced</a> the GST rate on high-value system components such as solar modules, cells, and inverters. Other components, including mounting structures, wiring, protection equipment, and junction boxes, also saw tax-cost reductions, contributing to a broader decline in overall system prices.</p>
<p>The GST cut has also lowered engineering, procurement, and construction (EPC) costs, which were previously subject to higher tax rates, further easing installation expenses.</p>
<p>Installers said consumers planning to adopt rooftop solar can now expect a 7%–10% reduction in total system costs, a development likely to accelerate uptake, particularly in Tier-2 and Tier-3 cities.</p>
<p><strong>System Costs to go Down</strong></p>
<p>According to Radhika Choudary, Co-Founder and Director at <a href="https://freyrenergy.com/" target="_blank" rel="noopener">Freyr Energy</a>, for an average 2 kW-3 kW residential rooftop solar system, the GST rate cut translates to savings of around ₹8,000 (~$88.4) to ₹12,000 (~$132.6), depending on the type of modules and inverters used.</p>
<p>Installers note that before the GST reduction, a typical 2 kW-3 kW residential rooftop solar system in cost between ₹120,000 (~$1,326.2) and ₹140,000 (~$1,547.25), varying across states and component choices. After the GST rate was reduced to 5%, the cost of the same system has dropped to ₹108,000 (~$1,193.59) and ₹125,000 (~$1,381.48).</p>
<p>They say that consumer affordability is one of the biggest drivers of rooftop solar projects, and that reductions in system costs shorten payback periods and reduce upfront capital expenditure.</p>
<p>Alok Karwasra, Senior Vice President at <a href="https://solariumenergy.in/" target="_blank" rel="noopener">Solarium Green Energy</a>, said that rooftop solar system costs could go down by another ₹10,000 (~$110.5) if state subsidies are factored in.</p>
<p>A typical 3 kW system can generate 3,500–4,000 units annually, helping households save between ₹18,000 (~$198.9) to ₹22,000 (~$243.14) per year, depending on the state’s electricity tariffs. “Over a 20-year lifespan, the cumulative savings can range from ₹100,000–120,000 (~$1326.22) or higher,” said Choudary.</p>
<p>She added that a reduced system price also means consumers will pay lower equated monthly installments (EMIs) on their loans.</p>
<p>Installers say government subsidies and low-cost financing options could help consumers slash their electricity bills by a third.</p>
<p>Karwasra explained that opting for a loan under Jan Samarth, a digital portal linking 14 credit-linked government programs, helps consumers start saving from the very first month. “In case the EMI is equal to the consumer’s electricity bill, the consumer can achieve payback within 3 years. For the remaining project life, the consumer can get free electricity for the amount equivalent to the power bill.”</p>
<p><strong>PM Surya Ghar Targets</strong></p>
<p>India had set a target of 3.5 million households under the PM Surya Ghar program for FY 2026.</p>
<p>As of December 2025, the country has installed rooftop solar systems in 2,396,497 residential households under PM Surya Ghar, reaching nearly 24% of the 10 million target set for the financial year FY 2027. Installers are confident that, with strong policy incentives, falling component prices, and rising consumer awareness, India can meet the target.</p>
<p>India <a href="https://www.mercomindia.com/product/rooftop-solar-market-report-q3-2025" target="_blank" rel="noopener">added</a> a record 4.9 GW of rooftop solar capacity in the first nine months of 2025, a 161% year-over-year growth, according to Mercom India’s Q3 2025 India Rooftop Solar Market Report. Of these installations, close to 75% were in the residential segment.</p>
<p>Shreya Mishra, Co-Founder of <a href="https://www.google.com/aclk?sa=L&amp;pf=1&amp;ai=DChsSEwjLuoaFjMeRAxV0PYMDHeJ6OQkYACICCAEQABoCc2Y&amp;co=1&amp;ase=2&amp;gclid=Cj0KCQiA6Y7KBhCkARIsAOxhqtMo5ORZrEUoWV9al7y2mI_9_QEhUtQG_9ngbqgq4RhGqTNh2_FswI0aAr8QEALw_wcB&amp;cid=CAASWeRoi7I5ngXrGGgd6B8X9WW4BdPXsxDapVLyGHKPw-HnBS5CEI_jssSTJqLG9POvJPyk5dx-i_ulcgQtv-C5l2mhh0M-fkI0eftWn0VM91izJeTXvNRgnkgE&amp;cce=2&amp;category=acrcp_v1_32&amp;sig=AOD64_2A4ieOR9rPiWAUIYkXsMZD9h-mHg&amp;q&amp;nis=4&amp;adurl=https://www.solarsquare.in/go-solar?utm_term%3Dsolarsquare%26utm_campaign%3DDR_Search_Brand_AllCities_Jan13%26utm_source%3Dadwords%26utm_medium%3Dppc%26hsa_acc%3D1384667780%26hsa_cam%3D19566406052%26hsa_grp%3D152005427984%26hsa_ad%3D644801250633%26hsa_src%3Dg%26hsa_tgt%3Dkwd-831268040081%26hsa_kw%3Dsolarsquare%26hsa_mt%3De%26hsa_net%3Dadwords%26hsa_ver%3D3%26gad_source%3D1%26gad_campaignid%3D19566406052%26gbraid%3D0AAAAACamwb-wnsUVsUo22R3XAWrT-G1dv%26gclid%3DCj0KCQiA6Y7KBhCkARIsAOxhqtMo5ORZrEUoWV9al7y2mI_9_QEhUtQG_9ngbqgq4RhGqTNh2_FswI0aAr8QEALw_wcB&amp;ved=2ahUKEwjn5_2EjMeRAxUuS2cHHQkePVoQ0Qx6BAghEAE" target="_blank" rel="noopener">SolarSquare</a>, said that the GST reduction on solar equipment will be another tailwind for the PM Surya Ghar program.  “While solar has a great return on investment, the high upfront cost is the biggest barrier for middle-class Indian families to adopt solar.”</p>
<p>Solar will become more affordable with lower GST, coupled with subsidies and low-interest loans from public-sector banks, she said. This will drive installations in the residential segment.</p>
<p>Karwasra noted that “With the current trend, the target of reaching 3.5 million in FY26 is possible, given the push and support from both the Ministry of New and Renewable Energy and REC.”</p>
<p>He added that installations are rising in more states than in the previous financial year, with state governments now offering subsidies.  “Vendor registrations and penetration are also increasing significantly month-on-month, indicating greater awareness and adoption of rooftop solar systems.”</p>
<p><strong>Bottlenecks</strong></p>
<p>While rooftop installers are confident they can meet the targets, they also highlight issues that could slow adoption.</p>
<p>Choudary noted that streamlining net-metering approvals, accelerating subsidy disbursal, and adopting consistent state-level guidelines would significantly reduce installation timelines.</p>
<p>She added that there is an urgency to increase the supply and availability of domestic content requirement (DCR)-compliant modules to prevent shortages.  “Standardized quality checks and digital monitoring mechanisms will also enhance system reliability and long-term consumer confidence.”</p>
<p>Karwasra said that, currently, project commissioning takes up to 12 weeks and can be reduced to 3-4 weeks by streamlining the distribution companies’ processes for metering documentation and installations, seamless financing under Jan Samarth, and quicker loan and subsidy disbursements.</p>
<p>State government subsidies, on top of Central financial assistance and the recent GST rate cut on solar components should boost rooftop installations in the coming months.</p>


Rooftop Solar Gets Cheaper as GST Cut Shortens Payback Period for Consumers


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					</table><p>India’s accelerating shift toward renewable energy is the central reason battery energy storage systems (BESS) are growing rapidly. As solar and wind take up a larger share of the installed power mix, their natural intermittency creates a growing gap between when clean power is generated and when electricity is actually needed.</p>
<p>At the same time, India’s power demand profile is evolving toward sharper firm and peak-period requirements, driven by urban consumption and industrial activity.</p>
<p>BESS has become a critical enabler for India’s energy transition, helping store surplus renewable power and dispatch it when generation dips, ensuring grid stability and allowing renewable capacity to expand without compromising reliability.</p>
<p>Coupled with supportive policy signals and steadily improving storage economics, these factors are pushing BESS into mainstream grid infrastructure across the country.</p>
<p>In 2025, various agencies in India floated tenders to develop projects with 17 GW/48 GWh of standalone BESS.</p>
<p>Here are the top tenders issued in 2025:</p>
<p><strong>#1 </strong>NTPC floated the largest tender to develop 2,500 MW/10,000 MWh standalone BESS at NTPC’s thermal stations. The capacity at each station is 500 MW/2,000 MWh, with two 250 MW blocks per plant. All capacities are measured at a 400 kV/220 kV interconnecting point. The designed service life of BESS should be 20 years for daily single-cycle operation.</p>
<p><strong> <a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88360 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1.jpg" alt="BESS 1" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-1-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></strong></p>
<p><strong>#2</strong> The second-largest one was <a href="https://www.mercomindia.com/maharashtra-floats-tender-for-2000-mw-4000-mwh-battery-energy-storage/" target="_blank" rel="noopener">tendered</a> by Maharashtra State Electricity Distribution Company (MSEDCL) to procure power from 2,000 MW/4,000 MWh of standalone BESS with viability gap funding (VGF) support. The storage systems will be deployed across multiple locations near MSEDCL or the Maharashtra State Electricity Transmission Company substations.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88361 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2.jpg" alt="BESS 2" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-2-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p><strong>#3</strong> The third-largest tender was <a href="https://www.mercomindia.com/gujarat-floats-tender-for-2000-mw-4000-mwh-standalone-bess-project/" target="_blank" rel="noopener">issued</a> by Gujarat Urja Vikas Nigam (GUVNL) to develop a 2,000 MW/4,000 MWh standalone BESS project under Phase VII of GUVNL’s BESS program. The BESS installations will be connected to Gujarat Energy Transmission Corporation, including substations at Charanka, Shapar, and Bhogat, among others.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88362 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3.jpg" alt="BESS 3" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-3-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p><strong>#4 </strong>The Transmission Corporation of Andhra Pradesh (APTRANSCO) <a href="https://www.mercomindia.com/andhra-pradesh-invites-bids-for-1000-mw-2000-mwh-bess-projects/" target="_blank" rel="noopener">floated</a> the fourth-largest tender to develop 1,000 MW/2,000 MWh standalone BESS across seven substations in the state. The projects will be developed under a build, own, and operate model through tariff-based competitive bidding, with VGF support.</p>
<p><strong> <a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88363 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4.jpg" alt="BESS 4" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-4-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></strong></p>
<p><strong>#5 </strong>The fifth-largest tender was <a href="https://www.mercomindia.com/rajasthan-tenders-1000-mw-2000-mwh-standalone-bess" target="_blank" rel="noopener">issued</a> by Rajasthan Rajya Vidyut Utpadan Nigam (RVUNL) to set up 1,000 MW/2,000 MWh standalone BESS at six locations in the state. Apart from setting up the BESS, the scope of work entails making the storage facility available to RVUNL for its on-demand charging and discharging.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88364 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5.jpg" alt="BESS 5" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/BESS-5-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p>India’s cumulative installed energy storage capacity reached 490 MWh by the end of June 2025, according to Mercom India Research’s <a href="https://www.mercomindia.com/product/india-energy-storage-landscape-1h-2025" target="_blank" rel="noopener">India’s Energy Storage Landscape 1H 2025 Report</a>.</p>


India’s Top Battery Energy Storage Tenders in 2025 [Infographics]


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					</table><p>India added 26.6 GW of solar capacity in the first nine months (9M) of the calendar year 2025, an <a href="https://www.mercomindia.com/india-16-gw-solar-capacity-9m-2024" target="_blank" rel="noopener">increase</a> of 53.7% year-over-year (YoY) from 17.3 GW, according to the <a href="https://www.mercomindia.com/product/q3-2025-india-solar-market-update" target="_blank" rel="noopener">Q3 2025 India Solar Market Update</a> Report by Mercom India Research.</p>
<p>Large-scale solar accounted for 81.5% of the capacity commissioned in 9M 2025, while rooftop solar contributed 18.5%.</p>
<p>Tenders totaling about 7.7 GW were issued in 2025 to develop utility-scale solar projects.</p>
<p>Here are the top solar project development tenders issued in 2025:</p>
<p><strong>#1</strong> The largest tender was <a href="https://www.mercomindia.com/uttar-pradesh-floats-eoi-for-2-gw-solar-power-projects/" target="_blank" rel="noopener">issued</a> by Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), inviting expressions of interest to develop 2 GW of solar power projects in the Chitrakoot, Jalaun, Jhansi, and Lalitpur districts in Uttar Pradesh. UPNEDA has shortlisted three locations for projects exceeding 50 MW, 11 locations with capacities between 30 MW and 50 MW, 56 locations between 10 MW and 30 MW, and 167 locations with capacities below 10 MW. The initiatives will utilize roughly 8,000 acres of government land across 158 villages in four districts.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88138 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1.jpg" alt="1" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/1-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p><strong>#2 </strong>UPNEDA also <a href="https://www.mercomindia.com/uttar-pradesh-invites-eoi-for-1-3-gw-solar-projects-in-jhansi/" target="_blank" rel="noopener">floated</a> the second-largest tender seeking expressions of interest to develop 1.3 GW solar power projects in Jhansi, Uttar Pradesh. The projects will be developed on a build-own-operate basis in Garautha and Mauranipur tehsils. The total project area covers 5,508 acres, comprising 957 acres of government land leased to the developers for a 30-year period and 4,551 acres of private land to be procured by the developers, including wasteland areas. The land is in three contiguous blocks within nine villages of Garautha tehsil and one continuous block within a village of Mauranipur tehsil.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88139 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2.jpg" alt="2" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/2-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p><strong>#3 </strong>NHPC <a href="https://www.mercomindia.com/nhpc-invites-bids-for-1-2-gw-solar-projects-in-uttar-pradesh/">released</a> the third-largest tender which was to develop 1.2 GW of ground-mounted solar projects at the Jalaun Solar Park in Uttar Pradesh. Bundelkhand Saur Urja, a joint venture of NHPC and Uttar Pradesh New and Renewable Energy Development Agency, is developing the solar park. Selected bidders must sign a power purchase agreement (PPA) with NHPC for 25 years. The scope of work includes the development of the solar projects until the interconnection point at the incoming side of the pooling substation. It also involves providing operation and maintenance services.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88140 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3.jpg" alt="3" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/3-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p><strong>#4</strong> Deendayal Port Authority (DPA) <a href="https://cms.mercomindia.com/deendayal-port-authority-floats-tender-for-1-gw-solar-project/" target="_blank" rel="noopener">announced</a> the fourth largest tender for developing a 1 GW solar project on its coastal land parcel between Chirai and Jangi in Gujarat. The land parcel is intertidal and marshy and partially falls within the Coastal Regulation Zone. DPA will sign a PPA with developers for 25 years, who must supply 1,750 MW of power in a year. Projects must be completed within 10 months of the PPA signing.</p>
<p><img loading="lazy" decoding="async" class="aligncenter wp-image-88141 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4.jpg" alt="4" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/4-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></p>
<p><strong>#5</strong> The fifth largest tender was <a href="https://www.mercomindia.com/coal-india-invites-bids-for-875-mw-solar-project-in-rajasthan/" target="_blank" rel="noopener">issued</a> by Coal India to develop an 875 MW solar power project at Rajasthan Rajya Vidyut Utpadan Nigam’s 2,000 MW Solar Park at Pugal. The scope of work includes the design, engineering, procurement, erection, testing, and commissioning of the solar project, along with comprehensive operation and maintenance services for two years.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5.jpg"><img loading="lazy" decoding="async" class="aligncenter wp-image-88142 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5.jpg" alt="5" width="1379" height="207" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5.jpg 1379w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5-300x45.jpg 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5-768x115.jpg 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5-650x98.jpg 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5-624x94.jpg 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/12/5-600x90.jpg 600w" sizes="auto, (max-width: 1379px) 100vw, 1379px" /></a></p>
<p>Subscribe to Mercom’s <a href="https://mercomindia.com/product/india-solar-tender-tracker/" target="_blank" rel="noopener">India Solar Tender Tracker</a> to stay on top of the real-time tender activity.</p>


India’s Top Five Utility-Scale Solar Tenders in 2025 [Infographics]


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					</table><p>The Ministry of New and Renewable Energy’s (<a href="https://mnre.gov.in/" target="_blank" rel="noopener">MNRE</a>) recent advisory to banks and financial institutions, calling for prudence in lending to standalone solar module manufacturing, has been welcomed by the renewable energy sector. Stakeholders say capital should flow into parts of the renewable energy ecosystem that have remained underdeveloped.</p>
<p>In an office memorandum, MNRE <a href="https://www.mercomindia.com/mnre-flags-solar-module-glut-asks-lenders-to-fund-upstream-manufacturing" target="_blank" rel="noopener">urged </a> the Department of Financial Services to ensure that financing decisions “adopt a calibrated and well-informed approach” when lending to module manufacturing amid overcapacity.</p>
<p>India’s module manufacturing capacity, now nearing 150 GW, is already 200–250% higher than domestic demand and could cross 200 GW in the coming years.</p>
<p>However, upstream segments such as polysilicon, ingots, wafers, and key ancillaries such as solar glass and aluminium frames, have not kept pace with module manufacturing growth.</p>
<p>Module capacity <a href="https://www.mercomindia.com/solar-module-capacity-under-almm-grows-to-121-7-gw" target="_blank" rel="noopener">enlisted</a> under the Approved List of Models and Manufacturers List (ALMM) as of November 2025 was 121.72 GW, while the cell capacity <a href="https://www.mercomindia.com/solar-cell-capacity-under-mnres-almm-list-ii-rises-to-18-5-gw" target="_blank" rel="noopener">registered</a> under the ALMM List-II stood at 18.48 GW.</p>
<p>Industry insiders say the MNRE advisory is timely.</p>
<p>Dushyant Kumar, PV Quality Manager at <a href="https://axitecsolar.com/in" target="_blank" rel="noopener">AXITEC Energy India</a>, said, “Overcapacity is pressuring prices and lowering utilization, and continued financing of standalone module plants could create avoidable debt risks. The priority now should be integrated manufacturing and upstream segments, such as polysilicon, ingots, wafers, and key ancillaries, such as glass and frames. These are the real gaps holding back India’s solar supply chain.”</p>
<p><strong>Unsustainable Buildup</strong></p>
<p>The trigger for MNRE’s action was a letter from the All India Solar Industries Association (<a href="https://aisia.org.in/" target="_blank" rel="noopener">AISIA</a>), which warned that installed and upcoming module capacities already exceed near-term domestic demand and that unchecked lending to more module and cell lines risks unsustainable debt buildup and potential non-performing assets.</p>
<p>“If fresh lending keeps flowing indiscriminately into new module lines, we risk pushing the industry towards distress and bankruptcies,” says Praveen Kumar, Director General at AISIA. “The intent was never to say ‘stop lending’ to the solar sector, but rather to urge lenders to be cautious about further expanding module capacity in an already saturated segment.”</p>
<p>He stressed that the Association also wanted to draw attention to the parts of the value chain where capital is still welcome: “Capacity in upstream manufacturing is still lagging behind potential demand, and where lending opportunities remain strong. MNRE’s subsequent clarification through its press release should put these doubts to rest and give banks and NBFCs the confidence to keep supporting viable, well-structured projects across the solar ecosystem.”</p>
<p>AISIA essentially told the government and the banking system that the sector is at risk of building factories that will be stranded if utilization stays low and prices remain under pressure.</p>
<p><strong>Horizontal Growth</strong></p>
<p>For years, government incentives, from production-linked incentives to customs duties and domestic content rules, spurred a proliferation of module assembly lines and, later, cell manufacturing lines. These were faster, cheaper, and less technologically intensive to set up than upstream facilities, making them the natural entry point for new players.</p>
<p>“India stands at a decisive moment in strengthening its solar manufacturing ecosystem,” said  Chetan Shah, Chairman and Managing Director at <a href="https://solex.in/" target="_blank" rel="noopener">Solex Energy</a>. “While our module capacity has grown significantly, the ground realities of domestic cell manufacturing are often misunderstood. A major portion of India’s cell capacity is still based on older P-type technologies that require urgent upgradation, and only a limited share is truly future-ready N-type capacity.”</p>
<p>Shah warned that if lenders apply a blunt caution that doesn’t distinguish between modules and cells, they could inadvertently hurt a critical bridge segment. In his view, solar cells remain the backbone of upstream integration, ALMM compliance, and India’s domestic manufacturing ambitions. Restricting or delaying financing for genuinely competitive, technology-upgrading cell projects, he argued, would risk slowing the transition to advanced technologies such as TOPCon and beyond, precisely where India needs to move next.</p>
<p>The contrast with the upstream side is stark. While module capacity has raced ahead, cell capacity appears on track to meet demand in the near future, India still has only about 2 GW of ingot and wafer capacity and no commercial-scale polysilicon production. Solar glass and aluminum frames, crucial ancillaries for any serious module ecosystem, are also flagged by MNRE as segments where domestic capacity lags demand, with glass around 15 GW and aluminum frames around 17 GW per year.</p>
<p>Some stakeholders introduced a caveat. While agreeing that module overcapacity is real, they cautioned against overreacting. “While banks may exercise caution in the short term, growing demand for solar panels will require a substantial increase in solar capacity,” noted Avinash Hiranandani, Vice Chairman and Managing Director at <a href="https://www.renewsysworld.com/" target="_blank" rel="noopener">RenewSys</a>.</p>
<p>He argued that continued banking support for solar manufacturing, including modules, will remain crucial as India’s deployment targets ramp up, especially since “solar cell production has not yet caught up with rising module demand” and a broader ecosystem of ancillaries, such as encapsulants, also needs timely funding to scale.</p>
<p>The sector’s problem is not that too much capital has flowed into solar, but that it has flowed disproportionately into one layer of the stack.</p>
<p><strong>The Road Ahead</strong></p>
<p>The MNRE advisory to banks must also be seen in the context of India’s position within global supply chains. For long, the Indian industry has relied on the Chinese upstream supply. However, the actual build-out has left India with a large fleet of module lines and some cell lines that are still dependent on imported wafers and polysilicon.</p>
<p>Vinay Rustagi, Chief Business Officer at <a href="https://premierenergies.com/" target="_blank" rel="noopener">Premier Energies</a>, pointed out that the real gap lies in ingots, wafers, polysilicon, silicon refining, and critical minerals and chemicals. “If we want true self-sufficiency and not just final assembly in India, then capital has to flow into these areas.”</p>
<p>The advisory, he said, was “a nudge for the financial system to align with the country’s long-term manufacturing and energy security goals, rather than adding more capacity where we are already relatively comfortable.”</p>
<p>Another layer to the rationale lies in the need to correct distortions created during the ALMM-heavy years. ALMM pushed developers to buy from domestic, listed manufacturers, which in turn incentivized many firms to quickly add or expand module lines to make it onto the list.</p>
<p>MNRE’s advisory signals that the next phase of growth should address structural gaps in the value chain.</p>
<p>Not everyone, however, is at ease with the implied consolidation. Smaller module manufacturers fear that prioritizing upstream could make it harder for them to raise funds.</p>
<p>Rustagi noted that solar manufacturing is extremely capital-intensive, and globally, the large, vertically integrated players are best positioned to survive and grow over time. “Smaller companies with limited, non-integrated capacities were always going to find it difficult to compete and to raise money at scale, regardless of this lending guidance.”</p>
<p>In that sense, the MNRE rethink on lending to module manufacturing is less a sudden change in direction and more a formal recognition of where market forces were already pushing the industry. If upstream capabilities, especially in ingots and wafers, are strengthened in time ahead of tighter ALMM timelines around 2028, that shift could ultimately support a more resilient, integrated domestic ecosystem that benefits the entire solar value chain.</p>
<p>Industry voices converge on one central point: prudence does not mean paralysis. A calibrated lending approach, as Shah and others argue, would distinguish between speculative, announcement-driven projects and genuinely competitive, technology-upgrading investments, especially in cells and upstream manufacturing. Hiranandani’s emphasis on long-term demand and ancillaries, Rustagi’s call for upstream depth, and AISIA’s focus on system-wide stability all point in the same direction: rebalance capital, don’t retreat from the sector.</p>
<p>“I’m generally not in favor of steering lenders or directing lending toward one segment over another. There’s already too much thumb on the scale in this sector,” commented Raj Prabhu, CEO at Mercom Capital Group.</p>
<p>“Sophisticated lenders are expected to conduct proper due diligence and price the risk of each segment based on fundamentals and demand-supply realities. The market rewards good underwriting with attractive returns and will punish poor decisions with bad loans.</p>
<p>If investment decisions are routinely ‘guided’ from the top or shaped by factions with their own interests, you end up with misallocation and poor outcomes. Government should focus on providing clear policy direction, long-term demand visibility, and targeted incentives to accelerate innovation towards building critical domestic supply chains,” added Prabhu.</p>


Industry Welcomes Government Push For Upstream-Focused Solar Lending


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					</table><p>India added 1.8 GW of wind energy capacity in the first quarter (Q1) of the calendar year 2025, an increase of 63% year-over-year (YoY) from 1.15 GW in Q1 2024. The capacity additions rose 134% quarter-over-quarter (QoQ), according to <a href="https://www.mercomindia.com/research" target="_blank" rel="noopener">Mercom India Research</a>.</p>
<p>Wind-specific renewable purchase obligations from 2023 to 2030 and the annual onshore wind bidding target of 10 GW from 2023 to 2027 have served as key long-term policy enablers for capacity additions. However, the 100% Inter-State Transmission System (ISTS) charges waiver, currently set to expire in June 2025, has led to a spike in installations in Q1 and is expected to further accelerate activity in the upcoming quarter, particularly if the waiver is not extended.</p>
<p>During the quarter, Karnataka led all states in capacity additions with 620 MW. Madhya Pradesh followed with 351 MW, a significant increase despite reporting no installations in previous quarters. Tamil Nadu added 331 MW, while other states collectively contributed 573 MW to the total installed capacity.</p>
<p>JSW Renew Energy commissioned 210.5 MW under SECI&#8217;s 2500 MW ISTS-connected projects (Tranche-IX) across Karnataka and Tamil Nadu, and Sembcorp commissioned 54.6 MW under the 1,200 MW ISTS-connected (Tranche-XI) project in Karnataka in Q1 2025.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-79792 " src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image.png" alt="wind q1" width="631" height="436" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image.png 693w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-300x207.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-650x449.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-624x431.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-600x415.png 600w" sizes="auto, (max-width: 631px) 100vw, 631px" /></a></p>
<p>As of March 2025, the cumulative installed wind capacity was 50 GW, rising 3.9% <a href="https://www.mercomindia.com/indias-installed-wind-capacity-rose-45-yoy-in-q4-2024" target="_blank" rel="noopener">from</a> 48.2 GW at the end of December 2024.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-79795 " src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1.png" alt="cumulative wind q1" width="671" height="442" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1.png 908w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1-300x198.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1-768x506.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1-650x428.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1-624x411.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/05/image-1-600x395.png 600w" sizes="auto, (max-width: 671px) 100vw, 671px" /></a></p>
<p>At the end of Q1, Gujarat led the cumulative installed wind energy capacity with 12.6 GW. Tamil Nadu and Karnataka followed with 11.7 GW and 7.3 GW, respectively.</p>
<p>Maharashtra and Rajasthan rounded off the top five with 5.2 GW each of cumulative installed wind capacity.</p>
<p>Andhra Pradesh and Madhya Pradesh also had significant cumulative wind installations, with 4.3 GW and 3.1 GW at the end of the quarter.</p>
<p>The top five states accounted for 84.5% of the cumulative installed wind capacity as of March 2025.</p>
<p>Hybrid power projects, particularly those combining wind and solar and Firm and Dispatchable Renewable Energy (FDRE) projects, have been key drivers of wind installations in India. Looking ahead, the repowering of aging wind turbines presents a significant opportunity for future growth.</p>
<p>In January 2025, Telangana set a <a href="https://www.mercomindia.com/telangana-aims-for-20-gw-renewable-energy-capacity-additions-by-2030" target="_blank" rel="noopener">target</a> of 2.5 GW for wind installations under its Renewable Energy Policy initiatives.</p>
<p>In October last year, Andhra Pradesh <a href="https://www.mercomindia.com/andhra-pradesh-clean-energy-policy-targets" target="_blank" rel="noopener">announced</a> its wind installation target of 35 GW capacity by 2029. In December, Rajasthan <a href="https://www.mercomindia.com/rajasthan-clean-energy-policy-2030" target="_blank" rel="noopener">unveiled</a> its plans for 25 GW of wind and hybrid energy by 2030 under its Integrated Clean Energy Policy, 2024.</p>


India’s Wind Energy Installations Surge 134% QoQ in Q1 2025


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					</table><p>With just over two months to go before the interstate transmission system (ISTS) charges waiver ends, the Indian renewable energy project developers are keeping their fingers crossed for an extension.</p>
<p>The ISTS-charges waiver will end on June 30, 2025. While the waiver is in effect, commercial and industrial consumers can access renewable energy from various states at a more affordable price.</p>
<p>The waiver was intended to foster renewable energy transition by lowering generation costs and help India reach its 500 GW goal of non-fossil fuel energy capacity by 2030.</p>
<p>In 2024, the <a href="https://cercind.gov.in/" target="_blank" rel="noopener">Central Electricity Regulatory Commission</a> <a href="https://www.mercomindia.com/cerc-amends-regulations-waiver-applicability" target="_blank" rel="noopener">expanded</a> the transmission charges waiver eligibility by adding renewable energy generation systems based on offshore wind to the energy sources list, which already includes hydropower generation.</p>
<p>About 3 GW projects were auctioned in 2023, which are yet to sign power purchase agreements (PPA). Rajasthan has the highest capacity, with 18% of the projects with PPAs yet to be signed, followed by Madhya Pradesh with 7% and Karnataka with 4%. Around 13 GW projects, which were auctioned in 2023, have signed PPAs but have not been commissioned yet due to several factors.</p>
<p>These projects will lose the benefit of the waiver, pushing their project costs significantly.</p>
<p>“The uncertainty around the ISTS waiver extension has brought project development to a near standstill. Without an extension, India’s 2030 renewable energy targets are at serious risk. Many projects won’t be financially viable, and the momentum the industry has built over the years could slow dramatically. With so much geopolitical uncertainty already in play, this the time for India to shine as a leading destination for renewable energy investments by providing policy support, stability and clarity that the market is urgently seeking,” said Raj Prabhu, CEO of Mercom Capital Group.<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1-.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-78902 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1-.png" alt="" width="632" height="405" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1-.png 632w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1--300x192.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1--624x400.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/04/ists-indepth-1--600x384.png 600w" sizes="auto, (max-width: 632px) 100vw, 632px" /></a></p>
<p>&nbsp;</p>
<p><strong>Developers Push for Extension</strong></p>
<p>The government has already <a href="https://www.mercomindia.com/no-ists-charges-solar-wind-december-2022" target="_blank" rel="noopener">extended</a> the waiver multiple times since 2016. The last waiver extension was issued in 2022 for projects to be commissioned by June 30, 2025. After this deadline, 25% of the applicable ISTS charges will be <a href="https://www.mercomindia.com/ists-charges-levied-solar-wind" target="_blank" rel="noopener">levied</a> on projects commissioned between July 1, 2025, and June 30, 2026. Increased by 25% annually, 100% of ISTS charges will be levied from July 1, 2028.</p>
<p><span data-teams="true">Developers and independent power producers hope for another extension. However, if recent tenders are any indication an extension appears unlikely. Terms of recent tenders specify that projects located outside the state must quote ISTS charges and transmission losses, over and above the tariff.</span></p>
<p>A developer commented, “We are in a ‘wait and watch’ situation. We see the power ministry has stated that where there is a genuine delay, supported by evidence, some concessions will be provided, but it has refrained from granting a blanket extension of the exemption.”</p>
<p>The developer contended that another extension is crucial. IPPs and developers have experienced massive delays in converting bids to power purchase agreements (PPAs). “There is a huge backlog of auctions where PPAs are yet to be signed due to delays relating to land acquisition and permits, infrastructure deficits, etc.”</p>
<p>These delays can cause huge losses to the bidders. “If a developer placed a bid assuming the ISTS waiver would apply, and if the waiver is no longer available, it would be unfair to penalize the developer, especially since the bidder didn’t cause the delay,” goes the refrain of renewable energy developers.</p>
<p>Kannan Krishnan, Managing Director, <a href="https://www.jakson-green.com/" target="_blank" rel="noopener">Jakson Green</a>, made out a case for another ISTS charges waiver extension. “With more than 50 GW of PPAs yet to be signed, the burden of ISTS charges will further slow down the offtake. The government needs to extend the waiver until the PPA backlogs are cleared to enable projects to be installed.”</p>
<p>Timely government action is key, according to developers. As Ateesh Samant, COO of <a href="https://www.oysterrenewable.com/" target="_blank" rel="noopener">Oyster Renewable Energy</a>, put it, “Timely communication about the extension from the government is certainly beneficial, as it allows the entire ecosystem to align expectations and planning horizons. The renewable industry has matured significantly since this waiver was first implemented, and we’re now better positioned to absorb policy transitions through technological advancements and business model innovations.”</p>
<p><strong>Market Implications</strong><strong> </strong></p>
<p>Stakeholders estimate a huge impact on the market if the waiver is not extended. Those with delayed PPAs will suffer from losses, increasing generation costs, and infrastructure bottlenecks.</p>
<p>“If the exemption isn’t extended, we estimate the cost impact to be around ₹0.40 (~$0.0047)/kWh- ₹0.50 (~$0.0059)/kWh. That’s significant, especially for solar projects bidding around ₹2.40 (~$0.028)/kWh to ₹2.50 (~$0.029)/kWh. Losing ₹0.40 (~$0.0047)/kWh to ₹0.50 (~$0.0059)/kWh (16% to 17% decrease) can bring the effective tariff down to ₹2 (~$0.023)/kWh. That can seriously affect the financial viability of projects,” according to one estimate by a developer.</p>
<p>For developers who factored in the ISTS exemption in their bids, its absence can be significant.</p>
<p>Developers believe that if the waiver is not extended, the government’s planned 50 GW annual tendering trajectory until 2030 could be in jeopardy.</p>
<p>“It could adversely affect the renewable energy sector, signaling a lack of sustained policy commitment. Such a move could undermine the confidence of offtakers and financing institutions, which is crucial for the sector’s growth. It will slow down our growth towards the ambitious target of 500 GW from non-fossil fuel sources by 2030,” said Krishnan.</p>
<p>Samant said that if the waiver is not extended, the market will go through a period of adjustment if not disruption. “Project economics would certainly be recalibrated, with potential tariff adjustments of ₹0.70 (~$0.0082) &#8211; ₹1.20 (~$0.014)/kWh over the next three years, when the full impact of the removal of the waiver kicks in, depending on the source of energy.”</p>
<p>While the deadline is only weeks away, there has been silence from the government so far.</p>
<p>A few developers have started to plan in case there is no extension. “We’ve been strategically preparing for multiple scenarios regarding the ISTS waiver. We’ve begun diversifying our project pipeline geographically, increasing our focus on intrastate projects where we can co-locate generation closer to consumption centers,” said Samant.</p>
<p>Another developer noted, “While it seems a bit unlikely that there will be an extension, the government works at its own pace. The market is currently apprehensive; there’s a widespread belief that the government might go ahead and extend it for a meaningful period. But despite that perception, decisions are not being made on that assumption.”</p>
<p>The Indian solar sector is no stranger to market fluctuations and policy shifts. What the industry needs now is clarity. At a minimum, the government should communicate its decision on the ISTS waiver quickly so the companies can plan effectively and minimize disruptions to ongoing and upcoming projects.</p>


Without ISTS Waiver Extension, India’s 2030 Renewable Energy Goals Will Be at Risk


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					</table><p>Solar photovoltaic projects comprised 21.2% of India’s total installed power capacity and 46.8 % of the total installed renewable capacity at the end of December 2024. India’s installed solar capacity rose 10.5% quarter-over-quarter (QoQ) and 57.2% year-over-year (YoY).</p>
<p>Renewables, including large hydroelectric power projects, comprised 45.4 % of the country’s cumulative installed power capacity, with 209.7 GW installed at the end of the calendar year (CY) 2024. The country’s installed renewable energy capacity rose 5.1% QoQ and 25.7% YoY.</p>
<p>India’s installed power capacity was 462.2 GW at the end of CY 2024, up 2.6% <a href="https://www.mercomindia.com/solar-share-india-rises-q3" target="_blank" rel="noopener">from</a> 450.7 GW as of September 2024, according to data from Mercom’s <a href="https://www.mercomindia.com/product/india-solar-project-tracker" target="_blank" rel="noopener">India Solar Project Tracker</a>, Ministry of New and Renewable Energy (<a href="https://mnre.gov.in/en/" target="_blank" rel="noopener">MNRE)</a>, and Central Electricity Authority (<a href="https://cea.nic.in/?lang=en" target="_blank" rel="noopener">CEA</a>).</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-82876 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635.png" alt="Solar Energy’s Contribution to India’s Power Mix Surpassed 21% in Q4" width="971" height="597" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635.png 971w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635-300x184.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635-768x472.png 768w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635-650x400.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635-624x384.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/01/Screenshot-2025-08-07-131635-600x369.png 600w" sizes="auto, (max-width: 971px) 100vw, 971px" /></a></p>
<p>Large hydro, with a total installed capacity of 47 GW, accounted for nearly 10.2% of the total installed power capacity as of December 2024. No large hydro projects were commissioned in Q4 2024. The country’s installed large hydro capacity increased by 25.2% YoY during the year.</p>
<p>Wind installations in India stood at 48.2 GW, making up 10.4% of the country’s overall installed power capacity. The country’s wind energy capacity rose 1.7% QoQ and 7.7% YoY.</p>
<p>Installed biomass and small hydro totaled 10.7 GW and 5.1 GW, contributing 2.3% and 1.1% to the total installed power capacity as of December 2024. The country’s biomass-based power capacity rose 0.03% QoQ and 4.5% YoY, whereas the installed capacity for small hydropower was up 0.5% QoQ and 2.3% YoY.</p>
<p><strong>Conventional Energy Sources</strong></p>
<p>At the end of 2024, the country’s installed power capacity for conventional energy sources stood at 252.6 GW, accounting for 54.6% of all installations. The installed capacity rose 0.5% QoQ and 2% YoY to fulfill the baseload requirements of the country’s increasing power demand. However, the share of conventional power reduced from nearly 58% as of December 2023 to 54.6% as of December  2024.</p>
<p>The electricity generated from thermal sources includes coal (45.9%), gas (5.4%), nuclear (1.8%), lignite (1.4%), and diesel (0.13%). The increase in installed conventional power capacity was primarily due to additions to the country’s coal and nuclear power capacity. The installed capacity of coal power rose 0.6% QoQ and 2.2% YoY. The country did not add any nuclear power capacity in Q4. However, the installed nuclear capacity rose 9.4% YoY during the year.</p>
<p>With the increasing share of intermittent power sources, including solar and wind, in the country’s power mix, the Central Electricity Regulatory Commission <a href="https://www.mercomindia.com/cerc-recovery-of-legacy-dues-dsm-pool-account" target="_blank" rel="noopener">reiterated</a> that the approved methodology in the National Load Despatch Centre’s detailed procedure applies to all deficits in the Deviation Settlement Mechanism Pool Account. The commission directed the distribution companies to ensure timely payment of dues to avoid delays in compensating ancillary service providers and maintain grid stability.</p>


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