India’s Renewable Energy Expansion

India’s Renewable Energy Expansion (Target: 500 GW by 2030)

Introduction 

• India aims to achieve 500 GW of non-fossil fuel energy capacity by 2030 as part of its Nationally Determined Contributions (NDCs) under the Paris Agreement.
• This goal is essential for reducing carbon emissions, enhancing energy security, and supporting sustainable economic growth.
• By October 2024, India had surpassed 200 GW of renewable energy capacity, accounting for over 3% of the country’s total installed electricity capacity.

Current Status of Renewable Energy (As of 2024-2025)

• Total Renewable Energy Capacity:62 GW (as of January 2025).
• Renewable Energy Share:3% of the total electricity generation capacity.
• Key Contributors:
  • Solar Energy: 94.17 GW (47% of total renewable energy capacity).
  • Wind Energy: 47.96 GW.
  • Hydropower: 52 GW (46.93 GW large hydro + 5.07 GW small hydro).
  • Biopower: 11.32 GW.

Global Ranking:

• 4th in renewable energy capacity addition.
• 5th in solar power capacity and 4th in wind power capacity.

Key Renewable Energy Initiatives (India’s Renewable Energy Expansion: 500 GW Target by 2030)

India's renewable energy growth is driven by targeted initiatives across solar, wind, hydropower, and green hydrogen. The government’s focus on policy support, financial incentives, and infrastructure development is positioning India as a global clean energy leader. This section provides a detailed overview of key initiatives.

Solar Energy (Backbone of India’s Renewable Energy Transition)

Solar energy accounts for 47% of India's renewable energy capacity and is crucial to meeting the 500 GW target. Growth is driven by large-scale solar parks, rooftop installations, and off-grid systems, supported by policies like PM Surya Ghar: Muft Bijli Yojana (PMSGMBY) and production-linked incentives (PLI).

Utility-Scale Solar

• Capacity Added:
  • 2024:5 GW added, a 2.8x increase from 2023, reflecting the sector’s rapid growth.
  • By 2030, 293 GW of solar energy is targeted, supplying 23% of India’s electricity.
• Top Performing States:
  • Rajasthan (Solar Capital of India):98 GW (leads in both solar parks and utility-scale solar).
  • Gujarat:52 GW (pioneering solar-wind hybrid projects).
  • Tamil Nadu:70 GW (known for its solar-wind hybrid potential).
  • Combined, these states contributed 71% of utility-scale solar additions in 2024.
• Major Solar Parks:
  • Lakshadweep’s First On-Grid Solar Plant:7 MW capacity, enhancing renewable energy access on islands.
  • Rajnandgaon Solar-BESS Plant (Chhattisgarh): India’s largest solar-plus-battery plant with 40 MW/120 MWh capacity, improving energy storage and grid stability.

Rooftop Solar

• Capacity Added:
  • 2024:59 GW, a 53% increase from 2023, showcasing the success of government incentives.
  • Target: 1 crore rooftop solar installations by 2027, contributing significantly to decentralized energy production.

• Key Scheme:
  • PM Surya Ghar: Muft Bijli Yojana (PMSGMBY):
    • Launched: February 2024, with a budget of ₹75,021 crore.
    • Incentives: Up to 300 units of free electricity per month, with subsidies ranging from ₹30,000 to ₹78,000 per household.
    • Impact: 7 lakh rooftop solar installations within 10 months.

Off-Grid Solar

• Capacity Added:
  • 2024:48 GW, marking a 182% increase from 2023, significantly enhancing energy access in rural and remote areas.
• Benefits:
  • Supports rural electrification and reduces dependency on fossil fuels for lighting and irrigation.
  • Used for solar pumps, street lighting, microgrids, and solar home systems, improving energy access and livelihoods.

Solar Manufacturing Expansion 

• Production-Linked Incentive (PLI) Scheme:
  • Focused on boosting domestic manufacturing of solar PV modules and reducing import dependence.
  • Supports India’s goal of becoming a global hub for solar equipment manufacturing.

Wind Energy (Balancing Solar Energy’s Intermittency)

Wind energy, both onshore and offshore, plays a critical role in complementing solar energy, especially during nighttime and non-sunny periods.

Onshore Wind

• Capacity Added:
  • 2024:4 GW, reflecting a 21% increase from 2023.
  • Leading States:
    • Gujarat: 1,250 MW (strong wind corridors along the coast).
    • Karnataka: 1,135 MW (steady wind patterns).
    • Tamil Nadu: 980 MW (consistent wind resources in southern India).
    • These three states accounted for 98% of new wind capacity additions.

Offshore Wind

• Capacity Targets:
  • 4 GW planned off the Tamil Nadu coast, divided into four 1 GW blocks.
  • Part of India’s strategy to harness its vast coastline for energy generation.
• Viability Gap Funding (VGF) Scheme:
  • ₹7,453 crore allocated to attract investments in offshore wind projects.
  • Reduces financial risks and accelerates project development, ensuring competitive tariffs.

Wind Energy Manufacturing

• Scaling up domestic wind turbine production is key to reducing costs and increasing deployment.
• India aims to become a global hub for wind energy equipment, supporting both onshore and offshore projects.

Hydropower (Ensuring Grid Stability and Flexibility)

Hydropower is crucial for balancing the variability of solar and wind energy, though its growth is constrained by environmental and hydrological factors.

• Large Hydropower:
  • Installed capacity: 93 GW (included in India’s non-fossil fuel target).
  • Growth has slowed due to environmental concerns and seasonal water availability.
• Small Hydropower:
  • Installed capacity: 07 GW.
  • Supports rural electrification and decentralized energy generation, especially in hilly and remote areas.
• Challenges:
  • Hydrological variability affects electricity generation, requiring better water management and climate adaptation strategies.

National Green Hydrogen Mission (NGHM)

The National Green Hydrogen Mission is critical for decarbonizing industries such as steel, cement, and transportation. Green hydrogen produced using renewable energy can replace fossil fuels in hard-to-abate sectors.

• Budget: ₹19,744 crore (₹600 crore allocated for FY 2024-25).
• Production Targets:
  • 12 lakh TPA (tonnes per annum) of green hydrogen by 2030.
  • 1,500 MW of electrolyser manufacturing capacity to reduce production costs.
• Economic Benefits:
  • Investment: ₹8 lakh crore by 2030, boosting industrial growth.
  • Employment: 6 lakh new jobs, supporting India’s green economy.
  • Energy Security: ₹1 lakh crore reduction in fossil fuel imports annually by 2030.
• Key Projects:
  • Electrolyser manufacturing clusters in states like Gujarat, Maharashtra, and Tamil Nadu.
  • Green hydrogen hubs to facilitate production, storage, and transportation.
• Global Collaboration:
  • India is partnering with countries like Germany, Japan, and Australia to develop hydrogen supply chains.

Summary of Renewable Energy Targets by 2030 

Key Policies and Schemes 

India’s renewable energy growth is supported by comprehensive policies aimed at promoting solar and wind energy, enhancing domestic manufacturing, and ensuring greater consumer access to clean energy. The following key initiatives are driving the country toward its 500 GW target by 2030.

PM Surya Ghar: Muft Bijli Yojana (PMSGMBY)

• Launch: February 2024, with a budgetary outlay of ₹75,021 crore.
• Objective: Promote rooftop solar adoption to empower households and reduce electricity bills, supporting India's goal of achieving 1 crore rooftop solar installations by 2027.

Key Benefits:

• Up to 300 units of free electricity per month, directly reducing household energy expenses.
• Subsidies:
  • ₹30,000 for 1 kW systems, ₹60,000 for 2 kW, and ₹78,000 for 3 kW or higher.
• Implementation Progress:
  • Within 10 months of launch, the scheme facilitated 7 lakh rooftop solar installations, contributing 59 GW of new capacity in 2024 (53% increase from 2023).

Social Impact:

• Enhances energy accessibility for middle-class and low-income households.
• Reduces dependence on fossil fuels, lowering household carbon footprints.
• Supports local employment in solar panel manufacturing, installation, and maintenance.

Production-Linked Incentive (PLI) Scheme 

• Objective: Boost domestic manufacturing of solar PV modules and wind turbines to reduce import dependence and strengthen India’s renewable energy supply chain.
• Sectors Covered:
  • Solar Energy: Focus on producing high-efficiency solar cells and modules.
  • Wind Energy: Expansion of domestic wind turbine manufacturing to support both onshore and offshore projects.

Key Targets:

• Solar PV Modules:
  • Increase production capacity to meet the demand for 293 GW of solar installations by 2030.
• Wind Turbines:
  • Scale up production to support 140 GW of wind energy by 2030, including 4 GW of offshore wind.

Economic Impact:

• Attracts foreign and domestic investments in renewable energy manufacturing.
• Creates employment in manufacturing, assembly, and supply chain logistics.
• Strengthens India’s position as a global renewable energy hub, reducing reliance on imported equipment.

Renewable Purchase Obligation (RPO) & Renewable Consumption Obligation (RCO)

• Objective: Ensure that electricity distribution companies (DISCOMs) procure a minimum percentage of electricity from renewable sources, supporting demand growth for clean energy.
• Mandates:
  • By 2030, DISCOMs must source 3% of their total electricity consumption from renewable energy.
  • Targets are set annually, increasing incrementally to encourage sustained adoption of renewables.
• Compliance and Penalties:
  • Non-compliance attracts financial penalties, ensuring that DISCOMs prioritize renewable energy procurement.
  • The Renewable Energy Certificate (REC) mechanism allows states to meet their RPO targets by purchasing certificates from renewable energy producers.

Benefits:

• Promotes renewable energy adoption across all states, even those with limited natural resources.
• Creates a stable demand for renewable energy, incentivizing investments in solar, wind, and hydro projects.
• Supports the development of a competitive renewable energy market, reducing overall electricity costs.

Green Energy Open Access Rules (2022) 

• Objective: Facilitate open access to renewable energy, allowing consumers to purchase clean energy directly from producers.
• Threshold Reduction:
  • Minimum load requirement reduced from 1 MW to 100 kW, enabling small industries, commercial establishments, and residential complexes to benefit from open access.
• Key Provisions:
  • Simplified approval processes to encourage more consumers to shift to renewable energy.
  • No additional charges for renewable energy transmission, reducing costs for consumers.
  • Consumers can enter into long-term power purchase agreements (PPAs) directly with renewable energy producers, ensuring price stability and cost savings.

Impact:

• Empowers industries to reduce operational costs and carbon footprints.
• Supports the growth of independent renewable energy producers, enhancing competition and innovation.
• Accelerates India’s transition to a decentralized energy system, reducing dependence on traditional power grids.