Solar and wind to drive two thirds of India’s power generation growth by 2032

This implies that the country’s power generation growth, predominantly driven by coal in the last decade, could enter a stage with most of its power expansion over the next ten years driven by solar and wind, provided India is on track to deliver its NEP14 targets, Ember’s new analysis finds.

Meanwhile, as India’s solar adoption widens, there is also a growing need for a much higher level of storage capacity to be able to manage peak demand in the evenings and early mornings, underscored by recent power shortages.

“India’s electricity supply landscape is projected to change quite significantly in the next decade or so, with solar and wind likely to drive the growth in generation,” says Neshwin Rodrigues, Ember’s India Electricity Policy Analyst. “Given their variable nature, a significant increase in storage capacity is crucial to balance generation and demand.”

As India is scaling up investments to renewable energy, the government now plans to tender 50 GW of solar and wind capacity per year in the following five financial years. 

However, to achieve the ambitious NEP14 targets, India needs to increase its current annual solar capacity addition by about 36% each year leading up to 2026-27, according to Ember’s analysis. This means that India would need to commission at least 17.5 GW in FY 2024, with a further ramp-up to 41 GW by the 2027 target year. 

Other key findings of the report include:

• Solar is now playing a bigger role in meeting India’s peak demand, which is more likely now to occur in the daytime hours. Building grid flexibility and storage is now more crucial than ever to avoid shortages in the evenings and early mornings. 
• The NEP14 storage capacity targets, including pumped hydro storage and battery storage, will be capable of shifting 15% of power generation from solar and wind sources in the daytime hours to early morning and evening hours by FY 2032.
• A setup of providing dispatchable solar power with storage capacity is likely to be more cost-competitive than building new coal plants as India accelerates its transition to renewables.