Key View: Non-hydropower renewables in India will see robust growth over the coming decade, led by the wind power sector, followed by solar. This will be supported by strong government support, decreasing project development costs and increasing investor interest. We forecast the sector’s capacity to reach 114GW in 2022, falling short of the government’s capacity target of 175GW by 2022. Over the short-term, we remain cautious on the sector’s growth, with an underdeveloped grid, structural challenges and solar import taxes.

• Non-hydropower renewables will be India’s top performing power type in terms of growth forecast. In terms of power generation, non-hydropower renewables will grow by 237TWh, at an annual average of 9.3% from 2022 to 2031. Non-hydropower renewables will increase in its share of the power generation mix from 13% in 2022 to 17% in 2031.
• We forecast non-hydro renewables capacity to increase by an annual average of 9.3% from 2022 to 2031, totalling 243GW by 2031. This will correspond to 36% of India’s power capacity mix in 2031.
• That said, the capacity expansion remains below government targets as we highlight risks from grid bottlenecks, lack of power purchase agreements, and upcoming custom duties on solar which will require complementary supportive policies to boost local manufacturing.
• Reliance Industries, an Indian multinational conglomerate company, announced in January 2022 that it will be investing INR5tn (USD67.6bn) to build 100GW of renewable energy capacity and green hydrogen in Gujarat. Additionally, it will invest INR600bn in factories for manufacturing of renewable energy equipment in the state.
• In January 2022, Azure Power commissioned the final phase of its 600MW solar power project in Rajasthan. This was done by signing a 25-year PPA with the Solar Energy Corporation of India (SECI) at USD0.034/kWh.
• In January 2022, NHPC signed a pact with Green Energy Development Corporation of Odisha to form a joint venture (JV) that will develop 500MW worth of floating solar power projects in Odisha. The JV will have an investment of INR2bn (USD270mn) to set up 300MW of floating solar power at the reservoir of the Rengali hydroelectric project.
• In October 2021, JSW Energy has awarded a contract to Senvion India to provide turbines for a 591MW wind project. The facility will feature Senvion's 2.7MW wind turbines. The deal also includes a 10-year operations and maintenance agreement associated with the units. Financial details of the transaction were not disclosed. The delivery of turbines is due to begin in H122.
• In September 2021, Northern Coalfields, a unit of state-run Coal India, has collaborated with NTPC to install a 50MW ground mounted solar power project in the Indian state of Madhya Pradesh. The two entities have formed CIL NTPC Urja, a joint venture for the facility, which will see the facility constructed at the Nigahi coal mines in Singrauli district.
• The project pipeline for solar plus storage facilities is growing in India, which will help to mitigate intermittency issues associated with solar power. In line with this, Tata Power Solar won a USD52mn contract, in August 2021, to build a solar-plus-battery storage project in Leh. The project will comprise 50MWp solar farm with 50MWh of energy storage capacity. The project is due to start commercial operation in March 2023.
• In July 2021, India's Ministry of New and Renewable Energy (MNRE) granted approval to NTPC Renewable Energy for the construction of a 4.75GW solar project in Gujarat state in July. NTPC also plans to produce commercial-scale green hydrogen from the solar facility, which will come up at Rann of Kutch. The firm aims to invest USD13.4bn between 2019 and 2024 to reach a total capacity of 130GW by 2032 including 60GW from renewables.