A look back at solar in 2023

India’s ambitious target of achieving net-zero emissions by 2070 and fulfilling 50% of its electricity needs from renewable sources by 2030 marks a significant stride in the global battle against climate change. The Indian government has outlined ambitious targets, aiming for 500 GW of installed renewable energy capacity by 2030, and has made remarkable progress in expanding its renewable energy capacity.

India currently holds the fourth position globally for installed solar power capacity and in the last five years, the country has seen a monumental increase in its solar installed capacity from 21,651 MW to 70,096 MW in 2023.

A recent study by energy think tank Ember sheds light on India’s remarkable contribution to global solar energy generation. The report, which analyses electricity data from the first half of 2023, reveals that India, alongside the European Union, contributed 12% to the global increase in solar generation during this period.

Globally, solar energy accounted for 5.5% of electricity generation in the first half of 2023, marking a significant 16% increase compared to the same period last year, equivalent to an additional 104 terawatt-hours.

India’s solar growth was even more impressive, with a 26% increase contributing an additional 12 terawatt-hours, outpacing the global average. This substantial growth powered half of the country’s increased electricity demand over the same period, demonstrating the immense potential of solar energy in meeting India’s energy needs.

Notably, 50 countries, including India, set new monthly records for solar generation in the first half of 2023. In May, India itself reached an impressive milestone, further solidifying its position as a major player in the global solar power sector. During this period, India generated a remarkable 7.1% of its electricity from solar sources, underlining the country’s commitment to green energy.

In November 2023, 18 new renewable energy tenders with a cumulative capacity of 15,165 MW were issued. In terms of completed auctions, in November 2023 alone, about 4600 MW RE tenders were auctioned and allotted to various developers.

When it comes to key deals and financing trends, around $167 million was invested in the renewable energy sector last month.

From January to October 2023, about 8.7 GW of solar capacity was added in the country and 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.

The Indian government has demonstrated a robust commitment to advancing solar energy by implementing various strategic initiatives. There has been a reduction in the import tax on solar panels from 40% to 20%. Notably, there has been a reduction in prices across mono, poly, and mono half-cut solar panels.

A reduction in the Goods and Services Tax (GST) on solar panels, to 5% from the previously imposed 12% in 2021 has also been advocated by the government.

There has also been a shift in the market from traditional on-grid systems towards hybrid solar solutions, signalling an increased demand for hybrid solar technology.

The Union Minister for New & Renewable Energy and Power has informed that as of 30.06.2023, a cumulative solar power capacity of 70,096 MW has been installed in the country. The Minister informed that the country has an estimated solar power potential of 7,48,990 MW. Hence, the potential of solar energy is not fully tapped, so far.

The Government is making efforts to harness the available potential through various schemes and programs. Several steps have been taken by the Government to promote renewable energy, including solar energy, in the country in 2023. These include permitting Foreign Direct Investment (FDI) up to 100% through the automatic route, an influential move to encourage international investment. Waiving of inter-state transmission system (ISTS) charges for the inter-state sale of solar and wind power for projects commissioned by June 30, 2025, aims to bolster inter-state renewable energy transactions.

The declaration of trajectory for Renewable Purchase Obligation (RPO) until 2029-30 sets a clear roadmap for renewable energy integration.

Additionally, the establishment of standards for solar photovoltaic systems/devices and the creation of a Project Development Cell for facilitating investments showcase India’s commitment to fostering solar energy infrastructure.

Further, the government’s directive for power dispatch against a Letter of Credit (LC) or advance payment ensures prompt payment to renewable energy generators, enhancing financial security.

The introduction of the Green Energy Open Access Rules 2022 and the Green Term Ahead Market (GTAM) fortify platforms for the sale of renewable energy, notably solar power, through exchanges, reflecting a comprehensive approach toward propelling the nation’s solar energy agenda.

What lies ahead

India is steadfast in its pursuit of reaching a $5 trillion economy by 2024-25 and ascending to the position of the world’s third-largest economy by 2030. This renewed drive is accompanied by a strong emphasis on curbing the nation’s carbon footprint and fulfilling Sustainable Development Goals (SDGs).

To propel a green revolution, the government has outlined an ambitious objective of achieving 500 GW of installed renewable energy by 2030. This goal involves the installation of 280 GW of solar power and 140 GW of wind power generation capacity, marking a significant leap toward a sustainable future.

Accelerating the shift toward clean energy, the government has implemented numerous measures and favorable policies to encourage the domestic production of renewable energy. As part of this initiative, the government unveiled a Rs 2.44 lakh crore transmission plan. The plan is designed to facilitate the country’s energy transition and involves the development of 50,890 circuit km transmission lines and 4,33,575 MVA substation capacity. These infrastructural enhancements are poised to significantly boost domestic production within the industry. Additionally, the government has devised strategies aiming to ensure uninterrupted power supply to consumers by installing 515 GW of battery storage by 2030

The government’s new transmission system plans are poised to act as a significant catalyst, propelling cleaner energy to constitute 50 percent of the nation’s total power mix by 2030. This pivotal shift addresses the country’s energy security requirements, aligns with the imperative climate change goals, and fosters sustainable economic growth in the process.

The ministry’s proposed transmission plan is set to offer renewable energy developers insights into potential generation sites and the scale of investment opportunities. Furthermore, it aims to enhance transparency among transmission service providers by illustrating the sector’s growth prospects, alongside presenting a substantial investment opportunity totaling around Rs 2.44 trillion.

India’s ambitious targets, and remarkable progress in renewable energy, complemented by the government’s proactive measures and strategic policies promoting domestic manufacturing, foster a conducive environment for renewable energy growth. With the potential to lead the global solar sector, India is charting a path toward a resilient and sustainable energy future. As India marches towards fulfilling its economic ambitions, integrating renewable energy not only aligns with global sustainability objectives but also paves the way for a cleaner, greener, and more self-reliant future.