New Delhi, Mar 7 (KNN) India’s renewable energy sector is encountering significant obstacles that may impede its ambitious clean energy goals, according to a report released Thursday by the Institute for Energy Economics and Financial Analysis (IEEFA).
The challenges include weak demand for tenders, delays in power purchase agreements, and project cancellations.
Despite issuing a record 73 gigawatts of utility-scale renewable energy tenders in 2024, approximately 8.5 gigawatts were undersubscribed—five times higher than in 2023.
The IEEFA report attributes this declining interest to complex tender structures and delays in interstate transmission readiness.
The cumulative unsigned power sale agreement capacity in India has now exceeded 40 gigawatts, with tenders from the Solar Energy Corporation of India, the country’s premier clean energy agency, accounting for approximately 12 gigawatts of this backlog.
Further complicating the situation, about 38.3 gigawatts of capacity—representing 19 percent of the total—was cancelled between 2020 and 2024.
These cancellations stemmed from various issues including tender design problems, location or technical challenges, undersubscription, and delays in finalising power supply agreements.
“Delays in project implementation pose a significant challenge to India’s renewable energy target for 2030,” noted Ashita Srivastava, senior research associate at JMK Research and co-author of the report.
Srivastava further warned that these issues “could deter investor interest in future renewable energy projects in India, potentially affecting the availability of low-cost financing from large-scale investors.”
These challenges highlight the substantial hurdles facing India’s renewable energy sector as the government aims to achieve at least a 500-gigawatt non-fossil power capacity by 2030, a significant increase from the current 165 gigawatts.
India has already missed its previous target of adding 175 gigawatts of renewable capacity by 2022. Fossil fuels continue to dominate the country’s energy landscape, accounting for more than two-thirds of total power generation last year.
Despite these setbacks, India added nearly 28 gigawatts of solar and wind capacity in 2024, with solar power installations representing 70 percent of these additions, according to data from the renewable energy ministry.
(KNN Bureau)
