A central question in energy discussions today is whether India can meet its ambitious target of deploying 500 gigawatts (GW) of non-fossil fuel energy capacity by 2030. To understand the feasibility, it’s important to explore India’s journey in renewable energy, current progress, infrastructure development, and the obstacles that still need to be addressed.
India’s Renewable Energy Journey: A Brief Overview
India, now the most populous country and often referred to as the third-largest carbon emitter globally, began developing renewable energy in the mid-1980s. The country’s first wind energy project—a modest 40-kilowatt system—was launched in 1985, followed by its first solar project a year later.
Despite this late start, India has made significant headway. With over 300 sunny days annually, the nation has immense solar potential. Wind energy development, though more geographically limited, has found success in specific coastal and high-wind zones such as Gujarat, Karnataka, Maharashtra and Tamil Nadu. The first MW scale solar project, was installed in Tamil Nadu in 2010, coinciding with a surge in wind capacity in the country’s west and south.
Current Status: How Far Has India Come?
In 2014, the Indian government had set a plan target of installing 175 GW of renewable energy capacity by 2022—a milestone it not only achieved but slightly exceeded. This success paved the way for a more ambitious target: 500 GW of non-fossil fuel capacity by 2030. As of January 2025, India has achieved 217.62 GW of non-fossil fuel energy.
Notable achievements in 2024 include:
- 24.5 GW of new solar installations—double the previous year’s total.
- 3.4 GW of new wind energy—up 21% year-over-year.
- Solar now makes up 47% of India’s total renewable capacity.
A major portion—18.5 GW—came from utility-scale solar projects, primarily in Rajasthan, Gujarat, and Tamil Nadu, which together accounted for 71% of this growth. Rooftop solar also surged, adding 4.59 GW—a 53% increase over 2023—thanks in part to the PM Surya Ghar: Muft Bijli Yojana, which facilitated over 700,000 installations within ten months. Off-grid solar saw a 182% growth, adding 1.48 GW, helping bring power to underserved regions.
Policy Framework and Strategic Infrastructure
India’s clean energy growth has been driven by strong policy backing and infrastructure planning.
Renewable Energy Zones (REZs)
The Solar Energy Corporation of India (SECI) has identified 181.5 GW of potential renewable energy across eight states, alongside 43.6 GW of storage capacity to support this integration.
Grid Expansion and Modernisation
India is significantly expanding its grid to handle renewable inputs:
- 1,91,000 circuit kilometers of new transmission lines.
- 1,270 GVA of added transformation capacity.
- 47 GW of battery storage and 31 GW of pumped hydro.
- Deployment of advanced grid technologies like high-voltage DC links, dynamic line rating, and hybrid substations.
Key Policy Initiatives:
- Interstate transmission fee waivers (until June 2025).
- PM-KUSUM scheme to solarise agriculture feeder and water pumps.
- Production-linked incentive (PLI) schemes for domestic solar module and battery production.
- National Green Hydrogen Mission, aiming for 5 million tonnes of annual green hydrogen production by 2030.
Challenges Ahead:
Despite the progress, several hurdles remain:
- Grid Stability: Integrating large volumes of intermittent renewable sources requires advanced forecasting, real-time load management, and storage solutions.
- Land Acquisition: Finding suitable, regulation-compliant land for large-scale projects remains a bottleneck.
- Delays in signing of PPAs by REI Agencies: Majority of REI agencies have been delaying signing of PPAs.
- Financing Risks: Stable long-term policy and financial health of distribution companies (DISCOMs) are essential to attract investment.
- Energy Storage: Scaling battery and hydro storage is critical for ensuring round-the-clock renewable energy availability.
Feasibility: Can the 2030 Goal Be Achieved?
To meet the 500 GW goal, India must add approximately 282 GW of new non-fossil fuel capacity in six years—roughly 47 GW per year. Given that 28 GW was added in 2024 alone, and deployment is gaining speed, this target—while demanding—is within reach.
Massive investments further highlight the intent:
– Over ₹20 lakh crore (~$200 billion) shall have to be invested for renewable energy installations.
– Over ₹9.15 lakh crore (~$110 billion) shall have to be invested for boosting transmission infrastructure.
Funding the Transition: Financing Pathways:
1. Government Schemes and Incentives
– PM Surya Ghar Muft Bijli Yojana: Offers subsidies and loans for household solar systems. – PM-KUSUM Scheme: Assists farmers in installing solar-powered irrigation through Central and State
Financial Assistance.
– Viability Gap Funding (VGF): Supports energy storage, e.g., ₹720 crore for a 4,000 MWh battery storage project in Rajasthan.
2. Institutional and Multilateral Support:
– Domestic Institutions: Power Finance Corporation (PFC), REC, IREDA, SBI, SIDBI.
– International Agencies: Asian Development Bank (ADB), Japan’s JICA, Germany’s KfW.
3. Innovative Financing Tools:
– Green Bonds: Issued for eco-friendly projects. India recently reissued ₹5,000 crore in Sovereign Green Bonds.
– Infrastructure Investment Trusts (InvITs): Help developers monetize operational projects. Indigrid—India’s first power-sector InvIT—owns 40 transmission lines and 11 substations.
4. Public Market Participation:
– Waaree Energies raised ₹4,321 crore in a highly oversubscribed IPO.
– IREDA, a state-run financing agency, went public in 2023 with the government holding a 75% stake.
– Juniper Green Energy is preparing for a ₹3,000 crore IPO in 2025.
Key Takeaways:
– India has developed a diverse set of funding mechanisms—from public subsidies to capital markets—to finance its energy transition.
– The renewable energy IPO boom signals rising investor confidence.
– Supportive policies are critical to accelerating deployment, reducing risk, and attracting both
domestic and foreign capital.
Conclusion:
A sustainable future within reach. India’s 500 GW non-fossil energy target is more than a climate ambition—it’s a strategic move toward self-reliance, energy security, and green leadership. Thanks to a blend of natural resources, enabling policies, expanding infrastructure, and growing investor interest, India is well-positioned to achieve this transformative goal. If this momentum continues—backed by smart policies, collaborative governance, and innovation—India could not only meet its clean energy target but emerge as a global leader in the energy transition.
The author is an investment banking professional and
founder of Dazbog Power. These are her personal views.
