India’s renewable energy sector has shown remarkable resilience and resurgence, with power output from renewables soaring by 24.4% year-on-year in the first half of 2025 (January–June). This marks the fastest rate of growth in three years, based on federal grid data analyzed by Reuters. The country produced 134.43 billion kilowatt-hours (kWh) from renewable sources during this period, excluding hydropower, making a strong comeback after a dip in momentum following the missed 2022 targets.

A Historic June for Renewables

June 2025 saw a record-breaking 17% share of renewables (excluding hydro) in India’s overall electricity generation. This represents a milestone achievement for a country that has been grappling with the challenges of energy transition, infrastructure constraints, and intermittency issues tied to solar and wind energy.

The sharp increase in green power generation is attributed to robust capacity additions, particularly in solar and wind segments, alongside favorable climatic conditions. A milder summer season, early arrival of monsoons, and moderated economic demand led to reduced reliance on coal-fired electricity, which declined by 3% year-on-year during the same period. This, in turn, helped India maintain higher coal inventories, thereby cutting down on coal imports, a significant cost burden for the economy.

Massive Capacity Additions in 2025

According to ICRA, a Moody’s-owned ratings agency, India is expected to add 32 GW of renewable energy capacity in 2025. This represents a significant jump from 28 GW added in 2024. Between January and May 2025 alone, the country commissioned 16.3 GW of solar and wind capacity, underlining the accelerated pace of clean energy adoption.

The momentum in capacity installation comes as India strives to fulfill its climate commitments under the Paris Agreement and its ambitious national target of 500 GW of non-fossil fuel-based capacity by 2030. This target encompasses solar, wind, hydro, and nuclear energy sources. However, India’s journey hasn’t been without hurdles.

Missed Targets and Revised Timelines

India had earlier set a target of 175 GW of renewable energy capacity by the end of 2022. Due to multiple delays stemming from the pandemic, supply chain disruptions, and policy bottlenecks, the country missed this milestone. This has led to renewed scrutiny and strategic recalibration in how India approaches its 2030 vision.

S&P Global Commodity Insights recently noted that while the 500 GW target is achievable, it may realistically be postponed to 2032. The delay would stem from the need for large-scale investments in grid modernization, energy storage systems, and transmission infrastructure—key enablers that determine the stability and scalability of renewable energy.

Drivers Behind the Growth

Several macro and policy-level factors have contributed to the recent uptick in renewable energy output:

1. Policy Push: Continued government support through PLI schemes, solar park development, and open access reforms have provided tailwinds to clean energy projects.

2. Declining Solar and Wind Costs: With falling equipment and installation costs, renewable energy is becoming increasingly competitive with thermal power, making it attractive to utilities and industries.

3. Private Sector Participation: Large conglomerates like Adani Green, Tata Power, and JSW Energy have ramped up investments and project execution, contributing to the high capacity additions in early 2025.

4. International Support: Financial assistance and technology collaborations from global institutions and climate funds have further boosted project pipelines, particularly in solar PV and hybrid projects.

Energy Storage and Grid Readiness: The Next Challenge

Despite the rapid growth, experts warn that India’s aging and fragmented power grid remains a significant roadblock to integrating high levels of intermittent renewable energy. As solar and wind sources don’t produce electricity continuously, energy storage solutions such as battery systems and pumped hydro storage become essential for balancing supply and demand.

ICRA and S&P both emphasize the urgent need to modernize the grid. Investment in smart grids, real-time monitoring, and flexible dispatch mechanisms are necessary to avoid curtailment issues and ensure reliable supply.

Additionally, land acquisition, environmental clearances, and local opposition to large solar and wind farms continue to slow down project timelines in certain states.

Regional Performance

States such as Rajasthan, Gujarat, Karnataka, Tamil Nadu, and Maharashtra have led the charge in renewable energy output in H1 2025. Rajasthan alone added over 3.2 GW of solar capacity, benefiting from strong solar irradiance and policy incentives.

Southern states with established wind corridors saw a revival in wind energy generation, especially Tamil Nadu, which recorded one of the highest plant load factors (PLFs) in the country for wind farms during the early monsoon period.

Coal Demand Moderation and Imports

With coal-fired power generation dipping, the domestic coal stockpile has reached one of its highest mid-year levels in the last five years. This has significantly reduced India's reliance on imported coal, a major boon for India’s trade balance and a positive signal for energy security.

Moreover, the reduction in coal usage has contributed to a notable dip in carbon emissions, though India remains a major emitter globally, with coal still accounting for over 70% of total electricity generation.

Looking Ahead: Policy Expectations

As India accelerates its green energy transition, the Union Budget 2025-26 is expected to allocate more funds toward:

• Green hydrogen development

• Battery energy storage projects

• Rural electrification via solar microgrids

• Transmission line upgrades in renewable corridors

The Ministry of Power and MNRE (Ministry of New and Renewable Energy) are also finalizing frameworks for round-the-clock (RTC) renewable power procurement, which could drastically improve viability for developers.

Conclusion

India’s 24.4% growth in renewable power generation in H1 2025 signals a strong rebound and renewed commitment toward sustainable energy. The record 17% non-hydro renewable share in June reflects improved resource utilization and capacity additions.

However, achieving the 500 GW non-fossil target by 2030 will depend on policy consistency, financial innovation, and infrastructure readiness. If India can sustain this momentum while overcoming logistical and regulatory challenges, it could cement its place as a global leader in clean energy.

The next 5 years will be critical—not just for India’s energy independence, but also for the planet’s climate stability.