The renewable energy sector has firmly held its position among India’s top five fastest-growing industries for over a decade, fuelled by record capacity additions and increasing investor interest as the country prepares to achieve its net-zero emission goals.
To better understand the scope and potential of this sector, it is essential to first examine the various energy sources that fall under the renewable energy umbrella. Renewable or green energy refers to energy derived from naturally replenishing sources with low or zero carbon emissions. The main types of renewable/green energy are, solar energy, wind energy, hydropower, tidal and wave energy, biomass energy (power produced from organic materials such as agricultural waste, crop residues and biogas), geothermal (energy extracted from heat stored beneath the earth’s surface) and green hydrogen (hydrogen produced using renewable electricity).
Although conventional sources continue to dominate India’s power generation, with thermal (coal and gas) power contributing nearly 70–75% of total electricity generation as per recent data, the shift towards clean energy is increasingly becoming a reality. On 29July 2025, India reached its highest-ever renewable energy share in electricity generation – that day, renewables met 51.5% of the country’s total electricity demand of 203 gigawatts (GW).
The Plan
India announced the Panchamrit (five-nectar) plan at the 26th meeting of the Conference of the Parties (COP26) to the United Nations Framework Convention on Climate Change (UNFCCC) held in United Kingdom, a summit that brought together over 120 world leaders to accelerate coordinated global action to combat climate change. The plan includes achieving 500 GW of non-fossil energy capacity, 50% of energy requirements from renewable energy, reduction of total projected carbon emissions by one billion tonnes and reduction of the carbon intensity of the economy by 45%, all by 2030. Lastly, achieve net-zero emissions by 2070.
In a notable achievement, the nation has achieved one of the five milestones in June 2025, with 50% of its cumulative installed electric power capacity derived from non-fossil fuel sources – five years ahead of the 2030 target. India crossed 250 GW milestone of non-fossil power installed capacity in August 2025.
History
Green energy in India did not begin as a climate response but as a solution to energy insecurity after the oil shocks of the 1970s, with early efforts focused on biogas, small hydro, and rural electrification. As climate change impacts became visible through extreme weather, pollution, and rising coal dependence in the 2000s, India gradually integrated clean energy into national policy, notably with the 2008 National Action Plan on Climate Change and the launch of large-scale solar and wind programs.
Then came, the Paris Agreement. Adopted in December 2015 at the 21st Conference of the Parties (COP21) under the UN Framework Convention on Climate Change (UNFCCC), the Paris Agreement brought almost every country onto a single framework to combat climate change. Besides the Paris Agreement, worsening climate stress in the 2010s made the renewable energy central to India’s development strategy, culminating in ambitious non-fossil capacity targets and a net-zero commitment. Today, India stands 4th globally in Renewable Energy Installed Capacity, 4th in Wind Power capacity and 3rd in Solar Power capacity (as per IRENA RE Statistics 2025). This was achieved as the nation introduced various initiatives to replace conventional energy sources with clean ones.
The Action
The Indian government has implemented various schemes such as the Pradhan Mantri Surya Ghar Muft Bijli Yojana, the PM-KUSUM scheme, and the National Green Hydrogen Mission, each designed to push solar, wind and clean hydrogen into the mainstream. Now, with the 2026–27 Union Budget, that focus has only sharpened. The government has allocated nearly Rs.32,914 crore to renewable energy schemes and projects. This is almost 30 per cent higher than last year’s revised budget allocation of Rs.25,301 crore.
The Pradhan Mantri (PM) Surya Ghar Muft Bijli Yojana scheme aims to provide free electricity to households in India. Under this scheme, households will be provided with a subsidy to install solar panels on their roofs. The subsidy is estimated to cover up to 40% of the cost of the solar panels. According to government sources, more than 28 lakh households have benefited under the PM Surya Ghar Muft Bijli Yojana as of January 2026, with disbursement of Rs.16,061.12 crore as central financial assistance. Among all the aforementioned schemes, the PM Surya Ghar scheme receives the highest budgetary allocation. Under the Union Budget 2026-27, this scheme has been allocated Rs.22,000 crore, that is almost two-thirds of the total allocation dedicated to clean energy projects and schemes.
The PM-KUSUM Scheme supports farmers in using solar energy instead of diesel. Farmers can get a 30% to 50% subsidy to install new solar pumps or convert old pumps to solar. This scheme has seen sustained support from the government, as the budgetary allocation was increased from Rs.2,560 crore in the year 2024-25 to Rs.5,000 crore in both 2025–26 (Revised Estimate) and 2026–27 (Budget Estimate).
Further, the government is running a scheme called “Development of Solar Parks and Ultra Mega Solar Power Projects” to set up large solar power plants connected to the electricity grid, with a target of 40 GW by March 2026. As of 31st October 2025, 55 solar parks with a combined sanctioned capacity of 39,973 MW approved across 13 states. A total of 14,922 MW capacity of solar projects has already been installed in these Parks and the balance are under various stages of implementation. The scheme has been extended until 31st March 2029 for completion of all approved solar parks.
Green hydrogen is recognised as a clean energy source as it emits water vapour and leaves no residue in the air, unlike coal and oil. The Indian government has doubled its allocation for the National Green Hydrogen scheme from Rs.300 crore in the last year’s revised budget to Rs.600 crore announced in the Budget 2026.
Wind and hydro power budgetary allocations have remained largely stable, with wind steady at Rs.500 crore and hydro at Rs.51 crore in recent years.
Players
India’s renewable energy landscape is dominated by a mix of massive private conglomerates, specialized clean-energy firms, and aggressive public sector undertakings.
The “Big Three” Private Giants
i. Adani Green Energy Limited
ii. Tata Power Renewable Energy
iii. ReNew
Adani Green Energy Limited (AGEL), known to be India’s largest renewable energy company, operate massive hybrid parks (solar and wind). It is developing the world’s largest renewable energy plant of 30,000 megawatts (MW) at Khavda in Kutch, Gujarat. In June 2025, the company achieved a significant milestone by surpassing 15,000 MW of operational capacity, specifically reaching 15,539.9 MW.
ReNew (formerly ReNew Power) has a diversified portfolio having solar, wind, and hybrid projects across India, backed by in-house solar module manufacturing. As of March 2025, ReNew has over 18 GW of commissioned capacity and aims to reach 25 GW by 2027.
Tata Power Renewable Energy is aggressively expanding its renewable energy portfolio in India, targeting 23-33 GW capacity by 2029-30. As of late 2025/early 2026, the company holds roughly 7 GW of operational renewable capacity (solar and wind) and has over 10 GW under development.
Public Sector Leaders (PSUs)
i. NTPC Green Energy Limited
ii. NHPC Limited
iii. Solar Energy Corporation of India
NTPC Green Energy Limited is aggressively expanding its renewable energy portfolio to achieve 60 GW of clean energy capacity by 2032.
NHPC Limited holds the title of India’s largest hydropower development organization. It has received the “Navratna” status, a prestigious designation for top-performing Indian Central Public Sector Enterprises (CPSEs) that grants them significant financial and operational autonomy. As of late 2025, NHPC operates with 8,332.90 MW of total capacity (including conventional hydro) and is actively diversifying into solar, wind, and green hydrogen projects.
Solar Energy Corporation of India (SECI), a Navratna CPSE, has successfully commissioned over 21 GW of solar capacity by March 2025, with recent data indicating a rise to 25 GW in early 2026. It plays a key role in the development of Battery Energy Storage Systems (BESS) and hybrid projects.
Specialized & Emerging Players
1. Waaree Energies & Vikram Solar: These are the primary manufacturing powerhouses, focusing on producing the solar modules and cells that the other companies use.
2. Suzlon Energy: The “Wind Man of India.” After a period of restructuring, Suzlon has reclaimed its spot as the leader in wind turbine manufacturing and maintenance, benefiting from the recent push for wind-solar hybrid projects.
3. AMPIN Energy: Develops utility-scale solar, wind and hybrid renewable assets with a multi-GW portfolio and growth plans.
4. Mahindra Susten: Part of Mahindra Group offering turnkey solar EPC solutions and project execution.
5. IREDA: While not a power producer, the Indian Renewable Energy Development Agency (IREDA) is the primary financial engine, providing the “green loans” that fuel these companies.
Company Financials
The Indian renewable energy sector in FY 2024-25 was characterized by the “Big Three” private giants—Adani Green, Tata Power, and ReNew—aggressively scaling their operational capacities while maintaining distinct financial trajectories. Adani Green Energy emerged as a margin leader, reporting an industry-high EBITDA margin of 91.7% and a 23% year-on-year (YoY) revenue jump to ₹9,495 crore, primarily driven by its massive 3.3 GW greenfield expansion. Meanwhile, Tata Power showcased steady growth with a 25% surge in net profit (₹4,775 crore for the full year) and a consolidated revenue of ₹65,478 crore, reflecting the strength of its diversified utility and rooftop solar model. ReNew reported a significant 19.3% increase in annual revenue to ₹9,706 crore, though its net profitability (₹1,454 crore for the first nine months) faced pressure from rising finance costs and a shift toward in-house manufacturing.
Among the PSUs, IREDA and SECI acted as the primary financial and trading engines, with IREDA reporting its highest-ever annual profit of ₹1,699 crore (up 36%) and a loan book expansion to over ₹76,000 crore. SECI crossed a historic milestone with ₹15,185 crore in revenue, highlighting its critical role as a power-trading intermediary. However, the hydropower giant NHPC faced headwinds, recording a 14.7% decline in net profit to ₹3,411 crore, largely due to a sharp 59.6% spike in finance costs.
In the emerging and specialized segment, Suzlon Energy witnessed a spectacular turnaround, with revenues climbing 67% to ₹10,851 crore and net profits more than tripling to ₹2,072 crore, while Waaree Energies maintained strong manufacturing momentum with a 27.6% revenue growth and a healthy 13.3% net profit margin. IREDA delivered a record-breaking financial performance, solidifying its role as the primary financial engine for India’s green energy transition. The company achieved its highest-ever annual Profit After Tax (PAT) of ₹1,699 crore, representing a robust 36% YoY growth compared to ₹1,252 crore in FY24.
Ongoing Big Projects
Based on official 2026 data and the latest Ministry of New and Renewable Energy (MNRE) status reports, here are the most significant projects currently in progress:
1. Khavda Renewable Energy Park (Gujarat)
- Capacity: 30 GW (26 GW Solar + 4 GW Wind)
- Status: Work in Progress (Phased Commissioning)
- Details: Spanning 72,400 hectares (nearly five times the size of Paris), this is the world’s largest renewable energy park. As of early 2026, Adani Green Energy and NTPC have already operationalized several gigawatts. It is a multi-developer project where infrastructure is shared by giants like AGEL, NTPC, and GSECL.
2. Dhirubhai Ambani Green Energy Giga Complex (Jamnagar, Gujarat)
- Capacity: 100 GW Target (Ecosystem for Manufacturing)
- Status: Advanced Construction
- Details: This is Reliance Industries’ flagship 5,000-acre project. While it involves power generation, its primary focus is manufacturing. It houses “Giga-factories” for solar panels, electrolyzers, and fuel cells. Reliance has recently fast-tracked its Battery Giga-factory, aiming for a 2026 launch to support India’s EV and grid-storage needs.
3. Pinnapuram Integrated Renewable Energy Project (Andhra Pradesh)
- Capacity: 5.2 GW (Solar, Wind, and Pumped Hydro)
- Status: Near Completion / Partial Commissioning
- Details: Developed by Greenko, this is the world’s first “Gigawatt-scale” project to combine three technologies. It features a 1,200 MW Pumped Hydro Storage component which acts as a giant “water battery,” allowing the project to provide dispatchable, round-the-clock (RTC) renewable energy—solving the problem of solar not working at night.
4. Pudimadaka Green Hydrogen Hub (Andhra Pradesh)
- Capacity: GW-scale Hydrogen Production (approx. 1,500 Tons Per Day)
- Status: Work in Progress (Foundation Stone Laid Jan 2025)
- Details: Developed by NTPC Green Energy, this is India’s first major integrated Green Hydrogen hub. It will produce green ammonia and sustainable aviation fuel (SAF). The project involves an investment of approximately ₹1.85 lakh crore and includes a dedicated desalination plant to provide water for electrolysis.
Prominent Agreements and Upcoming Green Projects
A series of newly signed MoUs and strategic agreements across multiple states are expected to further accelerate India’s renewable capacity expansion and sustain sectoral momentum. Presented below are key recently formalised agreements that highlight the scale and strategic direction of upcoming clean energy investments.
- In February 2026, Odisha signed 5 major MoUs totalling ₹67,000 crore, including a 5,000 MW project by ABC Cleantech & Axis Energy, 1,000 MW pumped storage by NHPC, 800 MW pumped storage by NEEPCO, and solar projects by BPCL.
- NLC India Limited signed a significant MoU with the Government of Gujarat to develop multiple large-scale green energy projects with an investment potential of around ₹25,000 crore.
- In March 2025, Tata Power Renewable Energy Limited signed an MoU with the Andhra Pradesh government to develop up to 7,000 MW (7 GW) of renewable energy projects, including solar, wind, and hybrid projects with storage, involving an investment of up to ₹49,000 crore.
- NTPC Green signed an agreement in 2025 with the Gujarat government to develop a 15 GW renewable energy project, comprising 10 GW of solar and 5 GW of wind power.
- In January 2026, INOXGFL announced plans to invest ₹17,000 crore in renewable energy, with agreements signed with Uttar Pradesh (₹10,500 crore), Assam, and Kerala for solar manufacturing and power generation.
- The Solar Energy Corporation of India (SECI) signed an MoU with the Government of Madhya Pradesh for a 200 MW Solar Project in Dhar and a 1000 MWh Battery Storage Project in February 2025.
- JSW Neo Energy signed a pact for a 5,200 MW pumped storage project in the Western Ghats of Maharashtra with an investment of ₹19,950 crore.
- Tata Power signed a MoU with the Assam government to develop up to 5,000 MW of renewable energy projects with an investment of ₹30,000 crore.
- Ceigall India was awarded a 220 MW solar project integrated with battery energy storage (BESS) via a Letter of Award from Rewa Ultra Mega Solar Ltd., valued at around ₹1,700 crore.
- NTPC Green Energy Limited and the Madhya Pradesh Power Generating Company signed MoUs in 2025 to roll out up to 20 GW of renewable energy projects, spanning solar, wind, pumped hydro, and other non-fossil energy sources, backed by roughly ₹2 lakh crore of investment.
In early 2026, a series of high-stakes international agreements have redefined India as the world’s “Green Energy Laboratory,” drawing massive capital and technology from every corner of the globe.
Here are the most significant recent international agreements driving this momentum:
1. The India-EU Green Hydrogen Task Force – Finalized in January 2026 during the landmark India-EU Summit, this pact officially integrates India into the European green energy supply chain.
2. The Davos 2026 “Hydrogen Diplomacy” Pact – At the World Economic Forum in January 2026, India signed a strategic cluster of MoUs with six nations: Oman, Belgium, Kuwait, Jordan, Paraguay, and Zimbabwe. This multi-nation alliance focuses on electrolyzer manufacturing. Instead of just buying technology, India is partnering to build the machines that create hydrogen, positioning the country as a global factory for the “engines” of the green economy.
3. South Asian Regional Grid Integration (Nepal & Bhutan) – This agreement treats the Himalayas as a giant “Natural Battery.” India will now export solar power to Nepal and Bhutan during the day and import their hydroelectric power at night, creating the world’s first successful model of Regional Round-the-Clock (RTC) Green Power.
Challenges
While the renewable energy sector appears to be advancing rapidly toward India’s net-zero ambitions, the transition is not without structural and operational complexities. Despite strong policy backing, record capacity additions, and rising investments, certain systemic bottlenecks could disrupt momentum or slow execution timelines if left unaddressed. From grid congestion to a massive backlog of unsigned contracts, the industry must now solve these “scale-up” problems to ensure the 2030 targets remain within reach.
Here are few of the significant challenges faced by the clean energy sector:
1. Transmission Bottlenecks & Grid Integration Constraints
The most significant risk is that transmission infrastructure is not keeping pace with generation. According to The Economic Times, as of February 2026, over 50 GW of renewable capacity remains “stranded” because evacuation lines are not ready. Transmission projects take 3–4 years to build, while solar plants are ready in 18 months. This mismatch has led to “curtailment” in states like Rajasthan and Gujarat, where grids are actively rejecting green power because they cannot handle the surge, leading to heavy revenue losses for developers.
2. Contractual Deadlocks and Unsigned PPAs
A major financial hurdle is the “execution gap” between winning a project and actually starting construction. Many projects are stuck in a limbo of paperwork, specifically the signing of Power Purchase Agreements (PPAs) and Power Sale Agreements (PSAs). According to an IEEFA report cited by The Economic Times, over 40 GW of awarded projects are currently stuck without signed agreements.
Another The Economic Times report stated that developers held the rights to 43 GW of renewable power for which state utilities (DISCOMs) were yet to sign Power Purchase Agreements (PPAs). Without a signed PPA, developers cannot secure “financial closure” (loans) from banks. This creates a massive backlog of “zombie projects” that exist on paper but do not contribute to the actual energy mix, eroding investor confidence and delaying the 2030 timeline.
3. Supply-chain Constraints for solar projects
India is currently caught in a multi-front “trade war” that is jolting solar supply chains. While domestic module production has crossed 144 GW, the industry still relies on imports for nearly 90% of its solar cells and wafers. Trade costs are rising due to India’s own import duties (BCD) and China’s recent move to remove export tax rebates on solar components.
4. Lack of sufficient, grid-scale energy storage capacity
Solar and wind power are inherently intermittent, generating electricity only when the sun shines or the wind blows, which creates variability in supply and makes grid balancing complex. Although battery energy storage systems (BESS) and pumped hydro projects are being tendered at scale, storage remains capital intensive, increasing overall project costs and affecting tariff competitiveness in round-the-clock (RTC) bids. The absence of sufficient storage capacity limits the ability of renewables to replace thermal baseload power fully, especially during peak evening demand hours. Until storage technology becomes more affordable and widely deployed, integrating high levels of renewable energy into the grid will remain a significant operational and financial challenge.
To address these mounting hurdles, the Indian government and private sector have launched a synchronized “rescue mission” backed by massive financial allocations and policy shifts.
- Solving the Grid & PPA Backlog: To clear the 43 GW backlog of unsigned contracts, the government has moved away from fixed annual auction targets to a “demand-driven” model and is injecting over ₹22,000 crore into the Green Energy Corridor (GEC) Phase-II to integrate 20 GW of stalled capacity.
- Fixing the Storage Gap: To provide stable, 24*7 power, the 2026 Budget provided a nine-fold increase in Viability Gap Funding (VGF) for Battery Energy Storage Systems (BESS) to ₹1,000 crore, while companies like NTPC and Adani are now mandatorily co-locating batteries with new solar plants.
- Ending Import Reliance: Under the ₹48,120 crore Solar PLI scheme, which was recently extended by two years to 2028, companies like Reliance and Waaree are building 39.6 GW of fully integrated manufacturing capacity (from polysilicon to modules) to eliminate the 90% dependency on Chinese solar cells.
Summary
India’s renewable energy transition has evolved from policy ambition to measurable execution, reflected in rising installed capacity, improving corporate financials, and multi-gigawatt project pipelines under implementation. Strong PSU participation, private sector capital deployment, and expanding international partnerships are collectively accelerating the country’s clean energy trajectory. While challenges around grid stability, storage integration, and financing discipline remain, the structural growth indicators across revenue, profitability, and project awards signal sustained sectoral momentum. If current investment velocity and policy support continue, India is well positioned to emerge as a global renewable energy powerhouse over the coming decade.