India needs to double renewable capacity additions to meet 2030 target: Report

India must double its annual renewable energy capacity additions to meet its target of 500 gigawatts (GW) of non-fossil power capacity by 2030, according to a report by Global Energy Monitor (GEM).

"Accelerating the rollout of renewable sources is essential to reverse the rise in fossil generation and achieve the 500 GW target," GEM said, adding that annual renewable capacity additions need to average 60% higher than 2024 levels or grow by 15% year-on-year.

Fossil fuels continue to dominate

India, the world's third-largest energy consumer, has seen soaring electricity demand amid economic expansion and extreme weather conditions. While fossil fuels continue to dominate power generation, GEM data indicates that renewable projects in development could surpass operating coal capacity within two years.

Coal accounted for all of India's net fossil capacity additions in 2024, which stood at 5.6 GW. The government has fast-tracked the development of large coal plants, with the pipeline of coal proposals expanding 45% in 2024 to reach 111 GW in development, the report noted.

Meanwhile, utility-scale solar projects comprise nearly half of all renewables under development, with more capacity in the construction phase than coal projects. Wind capacity additions in 2024 rose to 3.4 GW but remained below peak levels from 2016 and 2017 due to supply chain and regulatory challenges.

Concentration of renewable projects

India’s renewable expansion is largely concentrated in six states—Rajasthan, Gujarat, Maharashtra, Tamil Nadu, Madhya Pradesh, and Karnataka—accounting for 89% of solar and wind additions in 2024. Rajasthan led in solar capacity expansion, with the desert state hosting 27% of India’s solar PV fleet.

Despite these advances, GEM warned that inadequate transmission capacity, high financing costs, and land acquisition issues could hinder renewable deployment. The country must address the economic and social impact of transitioning from coal, which still accounts for 75% of total electricity generation, according to the report.

India's renewables expansion has tracked slightly above the required annual growth rate to reach 500 GW by 2030, GEM noted. However, sustaining this pace would require annual wind and solar additions to more than double by the decade's end.

Renewable sector to benefit

If India doubles its renewable capacity additions by 2030 to meet the clean-energy targets, it could significantly impact the stocks of companies in the renewable energy sector. Major players like Adani Green Energy and Tata Power, which focus on solar and wind power projects, could benefit from the increased demand for utility-scale solar and wind capacity, especially in states like Rajasthan and Gujarat where growth is concentrated. Equipment manufacturers like Suzlon Energy and solar PV module manufacturers like Premier Energies and Waaree could see a boost from the need for solar panels, wind turbines, and related infrastructure.