India’s clean energy boom slows as solar projects get delayed. Experts say it can pick up again

Sibi Arasu

Bengaluru, India: For years, renewable projects in India have been growing steadily, from small-town rooftop solar installations to largescale projects across the desert and long stretches of wind turbines and solar panels on farmland all contributing to the country’s climate goal of transitioning to clean energy.

But a mix of policy decisions, politics and supply chain issues meant solar projects in 2023 have been marred in delays and uncertainty, making the country fall short of its annual clean energy installation target in a year that saw heat records topple and devastating floods batter the country.

Experts say this is a significant dent in the country’s ambitions, but some are confident that the shortfall can be made up this year.

A report by the Institute for Energy Economics and Financial Analysis found that the country only installed 13.7 gigawatts of clean energy last year, like wind, solar and nuclear, compared to 16.3 gigawatts in 2022.

India needs to install 40 gigawatts a year to meet its goal of installing 500 gigawatts of clean energy — enough to power 51 million homes in the country — by the end of the decade.

The shortfall “means that meeting the 2030 target for clean energy is highly challenging,” said Charith Konda, part of the team that put together the IEEFA’s analysis.

Solar module prices have dropped substantially worldwide in recent years, but in India, they have been subject to conflicting import tax policies, with the government first ordering high import taxes and then backtracking within the space of a year.

This created a “wait and watch” attitude among solar project developers, said Vinay Pabba, chief operating officer of Hyderabad-based renewables company Vibrant Energy.

‘’It takes up to two years for solar projects to come online after all agreements and paperwork are finalized, he said, so “changing policies in timeframes lesser than that creates a lot of uncertainty.”

Numerous projects, both big and small and across different states, have been hit with monthslong delays because of solar project developers holding off making new orders, said Gurpreet Singh Walia, a consultant for renewable energy projects in India.

Konda said that incentives to encourage domestic manufacturing of solar modules, conflicted with the country’s goal of installing renewable energy at speed.

And since what was being domestically produced in India was preferred by countries like the United States for their own energy transition over Chinese manufacturers, a huge increase in exports of solar power parts from India meant there was less supply available for local projects, analysts say.

Experts also say fossil fuel lobbying meant policies to encourage renewable growth have fallen short.