India Adds Record 20.1 GW Renewable Capacity in Apr-Aug, 123% Jump YoY

India’s renewable energy sector saw record growth in the first five months of FY26, with 20.1 GW of new capacity added between April and August. This reflects a 123% increase compared to 9 GW in the same period last year, driven by an aggressive project pipeline and the expiration of interstate transmission charge waivers.

Massive Surge in Capacity and Strong Annual Projections

The nation is expected to surpass 35 GW of renewable additions for the full fiscal year 2025-26, according to ratings agency ICRA. This follows the addition of 28.7 GW in FY25, significantly higher than the 18.5 GW added in FY24. The surge is attributed to favourable solar PV module pricing and a policy shift as the transmission charge waiver expired on June 30, 2025.

Policy Support and Growing Energy Demand Driving Growth

ICRA noted that strong policy backing, competitive tariffs, and sustainability efforts by large corporations are sustaining positive momentum in the sector. However, bottlenecks persist, including issues in land acquisition, insufficient transmission infrastructure, and delays in power purchase agreements.

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Robust Tendering Pipeline Despite Slower Bidding

In terms of auctions, 40.2 GW capacity was tendered in FY25, following 47 GW in FY24. Yet, a slowdown has been observed in FY26 so far, with only 3.4 GW auctioned in H1 due to delays in power sale agreements between bidding agencies and state discoms. These concerns are affecting bidding sentiment, despite the strong underlying demand for renewable power.

Conclusion

India’s renewable sector is on track for a landmark year, buoyed by favourable policies, demand growth, and competitive cost dynamics. While infrastructure and regulatory delays pose short-term hurdles, the sector’s long-term outlook remains strong and aligned with the country’s energy transition goals.

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