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India installed over 1.2 GW of rooftop solar capacity in the first nine months (9M) of the calendar year (CY) 2022, a decline of 11% year-over-year (YoY), according to Mercom India Research’s newly released Mercom India Rooftop Solar Market Report Q3 2022.
The capacity additions were adversely impacted by the rise in module prices and uncertainty over the Approved List of Models and Manufacturers (ALMM) extension.
In the third quarter (Q3) of CY22, India installed over 320 MW of rooftop solar capacity, a YoY decline of approximately 29%. On a quarter-over-quarter (QoQ) basis, installed capacity fell by 18%.
Cumulative rooftop solar capacity at the end of Q3 CY22 reached 8.3 GW.
During July-September, Maharashtra added the highest rooftop solar capacity, followed by Kerala and Gujarat.
Gujarat led the cumulative rooftop solar installations with 23%, followed by Maharashtra and Rajasthan, which added 13% and 10%. The top 10 states accounted for about 73% of all rooftop solar capacity added in the quarter.
Madhya Pradesh registered the highest compounded quarterly installation growth with 10% compared to Q3 2021, followed by Punjab and Rajasthan with 9% and 8%.
“We are seeing rooftop solar installations trending down as costs have risen. The market is struggling with supply issues because of ALMM, and installers are finding it a tough environment to operate in overall,” said Raj Prabhu, CEO of Mercom Capital Group.
During the quarter, 46% of rooftop solar capacity was installed in the industrial sector, followed by residential, commercial, and government sectors, with 32%, 21%, and 1%, respectively.
Over 311 MW of rooftop solar projects were tendered during the quarter, a 46% YoY increase and an 18% QoQ increase. Nearly 33% of the tenders were announced by the Uttar Pradesh New Energy Development Agency, 16% by the Solar Energy Corporation of India, and 51% by other state agencies.
Rooftop system costs have increased by 13% over the past nine months. The report noted that system costs had risen steadily through 2022, with a 6% rise during Q1, and a 2% rise during Q2, followed by a 5% rise during Q3 CY22.
Escalation in commodity prices, basic customs duty imposition, and ALMM-approved module shortage, among others, impacted rooftop solar system costs.
The report showcases industries in the top six industrial states with considerable potential for rooftop solar.
A comprehensive analysis of the net metering policies across all Indian states and Union Territories is also included in the report.
Key Highlights from Mercom India Research’s India Rooftop Solar Market Report Q3 2022:
- In 9M 2022, India added 1,165 MW of rooftop solar, an 11% YoY drop
- In Q3 2022, India added 320 MW of rooftop solar, a decrease of 18% compared to 389 MW in Q2 2022. Installations declined 29% YoY
- Uncertainty over ALMM extension and module price volatility were critical challenges
- The cumulative installed rooftop solar capacity in India was about 8.3 GW at the end of Q3 2022
- In Q3 2022, the top 10 states accounted for approximately 73% of the cumulative rooftop solar installations
- Maharashtra had the most rooftop solar installations in Q3 2022, followed by Kerala and Gujarat
The Mercom India Rooftop Solar Report Q3 2022 is 54 pages and covers all facets of India’s rooftop solar market. For the complete report, visit: https://mercomindia.com/product/rooftop-solar-market-report-q3-2022/