India added 25.2 GW of solar capacity in the calendar year 2024, a 204% increase compared to the 8.3 GW added in 2023. According to Mercom India’s latest Q4 and Annual 2024 India Solar Market Update Report, this marks the highest annual capacity addition in the country’s history.

This growth was driven by large-scale solar projects, which accounted for over 87% of the total capacity additions, with rooftop solar contributing the remaining 13%.

“India’s solar sector saw record-breaking installations in 2024, but the numbers could have been significantly higher if not for transmission issues and supply chain delays. Rising costs due to import duties and expensive domestic modules remain a concern for the industry. With over 35 GW of annual solar additions needed to meet 2030 goals, the industry requires clear, stable policies that balance local manufacturing with seamless project development.” commented Raj Prabhu, CEO of Mercom Capital Group.

The bulk of the solar capacity additions totaling 22 GW came from large-scale solar projects, a 235% rise from the 6.6 GW installed in 2023. A major factor behind this expansion was the commissioning of previously delayed projects. The open access model contributed over 31% of these large-scale installations.

Leading the solar expansion in 2024 were Rajasthan, Gujarat, and Maharashtra, which accounted for approximately 32%, 27%, and 8% of the total capacity additions, respectively.

In 2024, India added 34.7 GW of new power capacity. Solar power accounted for almost 73% of the capacity additions.

India added 7.8 GW of solar capacity installed in Q4 2024, up 118% from Q3 2024’s 3.6 GW and a 303% increase from 1.9 GW installed in Q4 2023.

Large-scale solar projects dominated the quarter’s installations, making up over 83% of the total, while rooftop solar projects contributed nearly 17%.

“Rooftop solar installations have surged due to the PM Surya Ghar program. For the first time, residential rooftop installations are playing a major role, with commercial and industrial projects continuing steadily,” said Priya Sanjay, managing director of Mercom India.

During the quarter, 6.5 GW of large-scale solar capacity was installed, up 133% quarter-over-quarter (QoQ) from 2.8 GW and a 325% increase YoY from 1.5 GW.

Commissioning previously delayed projects was crucial in achieving the second-highest quarterly capacity addition on record. Among large-scale projects, solar open access accounted for nearly 32% of the quarter’s installations.

State-wise, Rajasthan, Gujarat, and Maharashtra again led the quarter’s capacity additions, contributing around 44%, 17%, and 9%, respectively.

By the end of 2024, India’s total installed solar capacity stood at 98.7 GW, with large-scale solar projects making up 86% and rooftop solar installations contributing 14%. Solar energy represented over 21% of India’s total installed power capacity and nearly 47% of the country’s total renewable capacity.

Rajasthan, Gujarat, and Karnataka emerged as the leading states in cumulative large-scale solar capacity, accounting for around 28%, 16%, and 13% of the total installations, respectively.

India’s large-scale solar project pipeline stood at 177.5 GW, with an additional 141.9 GW of projects tendered and awaiting auction by the end of 2024. The year witnessed a record 79.3 GW of large-scale solar project tenders, up 39% from 2023’s 57 GW. Additionally, solar auctions reached 48.1 GW, up 117% from 22.2 GW in 2023.

However, the Q4 2024 large-scale tendering activity dropped 14% to 13.7 GW of from 15.9 GW in Q4 2023 and 15.8% from 16.2 GW in Q3 2024. In contrast, 10.5 GW of solar projects were auctioned in Q4, marking a yearly 38% and a quarterly 82% rise.

The cost of large-scale solar projects rose by nearly 2% QoQ in Q4 2024 but saw an 8% YoY decline compared to Q4 2023. Sanjay said, “Solar project costs are unlikely to decrease significantly in the near future due to tight supply chains.”

She noted that the outlook for the next few quarters looks promising, with many projects in the pipeline. However, the uncertainty around the ISTS waiver’s extension creates challenges, as the government usually announces its decision only after the deadline.

Mercom’s Q4 & Annual 2024 India Solar Market Update report is 113 pages long and covers all facets of India’s solar market. For the complete report, visit:  https://www.mercomindia.com/product/q4-2024-india-solar-market-update