India installed over 1.3 GW of rooftop solar capacity in the first nine months (9M) of the calendar year (CY) 2023, an increase of 12% year-over-year (YoY), according to Mercom India Research’s newly released Q3 2023 Mercom India Rooftop Solar Market Report.

India added 431 MW of rooftop solar capacity in the third quarter (Q3) of 2023, up 34.7% YoY. The installations also saw a quarter-over-quarter increase of 11.4% from 388 MW.

India’s cumulative rooftop solar capacity reached 10.1 GW at the end of Q3 2023.

“Residential rooftop segment has been crucial in boosting installation numbers fueled by lower component costs,” said Priya Sanjay, Managing Director, Mercom India.

“Many empanelment tenders that resulted in aggressive quotes and unviable prices are now becoming feasible with the falling system cost. The extension of MNRE’s rooftop program until March 31, 2026, will also boost residential solar projects,” she added.

Sanjay noted that the decline in the cost of rooftop solar systems will also drive C&I installations. “Typically, decisions in the C&I segment take longer as approvals are sought from the management, requiring a compelling economic case. The reduced costs, tax-saving potential, and the extended benefits of power generation over the next few years make this a particularly attractive investment.”

State-wise Installations

Gujarat, Maharashtra, and Kerala were the top three states for solar capacity additions in Q3 2023, accounting for more than 81% of the total.

Gujarat continued to lead in rooftop solar installations, contributing to 26.7% of the cumulative installations, followed by Maharashtra (13.5%) and Rajasthan (8.3%). The top 10 states accounted for around 77% of the cumulative rooftop solar installations as of September 2023.

Between Q3 2022 and Q3 2023, Kerala recorded the highest compounded growth of 15%, followed by Gujarat (7.3%) and Maharashtra (5.1%).

In Q3, 119 MW of rooftop solar tenders was announced, a 19.8% QoQ decline. The tendered capacity was down 61.6% YoY.

Around 62% of the total tendered capacity during the quarter was for government buildings in Rajasthan, Gujarat, Kerala, and other states. Empanelment tenders in Rajasthan and across India accounted for 6.5% of the total tenders issued in the quarter. The average rooftop solar system cost fell 5.1% QoQ and 13.4% YoY during the quarter.

Sanjay expected the year to end positively for rooftop solar. She said there is a shift from focusing solely on cost savings to achieving net-zero emissions and securing a green supply chain. Companies are increasingly looking to monitor and reduce the carbon footprint of their entire value chain.

The Q3 2023 Mercom India Rooftop Solar Report is 54 pages long and covers all facets of India’s rooftop solar market. For the complete report, visit: https://www.mercomindia.com/product/rooftop-solar-market-report-q3-2023