India’s renewable energy sector is entering a phase of stricter regulatory compliance, growing integration of storage, and evolving market structures, according to Mercom India’s newly released Q1 2026 Renewable Energy Policy Impact Report.

The one-of-a-kind report analyzed key renewable energy policies, regulations, draft frameworks, and regulatory orders issued in response to petitions during the first quarter (Q1) of 2026 and assessed their impact on utility-scale solar, open access, rooftop solar, energy storage, renewable manufacturing, and other related markets.

The report also evaluated the impact of the shifting policy landscape on the broader renewable energy sector, comprising developers, engineering, procurement, and construction companies, distribution companies (DISCOMs), commercial and industrial consumers (C&I), manufacturers, and investors.

Renewable energy policy activity during Q1 2026 increasingly centered on battery storage deployment, renewable consumption compliance, open access restrictions, captive power verification, domestic manufacturing requirements, transmission readiness, and grid flexibility.

Raj Prabhu, CEO of Mercom Capital Group, said that the policy and regulatory developments in Q1 2026 indicate that India’s renewable energy market is moving into a more mature phase centered on storage integration, grid readiness, transmission infrastructure, and grid reliability. “As renewable energy penetration increases, the emphasis is shifting beyond capacity additions toward building a more reliable and integrated power system.”

One of the strongest themes during the quarter was the growing policy push toward energy storage and firm renewable power. Maharashtra’s Renewable Energy and Energy Storage Policy and Rajasthan’s battery storage regulations strengthened visibility into demand for storage-linked renewable energy projects.

The report pointed to a growing shift toward treating storage as core grid infrastructure rather than as a balancing add-on.

Another key trend highlighted in the report was the tightening of regulations on open access and captive renewable procurement across states. Maharashtra revised its energy banking and time-of-day rules, which are expected to push for storage integration, while Telangana increased transmission and wheeling charges. Additionally, multiple states moved toward stricter renewable consumption compliance frameworks. These policy changes are expected to materially affect the economics of procurement for C&I consumers.

The report highlighted that the Draft National Electricity Policy 2026 was among the most significant policy developments of the quarter. The framework placed storage, transmission planning, demand response, grid flexibility, and resource adequacy at the center of India’s next phase of renewable energy growth.

During the quarter, policy and regulatory developments focused heavily on renewable consumption obligation, firm and dispatchable renewable energy, storage-linked procurement, forecasting, scheduling, and thermal flexibility.

The report also warned that the gap between domestic module and cell manufacturing capacity remains a key near-term risk, especially with the implementation of the Approved List of Models and Manufacturers (ALMM List-II) for solar cells approaching.

In Q1 2026, rooftop solar policies leaned toward ensuring grid stability. States increasingly introduced measures related to phase balancing for rooftop systems, approvals for hybrid inverters, monthly settlement mechanisms, and rooftop sizing restrictions as rooftop solar penetration continued to rise.

The report found that transmission access and evacuation readiness emerged as major project risks across utility-scale renewable energy markets. It noted that developers are expected to face increasing pressure around scheduling discipline, congestion risks, forecasting obligations, and co-located storage integration.

Mercom India’s Q1 2026 Renewable Energy Policy Impact Report covers 103 regulations encompassing all facets of India’s renewable market.

For the complete report, visit:  https://www.mercomindia.com/product/mercom-india-q1-2026-renewable-energy-policy-impact