Rajasthan has become the first state in India to achieve more than 50% solar in its total installed power capacity, according to Mercom’s India Solar Project Tracker.

The state has approximately 23 GW of solar capacity, representing 51% of its total installed power capacity. Solar energy also dominates Rajasthan’s renewable portfolio, accounting for 76% of its total installed renewable energy capacity.

In 2022, Rajasthan became the first state in India to surpass 10 GW of cumulative large-scale solar installations.

Rajasthan is the top solar state in India, housing a quarter of India’s cumulative large-scale solar capacity.

In addition to its commendable installed capacity, the state also has an impressive pipeline of solar projects, with nearly 20 GW of large-scale projects tendered and awaiting auctions.

According to Mercom’s Solar Open Access Market Report, the state’s total solar open access capacity was 1.3 GW, accounting for 9% of the country’s total capacity.

The availability of large tracts of barren land and a higher rate of solar irradiation are crucial factors attracting developers to the state.

Rajasthan also had the third-highest rooftop solar installations (855.4 MW) as of March 2024, nearly 8% of the country’s cumulative rooftop solar capacity, per Mercom Research.

Policy push

A major developer told Mercom, “To encourage investment in solar projects, the government offers concessional rates on stamp duty and registration charges for land transactions related to solar energy projects. This significantly reduces the upfront costs for developers.”

The developer said these concessions make it more financially viable for companies to acquire land and invest in solar infrastructure. These sops help lower the overall project cost, giving developers a better return on investment.

Rajasthan provides exemption from land tax for land used to develop solar projects. This exemption applies for the duration of the project’s operational life.

Developers positively view the waiver of various administrative and processing fees associated with developing solar projects. The costs include charges for land use conversion, environmental clearances, and other regulatory approvals.

Rajasthan’s Solar Policy 2019 exempted project developers from the statutory requirements of first converting agricultural land to non-agricultural use and land ceilings. This eliminates the need for separate land conversion permissions, which can be time-consuming and cumbersome.

The policy also offers other benefits to solar projects, including a 90% State Goods and Services Tax subsidy on solar, wind, and hybrid energy equipment and a 50% employment subsidy.

However, developers say there are a few hurdles, like insufficient evacuation infrastructure, that the government must help overcome. “The state’s power generation far exceeds its internal power demand, so most of the power is evacuated to other states,” an executive of a solar company with large-scale projects in Rajasthan pointed out.

Reactive power support to intermittent renewables (wind and solar) is a challenge, and thermal and hydropower capacity in the state is significantly low. The government has planned an evacuation infrastructure using high-voltage direct current (HVDC) to overcome this challenge. The waiver of the inter-state transmission system (ISTS) charges on the transmission of electricity generated from renewables is therefore critical, as many projects expect commissioning delays due to the lack of evacuation facilities.

Solar capacity additions in Rajasthan could have been higher if not for the Great Indian Bustard (GIB) issue. The Supreme Court’s directive, which requires project developers to implement measures like installing bird diverters and the undergrounding of transmission lines to prevent the deaths of the endangered GIB due to collisions with overhead transmission lines, has stranded many solar projects.

Rajasthan unveiled its Renewable Energy Policy 2023, aiming to establish 90 GW of renewable energy projects by the financial year 2029-30. Solar projects will constitute 65 GW, and wind and wind-solar hybrid projects will account for 15 GW.