Uttar Pradesh recorded the highest quarter-over-quarter (QoQ) growth rate of 4,042% in solar open access installations in the second quarter (Q2) of 2024, according to Mercom’s Q2 2024 India Solar Open Access Market Report.

In Q2 of 2024, about 1.8 GW of solar open access capacity was added in the country, a marginal 2.5% drop QoQ and up nearly 152% year over year (YoY).

Uttar Pradesh ranked third for capacity additions in the quarter, and the installations were up 263.7% compared to the same quarter of the previous year.

Solar open access installations in the first half (1H) of 2024 reached 3.6 GW, up 153% from the 1.4 GW installed in 1H 2023. The capacity added in the year’s first half surpassed any previous half-yearly and annual installations.

Uttar Pradesh accounted for over 6% of the capacity additions in 1H 2024. The installations in the state were up 326.7% YoY.

India’s cumulative solar open access capacity was 16.3 GW as of June 2024, with Uttar Pradesh accounting for 6.5% of the installations. Between Q3 2022 and Q2 2024, the state’s cumulative solar open access capacity rose 67.4%. As of June 2024, the state ranked sixth for cumulative installed capacity compared to seventh at the end of Q1 2024.

Policy Support

Under its solar policy, Uttar Pradesh provides a 50% waiver on wheeling and transmission charges for captive, group captive, and third-party projects exceeding 1 MW. Furthermore, cross-subsidy surcharges, wheeling, and transmission charges do not apply to the purchase of power from solar open access projects connected to intra-state transmission systems.

The stamp and electricity duties are waived for solar open access projects, which are provided with 100% annual energy banking. The electricity duty exemption is applicable for ten years. The state’s solar policy has simplified land allocation, conversion, and availability for open access projects. The state has streamlined the application, approval process, and effective implementation of availability-based tariff meters, which was previously lacking in the state’s regulatory framework.

Under the third-party open access model, the state provided the third-lowest landed cost for high-tension industrial consumers in Q2 2024. Industrial consumers in the state save up to ₹2.41 (~$0.016)/kWh under captive open access mode or nearly 35% of the DISCOM’s tariff at 11 kV. Commercial consumers can save up to ₹3.93 (~$0.031)/kWh or almost 47% of the electricity tariff levied by DISCOMs through open access solar.

Streamlined policy frameworks and approval procedures have been driving the solar capacity additions and intensified competition among developers in the state. However, land availability and access to power evacuation infrastructure are among the critical challenges faced by the projects under various stages of development.

Per Mercom India Research, the state has a significant pipeline of standalone solar projects, which is expected to add to capacity growth in the upcoming quarters.

Mercom’s solar open access tracker provides all vital project details for installed and pipeline captive, group captive, third-party, and projects under solar parks in the country.

The Q2 2024 Mercom India Solar Open Access Market Report is 58 pages long and covers state-wise open access charges, electricity tariffs, power purchase agreement (PPA) tariffs, installed and pipeline project capacities, and policy updates, along with other critical information and data on the market.