India to add 50GW RE capacity in 2025 with investment of ₹2 lakh crore; To maintain momentum in 2026

While major powers slowed their push on renewable energy, India – often portrayed as the champion of fossil fuels – did the unthinkable. In 2025, it achieved a major climate milestone, with 50% of its installed electricity generation capacity now coming from non-fossil fuel sources, five years ahead of the 2030 target under the Paris Agreement signed in December 2015.

The world’s fastest growing economy now has total installed generation capacity of about 510 GW, including 247 GW of fossil-fuel sources and 262 GW of non-fossil fuel sources (including 254 GW from renewable energy sources).

India to add nearly 50 GW of renewable energy capacity in 2025, supported by investment from approx

2 lakh crore, taking its total non-fossil fuel capacity to about 262 GW. The government expects the same pace of capacity addition to continue in 2026, even as challenges related to land acquisition, right-of-way issues and delays in signing power purchase agreements continue to hinder new projects.

Union New and Renewable Energy Minister Pralhad Joshi told PTI that India saw record growth in 2025, with about 45 GW of renewable capacity added between January and November, led by about 35 GW of solar installations.

“By December, we will reach around 48-50 GW. The future is bright and will be powered by renewable energy,” he said. He said this momentum is expected to continue in 2026 as well.

Industry estimates place investment requirements at around 4 crore per MW, meaning ₹2 lakh crore for every 50 GW capacity.

According to a study by IREDA, India will require investment of approx 30.54 lakh crore between 2023 and 2030 to meet its 500 GW non-fossil fuel target. Public sector financial institutions have already deployed about Rs 10.79 lakh crore invested in renewable projects since 2014 2.68 lakh crore in 2024-25 alone.

“We see record growth in the renewable energy sector in 2025. We have set a total capacity addition of about 45 GW from January to November 2025, with solar power leading the notable growth with about 35 GW. In December, we will reach about 48 to 50 GW.

Joshi said, “…I am very optimistic about the future growth prospects of this sector. We hope that this momentum will continue in the coming year 2026 also.”

The minister said that from 2014 to 2024-25, an amount of Rs 10.79 lakh crore (approximately) has been deployed for renewable energy projects by public sector banks, IREDA, PFC, REC, IIFCL, SIDBI and NaBFID (except private banks).

He said that during the financial year 2024-25, an amount of Rs 2.68 lakh crore (approximately) has been deployed by these institutions.

Vinay Rustagi, Chief Business Officer, Premier Energies, said that 2025 is going to be a super-charged year for renewable energy.

He said there has been an increase of more than 50% in new project launches compared to last year, with a big boost from PM Surya Ghar Yojana and PM Kusum Yojana.

He said that the government has prepared a roadmap to promote domestic manufacturing of cells and ingot-wafers to meet the entire domestic demand.

Due to this, many companies have announced big investment plans in this sector. He said it was also an important year for storage, where the government announced another big capital subsidy scheme, leading to a surge in storage tenders and auctions.

He pointed out that increasing renewable energy capacity has led to imbalances in the grid, leading to power cuts and delays in adding transmission capacity, especially in Rajasthan, slowing down project execution.

He said the signing of the US-India trade treaty will help provide an attractive market opportunity for Indian manufacturers.

“Prospects for the new year remain bright. We expect the growth momentum in new establishments to continue. More domestic manufacturing capacity is expected to come on stream, leading to reduction in imports and foreign exchange expenditure,” he said.

“2025 is going to be a year of intense bullish momentum for the Indian energy sector,” said Lakshit Awala, Executive Director and Chief Executive Officer, SAEL Industries Limited.

He said that the power sector is now shifting its focus from capacity expansion to capacity absorption and grid integration remains the major challenge in the sector.

He pointed out that this integration gap has increased financial constraints, making the necessary long-term investment structurally underfunded.

He suggested that steps such as mandating long-duration energy storage (LDES) obligations along with existing feasibility gap funds to install reliable, dispatchable capacity will enhance the growth of the sector.

Rohit Chandra, Co-Founder and CEO, OMC Power, said, “Rising raw material costs, lack of infrastructure in remote areas, and limited access to affordable long-term financing continue to hinder scalability. There is an urgent need to focus on last-mile connectivity and financial feasibility in rural markets. Investments in microgrids, storage systems and EV charging infrastructure are critical to sustain the momentum.”

India’s energy transformation is moving from megawatts to megaprojects – multi-GW clusters, hybrid parks, storage-linked development and transmission integration and the coming year will be defined by scale, pace and structural reforms, said Datta Infra MD Swarvami Gaggal.

N Venu, MD and CEO, India and South Asia, Hitachi Energy, suggested that the focus should be on strengthening transmission networks, accelerating the development of renewable energy sectors, enhancing energy storage capacities and moving from project-based to programme-based initiatives.

He said that with focused efforts in 2026, India can enhance its energy security and strengthen its position in the global clean energy sector.