India's Renewable Energy Capacity Surpasses Fossil Fuels Amid Record Growth

India's renewable energy installations have reached a record high in the first half of 2025, with 22 GW of capacity added, a 56% increase from the previous year. This growth brings India's clean energy capacity to surpass fossil fuels, supporting its 2030 goal of 500 GW of non-fossil sources. However, coal still accounts for 75% of the country's power generation, and experts warn that urgent grid upgrades and storage deployment are needed to truly transition to clean energy and meet net-zero goals.

India has set a new record in renewable energy installations, adding 22 GW of capacity in the first half of 2025, a 56% increase from the previous year. This surge brings India's clean energy capacity to 234 GW, surpassing fossil fuels and supporting its 2030 goal of 500 GW of non-fossil sources [1].

The growth is primarily driven by solar and wind energy. Solar capacity additions reached 18.4 GW, while wind contributed 3.5 GW. However, coal continues to dominate power generation, accounting for nearly 75% of the country's electricity supply in the first half of 2025 [1].

While India's renewable energy sector has made significant strides, experts caution that the country needs to address several challenges to achieve a true energy transition. Sushma Jaganath, Vice President of Renewables & Power Research at Rystad Energy, notes, "India is not undergoing a true energy transition. It is strengthening both renewable and fossil generation to meet surging demand" [1].

Battery energy storage systems (BESS) have emerged as a critical component in integrating variable clean energy into the grid. India awarded 5.4 GW of collocated solar-BESS and 2.2 GW of standalone BESS in the first half of 2025, the highest on record [1].

Leading corporates have diversified their portfolios to include BESS. Jindal Group secured 990 MW of solar + BESS, NTPC and ReNew won 900 MW each, and JSW Energy led in standalone BESS with 625 MW [1].

India's renewable energy capacity growth is supported by strong policy initiatives and foreign investment. The government's Production-Linked Incentive (PLI) and National Wind-Solar Hybrid Policy have boosted domestic manufacturing and capital inflow [3]. Foreign direct investment in the sector since 2020 has exceeded ₹1.6 lakh crore, with ₹42,000 crore alone in 2023 [2].

However, the continued reliance on coal and the large-scale installation of fossil-based capacity reflect a power security-first strategy rather than a full decarbonization pivot. To truly transition to clean energy, India needs to pair its renewable energy expansion with grid modernization, flexible storage, and policy clarity [1].

References:
[1] https://solarquarter.com/2025/07/21/india-achieves-record-renewable-energy-growth-in-h1-2025-accelerates-clean-power-and-energy-storage-expansion/
[2] https://economictimes.indiatimes.com/industry/renewables/indias-renewable-energy-capacity-soars-420-in-june-solar-now-cheaper-than-coal/articleshow/122528017.cms?from=mdr
[3] https://timesofindia.indiatimes.com/business/india-business/indias-energy-milestone-half-of-power-capacity-now-from-non-fossil-sources-clean-energy-capacity-driven-by-developers/articleshow/122768091.cms