The India renewable power market is experiencing unprecedented growth, driven by record capacity additions and robust policy support. According to Market Research Future, the nation has solidified its position as a global renewable energy leader, adding a record 55.3 GW of non-fossil fuel capacity in 2025-26 and achieving the milestone of 50% of installed electricity capacity from non-fossil sources in June 2025, five years ahead of schedule. This remarkable progress reflects India's strategic commitment to energy security, climate action, and sustainable economic growth, underpinned by a comprehensive policy ecosystem and substantial investments in clean energy technologies.

Key Market Statistics

Insights published by Market Research Future reveal that the India renewable power market is on a strong growth trajectory, with the market projected to grow from USD 79.09 Billion in 2025 to USD 159.81 Billion by 2035, at a CAGR of 7.36%. India's total non-fossil fuel-based installed capacity reached 283.46 GW as of March 31, 2026, including 274.68 GW from renewable sources and 8.78 GW from nuclear energy. India ranks third globally in renewable energy capacity, with domestic installed renewable energy capacity standing at 250.52 GW as of December 2025, placing the country behind China and the United States. Solar power generation leads the market, while wind power generation is the fastest-growing segment. Total power generation in India stood at 1,845.9 billion units (BU) in 2025-26, of which 538.97 BU or 29.2% came from non-fossil fuel sources.

Industry Trends and Technological Evolution

The India renewable power market is being shaped by significant trends that reflect the maturing of the sector. Utility-scale solar remains the dominant force, with the country adding about 28.6 GW of new utility-scale solar in 2025, a 54.6% increase from 2024. Rooftop solar installations reached 7.9 GW in 2025, up 72% year-on-year, driven by the PM Surya Ghar: Muft Bijli Yojana scheme. The commercial and industrial (C&I) sector is a major driver of distributed energy adoption, with companies across manufacturing, data centres, automotive, textiles, and cement sectors announcing renewable energy procurement deals throughout 2025-26.

Wind power is rapidly gaining traction, with onshore wind capacity additions reaching 6.05 GW in 2025-26, the highest-ever annual addition. Offshore wind technology is emerging as the fastest-growing technology segment, with various projects in planning and early development stages, supported by favorable wind conditions along India's coastline and government initiatives. Bioenergy reached 11.7 GW as of March 2026, contributing to the diversified renewable energy mix.

A significant trend is the pivot toward storage-linked renewable energy projects. Almost 40% of capacity requested in FY 2025-26 pertained to stand-alone energy storage tenders, up from 9% in FY 2024-25. This shift reflects the growing recognition that battery energy storage systems (BESS), hybrids, and firm and dispatchable renewable energy (FDRE) projects are critical for managing intermittency and ensuring grid reliability.

Challenges Facing the Market

The India renewable power market faces challenges that require strategic policy intervention. A key challenge is the slowdown in tender activity, with tendered capacity declining 16% and awarded capacity shrinking 45% in FY 2025-26. The misalignment between distribution companies' (DISCOMs) dispatch expectations and the generation profile of tendered renewable capacity has led to a situation where about 44 GW of awarded capacity from April 2023 to September 2025 remains without signed Power Sale Agreements (PSAs). The government has centralized tendering authority with SECI to address this market failure, but challenges in offtake remain.

Proposed stricter grid-discipline regulations pose a significant financial risk. The new framework, effective April 2027, could reduce revenues by an estimated 11% for solar projects and up to 48% for wind farms. This regulatory uncertainty comes at a critical stage of expansion and could impact investor confidence. Other challenges include land acquisition hurdles, transmission infrastructure constraints as renewable capacity is concentrated in select states while load centres are dispersed across the country, and the need for continued development of domestic manufacturing capacity to reduce import dependence.

Future Outlook

Analysis presented by Market Research Future indicates that the India renewable power market will continue to expand, driven by strong demand fundamentals and policy direction. The government has set a target of 500 GW of non-fossil fuel capacity by 2030 and is on track to cross 600 GW by FY 2030. The future growth will be increasingly multi-dimensional, extending beyond utility-scale projects to distributed renewable energy, green open access, and emerging prosumer models enabled by digital platforms.

New opportunities lie in the development of integrated solar-wind hybrid power plants, the expansion of energy storage solutions for grid stability, and investment in smart grid technologies. The National Green Hydrogen Mission, targeting 5 million tonnes of annual production by 2030, is expected to become a major driver for solar demand, with each million tonne requiring approximately 20 GW of dedicated solar capacity. The data centre sector, with major global technology firms committing investments of ₹ 2-3 lakh crore each in India, is expected to drive demand for 24/7 firm power that only solar-plus-storage can deliver cost-effectively.

The transmission infrastructure is being strengthened, with a transmission plan prepared for integrating over 900 GW of non-fossil fuel capacity by 2035-36. Regulatory reforms, including the Renewable Consumption Obligation (RCO), are being implemented to boost RE consumption and attract penalties for non-compliance. By 2035, the India renewable power market is expected to be robust, driven by innovation and sustainable practices.

Conclusion

According to Market Research Future, the India renewable power market is poised for sustained growth, underpinned by record capacity additions, strong policy support, and increasing demand from new sectors like green hydrogen and data centres. The market's evolution reflects India's strategic vision for energy security and climate leadership. While challenges related to offtake agreements, grid discipline, and infrastructure persist, the long-term outlook remains highly positive. The continued focus on hybrid solutions, energy storage, and domestic manufacturing will create new opportunities for stakeholders across the value chain. As the India Clean Energy Market continues to mature, it will play a vital role in powering India's economic growth and supporting its net-zero ambitions.

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