In 2025, India’s energy transition continued to break records across multiple areas. Newly installed non-fossil fuel power capacity, energy storage project auctions, and new energy vehicle sales all reached new highs. Clean energy financing grew in tandem with deployment, while green hydrogen emerged as a major highlight, with highly competitive pricing achieving some of the lowest levels globally.
Renewables: Growth Expected to Slow Before 2028
India’s renewable energy expansion is expected to plateau in the coming years, with annual additions of wind and solar capacity stabilizing until 2028.
Policy
India has established legally binding emissions targets for eight high-emission industries. Entities exceeding their targets will receive carbon credits, while those falling short must purchase credits or use existing ones to offset deficits. Increased penalties for misreporting and relatively low one-time fees for non-compliance with renewable consumption obligations may pose challenges for the renewable energy sector.
Clean Energy Financing
In the second half of 2025, clean energy financing totaled $18.7 billion, bringing the annual total to over $37 billion. Following record-low bidding prices in 2024, financing for solar and wind projects reached a historic high of $27.8 billion. Meanwhile, at least 10 clean energy and EV companies went public, spanning diverse business segments.
Wind Power
India added a record 6.3 GW of wind capacity in 2025, making it the largest wind market outside China, surpassing the United States. Order volumes reached 8.5 GW, a 4% increase year-on-year. However, declining renewable energy tariffs combined with battery storage challenges are negatively impacting the wind sector, prompting some developers to scale back project pipelines.
Solar Power
India’s next phase of localization began in June, with the Approved List of Models and Manufacturers (ALMM) expanding from solar modules to include battery cells. However, implementation has been gradual, delaying battery demand growth until the second half of 2026. As export orders shift toward domestic projects and component production capacity expands, competition in the local market is expected to intensify.
Energy Storage
In 2025, India’s standalone energy storage project auction capacity doubled to 24 GWh. However, some inexperienced developers have aggressively bid for capacity. Rising battery metal prices and reduced export tax incentives from China may create challenges during project construction.
Hydrogen
India’s green hydrogen auction prices continue to decline. In February, Numaligarh Refinery achieved a record-low global price of $3/kg. At the same time, major Indian companies such as AM Green and Reliance signed binding agreements to export green ammonia. A deal between AM Green and Uniper for 500,000 tons annually is currently the largest binding agreement announced globally.
Power Sector
In 2025, India’s combined additions of solar, wind, and coal power reached a nine-year high, with total new installed capacity hitting 58 GW (AC). Non-fossil fuels accounted for nearly one-third of India’s electricity generation.
Electric Mobility
India’s new energy vehicle sales reached nearly 210,000 units in 2025. In Q1 2026, sales grew by 61% year-on-year, exceeding 64,700 units. The current market share stands at 4.8%. The launch of new models and affordable compact SUVs has supported demand. Sales are expected to grow by 46% in 2026, reaching approximately 305,000 units.
In 2025, India’s energy transition continued to break records across multiple areas. Newly installed non-fossil fuel power capacity, energy storage project auctions, and new energy vehicle sales all reached new highs. Clean energy financing grew in tandem with deployment, while green hydrogen emerged as a major highlight, with highly competitive pricing achieving some of the lowest levels globally.
Renewables: Growth Expected to Slow Before 2028
India’s renewable energy expansion is expected to plateau in the coming years, with annual additions of wind and solar capacity stabilizing until 2028.
Policy
India has established legally binding emissions targets for eight high-emission industries. Entities exceeding their targets will receive carbon credits, while those falling short must purchase credits or use existing ones to offset deficits. Increased penalties for misreporting and relatively low one-time fees for non-compliance with renewable consumption obligations may pose challenges for the renewable energy sector.
Clean Energy Financing
In the second half of 2025, clean energy financing totaled $18.7 billion, bringing the annual total to over $37 billion. Following record-low bidding prices in 2024, financing for solar and wind projects reached a historic high of $27.8 billion. Meanwhile, at least 10 clean energy and EV companies went public, spanning diverse business segments.
Wind Power
India added a record 6.3 GW of wind capacity in 2025, making it the largest wind market outside China, surpassing the United States. Order volumes reached 8.5 GW, a 4% increase year-on-year. However, declining renewable energy tariffs combined with battery storage challenges are negatively impacting the wind sector, prompting some developers to scale back project pipelines.
Solar Power
India’s next phase of localization began in June, with the Approved List of Models and Manufacturers (ALMM) expanding from solar modules to include battery cells. However, implementation has been gradual, delaying battery demand growth until the second half of 2026. As export orders shift toward domestic projects and component production capacity expands, competition in the local market is expected to intensify.
Energy Storage
In 2025, India’s standalone energy storage project auction capacity doubled to 24 GWh. However, some inexperienced developers have aggressively bid for capacity. Rising battery metal prices and reduced export tax incentives from China may create challenges during project construction.
Hydrogen
India’s green hydrogen auction prices continue to decline. In February, Numaligarh Refinery achieved a record-low global price of $3/kg. At the same time, major Indian companies such as AM Green and Reliance signed binding agreements to export green ammonia. A deal between AM Green and Uniper for 500,000 tons annually is currently the largest binding agreement announced globally.
Power Sector
In 2025, India’s combined additions of solar, wind, and coal power reached a nine-year high, with total new installed capacity hitting 58 GW (AC). Non-fossil fuels accounted for nearly one-third of India’s electricity generation.
Electric Mobility
India’s new energy vehicle sales reached nearly 210,000 units in 2025. In Q1 2026, sales grew by 61% year-on-year, exceeding 64,700 units. The current market share stands at 4.8%. The launch of new models and affordable compact SUVs has supported demand. Sales are expected to grow by 46% in 2026, reaching approximately 305,000 units.
