Surge in India’s coal share below 50% in total installed capacity

 India is strongly emerging as a renewable energy powerhouse on the world stage with a surge in both capacity addition and tendering to add more plants, as evidenced by a suite of new research reports. The trend points to a more sustainable future for India’s electricity sector, even as the country continued to generate more electricity from its coal-fired plants in recent months.

Coal’s share in total power generation capacity in India dropped below 50% for the first time in several decades in the first quarter of 2024.

A record 69+ GW of renewable energy tenders were issued across India in fiscal year FY24, exceeding the central government’s target of 50GW.

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Renewable energy accounted for 71.5% of the record 13,669 megawatts (MW) power generation capacity added by India in the first quarter (Jan-Mar) of this year (2024), while coal’s share (including lignite) of total power capacity dropped below 50% for the first time since the 1960s.

India surged to third in the world in terms of solar power generation in 2023. 

“After a slump from 2019 to 2022 due to supply-chain issues and global price spikes brought on by the COVID-19 pandemic and Russia’s invasion of Ukraine, the market has rebounded and gone from strength to strength,” says the report’s contributing author, Vibhuti Garg, Director – South Asia, IEEFA. 

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“There is strong investor interest in the Indian utility-scale renewable energy market. The primary reasons are the large-scale potential for market growth, central government support in terms of targets and regulatory frameworks, and higher operating margins.”

 This is well ahead of the Government of India’s target to establish 50% cumulative power generation capacity from non-fossil fuel-based sources by 2030, according to the latest POWERup quarterly report from the Institute for Energy Economics and Financial Analysis (IEEFA).

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