India added more than 34,000 megawatts (MW) of cumulative power capacity during FY25, which is the highest in the last nine years.

Besides, the last financial year—ended March 2025—also witnessed a record renewable energy capacity addition of around 29,520 MW.

According to the Central Electricity Authority (CEA), a record 34,054 megawatt (MW) capacity, from all sources, has been added during FY25. It is the highest ever achievement in a single year and surpassed the previous highest of 31,118 MW during FY16.

Record capacity addition

The charge was led by renewable energy sources (RES) with a record annual capacity addition of 29,520 MW taking India’s total installed RE capacity to 220.10 gigawatts (GW) at the end of March 2025. Around 4,530 MW of thermal capacity was added during the same period.

Solar energy contributed the most towards capacity expansion with 23.83 GW added in FY25, a significant increase over the 15.03 GW added in the previous year. The total installed solar capacity now stands at 105.65 GW.

This includes 81.01 GW from ground-mounted installations, 17.02 GW from rooftop solar, 2.87 GW from solar components of hybrid projects, and 4.74 GW from off-grid systems.

Solar installations in FY25 were led by roll out of PM Surya Ghar Yojana in rooftop solar, momentum in the green open access (OA) market, acceleration of utility-scale tendering and ease of implementation, JM Financial said.

Wind energy also witnessed sustained progress during the year, with 4.15 GW of new capacity added in FY25. The total cumulative installed wind capacity has surpassed 50 GW-milestone and now stands at 50.04 GW.

According to JM Financial, 70 per cent of all solar installations were in Rajasthan, Gujarat and Maharashtra in FY25. In the case of wind energy, Gujarat, Tamil Nadu and Maharashtra accounted for 97.4 per cent of installations in India.

Under RES, bioenergy installations reached 11.58 GW, which includes 0.53 GW from off-grid and waste-to-energy projects. Small Hydro Power projects have achieved a capacity of 5.10 GW, with a further 0.44 GW under implementation.

India has 169.40 GW of RE capacities under implementation, while 65.06 GW have already been tendered.

The capacities under implementation includes 65.29 GW from emerging solutions such as hybrid systems, round-the-clock (RTC) power, peaking power and thermal + RE bundling projects. These initiatives represent a strategic shift towards ensuring grid stability and reliable supply from renewable sources.

Challenges ahead

Going forward, JM Financial said that it expects solar installations to be range-bound at 25-30 GW during FY26, given excess generation during solar hours, Discoms’ reluctance to sign power purchase agreements (PPAs) for solar, and shortage of domestic content requirement (DCR) cells and modules in the domestic market.

Wind energy is expected to maintain its momentum and add 5.5-6 GW capacity driven by increasing focus on complex projects (RTC, Hybrid, FDRE) for dispatchable power, the brokerage added.

Published on April 14, 2025