As India races to meet its climate goals and energy demands, solar energy has emerged as a critical solution, offering both sustainability and economic growth. With a solar potential of 748 GW and an installed capacity of 94.17 GW as of December 2024, India is rapidly advancing towards a renewable energy transformation, thanks to the ingenuity of start-ups addressing critical challenges and leveraging untapped opportunities. Companies like Mufin Green Infra, Ecofy, Livsol and Zetwerk are leading the charge with diverse business models that address the unique needs of the sector.
Funding for the sector has been steady over the past decade, except for small dips in 2021 and 2023, according to data from Tracxn, a market intelligence platform. To date, the sector has secured a total funding of $106 million, peaking at $42.5 million in 2024. However, 2024 year-to-date funding stands at $42.5 million, reflecting a growth of 308.6 per cent from the $10.4 million in the same period during 2023 and a growth of 559.9 per cent from 2022.
“India’s solar energy sector has shown exceptional growth in installed capacity, rising from 2.8 GW in 2014 to 92 GW in 2024. The country aims to achieve 500 GW of non-fossil fuel capacity by 2030 and has already crossed 200 GW this year. This growth is driven by government initiatives such as sanctioning of 51 solar parks with a combined capacity of 37.74 GW, led by States like Rajasthan (19.5 GW) and Gujarat (10.7 GW). Programmes like PM-KUSUM and the Production-Linked Incentive (PLI) scheme further encourage solar adoption among farmers and industries while international collaborations, such as the International Solar Alliance (ISA), bolster India’s renewable ambitions,” said Neha Singh, Co-founder of Tracxn.
“The sector is also advancing through innovations like perovskite solar cells, bifacial solar panel technology, solar integration into smart grids and agrivoltaics, which optimise land use and energy generation and use of AI for monitoring and optimisation of solar farms. Considering the rising prominence of solar alternatives across sectors and the pressing need to adopt renewable energy sources, we can expect this sector to continue growing in the coming years,” she noted.
Solar flare up
Start-ups in the sector are pursuing aggressive growth strategies to capture significant portions of the renewable energy market. While Mufin Green Infra targets a 1 GW solar asset portfolio within three years, Ecofy aims to triple its reach in the solar financing domain by March 2025.
Mufin Green Infra is involved in delivering advanced solar energy solutions for the commercial and industrial (C&I) segments through opex and capex models. “Our mission is to reduce the businesses’ dependence on conventional grid power while promoting sustainability by lowering carbon footprints,” says Kamlesh Kaushik, CEO of Mufin Green Infra.
Meanwhile, Ecofy operates on a B2B2C partnership model, enabling seamless financing for residential solar rooftop installations. “We aim to simplify the financing process through a 100 per cent digital approach, offering collateral-free loans and flexible EMI options,” explains Swapnil Wakade, Business Head at Ecofy.
Zetwerk connects largescale solar projects with a network of MSMEs, stabilising the supply chain and optimising procurement processes. “We’re addressing supply chain challenges by scaling manufacturing and providing consistent work to MSMEs,” says Abhay Adya, Business Head of Renewables at Zetwerk.
Mufin Green Infra targets a 1 GW solar asset portfolio within three years while Ecofy aims to triple its reach in the solar financing domain by March 2025.
India’s total addressable market (TAM) for solar energy remains vast. The government’s PM-Surya Ghar Scheme alone aims to install 1 crore rooftop solar systems by 2027. “We aim to capture 2 per cent of this market through tailored financing solutions,” says Wakade. Livsol seeks a 2 per cent share of the $236 million domestic solar inverter market over the next decade and Zetwerk looks for significant international expansion, particularly in the US and Europe.
Challenges persist
The solar industry faces persistent challenges, including policy uncertainty, dependency on imported materials and land acquisition hurdles.
Policy volatility remains a critical hurdle for the sector. “Sudden changes in government policies, like tariffs and taxes, can disrupt the industry,” says Adya. Companies advocate for consistent government regulations, streamlined land acquisition norms and incentives to boost domestic manufacturing. Initiatives like the PLI scheme and the National Solar Mission have already provided significant support but stakeholders agree that enhanced policies are necessary to drive sustained growth.
Despite challenges, these start-ups are making significant financial strides. Take the case of Zetwerk. It recorded a remarkable $2.1 billion in revenue during FY23-24, with solar contributing 30-35 per cent of it. “The solar sector has become a key growth driver for our company,” notes Adya. Livsol reported an annual turnover of ₹7.5 crore, with plans to scale up significantly in the coming years.
With innovative business models, ambitious growth plans and resilience in the face of challenges, start-ups are ready to shine bright as the world shifts to greener alternatives.