India’s energy transition is marked by rapid expansion of non-fossil capacity, policy-driven renewable growth, and strategic diversification into nuclear, storage, and green hydrogen systems.
India’s evolving energy capacity profile
As of October 31, 2025, India’s total installed power generation capacity stands at 5,05,023 MW. This includes 2,45,600 MW from fossil fuel sources and 2,59,423 MW from non-fossil sources, of which 2,50,643 MW is derived from renewable energy.
This composition indicates a structural shift in India’s energy mix, with non-fossil sources forming a majority share of installed capacity. A significant milestone was achieved in June 2025 when India reached 50% of its installed electricity capacity from non-fossil sources, surpassing its Nationally Determined Contributions (NDC) target well ahead of schedule.
Policy framework for renewable energy expansion
India has adopted a comprehensive policy approach to achieve its target of 500 GW non-fossil capacity by 2030.
- Transmission incentives and infrastructure support: The government has waived Inter-State Transmission System (ISTS) charges for solar and wind projects commissioned by June 2025, extended benefits for green hydrogen projects till 2030, and offshore wind projects till 2032. To support large-scale renewable integration, transmission infrastructure is being expanded through the Green Energy Corridor Scheme and long-term planning up to 2032.
- Competitive bidding and procurement strategy: Standard bidding guidelines have been issued for tariff-based competitive procurement across solar, wind, hybrid, and firm renewable energy projects. Additionally, a bidding trajectory of 50 GW annually has been planned from FY 2023–24 to FY 2027–28.
- Investment and manufacturing push: Foreign Direct Investment is permitted up to 100% under the automatic route. The Production Linked Incentive (PLI) scheme aims to scale up domestic manufacturing of high-efficiency solar PV modules.
- Renewable consumption and market mechanisms: Renewable Purchase Obligation (RPO) and Renewable Consumption Obligation (RCO) trajectories have been notified till 2029–30, with penalties for non-compliance. The Green Term Ahead Market (GTAM) facilitates renewable energy trading through power exchanges.
Flagship schemes accelerating renewable deployment
Several flagship schemes are driving renewable energy adoption across sectors and regions.
- Solar and decentralized energy initiatives: Schemes such as PM-KUSUM and PM Surya Ghar Muft Bijli Yojana aim to promote solar energy at the grassroots level. Targeted interventions are also being implemented in tribal and remote areas under PM JANMAN and DA JGUA initiatives.
- Large-scale renewable infrastructure development: The Solar Parks and Ultra Mega Solar Power Projects scheme provides land and transmission infrastructure to developers, enabling large-scale renewable installations.
Strategic importance of energy transition
India’s progress in non-fossil capacity reflects a balanced approach toward climate commitments and developmental priorities.
- Climate action and international commitments: The achievement of 50% non-fossil capacity underscores India’s commitment to the Paris Agreement and strengthens its climate leadership.
- Balancing energy security and affordability: Energy transition is being pursued while ensuring energy security, affordability, and accessibility remain central priorities, particularly for sustaining economic growth.
Nuclear energy as a long-term clean energy pillar
Nuclear power is positioned as a reliable, low-emission base-load energy source essential for achieving net-zero by 2070.
- Capacity expansion and technological advancement: India has set a target of 100 GW nuclear capacity by 2047. A Nuclear Energy Mission with ₹20,000 crore funding aims to develop Small Modular Reactors (SMRs) by 2033.
- Institutional and legal reforms: Proposed amendments to the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010 are intended to facilitate private sector participation.
- Indigenous reactor development and deployment: Bharat Small Reactors (BSRs) based on PHWR technology are being upgraded for industrial use. SMRs are also being developed for repurposing retiring coal plants and for remote areas.
- Fuel security and technological progress: New uranium discoveries, including extensions to the Jaduguda mine, and progress in closed fuel cycles such as the Prototype Fast Breeder Reactor enhance long-term sustainability.
- Institutional collaboration for expansion: A joint venture between NPCIL and NTPC, named ASHVINI, has been established to accelerate nuclear capacity addition.
Energy storage and grid stability measures
Energy storage systems are crucial for managing intermittency in renewable energy.
- Battery Energy Storage Systems: A Viability Gap Funding (VGF) scheme supports 13.22 GWh BESS capacity with ₹3,760 crore allocation. A second scheme approved in 2025 aims to develop 30 GWh capacity with ₹5,400 crore support.
- Pumped storage development: Pumped Storage Projects (PSPs) are being promoted to enhance grid stability, with 10 projects totaling 11,870 MW currently under construction.
Offshore wind and emerging energy technologies
India is expanding into new frontiers of renewable energy to diversify its portfolio. A dedicated strategy has been issued for offshore wind projects, with viability gap funding for an initial capacity of 1 GW.
Green hydrogen as a transformative energy solution
Green hydrogen is emerging as a key component of India’s decarbonization strategy.
- Production targets and renewable linkage: The National Green Hydrogen Mission aims to produce at least 5 million metric tonnes annually by 2030, supported by approximately 125 GW of renewable energy capacity.
- Economic and employment potential: The mission is expected to generate employment opportunities and contribute to industrial transformation while reducing carbon emissions.