THEBUSINESSBYTES
BUREAU
NEW DELHI, AUGUST 2, 2026
India has surpassed the United States to emerge as the
world’s second-fastest growing solar energy market after adding a record 37 GW
of solar capacity over the past year, underscoring the country’s rapid
transition towards clean energy.
According to a factsheet released by the Central government
on Sunday, India’s installed solar power capacity has witnessed a dramatic leap
from just 3 GW in 2014 to 162.15 GW as of June 30, 2026, reflecting the
sector’s remarkable expansion over the past decade.
The sharp increase in capacity additions has been accompanied
by a steep fall in solar power tariffs, making India one of the world’s most
competitive solar markets. The decline has largely been driven by the e-Reverse
Auction mechanism, under which developers bid competitively to supply
electricity at the lowest possible tariff.
As participation by developers increased, solar tariffs
plunged from around ₹18 per unit in 2010 to a record low of ₹2.44 per unit,
significantly improving affordability and accelerating adoption across the
country.
India’s cost competitiveness is also reflected in global benchmarks. In 2025, the Levelised Cost of Electricity (LCOE) from utility-scale solar photovoltaic (PV) projects stood at $35 per MWh, substantially lower than the global average of $44 per MWh, reinforcing the country’s position as one of the world’s lowest-cost solar power producers.
The sector has received another policy fillip with the Union Cabinet’s approval of the Pradhan Mantri Surya Sarovar Yojana (PM-SSY) on July 31, 2026. The scheme aims to support 5,000 MW of Floating Solar Photovoltaic (FSPV) projects integrated with co-located Energy Storage Systems (ESS), paving the way for improved grid stability and enhanced utilisation of water bodies for renewable energy generation.
