India’s Renewable Energy Growth is Outpacing the Grid

India’s renewable energy journey has been remarkable. Record-breaking additions in solar and wind capacity have positioned the country as one of the world’s fastest-growing clean energy markets. However, behind these impressive installation numbers lies a critical infrastructure challenge that could undermine the sector’s long-term sustainability, an overstretched transmission network.

During FY2025-26, nearly 6,900 GWh of clean electricity could not be fully utilized because transmission infrastructure failed to keep pace with the rapid deployment of renewable energy projects. The issue is no longer about generating green electricity, but it is increasingly about delivering it to consumers.

Renewable Capacity is Growing Faster Than the Grid

India currently has around 21 GW of renewable energy capacity, approximately 9% of its installed renewable portfolio, operating through Temporary General Network Access (T-GNA) while awaiting permanent transmission connectivity.

Of this capacity, nearly 12 GW regularly experiences restrictions in evacuating power, particularly during peak solar generation hours. This means that although solar plants are capable of producing electricity, they are often unable to transmit it to the grid due to insufficient transmission capacity.

Power evacuation, the movement of electricity from generating stations to the transmission network, has become one of the most critical bottlenecks in India’s renewable energy ecosystem.

Understanding Temporary General Network Access (T-GNA)

India’s General Network Access (GNA) framework grants renewable projects permanent transmission rights once associated transmission infrastructure is commissioned.

Projects operating under Long-Term GNA enjoy firm transmission access.

However, projects under Temporary General Network Access (T-GNA) receive access only when spare transmission capacity is available.

During periods of network congestion, priority is given to projects with long-term transmission rights. Consequently, T-GNA projects are forced to reduce or even stop power generation, despite having fully operational plants.

According to industry estimates, many projects are experiencing generation curtailment of 70–80%, while some projects in Rajasthan have reported curtailment levels as high as 90–95%.

Solar Plants are Producing Power That Cannot be Used

India follows a “must-run” policy for renewable energy, meaning solar and wind plants should generally not be curtailed.

However, exceptions are permitted for:

• Grid security
• Technical constraints
• Transmission bottlenecks

Government data shows that 8,133 GWh of solar electricity was curtailed during April–June alone because of transmission congestion and grid stability requirements.

While developers receive compensation when generation is backed down for grid security reasons, curtailment caused by transmission constraints, particularly under T-GNA, is largely uncompensated, creating significant financial losses.

Financial Stress is Mounting

Transmission delays are creating a severe cash-flow crisis for renewable developers.

Solar and wind projects are financed based on expected electricity generation over long-term Power Purchase Agreements (PPAs). When projects cannot inject power into the grid, revenues fall dramatically while loan repayments remain unchanged.

One renewable energy executive operating a 300 MW solar project in Rajasthan described the situation bluntly.

Instead of generating revenue based on full plant capacity at approximately ₹2.5 per unit, the project is sometimes permitted to inject only around 10 MW into the grid. Under such conditions, revenues become insufficient even to service debt obligations.

Developers report relying on:

• Internal equity
• Existing cash reserves
• Cross-subsidization from other operational assets

These measures may offer temporary relief but are not sustainable over extended periods.

Risk of Renewable Projects Turning into NPAs

Industry stakeholders warn that prolonged transmission constraints could convert otherwise healthy renewable assets into Non-Performing Assets (NPAs).

In Rajasthan alone, around 4 GW of renewable energy capacity is reportedly facing severe transmission-related curtailment.

If the situation persists:

• Loan repayments may be delayed.
• Project cash flows could deteriorate.
• Banks and financial institutions may face increased stress from renewable sector lending.
• Future investments in renewable projects may slow due to increased financing risks.

The challenge is no longer technological, it is becoming financial.

Industry Seeks Government Intervention

Recognizing the seriousness of the issue, the Sustainable Project Developers Association (SPDA), representing more than 50 renewable energy companies, recently approached the Ministry of New and Renewable Energy (MNRE) seeking financial relief.

Among the key requests were:

• Moratorium on principal repayments during transmission delays
• Interest-free or concessional bridge financing
• Extension of loan repayment tenures
• Debt restructuring without downgrading project credit ratings

The association has also urged coordination with the Ministry of Finance, the Reserve Bank of India (RBI), and financial institutions to prevent financially viable projects from slipping into distress due to infrastructure delays beyond developers’ control.

Transmission Planning Must Catch Up

India has ambitious renewable energy targets that require rapid capacity additions over the coming decade. However, generation assets alone cannot deliver the energy transition.

Transmission infrastructure must expand simultaneously through:

• Faster commissioning of Inter-State Transmission System (ISTS) projects
• Better synchronization between renewable project approvals and transmission planning
• Accelerated investment in Green Energy Corridors
• Improved forecasting and grid management systems
• Greater deployment of Battery Energy Storage Systems (BESS) to reduce peak congestion

Without these measures, new renewable capacity may increasingly remain stranded.

The Road Ahead

India’s renewable energy story has reached a new phase. The challenge is no longer installing solar panels or wind turbines—it is ensuring that every unit of clean electricity generated reaches consumers.

Transmission infrastructure has become the backbone of India’s energy transition. Unless investments in the grid keep pace with renewable expansion, clean energy projects will continue to face curtailment, developers will experience mounting financial stress, and investor confidence may weaken.

India’s clean energy ambitions depend not only on generating more renewable power but also on building a transmission network capable of carrying it. Closing this infrastructure gap will be essential to achieving energy security, climate goals, and sustainable economic growth.

About Indosol Solar

Indosol Solar Pvt. Ltd., the solar PV manufacturing arm of Shirdi Sai Electricals Limited, is driving India’s renewable energy ambitions through the development of a fully integrated, giga-scale solar PV manufacturing ecosystem. The company is building capabilities across the entire solar value chain right from quartz processing to high-efficiency solar photovoltaic modules.

Indosol Solar has commenced operations with a 500 MW solar module manufacturing facility at Ramayapatnam, Andhra Pradesh, which is currently being expanded to 1 GW. As part of its rapid growth strategy, the company is progressing toward its vision of establishing 10 GW of integrated solar PV manufacturing capacity by 2027, supporting India’s transition towards energy self-reliance and sustainable development.