Indian Solar Installations Declined By Over 44 Percent In 2023

Mercom Reports Connectivity Issues & Grid Compliance For Drop In New Deployments To 7.5 GW

Indian Solar Installations Declined By Over 44 Percent In 2023

According to Mercom, India’s total 7.5 GW new solar capacity additions in 2023 include 5.8 GW utility-scale projects. (Photo Credit: Mercom India Research)

  • Mercom says India’s total solar installations declined 44.1% annually to 7.5 GW in CY 2023 
  • Among the several factors responsible were extensions granted to large-scale projects and complexities arising out of new regulations 
  • Mercom now expects 2024 to see a growth in commissioned capacity for which the government will need to ensure adequate substations and transmission infrastructure 

The drop in solar module prices did boost orders from Indian solar developers during H2/2023; however, actual deployments could not keep pace with it, says Mercom India Research. 

It says the country’s total solar capacity addition in calendar year (CY) 2023 declined 44.1% annually to 7.5 GW, but accounted for 48.5% of new power capacity additions in the country last year. 

This includes 5.8 GW large-scale PV capacity that dropped by 50.8% over the same period from 11.7 GW in 2022. Mercom had earlier reported 13.4 GW solar additions in 2022. 

Among the reasons Mercom lists for this annual decline are grid compliance and last-minute connectivity issues due to new regulations causing delays in project commissioning. Extensions granted to various large-scale projects, and land and transmission challenges also played a role. 

During Q4/2023, 1.8 GW came online, having dropped by 41.3% annually and 6.6% sequentially. This quarter also saw a historic low in module prices with Mercom claiming the lowest-ever quarterly average project cost since the initiation of large-scale solar capacity additions in the country. 

Challenges 

Mercom India’s Managing Director Priya Sanjay added that quarterly additions were impacted due to challenges in adhering to grid connectivity regulations, addressing power evacuations in areas inhabited by the Great Indian Bustard (GIB) and project extensions. 

Additionally, compliance with amended grid code provisions also intensified challenges in power evacuation, thereby negatively impacting project implementation, according to Mercom’s latest report Q4 & Annual 2023 India Solar Market Update. 

Referring to the government’s recent order to not impose penalties in the event of project commissioning delays, Sanjay said, “The decision to eliminate penalties for project commissioning delays reflects an acknowledgment of completed projects facing challenges in adhering to the new regulations for connectivity.” 

The upside to this is that the country should be looking at increased installation and commissioning activity in 2024, especially with module prices staying low and the Approved List of Models and Manufacturers (ALMM) not an obstacle (see India Solar PV News Snippets). 

“However, the government must ensure adequate substations and transmission infrastructure to accommodate the large capacity of projects commissioning in the first quarter of 2024,” adds Sanjay. 

At the end of 2023, India’s total installed solar PV capacity reached 72 GW comprising 85.4% of utility-scale projects and 14.6% rooftop solar. Rajasthan, Karnataka and Gujarat hold the largest chunk of large-scale solar capacity, in that order. 

The country also has a large-scale project pipeline of 105.3 GW with an additional 70.6 GW of projects tendered and awaiting auction at 2023-end. 

The complete Mercom report can be purchased from its website. 

About The Author

Anu Bhambhani

Senior News Editor: Anu Bhambhani is the Senior News Editor of TaiyangNews. --Email : [email protected] --

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