December 30, 2022

India’s solar energy sector: Challenges, opportunities and the way forward


Solar energy is the most abundantly available and one of the cleanest energy resources that humankind has known for a long time. With the benefits of solar energy and its advantages, many countries worldwide are on the path to attaining success with energy generation using solar systems.

According to the Indian Renewable Energy Development Agency Limited (IREDA), India is endowed with abundant solar energy capable of producing 5,000 trillion kilowatts (kW) of clean energy. Moreover, India gets 300 sunny days a year in most parts of the country and solar insolation of 4-7 kWh per square meter per day.

If harnessed efficiently, this energy can substantially reduce the dependence on fossil fuels and reduce the carbon emissions involved in energy generation. It will also reduce the energy demand gap across the country, including in remote areas where the energy supply is limited.

In this article, we will understand the current scenario of solar energy usage in India, the challenges, and how it is changing the energy sector for the future.

National solar potential

Today India is one of the biggest importers of energy in the world, and about 85% of the total energy and fuels needed are imported from several other countries leading to high expenditure on energy resources amongst all other expenses.

With the scope to harness solar energy, there is a huge potential to meet the demand avoiding the dependency on imports.

With about 300 clear and sunny days in a year, the calculated solar energy incidence on India’s land area is about five quadrillion kilowatt-hours (kWh) per year (or 5 EWh/yr). If harnessed for a year, this energy will surpass India’s total fossil fuel energy reserves.

Many states in India have already recognized and identified the opportunity solar energy can offer in addition to being an endless power source. In the future, solar energy will greatly meet India’s energy demands in multiple sectors like electricity, automobile, manufacturing, and commercial.

Theoretically, a small fraction of the total incident solar energy (if captured effectively) can meet the entire country’s power requirements. 


Technologies and use cases of solar energy in India

Solar energy has already touched millions of lives in India by meeting their cooking, lighting, and other energy needs in an environment-friendly manner.

While there has been a visible impact of solar energy in the Indian energy sector in the last few years, the generation of these resources has not even met 10% of the country’s total demand.

Some of the technology that can revolutionize the energy sector are:

  1. Solar PV Technology: Solar photovoltaic (PV) cells convert solar light directly to electricity. The setup is directly installed on land or on top of homes where there is direct exposure to the sun and is used to power lighting and other electrical appliances we use daily.
  2. Solar Thermal Technology: In this case, solar energy is used as a heat source for direct use and to generate steam for electricity production in residential buildings.
  3. Floating Solar Technology: This type of solar energy generation is similar to solar PV, however, the panels are set up on floating platforms on water instead of land. This installation is most helpful when the population density is high and the land area is limited.

The application of solar energy is widespread and diverse. Some applications include solar electricity, solar water heating, solar heating, solar ventilation, solar lighting, portable solar, solar transportation, etc.

Challenges involved in solar development

While solar energy can be a boon for the Indian energy sector as an alternative source of power generation, there are still many challenges that we face today, limiting us from scaling up. Some of these challenges include:

  1. Lack of R&D, modern development facilities, and manufacturing infrastructure impact the development of solar panels, equipment, and inverters to meet complete demand. This friction leads to an increase in imports from countries like China, Germany, etc., thereby increasing the cost of the system.  
  2. Solar systems require substantial investment in the beginning and have longer payback periods. This investment will burden the flow of investments in other energy sectors and increase the debt. This challenge discourages many people and entities from adopting solar energy.  
  3. Lack of awareness amongst the general public is one of the key challenges slowing the adoption of solar energy. Education on solar energy, especially in the country’s rural areas, should be addressed more actively where the benefits, advantages, and accessibility perks are taught.  
  4. Some administrative issues, like the ease of land acquisition, government approvals, material supply limits, etc., affect the setup of solar generation plants and thereby lead to delays in development. This issue can be addressed by establishing dedicated government entities working toward solar energy implementation.  
  5. The overall setup warranty provided by the implementation partner is also one of the challenges that we face today. Many companies today provide limited support and warranty for implementing solar panels and systems, raising concerns for many customers.  


Solar energy in India - 2022 and beyond

India added 10 Gigawatt (GW) of solar energy to its cumulative installed capacity in 2021—the highest 12-month capacity addition, recording nearly a 200% year-on-year growth.

Solar energy in India has been noted as a very significant power source to meet the needs for power generation in the future. Therefore, various large projects have been proposed in India in the past few years to meet the country’s energy demand.

A 25-year vision document by the government has targeted 85% of the power generation from renewable and green energy sources enabling India to become one of the key markets for solar energy with a huge customer base for solar applications.

With the boom and demand in the renewable energy sector and initiatives that the government is taking today to meet the future demand, India will play an important role in developing, researching, and implementing solar energy in the future.


India is at the forefront of solar energy adoption, considering the challenges like the limited availability of natural resources needed for power generation, rising demand for power, increasing prices of fuels, distribution difficulties in rural areas, and more.

Bloomberg New Energy Finance (BNEF) estimates in its NEO 2018 report that India will generate 75% of its electricity from renewable energy sources by 2050.

Today, India has reached the 5th position in solar power deployment globally, and its usage has increased by more than 11 times in the last five years, from 2.6 GW in March 2014 to 30 GW in July 2019.

Solar energy has enormous potential. Therefore, the adoption of this renewable source of energy is not just a necessity but will become a mandate, especially in a developing, high-power-consumption country like India.

How Enphase Energy is driving the change:

We are on a mission to bring solar energy to the next level, where it’s ready to meet the energy demands of the entire globe. But, as we work towards our vision for a solar-powered planet, we never lose sight of the three commitments that have guided us from the beginning: innovation, quality, and responsibility.

Learn more about us - Energy Evolved


Indian renewable energy development agency limited
Solar Power in India
India’s solar capacity: Milestones and challenges
India targets 85% of energy needs from green sources
New Energy Outlook 2021
Ministry of New and Renewable Energy

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