India Solar Energy Market Projected to Grow at a CAGR of 7.8% during the Forecast Period (2022-2028)
Published | 25 January 2022
The growing number of favorable initiatives by the government is bolstering the demand for solar energy across India. The country plans to achieve 450 GW of renewable energy capacity by 2030, 280 GW of which will be solar energy. Read on to learn more about the trends and factors driving India's Solar Energy Market…
A study, recently conducted by the strategic consulting and market research firm BlueWeave Consulting, revealed that the India solar energy market is expected to grow at a CAGR of 7.8% during the forecast period (2022-2028). The growth of the India solar energy market has been positively impacted by the growing number of renewable and solar energy projects, coupled with the rising adoption of renewable energy across the nation. In addition, the growing environmental concerns and pledges to support the environment have paved the way for India to achieve its goal of creating renewable energy by using solar energy, which has positively impacted the growth of the India solar energy market. Last but not least, the geographical location and terrain of India make it ideal for solar power. The country thus has a competitive edge over other nations.
Rising adoption rates of renewable energy drive India's solar energy market growth
India has become a hub for the consumption of renewable energy around the world, largely due to the low prices for renewable energy sources in the past decade. According to the Ministry of New and Renewable Energy, India witnessed a growth of 226% in the installed capacities for the renewable energy sources. More than 25.24% of the nation's installed capacity comes from renewable sources. Since the majority of it uses solar energy, the growing adoption of renewable energy at this level over the past few years indicates and translates into growing demand for solar energy, contributing to the growth of the market.
Favorable governmental initiatives are bolstering the growth of the India solar energy market
With some of the largest energy production and installation plans in the world, the Indian government has fully embraced renewable energy across the nation. A growing number of solar energy projects are being developed in India, as it is categorized as the country with the most renewable energy installations. This will increase India's position in becoming a leader in the field. With some allocations anticipated to generate solar and renewable energy capacities up to 25,750 MW by the end of 2022, along with investments earmarked by the central government crossing USD 4.59 billion, India is on the right track of incorporating some of the largest solar energy installations in the world.
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Rooftop segment occupied the largest share in the deployment category of India solar energy market
Based on deployment methods, the India solar energy market, is grouped into rooftop and ground-mounted segments. Among these types, the rooftop solar energy deployment method garnered the maximum share in the India solar energy market in 2021. Solar energy consumption is on the rise as solar energy is increasingly being incorporated into industries and households. Nevertheless, because these domains have a shortage of space, it becomes more efficient to install the panels at the rooftops so they can be exposed to more sunlight. Agricultural sectors, on the other hand, have been using ground-mounted solar energy methods. The agriculture sector accounts for more than 18% of India's GDP and can significantly benefit from solar energy in irrigation technology. This factor will likely enhance the demand for solar energy in India in the coming years.
India Solar Energy Market: Regional Insights
Based on regions, the India solar energy market is grouped into North India, East India, West India, and South India. The Southern part of the country held the largest share in the India solar energy market in 2021. The growth of the region can be ascribed to the rising consumption and installation of solar energy capacities and energy storage systems across the states of the region. Additionally, the growing rate of industrialization in the region has also played an important role in incorporating such low-cost electricity generation methods. The state of Karnataka installed and generated the maximum solar energy across the country, with around 7355.17 MW in 2021. In addition to this, Andhra Pradesh (4203 MW), Telangana (3953.1 MW), and Tamil Nadu (4475.2 MW) are some of the other states that have become emerging players in the region contributing to the growth of the India solar energy market. The rising number of industrial projects across these states are anticipated to augment the demand for electricity, thereby generating more demand for solar energy as the renewable source of energy in the upcoming years, which is projected to drive the growth of the India solar energy market.
COVID-19 impact analysis
The COVID-19 pandemic negatively impacted the growth of the India solar energy market. The nationwide lockdown imposed by the government of India came with a major shock for the economy as it ended up disrupting the supply chain for the production of solar panels. Not only that, the growing geopolitical tensions with China, which happens to be the biggest supplier for photovoltaic cells also halted their hopes for the growth in the market amid the pandemic. Consequently, the higher solar module prices resulted in a price hike of 18% in 2021, which negatively affected the residential sector for incorporating such technologies at homes, thus altering the demand side of the economy as well. However, the growing vaccination rates, along with governmental incentives for solar panels, are anticipated to propel the demand for and supply chain for solar energy across the country in the coming years, thereby positively impacting the growth of the India solar energy market.
The leading players in the India solar energy market are Adani Group, Azure Power Global Limited, Mahindra Susten Private Limited, Sterling and Wilson Private Limited, Tata Power Solar Systems Limited, Bharat Heavy Electricals Limited, Solar Semiconductor Private Limited, Moser Baer Solar Limited, Central Electronics Limited, WAAREE, HHV Solar Technologies Private Limited, Lanco Solar Energy Private Limited, Jinko Solar Holdings Co. Limited, SMA Solar Technology AG, Trina Solar Limited, and other prominent players. The India solar energy market is a bit fragmented in nature with numerous players working on developing solar modules to curb the imports and instead start exporting the panels from India, which is projected bringing about a lot of consolidation in the coming years for the India solar energy market.
In November 2021, Adani Group subsidiary Adani Solar announced that the company is entering into a collaboration with KSL Cleantech for expand their market share in the Northeastern and Eastern renewable energy markets of India. Adani Solar, which happens to be the solar manufacturing and EPC arm for Adani Group also announced that the company is launching its retail distribution business for both regions, along with KSL Cleantech Ltd. as the official channel partner.
The in-depth analysis of the report provides information about growth potential, upcoming trends, and statistics of the India solar energy market. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends of the India solar energy market and industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyses the growth drivers, challenges, and competitive dynamics of the market.
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