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New Delhi: India’s ambitious solar expansion could face serious headwinds unless gaps in energy storage, power purchase agreements (PPAs) and performance evaluation systems are urgently addressed, a parliamentary standing committee has cautioned, flagging structural weaknesses beneath the country’s headline capacity growth.
While noting that India has scaled up solar installations to around 119 GW as of July 31, 2025, the committee said the absence of a robust framework to assess solar plant performance, combined with inadequate storage capacity and a large volume of unsigned PPAs, threatens the efficient utilisation of installed assets and future investor confidence.
The committee noted that “presently, there is no foolproof mechanism to assess the performance of solar power plants,” even as capacity additions continue at scale. It was informed by the Ministry of New and Renewable Energy (MNRE) that the National Institute of Solar Energy (NISE) is in the process of finalising photovoltaic plant rating guidelines, but said the work is still at a preliminary stage.
The panel observed that research related to identifying plant rating parameters and their impact on overall performance is ongoing, with NISE developing a Risk Priority Number to assess the probability of plant failure and detection chances, along with a Cost Priority Number. It pointed out that research institutions globally have already taken several initiatives in this area.
While acknowledging that developing an evaluatory framework is challenging due to multiple factors such as design, construction, generation, long-term maintenance and degradation, the committee said “having a reliable evaluation mechanism is essential for the policy makers, developers and investors to make an informed decision”. It urged MNRE and NISE to complete the draft solar plant rating framework at the earliest so that pilot projects and field tests can be completed on time.
The committee flagged inadequate energy storage as one of the most critical constraints affecting solar power reliability. It noted that while renewable energy accounts for around 50 percent of India’s installed power capacity, its share in actual generation, measured through the capacity utilisation factor, is only about 26 percent.
“This makes it unreliable for meeting the peak power demands of the country,” the panel said, adding that variability also leads to under-utilisation of land and transmission infrastructure.
Citing data from the Central Electricity Authority, the committee said that against about 243 GW of installed renewable energy capacity, the country currently has only 5–5.5 GW of storage capacity. In contrast, the CEA’s ‘Optimal Generation Mix 2030’ report estimates a requirement of 60.63 GW of storage capacity by 2029–30, comprising 18.98 GW of pumped storage and 41.65 GW of battery energy storage systems.
The panel attributed the slow pace of storage deployment mainly to high costs and recommended that storage systems be given due consideration in future tenders. It also called for dedicated capital grants to encourage research and development in storage technologies to support indigenisation and cost reduction.
Another major bottleneck identified by the committee is the large volume of renewable capacity that has been bid out but remains without long-term offtake agreements. It noted that power purchase agreements have not been signed for around 44 GW of capacity tendered by renewable energy implementing agencies such as SECI, NHPC, SJVN and NTPC’s renewable arm NGEL, as of June 30, 2025.
The reasons cited by MNRE include discoms not translating renewable purchase obligations into long-term procurement, a sharp rise in bidding activity since 2023–24, and expectations among state utilities that tariffs may fall further in future bids.
The committee said states have been asked to diligently follow Renewable Consumption Obligations (RCO) to avoid penalties under the Energy Conservation Act, while the Bureau of Energy Efficiency has been tasked with monitoring compliance. It also sought state-wise determination of compliance status and submission of final results to the panel.
The committee also flagged sharp regional imbalances in solar deployment, noting that eight north-eastern states and four Himalayan states and Union Territories together account for only about 1.5 GW of installed capacity, while eastern states and island territories contribute marginally.
These regions together account for only around 2.6 percent of India’s total solar capacity, despite large parts of the country receiving good solar irradiation. While acknowledging challenges such as difficult terrain and ecological sensitivity, the panel said transmitting renewable energy from high-producing western and southern states is costly and leads to efficiency losses.
It noted that the gradual withdrawal of inter-state transmission system waivers has begun encouraging states to focus on strengthening intra-state transmission, and called on central agencies to handhold low-capacity states through supportive policies, timely release of financial assistance and regular monitoring.
The committee expressed concern over delays in the solar parks programme, under which nearly 40 GW has been sanctioned across 55 parks in 13 states. As of March 2025, only around 12.2 GW had been commissioned, leaving nearly 70 percent of the capacity to be developed within one year.
Land acquisition was identified as a major factor affecting project timelines, with utility-scale solar typically requiring 4–7 acres per MW. The panel recommended the creation of a single-window clearance mechanism bringing together central and state stakeholders to resolve land-related issues in a time-bound manner.
While appreciating that India has achieved self-sufficiency in solar module manufacturing with about 91 GW of capacity, the committee flagged serious gaps in upstream components such as polysilicon, ingots and wafers. It noted that India currently has no domestic polysilicon manufacturing capacity and only a recently commissioned 2 GW ingot and wafer facility.
The panel also raised concerns over inadequate domestic manufacturing of transmission equipment and complete dependence on imports for certain HVDC components, leading to higher costs and delivery timelines of up to five years. It urged closer inter-ministerial coordination and faster progress under initiatives such as the Clean Tech Manufacturing Initiative announced in the 2025–26 Budget.
Taken together, the committee’s observations suggest that while India’s solar capacity has expanded rapidly, the systems needed to support scale — from storage and grid infrastructure to market mechanisms and performance metrics — are lagging, posing risks to the sustainability of the country’s solar growth trajectory.
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