India’s Rooftop Solar Soars: Record 4 GW Capacity Forecast in FY2024 Amid Regulatory Strides

Representational image. Credit: Canva

India’s rooftop solar market is experiencing a surge in growth, with the potential to add a record-breaking 4 gigawatts (GW) of capacity in the fiscal year 2024, according to a collaborative report by the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research & Analytics. The report reveals that the capacity added between April and July 2023 was nearly 2 GW, just slightly below the amount added during the entire fiscal year 2023. This growth trajectory is expected to be sustained due to decreasing costs of solar modules.


To achieve its goal of 500 GW of renewable energy by 2030, the report underscores the importance of solar energy and its various verticals, including utility-scale, rooftop solar, and open access. The report’s co-author, Vibhuti Garg of IEEFA, emphasizes that the right policy and regulatory framework can make rooftop solar a transformative force in greening the national energy mix, as demonstrated by countries like Germany and Australia.

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Despite the positive momentum, the report highlights significant regulatory obstacles in the rooftop solar market. Uncertainties in regulations and limited support from local electricity distribution companies (DISCOMs) have led many developers to either shift focus or exit the rooftop solar sector. Certain regions, such as Gujarat, Andhra Pradesh, Telangana, and Delhi, exhibit favorable conditions for commercial and industrial customers setting up rooftop solar projects. However, the report recommends that other states follow suit and adopt policies that encourage rooftop solar adoption.


To further boost the rooftop solar market, the report suggests creating separate renewable purchase obligations for rooftop solar, allowing behind-the-meter rooftop solar systems, and implementing uniform regulatory provisions. Additionally, the report identifies the micro, small, and medium enterprise (MSME) sector as a potential growth area for rooftop solar and anticipates a World Bank-backed credit guarantee mechanism to support financing for MSME rooftop solar projects. The adoption of battery energy storage systems, virtual net metering, and peer-to-peer trading are also recommended to enhance the market’s potential and benefits for consumers and DISCOMs.

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