A defining characteristic of solar additions in calendar year (CY) 2024 was the substantial 25 per cent share of non-utilities that has surpassed historical precedents, according to a recent report by SBI Caps.
Rooftop solar installations surged by 4.6 GW, reflecting a remarkable 53 per cent year-on-year growth, while off-grid solar witnessed a 197 per cent expansion, the report said.
“This escalating prominence of the non-utility segment can be attributed to a combination of factors, including a low initial base, supportive government policies stimulating both residential and commercial & industrial sectors, and enhanced affordability of distributed solar solutions,” observed the report.
CY24 marked a pivotal juncture for renewables, surpassing the symbolic 200-GW threshold in installed capacity, with solar energy demonstrating exceptional growth
Meanwhile, CY24 energy supply exhibited around 6 per cent year-on-year growth, characterized by H1’s robust 10 per cent expansion amid a scorching summer, followed by H2’s subdued 2 per cent growth attributed to an above-normal monsoon.
“The trend of exacerbated inter-quarter volatility and peaky demand determined by weather rather than industry use, played out for another year,” the report said.
Notwithstanding the blip in energy demand, installed power generation capacity registered a healthy 8 per cent year-on-year growth in CY24. Notably, renewables spearheaded this expansion, with solar and wind additions reaching around 24.5 GW and 3.2 GW respectively, exceeding CY23’s pace by a factor of two, according to the report.
“Solar, in particular, exhibits a trajectory consistent with our forecast of 50 GW of capacity additions across FY25 and FY26. Conversely, thermal capacity additions, following a respectable FY24, have decelerated in 9MFY25, casting doubt on the feasibility of achieving the FY25 targets,” noted the report.
C&I sector driven towards decentralised power solutions
C&I entities collectively constitute three-fourths of the installed rooftop capacity. This ecosystem flourishes due to the inherent disparity between elevated C&I grid tariffs and reduced tariffs procured from third-party IPPs/captive plants. While several states have acknowledged the erosion of market share within their respective discoms and implemented a series of Open Access charges, key states such as Gujarat, Karnataka, Rajasthan, and Tamil Nadu still offer a substantial 20 per cent cost advantage for utilizing OA renewable power. Furthermore, captive arrangements enhance the economic appeal by exempting consumers from additional surcharges and cross-subsidy levies, thereby maintaining viability across most states, the report added.
Featured photograph is for representation only
