Author: PPD Team Date: 10/03/2025
India’s renewable energy sector is grappling with execution challenges despite issuing a record 73 GW of utility-scale renewable energy tenders in 2024. According to a report by the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research & Analytics, weak demand for tenders, project cancellations, and delays in power sale agreements (PSAs) could slow progress toward India’s goal of 500 GW of non-fossil power capacity by 2030.
While India exceeded the Ministry of New and Renewable Energy’s (MNRE) annual target of 50 GW in 2024, half of the issued capacity was for non-traditional renewable technologies like wind-solar hybrid and battery energy storage. The shift reflects energy buyers’ demand for improved power quality. However, 8.5 GW of tenders remained undersubscribed—five times more than in 2023—due to complex tender structures, aggressive bidding, and delays in interstate transmission infrastructure readiness.
The report highlights that India’s total unsigned PSA capacity has surpassed 40 GW, with Solar Energy Corporation of India (SECI)-led tenders accounting for nearly 12 GW. The hesitation among energy buyers stems from expectations of continued declines in renewable energy prices. From 2020 to 2024, around 38.3 GW of issued capacity was cancelled, representing 19% of total tenders during that period. Reasons for cancellations included design flaws, location or technical challenges, undersubscription, and PSA delays.
Experts warn that project execution delays could undermine investor confidence and restrict access to affordable financing from major institutional investors. The report recommends that authorities focus on streamlining the tendering process, ensuring PSAs are signed on time, and enforcing stricter renewable purchase obligations to sustain demand.
Additionally, it suggests that the government set annual targets not just for issuing tenders but also for allotments and PSA signings. This would ensure that implementing agencies only issue bids after securing the necessary offtake agreements, improving execution efficiency in India’s renewable energy sector.