India Renewable Energy Market is Expected to Register a CAGR of 8.82% Through 2031

Government Policies & Supportive Regulatory Framework and Rising Energy Demand & Urbanization are likely to propel the market during the forecast period.

According to TechSci Research report, “India Renewable Energy Market – By Region, Competition, Forecast and Opportunities, 2021-2031F”, India Renewable Energy Market was valued at USD 19 Billion in 2025 and is expected to reach USD 31 Billion by 2031 with a CAGR of 8.82% during the forecast period.

India's renewable energy market is also strongly driven by growing environmental awareness and the country’s international climate commitments. As one of the world's most populous nations, India faces severe environmental challenges such as air pollution, water scarcity, and land degradation, largely due to the over-reliance on fossil fuels. The shift toward renewable energy is crucial to mitigate these impacts.

India is a signatory to the Paris Agreement and has pledged to reduce the emissions intensity of its GDP and increase the share of non-fossil fuel energy capacity. The updated Nationally Determined Contributions (NDCs) commit India to achieving about 50% cumulative electric power installed capacity from non-fossil fuel-based energy sources by 2030. Achieving this target requires a significant ramp-up in renewable energy deployment.

Public concern over pollution-related health issues and the visible effects of climate change, such as erratic monsoons and rising temperatures, have increased demand for cleaner energy alternatives. Citizens, industries, and policymakers are all becoming more conscious of the environmental impact of energy choices.

Corporate social responsibility (CSR) initiatives and Environmental, Social, and Governance (ESG) criteria are also influencing businesses to adopt green energy solutions. Many corporations are voluntarily committing to 100% renewable power under international frameworks like RE100, further accelerating demand. Additionally, global pressure and alignment with sustainable development goals (SDGs) are prompting financial institutions to move away from fossil fuel investments and toward greener alternatives. This shift in funding patterns enhances the growth prospects for renewable energy projects in India.

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Based on End Use, the industrial sector dominated the Indian renewable energy market due to its high energy demand, cost sensitivity, and increasing focus on sustainability. Industries such as manufacturing, cement, steel, IT, and textiles consume large amounts of electricity to power operations. Rising grid tariffs and fluctuating fossil fuel prices have made renewable energy an attractive, cost-effective alternative for these energy-intensive sectors.

One of the key reasons for industrial dominance is the economic advantage of renewable energy. With the cost of solar and wind power falling significantly over the last decade, industrial consumers can now access cleaner electricity at lower or stable prices through open access power purchase agreements (PPAs) and captive renewable projects. These arrangements allow industries to bypass state-owned distribution companies (DISCOMs), avoiding cross-subsidization charges and ensuring better power reliability.

Moreover, corporate sustainability goals are driving industries to adopt green energy. Many large companies have committed to reducing their carbon footprint and meeting ESG (Environmental, Social, and Governance) targets. Initiatives such as RE100, which promote 100% renewable energy usage among corporates, have seen strong participation from Indian firms and multinational companies operating in India.

Government policies also support this trend. Incentives such as waivers on transmission charges for open access renewable power and accelerated depreciation benefits for renewable energy assets encourage industrial adoption. Additionally, the availability of land, financing, and technical expertise makes it easier for industries to set up onsite or offsite renewable installations.

Industrial players often have the resources and creditworthiness to invest in large-scale renewable projects, unlike small consumers or residential users. As a result, the industrial sector leads in renewable energy procurement, driving capacity growth and shaping demand patterns in India’s clean energy transition. This dominance is expected to continue as industries strive for both cost efficiency and environmental responsibility.

Based on Region, North India has emerged as one of the fastest-growing regions in the country’s renewable energy market due to a combination of favorable geographic, policy, and economic factors. North India offers vast tracts of available land with high solar irradiance, particularly in states like Rajasthan, Haryana, and Uttar Pradesh. The region’s climate—characterized by abundant sunlight throughout the year—makes it highly suitable for large-scale solar power generation. Rajasthan, in particular, has become a solar hub, hosting some of India’s largest solar parks due to its expansive desert terrain.

The proactive approach of state governments in the north has accelerated renewable energy development. Many northern states have implemented attractive policies, including competitive tariffs, streamlined land acquisition, and robust renewable purchase obligations (RPOs). These policies create a conducive environment for private and public investments. For example, Uttar Pradesh and Haryana have launched aggressive solar capacity expansion programs supported by fiscal incentives and simplified regulatory frameworks.

The strong industrial base and rapid urbanization in North India have fueled increasing energy demand, especially in power-hungry sectors such as manufacturing, textiles, and IT services. This growing demand encourages investments in renewable energy to ensure sustainable, cost-effective power supply. Moreover, the proximity of renewable projects to major consumption centers such as Delhi, Gurgaon, and Noida reduces transmission losses and infrastructure costs, making renewable projects economically viable.

The development of grid infrastructure and connectivity in North India has improved significantly. Initiatives like the Green Energy Corridor and investments in high-capacity transmission lines facilitate the smooth integration of renewable energy into the grid, minimizing curtailment and optimizing power distribution.

Major companies operating in the India Renewable Energy Market are:

• NextEra Energy, Inc.
• Iberdrola, S.A.
• Enel S.p.A.
• Orsted A/S
• Siemens S.A.
• Vestas Wind Systems A/S
• Canadian Solar Inc.
• First Solar, Inc.

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“India’s renewable energy market presents a significant growth opportunity driven by its ambitious target of 500 GW of non-fossil fuel capacity by 2030. Rapid urbanization, rising energy demand, and climate commitments are fueling investment across solar, wind, hybrid, and green hydrogen segments. Government incentives, declining technology costs, and increasing corporate sustainability initiatives further strengthen the market potential. Emerging areas such as energy storage, rooftop solar, and electric mobility integration offer additional avenues for expansion. With strong policy support and investor interest, India is poised to become one of the world’s largest and most dynamic renewable energy markets in the coming decade.” said Mr. Karan Chechi, Research Director of TechSci Research, a research-based global management consulting firm.

“India Renewable Energy Market, By Type (Hydroelectric Power, Wind Power, Bioenergy, Solar Energy, Others), By End Use (Residential, Commercial, Industrial, Others) By Region, Competition, Forecast & Opportunities, 2021-2031F”, has evaluated the future growth potential of India Renewable Energy Market and provides statistics & information on Market size, structure and future Market growth. The report intends to provide cutting-edge Market intelligence and help decision-makers make sound investment decisions. The report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities in the India Renewable Energy Market.

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