India’s renewable energy sector is entering a phase in which adding generation capacity alone may not be enough to meet the country’s electricity requirements. The ability to deliver reliable power when consumers need it is becoming equally important, increasing the need for energy storage, transmission infrastructure and hybrid renewable projects, ET Energyworld reported.
Solar and wind generation have different operating patterns, while electricity demand continues throughout the day and night. This creates a challenge for developers seeking to supply predictable power through firm renewable energy contracts. The issue has implications for project planning, financing and power purchase agreements.
Transmission connectivity is one of the constraints. The Central Electricity Regulatory Commission (CERC) estimates that around 15.7 GW of transmission connectivity could potentially be released from projects that have not progressed towards generation. A substantial amount of renewable capacity awarded between 2019 and 2025 also remains without customers. Connectivity held by projects that may not materialise can prevent other developers from accessing the grid.
CERC has introduced measures allowing developers to surrender connectivity, provide higher bank guarantees or transfer connectivity to eligible group utilities. These provisions are intended to improve the allocation of transmission capacity and make access available to projects that are more likely to proceed.
The challenge is reflected in renewable energy curtailment as well. India reportedly experienced around 300 GWh of renewable energy curtailment in the first quarter of 2026 because of transmission constraints. Power that cannot be evacuated through the grid cannot reach consumers, even when generation capacity is available, reducing the economic value of investments in renewable energy.
Energy storage and hybrid projects could help address the gap between generation and demand. A study by the India Energy and Climate Centre at the University of California, Berkeley, found that a 3 GW solar project combined with 12 GWh of battery storage could meet the supply profile required under the Solar Energy Corporation of India’s (SECI) round-the-clock renewable energy tender in Rajasthan.
The commercial viability of such projects depends on several factors, including the generation mix, storage capacity required and the duration for which electricity must be supplied. Solar-wind hybrid projects, battery storage and dedicated transmission arrangements can provide a more consistent supply profile than standalone solar generation.
Policy support for this infrastructure is also gathering pace. The Union Cabinet’s approval of the Green Energy Corridor Phase III (GEC-III) project involves an estimated expenditure of Rs 1.86 lakh crore. The programme aims to support the evacuation of up to 135 GW of renewable energy by FY2032-33.
Of the proposed expenditure, around Rs 1.36 lakh crore is earmarked for intra-state transmission infrastructure, while Rs 50,000 crore is allocated for 50 GWh of battery energy storage capacity. The scale of the investment highlights the importance of developing transmission and storage alongside renewable generation.
Demand for dependable electricity is also expected to increase as data centres and artificial intelligence infrastructure expand. India’s data-centre capacity is projected to grow from around 1.4 GW to 9 GW by 2030, potentially adding 40-45 TWh to electricity demand. These facilities require continuous power, while industrial and commercial consumers are also looking for reliable supply and greater cost predictability.
Developers have several options to meet these requirements, including captive and group-captive renewable projects, round-the-clock power contracts, hybrid generation and improved forecasting and scheduling. The choice will depend on each consumer’s operating requirements and the cost of combining generation, storage and transmission.
CERC’s measures on unused connectivity, the GEC-III investment and SECI’s round-the-clock procurement initiatives point to the need for closer coordination between renewable generation, grid development, storage deployment and demand growth.
As India expands its renewable energy capacity, the ability to convert installed megawatts into reliable and usable electricity is likely to become a key measure of the sector’s progress.
