As per Latest International Energy Agency (IEA) report, India has recorded the third-largest power generation capacity growth in the world over the “past five years”, only after China and United States. The impressive growth in India is to be attributed the increased demand for energy across sectors, strong commitment to renewable energy, and high levels of foreign and domestic investment; particularly in solar photovoltaic (PV) projects.
The IEA just released its latest energy outlook and is bringing India’s progress in the power sector to the fore. India’s increase in clean energy infrastructure and being the third fastest growing power generator in the world, is a significant achievement within a global target of decarbonization and sustainability. Overall, the data showcases momentum in policies within India, the energy transition, and an emerging global power within the green energy economy.
Key Highlights from the IEA Report
- India has the third largest growth in generation capacity from 2019-2024, after China and US.
Electricity demand in India is rising rapidly due to,
- Growth in commercial and residential infrastructure.
- Increased use of air conditioners and household appliances.
- Growth in industrial activity.
Power Generation Expansion
- Growth occurred in all energy sources, fossil fuels, hydropower, renewables
- Clean energy development, specifically solar PV, was the predominant driver.
- Solar projects alone made up over 50% of the total investments in non-fossil energy in India in the past five years.
Investment & Financing
- 2024: 83% of all power sector investment in India went into clean energy.
- India was the largest recipient of DFI funding for clean energy in 2024, receiving USD 2.4 billion.
- FDI in the power sector rose to USD 5 billion in 2023, nearly double pre-pandemic levels.
- Government policy allows 100% FDI in most power-related areas (excluding nuclear).
