India To Install 1.7GW Of Rooftop PV By 2023

India installed 1.7GW of rooftop PV systems in 2023, the country's second-highest annual installed rooftop PV capacity on record, according to the "India Rooftop PV Market Report 2023 and Q4" recently released by research firm Mercom India Research.

However, the growth rate of installed capacity of PV systems installed in India in 2023 was only 3.7% as many commercial and industrial (C&I) consumers delayed the installation of PV systems as they waited for the price of PV modules to stabilize.Mercom India Research expects lower prices of PV modules in early 2024 to help reduce the cost of installing PV systems.

Figure 1 Installed capacity of rooftop PV systems installed in India from 2011 to 2023 (MW)

Priya Sanjay, Managing Director, Mercom India Research, explains why commercial and industrial (C&I) consumers are delaying the installation of PV systems in 2023, stating, "Prices of PV modules are still high in the first half of 2023, and some consumers regarding the ALMM (Approved List of Models and Manufacturers) applicability to rooftop PV projects there is a lot of confusion."

Earlier this month, India's Ministry of New and Renewable Energy suspended its order to reimpose ALMM regulations from April 1, 2024 onwards. The ministry had earlier confirmed the re-implementation of the ALMM regulations with exemptions for open-air PV projects and PV projects in advanced stages of construction and rooftop PV projects without subsidies.

By the end of December 2023, the cumulative installed capacity of rooftop PV systems installed in India reached 10.5GW.

The installed capacity of residential rooftop PV systems accounted for more than half of the new rooftop PV systems to be installed in India in 2023. The report also found that the installed cost of rooftop PV systems fell by 10% sequentially and 21.6% year-on-year, thanks to falling PV module prices.

The installed capacity of rooftop PV systems installed in India in the fourth quarter of 2023 was 406 MW, down 5.8% compared to the previous quarter and down 15.9% compared to the 483 MW installed in the fourth quarter of 2022.

Priya Sanjay said, "This is due to the prices of PV modules starting to fall in the second half of 2023 and installers are delaying the installation of rooftop PV systems as they wait for costs to stabilize."

Rooftop PV systems installed in Indian states

Gujarat installed the highest installed capacity of rooftop PV systems in Q4 2023, accounting for 42.6% of the installed capacity of rooftop PV systems installed in India during the quarter. By the end of 2023, Gujarat again emerged as the leader in the Indian rooftop PV market, accounting for 27.3% of the cumulative installed rooftop PV system capacity installed in the country, followed by Maharashtra and Rajasthan with 13.3% and 8.1% respectively.

Priya Sanjay said, "This is largely attributed to the state-owned power distributors in Gujarat." He added that the state's power distribution companies, which are among the highest rated in India, can reduce the number of consumers receiving subsidies by installing rooftop PV systems for agricultural and residential customers.

However, Gujarat has seen a 45.7% drop in installed capacity of rooftop PV systems tendered in 2023 compared to 2022. Uttar Pradesh emerged as the most active state in India in terms of tendering, accounting for 44.2% of the 1.2GW of rooftop PV systems tendered in India in 2023.

In addition, tenders for rooftop PV systems installed in government buildings accounted for nearly 57% of the announced tender capacity.

The installed capacity of rooftop PV systems installed in the top 10 states accounted for 77.3% of the total installed rooftop PV capacity installed in India.