Top 10 states accounted for over 85% of installations

Mar. 01, 2022 – Bengaluru – In calendar year (CY) 2022, India added 1.6 GW of rooftop solar, down almost 4% compared to 1.7 GW installed in 2021, according to the newly released report, 2022 Q4 & Annual Mercom India Rooftop Solar Market Report, by Mercom India Research.

In the fourth quarter (Q4) of 2022, 483 megawatts (MW) of rooftop solar was added, almost a 51% increase quarter-over-quarter (QoQ). Installations were up 20% year-over-year (YoY).

About 42% of installations during the year were in the industrial segment, while residential, commercial, and government represented 32%, 25%, and 1%, respectively.

“2022 was a lost opportunity for the rooftop solar market in India, affected by policy challenges restricting supply and impacting the cost of modules. Despite the hurdles, installations were almost on pace with the previous year. Strong fundamentals continued to drive installations in the commercial and industrial segments. We expect growth to resume in 2023 as pricing and supply challenges moderate,” said Raj Prabhu, CEO of Mercom Capital Group.

According to the report, cumulative rooftop solar installations reached almost 8.8 GW as of December 2022.

The Central Government implemented significant policy changes in the sector during the year, including Basic Customs Duty (BCD) implementation and the Approved List of Models & Manufacturers (ALMM) mandate for rooftop solar projects. These policies added to the volatility in solar module prices and supply in the market. Installations may have been higher if project costs hadn’t surged after the BCD and if installers had clarity about grid-connected rooftop solar projects requiring ALMM-enlisted modules, noted the report.

According to the report, the average rooftop solar system costs fell marginally by 0.4% compared to Q3 2022 but were up almost 13% YoY.

In 2022, over 2 GW of rooftop solar tenders were issued, a 90% increase YoY. The Madhya Gujarat Vij Company contributed to almost 47% of announced tenders, and government agencies in states like Madhya Pradesh, Rajasthan, Uttar Pradesh, and Telangana accounted for 23% of the tenders issued during the year.

According to the report, DISCOMs issued empanelment tenders in Kerala, Punjab, Gujarat, Uttar Pradesh, Madhya Pradesh, Telangana, and Karnataka under Phase II of the Ministry of New and Renewable Energy’s rooftop solar program in 2022.

Gujarat remained the top market, accounting for 24% of cumulative solar rooftop installations, followed by Maharashtra and Rajasthan, with 14% and 9%, respectively. The top 10 states accounted for approximately 74% of cumulative rooftop solar installations as of December 2022 and over 85% of capacity added in 2022.

Between Q4 2021 and Q4 2022, Kerala recorded the highest compounded growth at 19%, followed by Maharashtra and Andhra Pradesh.

A comprehensive analysis of net metering policies across all Indian states and Union Territories is also included in the report.

Key Highlights from the 2022 Q4 & Annual Mercom India Rooftop Solar Market Report

• In 2022, India added over 1.6 GW of rooftop solar capacity
• The top 10 states accounted for over 85% of rooftop solar installations in 2022
• In Q4, 56% of rooftop solar installations came from the residential segment, while 28% and 15% came from industrial and commercial segments, respectively
• Rooftop solar system costs during the quarter increased by almost 13% YoY
• Cumulative rooftop solar installations reached almost 8.8 GW as of December 2022
• Gujarat was the top state cumulatively for rooftop solar installations, followed by Maharashtra and Rajasthan

The 2022 Q4 & Annual Mercom India Rooftop Solar Report is 60 pages and covers all facets of India’s rooftop solar market. For the complete report, visit:  https://mercomindia.com/product/rooftop-solar-market-report-q4-2022

About Mercom India

Mercom India Private Limited (formerly Mercom Communications India Private Limited), a subsidiary of U.S.-based Mercom Capital Group, is a clean energy research and communications firm in India recognized worldwide for its expertise in Indian cleantech markets. Located in Bangalore, India, Mercom has been providing communications and research services across India for clean energy organizations since early 2009. For more information, visit: https://mercomindia.com

About Mercom India Rooftop Solar Market Report

Mercom’s India Rooftop Solar Market Quarterly Report is the most in-depth and accurate report available on the state of the Indian Rooftop Solar Market. The report covers the entire rooftop solar market, pricing, policies, and forecast that will help companies navigate the challenges as well as take advantage of opportunities in the market. For more information visit: https://mercomindia.com/research/