India’s energy transition reached a critical milestone in June 2025. The Government of India, Press Information Bureau, noted that the country’s total installed power generation capacity hit 476 GW, with non-fossil fuel sources contributing nearly 49 percent. This marks a substantial shift from a coal-dominated past, driven by rapid solar growth, expanding wind and hydro capacity, and early strides in hydrogen and nuclear energy.
India’s Rising Electricity Demand Fuels the Shift
Electricity demand in India has surged in recent years, fueled by growing commercial and residential spaces, increased ownership of air conditioners and appliances, and rising industrial consumption. Over the past five years, India recorded the third-largest growth in power generation capacity globally, after China and the United States.
Although generation has increased across all sources, investment in renewables—especially solar PV—has taken the lead. According to the IEA, 83 percent of India’s power sector investment in 2024 went to clean energy.
India also became the world’s largest recipient of development finance for clean power, receiving around USD 2.4 billion for project-level interventions. As a result, the share of non-fossil power generation capacity climbed to 44 percent in 2024, closing in on India’s target of 50 percent by 2030.
Solar Power Becomes the Cornerstone of Clean Energy
Solar energy continues to dominate India’s renewable push. Installed solar capacity soared to 110.9 GW in June 2025, up from just 2.82 GW in March 2014—a nearly 39-fold increase. In FY 2024–25 alone, 23.83 GW of solar was added, showcasing robust government support and investor confidence.
This growth aligns with a major expansion in domestic solar manufacturing. Module production capacity jumped from 2.3 GW to 88 GW, and cell production rose from 1.2 GW to 25 GW. These developments have strengthened India’s self-reliance in the solar supply chain.
Flagship programs such as PM Surya Ghar: Muft Bijli Yojana, rooftop solar subsidies, and the PM-KUSUM scheme have accelerated adoption, especially in rural and residential areas, empowering households and farmers to embrace solar energy.
Coal Still Dominates India’s Power Mix, but Its Grip is Slipping
Despite clean energy gains, coal remains India’s largest single source, with an installed capacity of 219 GW. When combined with gas (20 GW) and diesel (0.589 GW), thermal power contributes 240 GW, slightly over 50 percent of the country’s total.
Coal continues to play a key role in meeting base load demand, particularly for industrial use. However, its dominance is gradually eroding as solar, wind, and other renewable options scale up. Additionally, policy pressure to decarbonize and falling costs of renewables are accelerating this shift.
Wind, Hydro, and Biomass Add Balance to the Grid
India’s renewable mix is becoming increasingly diverse. Wind power reached 51.3 GW, with 4.15 GW added in the last fiscal year. Hydropower, including both large and small projects, stood at 48 GW, up from 35.8 GW in 2014. These sources provide critical grid flexibility and peak load management.
Biomass and biogas power have also strengthened, contributing 11.6 GW. Over five million small biogas plants and hundreds of medium-scale systems are now operational. In a major leap, India’s production of compressed biogas has reached 1,211 tonnes per day across 150 plants—up from just 8 tonnes per day in 2014.
Green Hydrogen finds its Place in the Energy Mix
India’s green hydrogen ambitions are taking shape under the National Green Hydrogen Mission. While still in its early stages, pilot projects using electrolysis powered by solar and wind have begun.
These initiatives support the government’s target of producing 5 million metric tonnes of green hydrogen annually by 2030, backed by 125 GW of renewable capacity.
Though current hydrogen capacity remains in the pilot phase, it is expected to play a transformative role in decarbonizing heavy industries, refining, and long-duration storage in the coming decade.
Nuclear power: Needs a Ramp-Up
Nuclear energy continues to provide a steady source of low-emission electricity, with 8.8 GW of capacity as of June 2025. While its share remains modest, nuclear offers reliable baseload power and supports the country’s broader clean energy ambitions.
The Government of India’s Department of Atomic Energy has announced that the RAPS-7 reactor (700 MW) was successfully connected to the grid on March 17, 2025, increasing the total number of operational nuclear reactors in the country to 25, with a combined capacity of 8,880 MW.
An additional 13,600 MW of nuclear power capacity is currently under implementation. Once these projects are progressively completed, India’s total nuclear capacity is expected to reach 22,480 MW by 2031–32.
The private sector is already playing a significant role in the nuclear ecosystem, particularly in the manufacturing, supply, and execution of nuclear power projects. Moreover, private investment in nuclear power generation has now been enabled within the current legal framework to support the establishment of Bharat Small Reactors (BSRs).
India’s Investment Landscape and Infrastructure Bottlenecks
India has introduced several steps to attract more investment in clean energy. These include significant support for solar panel manufacturing, battery production, and building better electricity grids. The IEA further highlighted that in 2023, foreign direct investment (FDI) in the power sector reached USD 5 billion. It’s almost double the amount seen before COVID-19. Under the current policy, India allows 100 percent FDI in power generation and transmission, except in nuclear energy.
However, foreign portfolio investment (money from global investors in stocks and bonds) has dropped over the last two years. One major challenge is the high cost of financing. In India, borrowing costs for renewable energy projects are 80 percent higher than in developed countries, which makes clean energy projects more expensive and less profitable.
Another serious issue is off-taker risk—this means that electricity distribution companies (discoms) often fail to pay power generators on time. As of March 2025, discoms owed more than USD 9 billion in unpaid bills. Their total losses had reached USD 75 billion by 2023.
In addition, poor transmission infrastructure is holding back progress. India has about 60 GW of renewable power capacity that is ready but cannot be used fully because the electricity cannot be moved where it is needed. This shows the urgent need to improve the power grid and connect new projects to the system faster.
The Future is Clean Energy
India’s energy system is changing quickly. Today, clean energy sources like solar, wind, hydro, biomass, nuclear, and hydrogen make up almost half of the country’s power capacity, nearly equal to fossil fuels. This shows that India is on track toward a cleaner, low-carbon future.
- The country’s goal is to have 500 GW of non-fossil power capacity by 2030.
The progress seen by June 2025 proves that this goal is within reach. But to keep the momentum going, India must solve key problems like discom debt, grid delays, and high project costs. With the right actions, India can fully unlock the potential of clean, affordable, and reliable energy.
The post India Achieves 50% Non-Fossil Fuel Power Milestone: Solar Shines Bright appeared first on Carbon Credits.
Most businesses that decide to act on their net-zero targets reach the same point of friction. Buying carbon credits has meant tracking down brokers, sitting through sales calls, and requesting a quote just to learn a price, sometimes with limited proof of what you are buying.
The earnings calls that quietly reframed climate from sustainability question to operating risk.
Three earnings calls in the last 18 months tell the story without any help from a press release.
Hershey, May 2024: cocoa price exposure compresses margin, and the company attributes part of the cost shock to West African weather. Olam, July 2024: coffee climate exposure quantified in the annual report. JBS, January 2025: supply chain climate disclosures expanded materially in response to investor pressure and regulatory expectation. None of these companies issued the announcement as climate news. They issued it as financial news. The climate-linked supply chain risk did not arrive with a sustainability framing; it arrived as a P&L line.
You are probably reading this article because you suspect the same thing is happening to your business. This piece walks through what is showing up on which earnings calls, how procurement and finance leaders are quantifying the exposure, and what serious corporates are doing about it before the regulator asks.
Where climate risk has already appeared in earnings
The pattern is consistent across resource-intensive sectors. A weather event compresses supply, the price spikes, the cost flows through the income statement, and the analyst on the call asks whether the event is anomalous or structural. Increasingly, the honest answer is the second one.
Cocoa is the cleanest example. The 2023 to 2024 West African harvest fell sharply on the back of erratic rainfall and disease. Cocoa futures more than tripled. Companies with concentrated West African sourcing absorbed the cost; companies with diversified sourcing absorbed less. The exposure was not climate as ESG topic. It was climate as cost of goods.
Coffee follows the same pattern. Brazilian and Vietnamese harvests have moved on weather more sharply across the last several seasons. Roasters with long-tenor supplier relationships and origin diversification have managed the volatility; roasters with spot-market exposure have not. Wheat, sugar, palm oil, beef: the same dynamic in different commodities, a pattern the IPCC AR6 Working Group II report projects will intensify across agricultural systems through mid-century.
What this means: climate risk is no longer a footnote in the 10-K. It is a line item the CFO has to explain on the call.
The three commodity exposures that hit margin first
For most companies with material Scope 3 exposure, three exposures dominate the near-term P&L risk.
- Concentrated single-origin sourcing in a climate-vulnerable region. If your tier-one supply for any material commodity sits in one geography, you have a concentration risk that climate amplifies. Diversification across origins is the obvious hedge, but it takes years to build and requires relationships you cannot acquire by tender.
- Supplier financial fragility under climate stress. Smallholder farmers, who supply a large share of the global cocoa, coffee, and palm oil market, do not carry the balance sheets to absorb yield shocks. When yields collapse, they exit. When they exit, your supply base shrinks, and the surviving suppliers raise prices. The risk is structural, not cyclical.
- Logistics and storage exposure to extreme weather. Hurricane disruptions to Gulf shipping, drought-driven Panama Canal restrictions, flooding in European inland waterways: each of these has moved input costs in the last three years, a pattern documented in Munich Re’s natural catastrophe data. The exposure shows up as a one-quarter event in the financial press but accumulates over time on the cost line.
TCFD and ISSB disclosure changes
The disclosure architecture has now caught up with the risk. The Task Force on Climate-related Financial Disclosures, whose recommendations are now embedded in the ISSB’s IFRS S2 climate standard, requires companies to disclose climate-related risks across physical and transition categories, with quantification where possible.
For physical risk specifically (the climate-linked supply chain risk you are reading about), the disclosure must address both acute exposures (extreme weather events) and chronic exposures (gradual changes in temperature, precipitation, and growing seasons). The disclosure must address the time horizon over which the risk is material, the parts of the value chain exposed, and the financial impact under different scenarios.
The CSRD imposes similar requirements under European law, with double materiality (both financial and impact materiality) embedded in the assessment. The practical effect: your auditors and your investor relations team now need a defensible answer to the climate-linked supply chain risk question, and the answer needs to be quantified.
What procurement and finance can do now
Three actions matter near-term.
Map your exposure. Most companies do not have a clear view of which tier-one and tier-two suppliers sit in which climate-vulnerable geographies. Without the map, you cannot quantify the risk, and without the quantification, you cannot disclose it credibly. The map is the foundation, and World Resources Institute climate risk research provides useful public tooling to start.
Diversify and deepen, in that order. Diversification across origins reduces concentration risk, but the deeper move is to invest in the resilience of the suppliers you already have. Regenerative practices, agroforestry, soil health interventions: these reduce yield volatility under climate stress and protect your input cost trajectory.
Embed the climate spend inside procurement, not outside it. Treating climate risk as a sustainability cost line subordinates it to the ESG budget. Treating it as a procurement and resilience investment puts it in the budget that matters, which is the cost-of-goods budget that the CFO defends quarterly.
Nature-based supply chain investments are the asset class designed for exactly this purpose. They sit inside the value chain, they reduce climate-linked supply risk, they generate verifiable Scope 3 reductions, and they produce the documentation an auditor and a regulator can both test.
If you are quantifying climate-linked supply chain risk in advance of the next earnings cycle or the next disclosure period, the carbon and sustainability experts at Carbon Credit Capital can help you map your exposure and structure a Dual-Value Model response that addresses reduction, resilience, and disclosure-readiness in a single program. Schedule a consultation.
More and more small and medium-sized businesses are hearing the same question from their larger customers: What is your carbon footprint? That question now travels down entire supply chains, and it arrives next to tender requirements, certification criteria, and rising customer expectations.
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