India recorded its highest-ever annual solar capacity addition in the calendar year 2025, installing 36.6 GW, a 43% increase over the 25.6 GW added in 2024, according to Mercom India’s newly released Q4 and Annual 2025 India Solar Market Update Report.

This milestone underscores the sector’s strong growth momentum, supported by favorable policies, faster project execution, and improved market conditions.

Large-scale solar projects, including open-access installations, accounted for the bulk of capacity additions in 2025, contributing nearly 81%, while rooftop solar accounted for over 19%.

A total of 29.5 GW of large-scale solar capacity was installed during the year, marking a 31% rise from 22.5 GW in 2024.

“India recorded its highest-ever annual solar installations in 2025, reflecting strong demand and steady execution despite ongoing challenges. Curtailment has emerged as the most pressing issue, particularly in solar-heavy states. At the same time, the upcoming Approved List of Models and Manufacturers (ALMM)-II deadline is creating uncertainty around cell availability, raising the risk of short-term supply bottlenecks. Equipment delays and a growing PPA backlog are also weighing on the market. Unless transmission expansion and manufacturing scale move in sync with capacity additions, growth will remain uneven in 2026,” commented Raj Prabhu, CEO of Mercom Capital Group.

Open-access projects alone accounted for 26% of large-scale additions, reflecting growing demand from commercial and industrial (C&I) consumers seeking cost savings and energy security.

“A lot of open-access projects were installed because of favorable policies in particular states, and demand from C&I units. The other large-scale projects, aside from the open access, are all under central government agencies with clear timelines,” said Priya Sanjay, Managing Director of Mercom India.

Rajasthan, Gujarat, and Maharashtra led large-scale installations in 2025, accounting for approximately 34%, 28%, and 15% of additions, respectively.

Solar accounted for 68% of the 57 GW of total new power capacity added during the year, highlighting its dominant role in India’s power sector expansion.

Q4 2025

The fourth quarter (Q4) of 2025 capped the year with strong performance. India added 9.9 GW of solar capacity in Q4, up nearly 11% from Q3 2025 and about 21% higher than Q4 2024.

Large-scale solar installations reached 7.6 GW during the quarter, increasing 12% quarter-over-quarter.

Rajasthan, Gujarat, and Andhra Pradesh were the leading states for large-scale additions in Q4, contributing roughly 41%, 25%, and 10% of installations, respectively.

As of December 2025, India’s cumulative installed solar capacity stood at nearly 136 GW, with large-scale projects accounting for almost 85% and rooftop solar comprising about 15%.

Rajasthan, Gujarat, and Karnataka remained the top states for cumulative large-scale solar capacity, with shares of around 30%, 19%, and 12%, respectively.

Despite record installations, activity in new project development slowed during the year. In 2025, nearly 44 GW of large-scale solar tenders were announced, a 45% decline from 79.5 GW in 2024.

Project auctions also fell sharply to 20.9 GW, down 57% year-over-year from 48.1 GW.

Mercom’s Q4 & Annual 2025 India Solar Market Update is 141 pages long and covers all facets of India’s solar market. For the complete report, visit:https://www.mercomindia.com/product/q4-2025-india-solar-market-update