Investments in Indian Solar Sector Fell by 30% QoQ in Q1 2021

Utility-scale projects attracted investments of $875 million


The investments in the Indian solar sector declined by 30% and stood at $1.04 billion (~₹76 billion) in the first quarter (Q1) of the calendar year (CY) 2021, compared to $1.49 billion (~₹109 billion) in Q4 2020. However, in a year-over-year (YoY) comparison, the investments increased by 7% compared to the $0.97 billion (~₹71 billion) invested in the sector during the same period last year. The data was revealed in Mercom India Research’s latest Q1 2021 India Solar Market Update.

The second wave of the Covid-19 pandemic is raging in the country and is impacting the overall investments in the sector.

Out of the total investments, utility-scale solar projects attracted investments of nearly $875 million (~₹64.05 billion), up by 48% compared to $591 million (~42.94 billion) in the last quarter. Rooftop projects saw investments of $159 million (~$11.66 billion) in Q1 2021, increasing by 11%, compared to $143 million (~₹10.39 billion) in Q4 2020.

Solar Investments-Updated

There were no investments announced in the solar manufacturing sector in the first quarter of 2021. However, with the approval of the production-linked incentive program, investments are expected to increase substantially in solar manufacturing. The tender under the program has been released, and the last date to submit the bids is June 30, 2021.

Deal Highlights

Some of the deals that grabbed the headlines in Q1 2021:

  • Solavio Labs, a start-up providing solar panel cleaning technology, received ₹4.06 million (~$0.05 million) in funding from the Canadian province New Brunswick through its New Brunswick Innovation Fund. With this investment, the company’s total funding stands at ₹20 million (~$0.26 million).
  • Solar monitoring and analytics platform Prescinto announced the closure of $3.5 million (~₹263 million) in seed round funding. The round was led by Venture Catalysts, with participation from Inflection Point Ventures, Mumbai Angels, and Lets Venture, amongst other prominent Angel Investors and Funds.
  • Adani Green Energy Limited (AGEL), the renewable energy arm of Adani Group, raised a $1.35 billion (~₹101 billion) debt package for its under-construction renewable asset portfolio in India. According to the agreement, 12 international banks, including Standard Chartered Bank, Intesa Sanpaolo, MUFG Bank, Sumitomo Mitsui Banking Corporation, Coöperatieve Rabobank, DBS Bank, Mizuho Bank, BNP Paribas, Barclays Bank, Deutsche Bank, Siemens Bank, and ING Bank, have committed their participation for the facility.
  • Total Eren and EDF Renewables announced that EDEN Renewables India, their equally-owned joint venture dedicated to large-scale Indian solar projects, secured financial closure for its 450 MW SECI III solar PV project with a group of three major international banks. The project, currently under construction in Rajasthan, was awarded to EDEN in a tender launched by SECI.
  • Philippines-based AC Energy and Infrastructure (AC Energy), the investment arm of Ayala Corporation, in association with UPC Solar Asia Pacific, achieved the financial closure of its 100 MW Sitara solar project in India. Located in Rajasthan, the project has an estimated cost of $67 million (~₹5 billion) and is expected to be operational by the first half of 2021.

Earlier, investments in the Indian solar sector had declined by 66% and stood at approximately $2.8 billion (~₹203.17 billion) in the CY 2020, compared to $8.2 billion (~$595.02 billion) in 2019.