India’s renewable energy sector is entering a phase of tighter compliance, growing storage integration, and evolving market structures, according to the Q1 2026 Renewable Energy Policy Impact Report by Mercom India Research.

The one-of-a-kind report analyzes key renewable energy policies, regulations, draft frameworks, and orders issued against petitions during the first quarter (Q1) of 2026, and assesses their impact on utility-scale solar, open access, rooftop solar, energy storage, renewable manufacturing, and other related markets. The report also assesses the impact on developers, EPC companies, DISCOMs, commercial and industrial (C&I) consumers, manufacturers, investors, and other key stakeholders across India’s renewable energy sector.

The report found that renewable energy policy activity during Q1 2026 increasingly centered around battery storage deployment, renewable consumption compliance, open access restrictions, captive power verification, domestic manufacturing requirements, transmission readiness, and grid flexibility.

One of the strongest themes during the quarter was the growing policy push toward energy storage and firm renewable power. Maharashtra’s Renewable Energy and Energy Storage Policy and Rajasthan’s battery storage regulations strengthened visibility into demand for storage-linked renewable energy projects. The report notes that storage is increasingly being treated as core grid infrastructure rather than a balancing add-on.

The report also highlighted tightening regulations in open access and captive renewable procurement. Maharashtra revised banking and time-of-day rules, Telangana increased transmission and wheeling charges, and multiple states moved toward stricter renewable consumption compliance frameworks. These changes are expected to materially affect procurement economics for commercial and industrial consumers.

According to the report, the Draft National Electricity Policy 2026 was among the most significant policy developments of the quarter. The framework places storage, transmission planning, demand response, grid flexibility, and resource adequacy at the center of India’s next phase of renewable energy growth.

The report also found that policy and regulatory developments during the quarter focused heavily on renewable consumption obligations (RCO), firm and dispatchable renewable energy (FDRE), storage-linked procurement, forecasting, scheduling, and thermal flexibility.

India’s domestic solar manufacturing ecosystem also continued to expand during the quarter. However, the report warned that the gap between domestic module and cell manufacturing capacity remains a key near-term risk, especially with the implementation of ALMM List-II approaching.

The report further noted that rooftop solar policies are also becoming more grid-focused. States increasingly introduced measures related to phase balancing, hybrid inverter approvals, monthly settlement, and rooftop sizing restrictions as rooftop solar penetration continued to rise.

Mercom’s analysis found that transmission access and evacuation readiness are emerging as major project risks across utility-scale renewable energy markets. Developers are expected to face increasing pressure around scheduling discipline, congestion risks, forecasting obligations, and co-located storage integration.

Mercom’s Q1 2026 Renewable Energy Policy Impact report covers 103 regulations encompassing all facets of India’s renewable market.

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