India's Solar Power Story: How Prices Fell from About ₹10 to ₹2.15 a Unit on the Road to 500 GW
A recent opinion piece described India's clean-energy growth as "an energy revolution in the making".
It noted that solar power, which cost close to ₹10 a unit (one unit = one kilowatt-hour) in the early years, now sells for as low as ₹2.15 a unit.
It linked this fall in price to a whole system built around India's goal of 500 GW (gigawatts) of installed power capacity from non-fossil sources by 2030.
As of 31 July 2026, India's non-fossil capacity stood at 300.50 GW, more than 54% of total installed capacity of about 552 GW. Solar alone was 164.59 GW.
In 2025-26, India added a record 55.29 GW of non-fossil capacity, including about 44.6 GW of solar.
Levelised Cost of Energy (LCOE) and Renewable Tariff Discovery
The levelised cost of energy, or LCOE, is the average cost of producing one unit of electricity from a power plant over its whole life. It adds up everything the plant will ever cost (building it, running it, repairing it, and the interest on its loans) and divides it by all the electricity the plant will ever produce. The answer is a single number, such as "₹2.50 per unit", which lets us compare very different power sources fairly. In India, the price at which a solar or wind developer agrees to sell power, found through an open auction, is called the "discovered tariff", and it closely follows the LCOE.
The fall in solar prices from about ₹10 to ₹2.15 a unit is the story of falling LCOE, discovered through Section 63 reverse auctions. Cheaper panels, solar parks, long PPAs and transmission waivers all pushed the cost down. This low price is what makes the 500 GW non-fossil target affordable for India's discoms and consumers.
India's Renewable Energy and Non-Fossil Fuel Capacity Targets
India has set clear goals to produce more of its electricity from clean sources like the sun, wind, water and nuclear power. The two biggest are 500 GW of non-fossil power capacity by 2030 and 60% of power capacity from non-fossil sources by 2035. "Non-fossil" includes renewable energy (solar, wind, hydro, bio-power) plus nuclear. The 2030 targets were announced at COP26 in Glasgow in 2021 as part of India's "Panchamrit" pledges.
The opinion piece links cheaper solar to the 500 GW goal. With about 300 GW reached by mid-2026, India must add roughly 200 GW more in about three and a half years. Low solar prices are the main reason this pace looks possible.
Solar PV Manufacturing Value Chain: Polysilicon, Ingots, Wafers, Cells, Modules
A solar panel is made in five main stages: polysilicon → ingot → wafer → cell → module. Each stage turns the product of the earlier stage into something more advanced. A country that controls more stages of this chain depends less on imports. India is strong in the last stage (modules), weaker in cells, and still building capacity in the early stages (polysilicon, ingots and wafers).
The opinion piece credits an "ecosystem" for cheaper solar. Building Indian factories across this value chain is part of that ecosystem: it reduces dependence on imports, but in the short term it can raise module costs, which then affects future tariffs.
- Solar tariffs: about ₹10 a unit in early years; as low as ₹2.15 a unit now (record low ₹1.99, GUVNL, December 2020)
- First JNNSM batch (December 2010) lowest solar bid: ₹10.95 per unit
- Target: 500 GW non-fossil capacity by 2030 (announced at COP26, 2021); 60% non-fossil capacity share by 2035
- Non-fossil capacity (31 July 2026): 300.50 GW, over 54% of about 552 GW total
- Solar capacity (31 July 2026): 164.59 GW
- 2025-26 additions: record 55.29 GW non-fossil, including about 44.6 GW solar
- Electricity Act, 2003: Section 63 governs tariff-based competitive bidding
- PLI for solar modules: ₹24,000 crore total outlay