New Delhi: India has begun curtailing solar power generation during periods of low electricity demand in an effort to stabilize its power grid and manage congestion in transmission lines, the Ministry of New and Renewable Energy (MNRE) said on Tuesday. The move comes as the country’s rapid renewable energy expansion outpaces infrastructure growth, leading to significant losses for solar developers.

Rajasthan, the state with the highest solar output, has seen the most severe cuts, with curtailments peaking at 48 percent during periods of maximum generation. Developers in the state and elsewhere have reported financial losses exceeding 26 million dollars since April. Tamil Nadu, Gujarat, and Maharashtra have also reported reductions, with Tamil Nadu’s solar generation falling 10 percent below forecasted levels in the quarter ending June.

Officials attribute the situation to transmission delays and weaker-than-expected demand growth. Several solar power plants came online earlier than anticipated, but key interstate and regional transmission projects have been delayed, creating grid congestion. Meanwhile, power demand across the country has remained largely flat compared to 2024, limiting the grid’s ability to absorb the surge in renewable generation.

The curtailments have also affected investment trends in the sector. Awards for new solar projects in the three months ending June dropped by 75 percent year-on-year, while tenders for upcoming projects fell by 65 percent. MNRE described the decline as a temporary adjustment rather than a long-term slowdown.

Solar capacity utilisation rates have dipped sharply, falling to 21.4 percent in May and 19.5 percent in June, driven by both low irradiance and grid constraints. The ministry expects utilisation to stabilize between 21 and 25 percent in the coming months.

Despite the challenges, India’s renewable sector has grown rapidly in 2025. The country added a record 22 gigawatts of new renewable capacity in the first half of the year, including 18.4 gigawatts of solar. For the first time, non-fossil fuel sources now account for 49 percent of installed power capacity, surpassing fossil fuels.

The government is seeking to address grid stability through energy storage expansion and transmission upgrades. Battery Energy Storage Systems (BESS) are expected to play a critical role, with targets set for 236 gigawatt-hours of storage capacity by 2032.

The solar curtailment crisis highlights the need for synchronized infrastructure development, smarter grid management, and accelerated investment in energy storage. While India has achieved historic milestones in renewable energy growth, the current situation underscores the importance of balancing capacity expansion with grid readiness to sustain momentum in its clean energy transition.