Despite the lowest coal prices in Asia in four years, India’s coal power generation in May dropped to its lowest level since the 2020 Covid lockdowns. This decline was driven by the absence of heatwaves, which typically increase electricity demand, alongside a significant rise in renewable energy generation. While coal still accounted for over 70% of India’s power output, its share fell to 70.7%, the lowest in three years, indicating a shift in the country’s energy mix.

Natural gas power generation also experienced a sharp decline, falling 46.5% in May, reflecting broader trends of reduced fossil fuel use in India’s electricity sector. In contrast, renewable energy surged to record levels, with output rising 17.2%, enabling renewables to capture a 15.4% share of total power generation—the highest on record. This growth is linked to substantial renewable capacity installations, particularly in solar power, as India accelerates its clean energy transition.

The reduction in coal power generation is partly due to milder weather conditions that lowered electricity demand, but the expansion of renewables also plays a crucial role. Despite this shift, India continues to invest in coal power, with new coal-fired capacity additions reaching 4 gigawatts in 2024, maintaining levels seen in recent years. The government plans to add up to 90 gigawatts of coal capacity by 2032 to meet increasing power needs with reliable baseload electricity.

Simultaneously, India is aggressively ramping up renewable energy installations. In the fiscal year ending March 2025, renewable capacity expanded by nearly 30 gigawatts, pushing total renewable capacity to over 220 gigawatts. The country has extensive renewable projects underway or tendered, aiming to reach 500 gigawatts of non-fossil fuel power capacity by 2030, signaling a strong commitment to a cleaner energy future.

Experts highlight India’s potential to become a global leader in clean energy if it continues investing adequately. Reports from the Rocky Mountain Institute and the Centre for Research on Energy and Clean Air underscore that India’s massive renewable pipeline and ongoing energy transition could significantly reduce emissions and set an example for other emerging economies. India’s power sector is thus at a pivotal point, balancing growth in renewable capacity with ongoing coal reliance.