New Delhi: India’s is running into an unexpected hurdle: the country is generating more solar power than its grid can handle, forcing operators to cut supply even as states sign new coal-based power deals.
Data from the Grid Controller of India showed that on 1 May, up to up to 27.34GW of solar capacity—equating to 121.46 GWh of power generation—was curtailed to ensure grid security, including curtailment under emergency TRAS Down mechanism, wherein gencos are directed by the Grid Controller of India to curtail generation.
The solar capacity that was curtailed that day equals almost one-sixth of the country’s installed capacity of 150GW. Experts said that low demand due to industries closing for Labour Day on 1 May may have contributed to the curtailment.
The oversupply also depressed spot market prices. Power prices on the Indian Energy Exchange hit zero on 1 May amid low demand and ease in temperatures. As recently as 31 May, power from up to 19.47GW of installed capacity was curtailed, and the energy that was not generated stood at 59.61 GWh.
Duttatreya Das, energy analyst for Asia at Ember, a global think tank focused on energy transition, said: “Instances of curtailment of 50 GWh or 100 GWh in a day are significant as during May-December 2025, a total of 2,300 GWh was curtailed.”
“In case there is a requirement to curtail generation for a longer time period, then thermal power stations can be shut accordingly. But in case of a sudden drop of demand, any planned step cannot be taken as the demand may shoot up the next day,” Das said.
According to a recent report by Ember, 470 GWh of renewable energy was curtailed across inter-state projects in the January-March quarter of 2026, of which around 300 GWh was attributable to transmission constraints, particularly across the Northern and Western regional grid pooling stations. The rest was due to frequency issues and the need to keep the grid stable.
The development comes at a time when discoms are selling renewable energy on electricity exchanges at lower than cost price. Also, several states including Uttar Pradesh, Bihar, Assam and West Bengal have signed costly coal-fuelled power purchase agreements (PPA) rather than cheaper green power.
A former executive with the Central Electricity Authority (CEA), requesting anonymity, said that curtailment is done for several reasons. “One of the key factors is the lack of transmission capacity, other reasons being lack of demand and the need to ensure a grid under the TRAS mechanism. In early May, there were instances of energy from around 25GW capacity being curtailed in a day,” this executive said.
The government has been trying to resolve the issue with the CEA and the national power grid operator Grid Controller of India Ltd (GRID-INDIA), holding meetings with states and transmission companies including state run Power Grid Corp. and some private firms.
A person aware of developments said: “Efforts are on to reduce curtailment. The Union power ministry recently reiterated the need to accelerate commissioning of transmission systems and some regulatory easing is also expected. Companies will take up measures to reduce oscillation.”
Another person said that by the end of 2025, curtailment may reduce by 7GW.
Queries mailed to the Union ministries of power and new and renewable energy remained unanswered till press time.
Investors worried
The issue has sounded warning bells among investors and developers who plan to set up India’s targeted 500GW non-fossil capacity by 2030.
Aditya Malpani, senior director and regional business development head (West) at AMPIN Energy Transition, said curtailments have become a major concern as they prevent consumers from fully replacing conventional power with renewable energy, affecting both sustainability targets and expected cost savings.
He added that developers are also struggling to meet the minimum monthly power supply required under Central Electricity Regulatory Commission rules to qualify for interstate transmission charge waivers under the GNA (General Network Access) framework.
Sanjeev Aggarwal, founder and chairman, Hexa Climate said that every unit curtailed is wasted capital. Debt serviceability gets stressed, returns fall short of projections, and the risk premium for the next project goes up. He added that if curtailment is not addressed, India’s cost of capital for renewable energy will not come down the way the transition requires.
“Developers bear curtailment risk with almost no recourse. When the grid is unavailable, the project suffers. There are provisions for compensation above 175 hours of grid unavailability, but below that threshold, the risk sits entirely with the developer. That asymmetry erodes investor confidence and raises the cost of capital further,” he said.
Gautam Mohanka, director at Gautam Solar, a solar module manufacturing company, suggested that integration of battery energy storage systems (BESS) with solar is key to avoid the issue of curtailment in cases where curtailment is done due to higher generation.
“India can absorb midday generation spikes by using BESS at strategic pooling stations. It will also alleviate transmission congestion and smoothly dispatch power when and where it is needed most,” he added.