Developers and Global Investors Snap Up India’s Solar Power Tenders: Decoding Tariffs vs. Returns for Solar Projects in India

In the last four years, solar installations in India have grown more than five-fold, from a mere 6 gigawatt (GW) of capacity in 2016 to almost 35 GW, achieving more than one-third of the country’s ambitious 2022 solar target of 100 GW. With another 23 GW of projects in the pipeline and 30 GW in the bidding phase, the sun is shining bright for India’s rising solar graph. These numbers, current as of March 31, are a testament to the response from solar developers and global capital providers who, despite some policy headwinds, are willing to invest in the sector despite some of the lowest real solar tariffs in the world. To earn reasonable returns from infrastructure projects such as these, it is crucial that the developers factor in the risks and rightfully estimate the costs of every component.