C&I renewable capacity seen rising to 57 GW by FY28

Chennai: India's commercial and industrial (C&I) renewable energy segment is set for rapid expansion, with installed capacity expected to rise to about 57 GW by FY2028 from nearly 40 GW projected by the end of FY26.The growth will be supported by competitive long-term power purchase agreement (PPA) tariffs compared with grid power prices, rising net-zero commitments by industries, renewable purchase obligation (RPO) compliance, and attractive returns for project developers, according to a report by CRISIL Ratings.
The C&I segment — the country's largest electricity-consuming category — has gained momentum following the implementation of the Green Energy Open Access (GEOA) Rules, 2022, allowing industrial and commercial consumers to directly procure renewable power through existing transmission networks."Following the GEOA rules, major industrial states have announced policies for open access to fast-track RE adoption and attract investments. States are offering rebates on cross-subsidy, wheeling and state transmission utility charges if power is sourced intra-state. Such incentives lower the landed cost of power compared with on-grid tariffs by 25–30%, driving capacity addition in this segment," said Gautam Shahi, Director, CRISIL Ratings.Capacity additions are largely being led by private equity-backed developers, attracted by higher returns compared with utility-scale projects and supported by financially strong corporate counterparties that ensure stable cash flows.A key bottleneck for capacity additions is the lack of transmission infrastructure to evacuate power owing to right-of-way issues. As most C&I capacities rely on intra-state networks, delays have a direct impact on project execution, while any rollback of open-access incentives by states — concerned about revenue loss for distribution utilities — could moderate investment momentum.The continued expansion of the C&I segment is expected to play a key role in supporting India's target of achieving 500 GW of non-fossil fuel capacity by 2030.