India's Solar Developers Turn to Battery Storage as Grid Wastes 11% of Output
Transmission bottlenecks drove nearly two-thirds of India's renewable curtailment in Q1 2026, and 42 GW of solar projects are still searching for buyers.
Solar developers in India have started bundling battery storage with photovoltaic projects to attract offtakers and reduce curtailment losses, Santosh Sarangi, Secretary at India's Ministry of New and Renewable Energy, said at the BNEF Summit in New Delhi, with comments carried by Bloomberg on Friday (2026-08-21).5
The numbers behind the move are stark. Between April and June 2026, India's national grid discarded 8 billion kilowatt-hours of solar energy, or 11% of total solar output, while 63 billion kWh reached consumers, according to Shripad Yesso Naik, Minister of State for New and Renewable Energy. Record demand across the summer quarter absorbed none of the excess.5
Ember Energy data show that transmission constraints drove almost two-thirds of all renewable energy curtailment in Q1 2026, with the total reaching 300 GWh. The grid cannot absorb what the panels produce because the wires needed to move that power to load centres have not kept pace with installation.1
India's solar growth has been rapid by almost any measure. Solar generation rose 37% year on year to 57 billion units in Q1 of fiscal year 2026-27, pushing solar's share of the national power mix to a record 10.9%, according to the Centre for Research on Energy and Clean Air. The 10% share threshold had never been crossed before.3
Demand kept pace with generation, yet curtailment persisted. Peak electricity demand reached 271 GW on May 21, 2026, up 12% on the equivalent peak in Q1 FY2025-26, CREA data show. Across the 91-day quarter, daily peaks fell during solar generation hours on 61 days. The sun was shining, demand was rising, and system operators were still discarding output.3
Coal is central to why. India's thermal fleet cannot ramp below its technical minimum fast enough when solar floods the midday grid, forcing dispatchers to cut renewable output rather than thermal. In a June 2026 analysis, Ember said India needs around 10 GWh of battery storage immediately to stop curtailment during hours when coal cannot ramp down further.5
The project finance consequences are now visible. About 42 GW of solar projects are still searching for offtakers, with roughly 18 GW of solar-only projects (those without co-located storage) most exposed to continued curtailment risk, Sarangi told the summit. A further 15 GW of projects awarded at high auction prices also risk failing to find buyers.5
The scale of the system being curtailed is substantial. Solar generation in India surged nearly 138% over four years, rising from 73.48 billion units in FY2021-22, according to official Ministry of New and Renewable Energy data. The IEA, in its World Energy Investment report, placed India's total energy investment on course for a record $170 billion in 2026, with solar PV investment up 25% over the past five years and combined solar and wind shares crossing 50% of installed capacity.4,2
But grid expansion has not matched project completion — the same mismatch that Ember's curtailment data now quantifies at 300 GWh for early 2026. Asian-power.com reported in May 2026 that India's transmission network has consistently lagged the renewable build cycle at every stage of the pipeline.1
Coal is not stepping back. The IEA estimated India's coal investment will reach $13 billion in 2026 as the government moves to expand domestic mining capacity. A larger, less flexible coal fleet does not ease an oversupply problem at noon.2
The developer shift toward hybrid projects is a rational response, but it carries its own risks. Adding batteries increases capital costs for projects already struggling to clear the offtake market at existing auction prices. How fast storage economics tighten relative to curtailment exposure, and the pace at which India can expand transmission capacity, will shape how much of the 42 GW backlog secures buyers before project economics deteriorate further.5