Maharashtra's Solar Surge: Powering RE Growth with Solar Energy

The State of Maharashtra is one of the frontrunners of India when it comes to developmental activities- infrastructure, industry, and residential and commercial construction. The development has also brought with it the growing demand of energy, preferably renewable energy. Given a favourable geography of the state, solar energy is potentially the most reliable source of renewable energy that is needed to power the state’s overall growth.

Realising that, the state is building its solar energy system to feed its growing energy needs. In this blog, we explore Maharashtra’s solar progress, highlighting policies, challenges, aspirations, and goals driving the trend of energy business. 

Renewable on Charge

Maharashtra ranks fifth in India, behind Gujarat, Rajasthan, Tamil Nadu, and Karnataka, in terms of installed renewable energy capacity, according to the latest state economic survey report. The state's total installed renewable energy capacity has grown from 11,476 MW to 12,271 MW, with the share of renewable energy in Maharashtra's total installed capacity increasing from 23.8 percent to 32.1 percent over the past five years.

The state enjoys around 250-300 days of sunny weather annually, with an irradiation of 4 to 6 kWh/sq metre. By harnessing solar energy through photovoltaic systems, Maharashtra has the potential to generate 1.5 million units of electricity per MW each year. To tap into this vast potential, the government is implementing various measures to enhance the state's renewable energy capacity, with a particular focus on solar power.

Policy Measures: The Engine of Solar Power in Maharashtra

Maharashtra’s Integrated Non-Conventional Energy Generation Policy 2020 went into effect on December 31, 2020, and will last until March 31, 2025. The policy was launched with the aim to develop almost 13 GW of solar capacity in the state by 2025. Maharashtra Energy Development Agency (MEDA) was made responsible for the implementation of the program.

Switching Urban Power Source with Solar Energy

Maharashtra's policy aims to provide solar power connections to 10,000 homes annually, targeting both rural and urban areas to reduce power outages and promote clean energy.

The state government has also planned investments in several transmission-free projects. These include 2,000 solar water supply stations, microgrid projects for 20 homes, around 55,000 square feet of solar water/solar cooking systems, and 800 solar cold storage facilities.

To further incentivize renewable energy adoption in the commercial and industrial sectors, the government reduced the minimum sanctioned load limit from 1 MW to 100 kW in November 2023. The net metering cap for rooftop solar projects was also increased to 5 MW.

Maharashtra is also planning a major project that combines solar power with pumped storage hydroelectric systems to ensure a 24x7 supply of renewable energy to consumers. If implemented, this project could reduce power purchase costs and result in lower tariffs for consumers across the state.

Under the PM Surya Ghar Muft Bijli Yojana, MSEDCL is set to receive a subsidy of INR 150 crore from the central government, which will be distributed among power consumers. The state government is also targeting the generation of 12,000 MW of electricity through solar energy within the next 18 months,

Powering Rural Region on Priority

The state has implemented a wide range of initiatives to expand solar energy access to its rural areas. 

The government has planned to distribute 100,000 agricultural pumps annually to farmers over five years to support agricultural activities. Under the Mukhyamantri Saur Krushi Pump Yojana, farmers receive a substantial subsidy of 90 to 95 percent for setting up solar pump sets.

Recently, the Maharashtra cabinet approved a budget exceeding INR 100 billion for the Chief Minister's Solar Agriculture Feeder Program 2.0. This program is designed to ensure a 24-hour reliable electricity supply to agricultural pumps throughout the state. The initiative aims to increase the state's solar energy capacity to 16,000 MW by 2025, with 9,000 MW dedicated to solar projects and 7,000 MW to decentralised solar capacity. The state government, following the central model of financial assistance, will provide 30 percent financial support for solar power generation from 2024-25 to 2026-27, totaling INR 100.41 billion, including INR 62.79 billion for 2025-26 and INR 37.62 billion for 2026-27.

To encourage rural households to adopt solar power, the administration also plans to electrify 10,000 rural homes. On August 18, Maharashtra Chief Minister Eknath Shinde launched the Solar Village Scheme, aiming to achieve 100 percent solar-powered electricity in 100 villages across the state, with the Maharashtra State Electricity Distribution Company (MSEDCL) leading the initiative. MSEDCL has committed to providing up to 100 percent solar-powered electricity to two villages in each district, with Manyachiwadi in Satara district recently becoming the first village in Maharashtra to earn the title of the state’s first solar village.

Recently, Solar Agro Power (MSAPL), a subsidiary of MSEB Holding Company, has invited bids to procure 49 MW of solar power under Component C of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) program for feeder-level solarization.

With various schemes in place to promote solar across the state, the government also holds an objective to provide farmers with free electricity during peak agricultural activity times.

Progress So Far

Maharashtra has made significant progress in increasing solar capacity for rural and urban households, as well as in the industrial sector. According to the Ministry of New & Renewable Energy’s report on state-wise installed capacity, Maharashtra had over 7.15 GW of installed solar energy capacity as of 31 July 2024. This includes more than 4.25 GW of ground-mounted solar capacity, 525 MW of off-grid solar, and roughly 2.38 GW added under the PM-Surya Ghar Yojna. Solar power now accounts for more than 38 percent of the state’s total renewable energy capacity, including large hydro.

Maharashtra has also become the second-largest state in India for cumulative rooftop solar installations, following Gujarat. Recently, the state’s rooftop solar capacity surpassed 2,000 MW. The Mumbai Metropolitan Region alone contributes about 150 MW to this total. Across the state, MSEDCL has received over 140,000 applications for rooftop solar, including 100,000 from residential properties. So far, 26,000 rooftop solar installations have been completed, with over 70,000 applications approved.

Mumbai is particularly successful in adopting solar power. The Maharashtra State Power Generation Co. (MAHAGENCO) is working on a £70 million (INR 730 crore), 105-MW floating solar project with Satluj Jal Vidyut Nigam, expected to generate 230 million units in the first year and 5,420 million units over 25 years, plus 600 MW in additional solar power projects. Adani Electricity Mumbai Ltd (AMEL) supplied 38 percent of ‘green energy’ to Mumbai in 2023 and plans to increase this to 60 percent by 2027. Tata Power is also developing a 28.8 MW solar power project in the Satara district of Maharashtra.

Moreover, along with many other measures, Maharashtra has started the tender process for acquiring 366 MW of solar power as part of the Pradhan Mantri Kisan Urja Suraksha Evam Utthaan Mahabhiyan (PM-KUSUM) programme, focusing on feeder-level solarisation.

Energy Storage: A Crucial Component for Solar Growth

Battery energy storage systems (BESS) and other energy storage solutions are crucial for the development of renewable energy, and Maharashtra is making strides in this sector as well.

In January 2024, NTPC Green Energy Limited (NGEL), a wholly-owned subsidiary of NTPC, signed a memorandum of understanding (MoU) with the Government of Maharashtra. This agreement includes 2 GW of pumped storage projects and the development of renewable energy projects with or without storage up to 5 GW within the state. Additionally, the MoU covers the development of green hydrogen and its derivatives (green ammonia, green methanol) with a capacity of up to 1 million tonnes per annum.

Earlier this week, NHPC announced that it has renewed a memorandum of understanding (MoU) with the Department of Water Resources (WRD), Government of Maharashtra, to establish energy storage systems, specifically pumped storage projects (PSPs) across the state. This follows an earlier MoU with Maharashtra’s Department of Energy for developing renewable energy sources, including solar, wind, and hybrid systems, with a total capacity of 7,350 MW.

In March, the Maharashtra State Electricity Distribution Company (MSEDCL) issued a request for selection to procure 1,000 MW of energy storage capacity for 40 years from inter or intra-state connected pumped hydro storage projects on a demand basis.

In August, MSEDCL issued another request for selection to set up pilot projects for 300 MW/600 MWh standalone battery energy storage systems in Maharashtra.

Maharashtra is emerging as a major contributor in India's solar energy landscape, with its ambitious solar projects and supportive policies driving significant growth. From urban rooftops to rural farmlands, the state is harnessing its abundant solar potential to meet the rising energy demands of its population. Investment in innovative energy storage solutions and integrating solar with other renewable sources will not only ensure a reliable power supply but also pave the way for a sustainable energy future. The state's commitment to expanding its solar capacity and adopting clean energy technologies underscores its role as a frontrunner in the nation's green energy transition.