Report on Solar Sector_Aug’24: Building the Solar System – Revolutions in the Funding Space

The solar energy sector is hotting up, and saw record capacity additions in FY24. This is just a trailer to what is going to happen, with drivers now going beyond just utility scale installations into the realm of C&I and rooftop solar. The primary constraint to achieving this comes from limited domestic capacities for upstream components, with India remaining dependent on geopolitically sensitive China. Recognising this, the government has incentivised upstream component manufacturing, while also making the usage of domestic panels cost-effective. Thus, the funding requirements to build a green grid go beyond just solar projects and into the ecosystem as well. The funding landscape is lush, with different players catering to different niches. Finally, the generous operational asset base will inspire InvITs to generate upfront cash, while M&A will help in settling a fragmented sector