India renewable energy sector faces supply chain and pricing pressures

India's renewable energy sector is facing supply chain challenges, including a mismatch between solar module and cell capacity. Module manufacturing utilization rates have dropped to between 35% and 40% as domestic cell production lags behind expanding module capacity.

Simultaneously, the Battery Energy Storage System (BESS) pipeline in India is threatened by rising costs. Chinese manufacturers, including Sungrow, have implemented price hikes of 5% to 15% for inverters and storage systems. These increases are driven by surging raw material costs, such as copper, aluminum, and lithium carbonate, as well as competition for semiconductors and components from AI data center demand.

In response to infrastructure needs, several Indian entities have initiated tenders. Coal India is seeking to develop 80 MW/320 MWh battery storage systems in Odisha, while NTPC Renewable Energy has invited bids for a 215 MW wind project in Madhya Pradesh. Additionally, the Central Transmission Utility of India has issued new procedures for increasing the energy storage capacity of existing BESS projects.