India's power sector is poised for a Rs 4.5 trillion investment by 2032, driven by rising electricity demand and economic growth.
The focus will be on expanding generation, modernizing transmission, and enhancing energy storage to ensure reliable and sustainable power, supporting India's growth and transition to clean energy.
With India’s power demand rising sharply alongside economic growth and electrification, the electricity sector is poised to attract cumulative investments of about Rs 4.5 trillion (Rs 450,000 crore) by 2032, Union power minister Manohar Lal said on January 15, 2026.
India’s electricity consumption has been growing steadily over the past decade, driven by industrial expansion, urbanisation, rising household incomes and the rapid electrification of transport, cooking and agriculture. According to official estimates, peak power demand has already crossed 250 gigawatts and is expected to double by 2040, placing unprecedented pressure on existing infrastructure.
Speaking at the curtain-raiser event for the Bharat Electricity Summit 2026, where the government outlined its roadmap for expanding generation, transmission and energy storage capacity to meet future demand, Manohar Lal said the projected investment will be spread across new power generation capacity, modernisation of transmission networks and large-scale deployment of energy storage solutions, including pumped storage and battery systems.
“Electricity demand and GDP growth go hand in hand. To sustain India’s growth trajectory, we must ensure reliable, affordable and sustainable power for all,” he said.
Over the past decade, India has more than doubled its installed power generation capacity—from 249 GW in 2014 to over 510 GW by late 2025—making it the world’s third-largest producer and consumer of electricity. Total electricity generation has increased from about 1,020 billion units in 2014 to nearly 1,830 billion units in 2025, while per capita electricity consumption has risen by over 50 per cent during the same period.
A key pillar of India’s power sector expansion has been its rapid transition towards clean energy. Non-fossil fuel sources now account for over 50 per cent of the country’s installed capacity, enabling India to achieve its nationally determined contribution target nearly five years ahead of schedule.
Renewable energy capacity has more than tripled since 2014, led by exponential growth in solar power and steady additions in wind and large hydro.
However, officials acknowledge that scaling up renewables at this pace requires parallel investments in grid infrastructure and storage to ensure round-the-clock power supply. India already operates one of the world’s largest synchronous grids, with an inter-regional transfer capacity of about 120 GW and nearly five lakh circuit kilometres of transmission lines. Further expansion is underway to support the government’s target of 500 GW of non-fossil capacity by 2030.
Energy storage is emerging as a critical focus area. Pumped storage projects with an estimated potential of over 230 GW are being developed, while battery energy storage systems are gaining policy and financial backing.
The power ministry estimates that storage alone could attract tens of billions of dollars in investment over the next decade.
The minister also highlighted upcoming policy reforms aimed at attracting private and foreign capital, including amendments to electricity laws, incentives for domestic manufacturing of power equipment, and support for emerging technologies such as green hydrogen and advanced nuclear energy. India has set an ambitious target of 100 GW of nuclear power capacity by 2047 as part of its long-term decarbonisation strategy.
As India pushes towards becoming a $30-trillion economy by 2047, officials said the power sector will remain central to achieving energy security, climate goals and inclusive growth. The scale of investment required underscores both the challenge ahead and the opportunities for domestic and global players in shaping the country’s electricity future.