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Over 1,000 clean energy projects got Rs 1,443 crore, but R&D funding weak on manufacturing

Funding largely favoured solar and other power technologies, finds study

Puja Das

India spent about Rs 1,443 crore ($151 million) on 1,359 publicly funded clean energy research, development and demonstration (RD&D) projects between 2019 and 2024, but the funding remains concentrated in a few technologies and is yet to adequately build the production capabilities needed to support the country’s clean energy manufacturing ambitions, according to a new study.

The projects, spread across more than 90 institutions, cover renewables, other power and storage, hydrogen and fuel cells, transport and electric mobility, energy efficiency, and carbon capture, utilisation and storage (CCUS). The database is one of the first consolidated assessments of India’s publicly funded clean energy RD&D ecosystem.

The report by the Sustainable Futures Collaborative (SFC) and the Climate Policy Lab at The Fletcher School, Tufts University, found that renewables accounted for 421 projects and Rs 580 crore (61 million), followed by other power and storage with 333 projects and Rs 492 crore (52 million). Together, the two categories absorbed about three quarters of declared funding. Solar photovoltaics (PV) alone accounted for 234 projects and Rs 401 crore ($42 million), more than hydrogen, energy efficiency, transport and CCUS combined.

The findings come as green industrialisation takes centre stage ahead of the 31st Conference of the Parties (COP31) in Turkey next month. The report’s assessment is that India’s challenge is no longer simply how much it spends on clean energy RD&D, but whether that spending is building the technological capabilities needed for its energy, industrial and climate objectives.

The authors caution that the database is based on publicly available information and is therefore a large sample rather than a complete census of India’s clean energy RD&D. It does not capture the substantial body of private sector research and innovation, while some industry linked and demonstration activity may not be visible in public disclosures.

The concentration is sharper when funding rather than project numbers is considered. Budget information was available for about 85 per cent of the portfolio. The Department of Science and Technology was the largest funder, accounting for Rs 401 crore (42 million) across 705 projects, or 52 per cent of the portfolio by project count. The Ministry of New and Renewable Energy (37 million) across only 39 projects. The Council of Scientific and Industrial Research accounted for Rs 170 crore (18 million), while the Ministry of Electronics and Information Technology accounted for Rs 66 crore (8 million), largely concentrated in batteries, the report said.

The study found that the portfolio is strongest in early stage laboratory research, materials development and component level innovation, with comparatively less visible activity at the prototype, pilot scale and demonstration stages. This creates a gap between research and deployment, commonly referred to as the “valley of death”.

A key concern is the type of innovation being funded. The report said public RD&D is increasingly important as India’s ambitions move beyond installing clean energy capacity towards making technologies domestically, competitively and at scale. Achieving that requires knowledge of production processes, materials, systems integration and scale up.

The report argues that spreading limited resources across technologies without explicit choices on concentration and sequencing can produce breadth without sufficient depth. Funding systems designed for small investigator-led research grants are less suited to pilot manufacturing, process development and demonstration, which require larger budgets, longer time horizons and sustained collaboration among laboratories, firms and equipment suppliers.

This is particularly relevant given India’s continuing dependence on imported clean energy technologies and components. The report points to reliance on imported polysilicon, wafers and production equipment in solar, as well as limited domestic supplies of battery cell materials. It also cites research showing that a battery manufacturing programme designed to establish 50 gigawatt hours (GWh) of domestic cell capacity had commissioned only 1.4 GWh, or 2.8 per cent of its target, with zero incentives disbursed. Domestic dependence on imported battery cells remained close to 100 per cent.

“RD&D builds the knowledge base that makes industrial policy productive,” the report said, noting that public research can help domestic institutions accumulate expertise in design, process engineering, materials science and systems integration.

The study also found that project funding is relatively uniform despite differences in the type of research being undertaken. Many projects receive relatively small grants, while projects requiring pilot-scale development or manufacturing demonstration need substantially larger, longer-term support. The report said India’s RD&D system would benefit from a broader mix of funding instruments suited to different stages of innovation.

The report concluded that India needs to identify where deeper domestic technological capability is required, where adapting existing technologies is sufficient, and how research can connect more effectively with manufacturing, demonstration and deployment.