Power Ministry’s answers to Rajya Sabha pinpoint India’s energy surplus and infrastructural bottlenecks — an analysis

India’s power sector has transformed over the past decade, shifting from chronic shortages to surplus capacity. Yet, an analysis of a set of answers provided by the Union Ministry of Power to Rajya Sabha during the recently concluded Budget Session reveals underlying structural inefficiencies, transmission constraints and the challenge of integrating renewable energy. 

The analysis highlights that as power demand rises, ensuring sustainable, reliable and affordable power remains a pressing issue. 

A complex equation

As of early 2025, India’s installed power capacity stands at 462,065 MW — an addition of 230,050 MW since 2014.

While this expansion has positioned India as self-sufficient on paper, ground realities reveal stark regional disparities. Weak transmission networks cause localised shortages which undermine the overall surplus.

In FY 2023-24, India’s total energy requirement was 16,26,132 MU, with 16,22,020 MU supplied, leaving a 0.3 per cent deficit. By December 2024, this narrowed to 0.1 per cent, but some states continue to struggle. 

Gujarat has met its energy demand every year since 2019-20, while Uttar Pradesh, Rajasthan, Jharkhand and Bihar face persistent deficits — Jharkhand’s peak at 7.5 per cent in 2021-22. These imbalances underscore the need for stronger transmission infrastructure to ensure equitable power distribution.

Capacity expansion

India is expanding its power mix, but execution delays remain a concern. Thermal power remains central, with 80,000 MW planned by 2031-32. 

Currently, 28,020 MW is under construction, and contracts for another 19,200 MW were awarded in FY 2024-25. However, coal-based generation faces fuel shortages and environmental scrutiny, raising concerns over long-term sustainability.

Hydropower, with 13,997.5 MW under construction and 24,225.5 MW in planning, faces cost overruns and ecological opposition. Meanwhile, nuclear power’s slow progress— 7,300 MW under construction against a 100 GW target by 2047 —raises doubts about its role in India's energy future.

Renewables, key to India’s energy transition, face hurdles in grid integration, storage, and policy consistency. Without robust frameworks and faster execution, these ambitious targets risk delays.

Transmission and distribution — an Achilles’ heel 

India’s transmission network remains a bottleneck, limiting the efficient flow of power. Plans include adding 1,91,474 circuit kilometres of transmission lines and 1274 GVA of transformation capacity by 2031-32. While Green Energy Corridors aim to streamline renewable evacuation, sluggish implementation threatens progress.

At the distribution level, high aggregate technical and commercial losses persist despite Rs. 3,03,758 crore-worth Revamped Distribution Sector Scheme which aims to cut losses to 12-15 per cent. 

To make things worse, political interference and financial distress of the distribution companies continue to hinder reforms.

Smart metering — covering 19.79 crore consumers, 52.53 lakh transformers, and 2.11 lakh feeders — is expected to curb inefficiencies. However, its success hinges on proper execution and consumer acceptance.

Renewables — policy incentives v/s structural hurdles

India’s renewable energy ambitions are among the most aggressive globally, but structural inefficiencies continue to hinder progress. While policies such as 100 per cent foreign direct investment in power generation, ISTS charge waivers and a 50 GW annual bidding trajectory aim to accelerate deployment, execution challenges persist. 

Regulatory inconsistencies, payment delays, and slow approvals deter investors, while states struggle to meet Renewable Purchase Obligations (RPOs).

Transmission infrastructure remains a critical bottleneck. Despite plans to integrate 500 GW of renewable capacity by 2030, delays in the Green Energy Corridor project lead to curtailment in high-generation states. Similarly, domestic solar manufacturing, supported by the Production Linked Incentive (PLI) scheme, still relies on imports for key components, exposing the sector to supply chain risks. Offshore wind, despite policy support, faces high costs and lacks a robust domestic ecosystem.

For India’s clean energy transition to succeed, infrastructure expansion must align with capacity growth, RPO enforcement must be strengthened, and domestic manufacturing must scale beyond module assembly. Without decisive action, policy ambitions risk falling short, leaving India’s renewable energy future uncertain.

Electrification and rural access

The Saubhagya Scheme electrified 2.86 crore households by March 2022 with Rs 6,330.32 crore in funding. Under RDSS, Rs 4,538 crore is allocated for grid electrification, targeting one million left-out households, including Particularly Vulnerable Tribal Group (PVTGs).

An additional Rs. 50 crore supports off-grid solar electrification for 10,000 households.

However, supply quality remains inconsistent. While Andhra Pradesh, Gujarat and Tamil Nadu provide over 23 hours of rural power, states like Nagaland, Jammu & Kashmir, Uttar Pradesh and Haryana struggle with sub-20-hour daily supply. Bridging these gaps is crucial for equitable energy access.

India’s power sector has made commendable progress, but structural inefficiencies remain. Achieving long-term energy security demands urgent action on transmission constraints, DISCOM finances, and renewable integration. With policy stability, regulatory reforms, and infrastructure investments, India can move closer to its vision of reliable, affordable power for all. However, without decisive action, the sector risks falling short of its ambitious goals.

Note: The abovementioned data and figures are presented by the Union Ministry of Power in its answers provided to the Rajya Sabha in its 267th session.