August 18: India added a record 27 GW of solar capacity in the first half (1H) of the calendar year (CY) 2026, up 49% compared to 18 GW in 1H 2025, according to Mercom India Research’s newly released Q2 and 1H 2026 India Solar Market Update.
Solar accounted for 76% of the 36 GW of new power capacity added during 1H 2026.
Commissioning activity remained strong in 1H 2026, driven by rising clean energy demand and developers accelerating project completion ahead of key policy changes. Many developers moved projects forward before the June 1 implementation of ALMM List-II for solar cells and the scheduled reduction in the ISTS charge waiver from 75% to 50% in July 2026.
India added 12 GW of solar capacity in the second quarter (Q2) of 2026, making it the second-highest quarterly addition on record after 15 GW were installed in Q1 2026. However, installations declined 24% quarter-over-quarter (QoQ) and were up 1% compared to 11 GW in Q2 2025.
Gujarat, Rajasthan, and Maharashtra were the leading states for utility-scale solar installations during Q2 2026, accounting for 40%, 19%, and 17% of installations, respectively.
“India added record solar capacity in the first half of 2026, supported by strong demand and projects commissioning ahead of key policy changes. The concern now is whether this pace can continue. Utility-scale project commissioning is being slowed mainly by limited transmission availability and domestic cell shortages. Several projects are reaching completion but are unable to connect to the grid because evacuation infrastructure is not ready. ALMM List-II has added pressure on domestic cell supply, especially TOPCon, affecting timely procurement and project planning. India’s large project pipeline will not translate into commissioned capacity at current forecasted levels unless these major bottlenecks are addressed,” said Raj Prabhu, CEO of Mercom Capital Group.
Large-scale solar installations totaled 8 GW, down 37% QoQ compared to nearly 13 GW in Q1 2026 and down 23% year-over-year (YoY) compared to 10 GW in Q2 2025. Large-scale projects accounted for 68% of all solar installations during the quarter.
As of June 2026, India’s cumulative installed solar capacity reached 165 GW. Large-scale solar projects represented 83% of the installed capacity, while rooftop solar accounted for the remaining 17%. Solar photovoltaic (PV) comprised 30% to India’s total installed power capacity and 57% of installed renewable energy capacity.
Rajasthan, Gujarat, and Karnataka continued to lead the country in cumulative utility-scale solar capacity, accounting for 31%, 22%, and 11% of total installations, respectively.
The top 10 states accounted for 98% of large-scale solar capacity commissioned during Q2 2026.
In 1H 2026, 11 GW of large-scale solar tenders were announced, down 54% compared to 24 GW in the corresponding period of 2025. Large-scale solar auctions totaled over 5 GW during the first half of the year, a 59% decline compared to 13 GW in 1H 2025.
In Q2 2026, agencies issued over 5 GW of utility-scale solar tenders, down 6% QoQ and 22% YoY. Auctions totaled nearly 2 GW, a decline of 56% QoQ and 40% YoY, as the market prioritized executing previously awarded projects over issuing new tenders.
Future installations will increasingly depend on the timely execution of power purchase agreements (PPAs) and power sale agreements (PSAs), transmission readiness, land and grid connectivity approvals, equipment availability, and the commercial viability of projects awarded under earlier cost assumptions.
The report also provided installation trends by state, project pipeline analysis, tender and auction activity, and market forecasts to help developers, manufacturers, investors, and other industry participants assess emerging opportunities and execution risks.
Key Highlights from Mercom India Research’s Q2 and 1H 2026 India Solar Market Update:
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India installed 27 GW of solar capacity in 1H 2026, up 49% YoY
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Around 12 GW of solar capacity was installed in Q2 2026, the second-highest quarterly addition on record
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Solar accounted for 76% of the 36 GW of new power capacity added during 1H 2026
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India‘s cumulative installed solar capacity reached 165 GW, representing 30% of total installed power capacity
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The top 10 states accounted for 98% of large-scale solar installations in Q2 2026
Mercom’s Q2 and 1H 2026 India Solar Market Update report covers all facets of India‘s solar market. For the complete report, visit: https://www.mercomindia.com/product/q2-2026-india–solar–market-update