Renewables accounted for a record one-fifth of Indian power generation in July — even as thermal energy led with more than 65% of the 182.52 billion units generated. The outlier was hydropower generation which declined 10.75% year-on-year during the first quarter of FY27 as reservoirs hit their lowest levels since 2023 amid erratic weather conditions. Government data now highlights a strange contrast: surging green capacity is sharing space with persistent coal generation as the 500 GW renewable energy target for 2030 looms.

Coal has remained the backbone of energy supply in India — accounting for nearly 79% of the total energy supplied domestically in FY25. Production grew by 4.98% during the same year to reach 1047.52 million tonnes. Non-coking coal retained a dominant share at around 93.65% of the total production during FY25. The situation has not changed significantly in the ensuing months. CEA data for July 2026 shows thermal energy generated 119.36 billion units in July. 

According to government data cited by Reuters, coal-fired power generation surged to a near-three-year high in June amid increased cooling demand during an ​extended heatwave and below-average monsoon rainfall. The publication calculated daily data from Grid India to report that coal-fired power generation had risen about 14% year-on-year to ​120.20 billion kWh in June — the highest since November 2023. 

At the same time, data from the government’s Report of the Expert Committee on Energy Statistics contended in July that the “estimated potential for generation of energy from renewable resources reached 4,704 GW by the end of March 2025”. Solar led the list with a staggering growth from 748,990 MW in FY24 to 33,43,378 MW during FY25. Wind Power now stands at 11,63,856 MW while large hydro is at 1,33,410 MW. 

ALSO READ

Coal flexibility as the way forward?

India introduced a ‘flexible coal’ policy in January 2023 — mandating all relevant power plants to modify their equipment to run at a minimum technical load of 40% as per a phased plan. The Centre for Science and Environment also contended in a newly released report that coal flexibilisation can help India create an additional 18GW to 34 GW of renewable energy space and potentially  to reduce power sector emissions by up to 8.37%.

“Enhancing the flexibility of the existing coal fleet can play a role in balancing the system and enabling greater integration of renewable energy. We are not talking about renewable vs coal here. We are talking about renewable and coal, and about how to integrate the two. The task is not to replace coal, but to displace it,” CSE director general Sunita Narain argued during a recent event. 

ALSO READ

But the plan has reportedly been put on hold as India logged its fifth-driest June since 1901 amid strong El Nino conditions. Searing heat has led to a surge in power consumption and correspondingly, a growing demand for coal power. Renewable energy sources remain still somewhat curtailed by a lack of battery storage despite the overall increase in generation. Documents viewed by Reuters indicated recently that the plan had been “pushed back by a year” as regulators work out how to compensate for the higher costs of retrofitting entailed.

Hydropower falls amid El Niño

Hydroelectric power has historically served as a prime source of ‘flexible’ electricity for peak hours. But the renewable source remains restricted by severe weather dependencies — especially as India contends with warmer weather and erratic rainfall. 

Electricity requirements rose sharply this year amid El Nino conditions — with an all-India peak demand of 270.8 GW during solar hours (daytime) and 253.3 GW during non-solar hours in May 2026. The weather conditions have also impacted water levels at key reservoirs between April and July and curtailed hydropower generation.

“The impact of El Niño on Hydro reservoir levels is expected to reasonably reduce hydropower generation in India as compared to the previous year. Between April 1 and July 30, hydropower generation has been 10.75% less than that for the corresponding period in 2025,” Union Minister Shripad Naik told the Lok Sabha earlier this month.

He added in a written reply to the Parliament that flash floods in the Teesta river basin had also created a “major operational disruption” since October 2023. Data from the Central Electricity Authority suggested that large hydro projects generated 17.75 billion units (9.73%) in July, while small hydro added another 1.15 BU to the overall tally.

2030 clean energy target 

India had announced its first-ever net zero target during the COP26 Summit in Glasgow — pledging to become carbon neutral by 2070. New Delhi achieved a capacity of 283.46 GW from non-fossil fuel sources in April this year as it ranked third globally for Renewable Energy Installed Capacity. 

The reliance on coal as a flexible backup now appears likely to create a striking paradox for the 2030 clean energy targets outlined by Prime Minister Narendra Modi. Data suggests the country will likely meet the installed capacity goals with ease — while struggling to phase down actual coal power generation.