India’s Scheme for Solar Parks and Ultra Mega Solar Projects 2025

Policy Update
Bhavya

Introduction 

The “Development of Solar Parks and Ultra Mega Solar Power Projects” scheme was launched in December 2014 under the Ministry of New and Renewable Energy, with a timeline up to 31st March 2026. It aims to contribute to India’s target of achieving 500 GW of non-fossil fuel capacity by 2030 under the Paris Agreement. By facilitating plug-and-play infrastructure by providing land, transmission, and clearances. So far, 50 solar parks with a total capacity of 37,990 MW have been sanctioned across 12 States, supporting India’s renewable energy targets and clean energy transition.

Background 

India’s fast-growing population and economy necessitate access to clean, affordable, and reliable energy. Situated in a high solar insolation zone, India receives over 300 days of sunshine annually, making it ideal for solar power generation.

While solar projects can be set up almost anywhere, scattered installations raise per-MW costs due to increased transmission losses and the need for site-specific infrastructure like access roads, water, and substations. This duplication raises capital costs and project execution time.

Solar parks, by contrast, enable economies of scale by offering pre-approved, well-located land with shared infrastructure and streamlined regulatory approvals. This plug-and-play model reduces project risk and cost.

Pioneering projects such as Charanka Solar Park in Gujarat and Bhadla Solar Park in Rajasthan, launched under the Jawaharlal Nehru National Solar Mission (JNNSM), validated this approach. They attracted private developers by offering transmission access and government-backed land clearance.

Recognizing this success, MNRE scaled the model nationally, including Ultra Mega Solar Projects (UMSPs) of 500 MW or more, to drive down costs further and accelerate capacity addition.

Functioning 

Applicability: All the states and union territories are eligible to take advantage of the scheme.

Capacity: The Park to be taken up for development should have a minimum capacity of 500 MW and a maximum capacity of 1000 MW. Smaller parks of 100 MW and above may be considered in North East, Himachal Pradesh, Uttarakhand, and J&K, or Union Territories and small States with a population of less than 2 crores.  Parks with capacities higher than 1000 MW may also be considered under special circumstances.

Implementing Agency: The solar parks will be developed in collaboration with the state governments and the implementation agency, Solar Energy Corporation of India (SECI).

The SECI will handle funds on behalf of the Central Government.  Depending on the situation, the parks may be developed by a state nodal agency, a joint venture between SECI and the state, SECI alone, or any of these three with a private sector partner (wherein SECI and the state hold a minimum 51% equity stake).

Site Selection and Land Acquisition: The state governments are responsible for identifying and acquiring land. Preference is given to government-owned, waste, or non-agricultural land to minimize acquisition delays and costs. Parks typically require at least 5 acres per MW. Sites are selected based on good solar radiation, water availability, and proximity to existing grid infrastructure.

Facilities and Infrastructure: Each solar park is designed as a one-stop solution for developers. The implementing agency ensures:

• Pre-approved land with all clearances,
• Road connectivity within the park and access roads,
• Water supply for plant operations and construction,
• Internal drainage and flood mitigation,
• Construction power and telecom facilities,
• Pooling substation (400/220, 220/66 kV) for transmission,
• Housing, parking, warehouse, and security facilities.

These bundled services reduce time and costs for developers by minimizing the need for separate approvals and infrastructure arrangements.

Transmission and Grid Connectivity: Pooling stations are established within the park, and transmission lines are set up to connect the park with the state (STU) or central transmission utility (CTU) grid. If the state agrees to purchase a substantial share of the power, preference is given to STU for grid connectivity. Otherwise, CTU may take over, with potential funding from green corridor programs or multilateral agencies.

Financial Model:
The cost of developing infrastructure, land acquisition, and operation is estimated and recovered through:

• Sale/lease of plots,
• Registration and installment-based land payments by developers,
• Subsidies from MNRE,
• Loans from multilateral/bilateral agencies,
• Creation of a corpus fund for long-term maintenance.

MNRE Support: MNRE provides grants up to ₹25 lakhs for DPR preparation and ₹20 lakhs per MW or 30% of project cost (whichever is lower), disbursed in phases tied to project milestones such as land acquisition, financial closure, substation construction, and grid connectivity.

Ultra Mega Solar Projects: Parks may host Ultra Mega Solar Power Projects, each of 500 MW or more. These can be developed as stand-alone or integrated projects and may also include hybrid energy setups (e.g., wind or biomass) and solar manufacturing zones.

Power Purchase and Sale: Acceptance under the scheme does not guarantee a Power Purchase Agreement (PPA). Developers are free to sell power under any scheme or via third-party sales. States developing parks must commit to buying at least 20% of the power produced.

Policy Assessment

Effectiveness

• Out of 37,990 MW sanctioned, only 10,237 MW were developed (~27% completion).
• Completion bottlenecks exist due to land delays and transmission coordination.

Efficiency

• The shared infrastructure model offers lower per-MW costs.
• SECI’s implementation improves standardization, but project timelines vary across states.

Sustainability

• Lacks robust biodiversity safeguards in its current form (see Environmental Concerns below).
• Grid integration challenges persist without battery/storage systems.

Performance 

As per the PIB Report of July 2023, under this scheme, the Government has sanctioned 50 solar parks with an aggregate capacity of 37,990 MW in 12 states across the country. Against this sanction, 11 Solar Parks with an aggregate capacity of 8521 MW have been completed, and 7 Solar Parks with an aggregate capacity of 3985 MW have been partially completed. In these parks, solar projects with an aggregate capacity of 10,237 MW have been developed. State/UT-wise details of Solar Parks and projects installed inside various Solar Parks are given in the table below.

State/UT-Wise Details of Solar Parks and Projects Inside Solar Parks 

Source: PIB, 2023

Further, in August 2023, the Union Minister for New & Renewable Energy and Power, Shri R. K. Singh, informed the Rajya Sabha that the electricity generation capacity of solar projects installed in various Solar Parks has increased by 2,292 MW during the last three years and the current year. Around 69,000 hectares of land have been acquired for Solar Parks. 

Impact 

India ensures that it meets its global climate commitments goals under the Paris Agreement, which includes the pledge to achieve 500 gigawatts GW of renewable capacity by 2030 and reach net-zero carbon emissions by 2070 (IBEF, 2025). In February 2025, India will have surpassed 100 GW of installed solar power capacity. India’s solar power sector has witnessed an extraordinary 3450 % increase in capacity over the past decade, rising from 2.82 GW in 2014 to 100 GW in 2025. Solar energy remains the dominant contributor to India’s renewable energy growth, accounting for 47% of the total installed renewable energy capacity. In 2024, a record-breaking 24.5 GW of solar capacity was added, reflecting a more than two-fold increase in solar installations compared to 2023 (PIB, 2025).

India has also made significant strides in solar manufacturing. In 2014, the country had a limited solar module production capacity of just 2 GW. Over the past decade, this has surged to 60 GW in 2024, making significant progress in solar capacity addition, positioning itself among the top global renewable energy producers.

Moreover, India became the world’s third-largest producer of electricity from wind and solar energy in 2024, overtaking Germany, as per the 6th edition of global energy think tank Ember’s Global Electricity Review (The Hindu, 2025).  

However, the success can’t only be attributed to the scheme, as the Government of India has several other schemes functioning, such as the Rooftop Solar Scheme, Atal Jyoti Yojana (AJAY), National Solar Mission, SRISTI Scheme, and International Solar Alliance (ISA). 

Environmental Concerns

The habitat of the Great Indian Bustard has been encroached on by transmission lines of solar power projects that endanger the bird. These endangered species number fewer than 200 in Rajasthan. In response, the Supreme Court in April 2022 directed power companies to lay underground cables in solar parks in Rajasthan; however, only a few companies have complied with this directive. The Government had told the Supreme Court that laying underground cable would significantly increase the cost of solar power. In 2023, a Supreme Court-constituted committee issued guidelines for protecting the Great Indian Bustard, focusing on mitigating the impact of power lines on the species. These guidelines include measures like installing bird diverters on existing power lines and exploring the feasibility of undergrounding power lines, especially in critical habitats (The Hindu, 2023).

Way Forward 

1. Address Implementation Bottlenecks: To overcome delays, it is essential to establish a centralized single-window clearance system that simplifies and accelerates land acquisition and environmental approvals. Enhancing coordination among MNRE, SECI, state nodal agencies, and transmission utilities will streamline project execution. Additionally, implementing a real-time monitoring dashboard can help track progress and quickly identify issues at both the solar park and individual project levels.
   
2. Bridge Investment Gaps: Investment challenges, especially in early-stage infrastructure, can be mitigated by introducing viability gap funding and risk mitigation mechanisms that reduce financial risks for private investors. Leveraging blended finance models, including multilateral development banks, green bonds, and sovereign guarantees, will mobilize additional capital. Strengthening SECI’s role as an anchor investor will also provide the necessary financial support to kick-start projects.
   
3. Enhance Scalability and Adaptability: Scaling up solar parks requires promoting modular and decentralized models that can be tailored to smaller states or urban clusters with high energy demand. Integrating hybrid energy systems, combining solar with wind and storage solutions, will ensure a more stable and reliable power supply. Aligning state-level incentives and land-use policies with national renewable energy targets will accelerate land acquisition and policy compliance, enabling faster project development.
   
4. Ensure Environmental and Social Sustainability: Environmental safeguards should be prioritized by enforcing strict ecological siting norms and encouraging the use of degraded or wasteland to minimize habitat disruption. Community engagement is crucial for building public support, and projects should focus on local job creation to maximize social benefits. Furthermore, mandatory biodiversity impact assessments in sensitive areas before project approval will help balance development with conservation.
5. Upcoming Technologies: Grid-scale battery storage and agrivoltaics represent promising opportunities in the energy and agriculture sectors. Grid-scale battery storage helps manage fluctuating energy supply from renewable sources, ensuring grid stability. Agrivoltaics, the co-use of land for solar energy generation and agriculture, offers the potential for dual-purpose land utilization and improved crop conditions. 

References 

1. Ministry of New and Renewable Energy. (2025, May 16). Development of Solar Parks and Ultra Mega Solar Power Projects. Government of India. https://mnre.gov.in/en/development-of-solar-parks-and-ultra-mega-solar-power-projects/
2. Ministry of New and Renewable Energy. (2014, August 1). Draft scheme for development of solar parks and ultra mega solar power projects. Government of India. https://www.seci.co.in/web-data/docs/Draft-Scheme-Solar-Park-and-Ultra-Mega-Solar-Power-Projects-for-comments.pdf
3. Press Information Bureau. (2023, July 20). 11 solar parks with 8521 MW capacity completed and 7 solar parks partially completed under the scheme for ‘Development of Solar Parks and Ultra Mega Power Projects’: Union Power & NRE Minister Shri R. K. Singh. Government of India. https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=1941144
4. The Hindu. (2025, May 20). India overtakes Germany to become 3rd largest generator of wind, solar power: report. https://www.thehindu.com/news/national/india-overtakes-germany-to-become-3rd-largest-generator-of-wind-solar-power-report/article69425757.ece
5. India Brand Equity Foundation. (2025, January). India’s renewable energy boom: The power of solar and beyond. https://www.ibef.org/research/case-study/india-s-renewable-energy-boom-the-power-of-solar-and-beyond
6. Press Information Bureau. (2025, February 7). India achieves historic milestone of 100 GW solar power capacity. Ministry of New and Renewable Energy. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2100603
7. Koshy, J. (2023, February 4). Easing an albatross off the neck of the Great Indian Bustard. The Hindu. https://www.thehindu.com/sci-tech/energy-and-environment/sc-committee-directs-10-of-power-lines-in-rajasthan-gujarat-be-altered-to-protect-the-great-indian-bustard/article66470168.ece
8. The Hindu. (2024, May 27). SC forms expert panel to balance bustard conservation with sustainable energy goals. https://www.thehindu.com/news/national/sc-forms-expert-panel-to-balance-bustard-conservation-with-sustainable-energy-goals/article67977617.ece
9. Choudhari, A. (2025, February 18). The future of grid-scale energy storage: Driving clean and resilient power systems. Tata Consulting Engineers. https://www.tce.co.in/blogs/the-future-of-grid-scale-energy-storage-driving-clean-and-resilient-power-systems/Tata Consulting Engineers+3

About the Author 
Bhavya is a research intern at IMPRI Impact and Policy Research Institute, a third-year undergraduate pursuing a double major in Economics and Sociology at Christ University, Bangalore, Central Campus. 

Acknowledgment 
The author thanks Ms. Aasthaba Jadeja, internship coordinator, for her guidance and support.

Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.

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