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Indian Solar Power costs Decline to 3 cents making them even more Competitive with Fossil Fuels

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The cost for solar power in India declined by another 10% this year and the current cost for producing solar power is just USD 50 cents/watt which continues the tradition of making the Indian solar system costs the lowest in the world. Not only the cost of large scale grid-connected solar systems but also that of rooftop solar systems have declined sharply over the last year. The key cost factors behind the decline in price were the fall in solar panel prices which have gone down to the USD 20 cents/watt while the other costs have also declined though not that sharply.

solar panels india

What is notable was the sharp decline in rooftop solar costs which does not require any transmission saving greatly on the T&D losses, due to moving large scale solar energy from big solar farms to the key consumption centers. The lower system costs are already reflecting in the solar tariffs with new all-time low costs of around USD 3 cents/unit being bid in the most recent solar auctions being conducted these days. The prices may increase a bit in the short term as India plans to impose duties on imports of solar panels to boost domestic production, however, the cost impact should not be large given that solar panels now form only 43% of the overall system cost which means that even a 10% increase in solar panel cost would only have a 4% total cost impact on the overall system.

Also, read Residential Solar Rooftop Installations in India pick up the pace

Solar power costs have continued to decline rapidly over the last decade and there is no reason to think that this trend is going to change anytime soon with improvements in technology and processes continuing to pressure solar energy prices.



Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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