India Considers Low-Cost Loans for Renewable Projects Hit by Power Curbs

India is considering offering low-cost, long-term loans to renewable energy producers to compensate for losses caused by inadequate transmission infrastructure, four industry sources said. The power ministry is discussing loans with tenures of seven to eight years as renewable projects in states such as Rajasthan and Gujarat face restrictions on sending electricity to the national grid.

Renewable energy developers have lost around 45 billion rupees ($470 million) since February 2025 due to transmission constraints, with some projects unable to supply as much as 70%-80% of their generated power. Government data also shows that India curtailed 14%, or 8,133 gigawatt hours, of solar power between April and June 2026.

The proposed financing support is aimed at easing the impact of these curbs while the government verifies which projects qualify for compensation. Industry executives warn that frequent and uncompensated power restrictions could raise financing costs, as lenders may become less confident about future generation. ICRA estimates that about one-third of India’s newly commissioned 54.8 GW of clean energy capacity was relying on temporary transmission arrangements as of May 2026.

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