Balancing the electricity grid is one of the most complex tasks mankind has achieved, primarily because it relies on real-time balancing demand and supply (net of system losses). The old calculation started with demand and then built out enough capacity to meet said demand at all times, along with a predictable buffer. But with the rise of wind and solar, mainstays of India’s decarbonisation ambitions, even supply is highly variable.

If we start with the energy requirements (kilowatt-hours, or kWh), no one knows precisely how much output a one MW wind turbine or solar plant will give, let alone when it will do so. We only know solar mostly follows a bell curve of output, and wind is relatively seasonal. Even these depend on a range of variables we study, including location and the use of rooftop solar. We also have enormous uncertainty on the shape of the demand curve. While mid-day demand is rising, which is good for aligning with solar supply, we still have huge demand growth in the evening, and this will only worsen with more air conditioning loads.

Even under optimistic scenarios where all planned RE projects complete on time — a significant assumption given historical delays — our study reveals that by 2030, renewable growth is likely to fall short by almost 12% in terms of meeting incremental total annual energy.

The challenge becomes even more acute when considering the mismatch between supply and demand during specific times of the day or year, which we studied using actual historical data across several years. Even if we sized wind and solar to provide enough power annually, the majority of time periods would either have large deficits or surpluses.

An obvious solution to renewable variability and to bridge deficit periods with surplus is energy storage, like batteries or pumped hydro. However, storage systems face efficiency losses (10–25%) and seasonal mismatches. Even if we oversize to overcome such losses, an economic penalty, our study highlights a major unanswered question — how do we charge the batteries?

While RE surpluses are invariably in the middle of the day, as we quantify, they vary enormously by season. The day you need the battery the most, there is little RE surplus within that previous day. Relying on daily-use storage may need significant overbuilding of renewable capacity, which is expensive.

Addressing these challenges requires a range of policy and planning upgrades.

First, we have to focus on the overall portfolio, instead of a narrow silo approach. India’s renewable plans are heavily skewed toward solar, which appears cheaper on average, but solar is very coincident in output, to the point it will soon become surplus mid-day. Wind may appear more expensive on average than solar (basis its LCOE, or levelised cost of energy), but it provides output more times of the day (it’s unfortunately also more seasonal). A more balanced solar-to-wind mix could mitigate surpluses and deficits but scaling up wind power faces challenges such as land constraints and regional disparities. Additionally, the growing share of rooftop solar in the total solar capacity reduces the overall national solar output due to the inherently lower capacity utilisation factor of rooftop solar.

Portfolio planning must also factor in uncertainty, risk, resilience, and greater policy choices (like subsidies/free power, which skew producer and consumer incentives). All these need far more transparent assumptions and granular data, a limitation today.

Second, we have to focus on scale, not just capacity but also the right type. Doubling the pace of renewable installations is crucial, with an emphasis on high-quality projects that deliver better capacity utilisation. Moreover, grid planning must incorporate hourly and seasonal variability rather than relying solely on annual averages, especially as new demand sources like electric vehicles (EVs) and green hydrogen emerge. And while India urgently needs storage, these aren’t yet nearly cheap enough to “end coal”. Any storage needs clear plans for how it will charge — storage should complement renewables, not continue the dependence on fossil fuels.

Lastly, we have to signal prices and value correctly. Electricity pricing should reflect time-of-day costs, encouraging industries and consumers to shift demand to periods when renewables are plentiful. Demand response programmes, powered by smart grids and technology, can help dynamically align demand with RE supply. We don’t just want to save energy but save it at the right time. Importantly, this isn’t just a supply problem.

India’s energy transition stands at a critical juncture. The 2030 targets are still easier than future needs when the share of RE will be higher and there will be more pressure on avoiding coal. Failing to address these challenges risks increasing India’s dependence on coal, undermining decarbonisation goals. Even with planned hydro and nuclear additions, fossil fuels will fill the gap left by renewables. While this may be prudent economically and grid-security-wise, there is an obvious environmental trade-off. The good news is clean-tech costs continue to fall. We should be ready to innovate, adapt and accelerate.

Rahul Tongia is senior fellow and Rohit Vijay is research associate, at the Centre for Social and Economic Progress (CSEP), a New Delhi-based not-for-profit think tank. The views expressed are personal