MNRE seeks sweeping powers under Electricity Act to govern India’s renewable energy sector

The Ministry of New and Renewable Energy (MNRE) has made a case before a parliamentary committee for a significant expansion of its administrative authority over India’s renewable energy sector, arguing that it should be recognised as the “Central Government” in all matters pertaining to renewables under the Electricity Act, 2003. 

The demand, part of a detailed reply furnished to the committee in February but made public this month, in response to “stakeholder requests” for a standalone Renewable Energy Act, effectively seeks to redraw the institutional boundaries between the MNRE and the Ministry of Power, which currently exercises primary authority over the Electricity Act’s provisions, including those governing grid-connected renewable energy.

As of January 31, 2026—the MNRE cited in a submission—India has installed 271.96 GW of capacity from non-fossil fuel sources, a little over half the country’s total installed generation capacity of 520.50 GW. Of this, 263.18 GW is from renewable energy: 140.60 GW from solar, 54.65 GW from wind, 51.16 GW from large hydro, 11.61 GW from bioenergy, and 5.16 GW from small hydro. Nuclear power accounts for the remaining 8.78 GW. The Ministry’s stated target is 500 GW of non-fossil capacity by 2030. However, the actual electricity generated from non-fossil sources is about 25%. The intermittent nature of renewable energy sources and insufficient battery storage means that only coal power can be relied upon to provide consistent electricity on demand.

While the Ministry conceded that a separate Act was unnecessary as electricity from renewable sources is already integrated into the grid and governed under the existing framework, it laid out a sweeping list of empowerments it believes are needed to bring “institutional clarity and effective administration” to the sector.

Among the most consequential of these: MNRE wants the power to design electricity markets for renewable energy, prepare and notify bidding guidelines for RE projects, frame tariff determination principles for the Central Electricity Regulatory Commission (CERC), and guide the CERC on matters related to renewables under Section 107 of the Act. It has also sought oversight of the planning and monitoring of Renewable Purchase Obligations,  the mechanism that compels distribution companies and large consumers to procure a minimum share of their electricity from clean sources. Several States are laggards in these aspects.

The Ministry has further asked that the Central Electricity Authority (CEA) coordinate with it while framing regulations related to renewable energy, and that the National Committee on Transmission work under MNRE’s guidance—a significant institutional claim, given that transmission planning has traditionally been the turf of the Power Ministry and CEA.

The submission also flags the need to bring energy storage and flexibility resources within the renewable energy framework, mandate RE experts on all regulatory bodies and technical institutions at both central and State levels, and impose statutory obligations on transmission and distribution system operators to expand grid infrastructure for renewables.

The committee also probed an administrative anomaly: while capacities from large hydropower projects are counted toward India’s renewable energy targets and achievements, the large hydro sector continues to be administered by the Ministry of Power. MNRE, when asked about this mismatch, argued that a unified administrative structure under its control for all renewable sources—including large hydro—would enable “integrated policy formulation, holistic renewable energy planning, sectoral synergy across all renewable energy technologies, and improved coordination in achieving national renewable energy and net-zero goals.”

Large hydropower was reclassified as a renewable energy source in 2019, a decision driven partly by the desire to inflate India’s RE capacity numbers. But the administrative follow-through—shifting governance to MNRE—never happened, creating a situation where targets and administration sit in different Ministries.

The MNRE also weighed in on concerns about decentralised and off-grid renewable energy. India’s share of decentralised RE stands at roughly 15%, compared to a global average of about 40%—a gap the committee flagged.

The MNRE acknowledged that no separate policy framework exists for off-grid and decentralised applications, which range from biogas plants and solar pumps to solar dryers and cold storages in rural areas. It noted that such a policy “would promote sustainable deployment in remote and rural areas, and provide regulatory clarity for decentralised renewable energy ecosystems in line with national clean energy objectives.”