Karnataka, Himachal Pradesh, and Kerala led India’s electricity transition in FY2025, but uneven grid readiness and policy gaps continue to slow a broader shift to clean power, according to the State Electricity Transition 2026 assessment.

The report, published by Ember and the Institute for Energy Economics and Financial Analysis (IEEFA), evaluated 21 states representing about 95 percent of India’s power demand between FY2018 and FY2025. It assessed 18 parameters across three dimensions: decarbonisation, readiness and performance of the power ecosystem, and market enablers. The findings show that while all states advanced in specific areas, none performed strongly across all three dimensions.

Leaders in Decarbonisation

Karnataka retained its position as the top decarbonisation performer. Renewables accounted for 37 percent of its power procurement mix, and the state maintained low emissions intensity in the power sector. Between FY2021 and FY2025, Karnataka recorded an average annual renewable capacity growth rate of 5 percent, reaching 24 gigawatts of installed capacity.

Himachal Pradesh recorded the highest renewable share at approximately 65 percent, largely driven by hydropower. It also posted the lowest emissions intensity among assessed states. However, only 22 percent of its renewable energy potential has been utilised, with average annual capacity growth of 4.4 percent over five years.

Kerala ranked among the top three, utilising 31 percent of its renewable potential as of March 2025 and recording average annual renewable growth of about 11 percent over five years. Renewables accounted for 21 percent of its procurement in FY2024.

Rajasthan posted the fastest renewable expansion, averaging 26 percent annual growth between FY2021 and FY2025. Despite this pace, only about 8 percent of its renewable potential had been tapped. Maharashtra added 9.6 GW of renewable capacity during the period, with 16 percent of procurement sourced from renewables. Tamil Nadu strengthened energy-efficiency measures but recorded a 17 percent renewable share in FY2024.

The report states that performance across decarbonisation parameters — including procurement, potential utilisation, emissions intensity, energy efficiency, public expenditure and capacity additions — remains uneven.

Grid Readiness and Distribution Performance

Renewable additions accelerated in several states, but grid readiness and distribution reforms show varied outcomes.

Delhi, Haryana and Assam emerged as high performers in ecosystem readiness. Delhi reported zero power shortages in FY2025 and met its entire electricity requirement. Distributed solar capacity reached 303 MW, accounting for 97 percent of its total solar capacity. However, despite 3,521 smart meters being sanctioned under the Revamped Distribution Sector Scheme (RDSS), installations had not commenced.

Haryana recorded a 0.04 percent energy shortage in FY2025, with distributed solar capacity of 1,798 MW. Its two distribution companies received A+ ratings in the 13th Annual Integrated Rating and Ranking of Power Distribution Utilities.

Assam reported a 0.07 percent shortage and installed 46 percent of the sanctioned smart meters. Punjab recorded zero shortages but had not installed any of its sanctioned 8.78 million smart meters as of March 2025. Gujarat demonstrated strong adequacy with a 0.001 percent shortage, but installed only 5 percent of the sanctioned smart meters. Karnataka had no sanctioned smart meters under the scheme.

Short-term electricity market participation remained limited in several states. Chhattisgarh sourced 1.35 percent of procurement through short-term markets in FY2024. Gujarat recorded 8 percent, while Uttar Pradesh stood at 9 percent.

Bihar led in smart meter deployment at 78 percent of sanctioned meters but reported a 0.4 percent shortage in FY2025. Kerala, despite a strong decarbonisation performance, recorded a 0.3 percent shortage and short-term participation at 18 percent of total procurement.

Policy and Market Enablers

The third dimension assessed regulatory and policy measures supporting renewable integration, storage and electric mobility.

Andhra Pradesh, Uttar Pradesh and Rajasthan performed strongly under this category. Andhra Pradesh led with an integrated clean energy policy and 1,440 MW of pumped hydro storage capacity. Uttar Pradesh advanced electric vehicle deployment, while Bihar and Assam implemented green tariff mechanisms and time-of-day tariffs.

States leading in renewable additions did not consistently perform strongly in market reforms. Punjab and Himachal Pradesh recorded limited progress in electric vehicle adoption and energy storage deployment. Maharashtra and Rajasthan faced constraints in the distribution company performance and distributed solar uptake.

Eastern states, including West Bengal, Telangana and Jharkhand, remain in earlier stages of transition. Renewable procurement shares in these states ranged between 7 and 14 percent in FY2024, with limited distributed solar adoption and structural challenges in distribution systems.

The report does not assess socio-economic or just transition factors such as employment dependence or fiscal reliance on fossil fuels. It focuses on electricity transition indicators that can be compared across states.

The findings indicate that increases in renewable capacity do not automatically translate into comprehensive transition outcomes. Coordinated national and state-level measures in grid modernisation, distribution reform and policy alignment are required as electricity demand continues to grow.