Solar’s rising share offsets wind shortfall, hybrids set to gain momentum

More than 60 per cent of India’s wind power assets have underperformed against their P90 benchmark over the past five fiscal years, a Crisil Ratings analysis has shown. The shortfall, largely driven by lower-than-expected wind speeds linked to climate change and regional weather shifts, has weighed on project cash flows.

The P90 metric used by lenders to assess the probability of power generation being achieved 90 per cent of the time is a critical indicator of project viability. A one-percentage-point dip below P90 can shave off 3-5 per cent in debt-servicing cushion and 1-2 per cent in equity returns.
In fiscal 2025, just 20 per cent of wind projects met or exceeded the P90 level, the weakest showing in five years.

In contrast, 77 per cent of solar projects achieved their P90 benchmark, broadly in line with the last five years’ average. “As high as 45 per cent of wind assets lagged their P90 level by over 3 percentage points in fiscal 2025. Meanwhile, only 8 per cent of solar assets lagged by 1 percentage point,” said Crisil Ratings Director, Ankit Hakhu.
The rising share of solar now exceeds 65 per cent of India’s renewable mix, up from 50 per cent in fiscal 2020 has cushioned the sector’s overall performance. According to Crisil, the blended deviation of actual operating Ebitda against P90 Ebitda remained under 10 per cent.

Developers’ financial strength has also helped absorb volatility. “Leading players have maintained operating leverage of 5-5.5 times, with cash-flow cushions of 1.2-1.3 times and liquidity of one to two quarters,” said Ankush Tyagi, Associate Director, Crisil Ratings.

Looking ahead, hybrid projects combining wind, solar, and storage are expected to account for over 40 per cent of capacity additions in the next three years, ensuring grid stability and sustained investor interest.