If you are sure the alternator is good, which is hard to verify if it is not charging, you have to go back to basics.

The alterator needs a small amount of positive voltage to excite the field which is what the red wire going into the alternator does. The wire and the spade connector are notorious for failing and most cars of your vitage have had the alternator wiring rerouted to avoid damage from heat and oil during oil changes.

The second most common culprit is the ground wire from the alternator to either the block or cross member. Because the alternator is rubber isolated through the accesory bushings, you have to have a ground wire. Normally these fail in a non visible way. Reach down and give it a healthy tug in both directions...most of the time it will pop right out of the engine-side ring connector if it has failed. Even worse, a non-Volvo Mechanic may not have hooked it back up.

The little red light not coming on when the alternator is not charging indicates a failed bulb is likely but it is unliekly that is your primary problem.

Onkel Udo