Archive · 12 Sep 2026
Andhra Pradesh Cuts Short-Term Power Costs Through Reforms
Andhra Pradesh says it has made buying electricity much cheaper.
Its average monthly cost for short-term power fell sharply between the two reported periods.
The average price per unit also went down.
The state used electricity markets and better planning to reduce costs further.
Officials say these savings have not led to higher consumer tariffs.
Many farming and lower-income households still receive free electricity under the state’s programs.
The state also plans to build much more solar, wind and battery storage capacity.
These projects are expected to bring investment and create jobs.
Andhra Pradesh’s average monthly short-term power purchase cost fell from Rs 641.5 crore in 2022–24 to Rs 194 crore in 2024–26.
The average purchase price declined from Rs 7.78 to Rs 5.15 per unit.
Market-based dispatch, day-ahead and real-time trading, and dispatch optimisation reduced costs from Rs 5.20 to Rs 4.97 per unit during April–July 2026.
The state continues free electricity for 20.78 lakh agricultural consumers and up to 200 units monthly for 22 lakh SC/ST and weaker-section families.
Andhra Pradesh plans major renewable expansion, including 78.5 GW of solar, 35 GW of wind, 22 GW of pumped storage and 25 GWh of battery storage by 2035.
- Who
- The Andhra Pradesh government, Energy Special Chief Secretary K Vijayanand and Chief Minister N Chandrababu Naidu were involved in presenting the reforms and targets.
- What
- The state reported a 70% reduction in average monthly short-term power procurement costs and outlined major renewable-energy and storage plans.
- When
- The comparison covers 2022–24 and 2024–26; further cost reductions were reported for April–July 2026, with storage targets set for January and August 2027.
- Where
- Andhra Pradesh, including its power transmission network and government buildings.
- Why
- The reforms aim to reduce electricity procurement costs, meet projected demand and expand renewable-energy capacity.
- Average monthly short-term cost
- Reduced from Rs 641.5 crore in 2022–24 to Rs 194 crore in 2024–26.
- Average purchase price
- Fell from Rs 7.78 to Rs 5.15 per unit.
- Additional dispatch savings
- The cost declined from Rs 5.20 to Rs 4.97 per unit during April–July 2026.
- Renewable investment target
- Rs 10 lakh crore, alongside a target of 7.5 lakh jobs.
- Green Energy Corridor-III
- A Rs 21,838-crore proposal to evacuate 18.4 GW through 7,872 ckm of transmission lines.
- Free electricity beneficiaries
- 20.78 lakh agricultural consumers and 22 lakh SC/ST and weaker-section families.
- Battery storage targets
- 225 MW/450 MWh by January 2027 and another 150 MW/300 MWh by August 2027.