By Sakshi Bansal
Electricity consumption in Andhra Pradesh has witnessed robust growth, with a CAGR of 6.7 per cent between fiscal year (FY) 2014-15 and FY2023-24, reflecting the state’s increasing energy demands, according to the State Electricity Plan (FY 2020–FY 2024). To ensure that much of this is produced from renewable sources, the state has proactively promoted several renewable energy policies and floated tenders in this space. This growth trajectory has positioned Andhra Pradesh as a leader in renewable energy, ranking seventh among states with respect to renewable capacity (including large hydro). According to the Ministry of New and Renewable Energy, as of December 31, 2024, the state’s total installed renewable energy capacity reached 11,174.62 MW. This includes 4,730.27 MW of solar power, 4,096.65 MW of wind power, 574.39 MW of biopower, 163.31 MW of small hydropower and 1,610 MW of large hydropower.
The solar capacity is further segmented into 4,356.33 MW of ground-mounted solar, 285.6 MW of rooftop solar and 88.34 MW of off-grid/KUSUM components. The biopower capacity comprises 378.1 MW of biomass power/bagasse cogeneration, 113.57 MW of non-bagasse biomass cogeneration, 53.16 MW of waste-to-energy (WtE) and 29.56 MW of off-grid WtE components.
Renewable Watch tracks the key developments, recent policy announcements and future prospects of Andhra Pradesh’s renewable energy sector…
Key developments
Andhra Pradesh stands as one of the leading states in India in terms of renewable energy adoption, playing a pivotal role in advancing clean energy initiatives. The state has significantly contributed to the development of large-scale solar parks, green energy corridors for efficient power evacuation, and resource mobilisation to accelerate the renewable energy sector nationwide. Currently, Andhra Pradesh hosts five massive utility-scale solar plants with a combined capacity of 4,200 MW. The commissioned projects include the NP Kunta Ultra Mega Solar Park (1,400 MW) the Kurnool Ultra Mega Solar Park (1,000 MW), and the Ananthapuramu II Solar Park (500 MW). The Kadapa Ultra Mega Solar Park (1,000 MW) and the Solar Wind Hybrid Park at Ramagiri (300 MW) are yet to be commissioned. Additionally, an upcoming 2,700 MW of solar capacity is being developed in Prakasam and Sri Sathya Sai districts. Moreover, the state is home to the world’s largest integrated renewable energy storage project, boasting a total capacity of 5,230 MW, with 3,000 MW sourced from solar energy, 550 MW from wind and 10,800 MWh of daily storage from pumped storage projects (PSPs), further solidifying Andhra Pradesh’s leadership in renewable energy development.
The state’s dedication to rooftop solar initiatives is equally remarkable. It aims to implement the PM Surya Ghar: Muft Bijli Yojana across 3 million households (as of November 2024), providing subsidies of up to Rs 78,000 for the installation of 3 kW solar power systems, which have a total cost of up to Rs 145,000. To date, over 70,000 applications have been submitted and solar panels have been installed on 4,961 rooftops across the state. In the Kuppam constituency, a pilot project for complete solarisation is set to begin soon, with 50,312 households agreeing to transition to solar power. Additionally, Andhra Pradesh is accelerating solar panel installations in government office buildings, targeting a capacity of 150 MW by 2025-26, supported by NTPC Vidyut Vyapar Nigam Limited (NVVNL). This project, costing Rs 2.62 million, will span 2,186 offices and is projected to save the state Rs 3.79 million annually in electricity costs, with NVVNL ensuring the project’s completion. Furthermore, the state plans to designate 132 villages as solar villages, where every household will generate its own solar power, reinforcing Andhra Pradesh’s leadership in renewable energy expansion.
As part of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyaan (PM KUSUM) initiative, Andhra Pradesh also spearheaded the feeder-level solarisation of agricultural feeders, achieving a capacity of 3,725 MW, alongside the installation of over 31,275 off-grid solar pumps.
Other key initiatives in the state’s solar segment in the past year include Indosol Solar launching its solar photovoltaic module manufacturing plant in Ramayapatnam, Nellore district, and HPCL Renewables and Green Energy floating a tender for the engineering, procurement and construction of a 2 MW floating solar project in Visakhapatnam.
Beyond its solar advancements, Andhra Pradesh’s strategic position along the coastline, spanning 974 km, offers an ideal setting for wind power development due to its favourable wind patterns. The Andhra Pradesh Renewable Energy Export Policy, 2020 has spurred significant investment in wind energy projects, fostering private sector participation and offering incentives to boost production. Among the key developments, the Beluguppa Wind Park, with a capacity of 100.8 MW, stands out as a major onshore wind farm. The state, rapidly emerging as a renewable energy hub, hosts prominent wind farms in Kadapa, Anantapur and Kurnool districts, further diversifying its clean energy portfolio.
Further, the state is actively advancing large-scale PSPs to enhance its renewable energy capabilities. It has identified a total PSP potential of 43.89 GW, with 19.83 GW already allocated to developers. According to the Central Electricity Authority, as of November 30, 2024, an on-river PSP with a capacity of 1,350 MW is under construction and is expected to be commissioned by February 2029. Additionally, the 1,200 MW off-river Pinnapuram project is progressing and is slated for completion by 2025-26. Further reinforcing its commitment, the state is conducting surveys and investigations for 14 off-river projects totalling 15,850 MW. In a significant move to tap into the state’s PSP potential, Andhra Pradesh Power Generation Corporation Limited partnered with NHPC Limited through a joint venture (JV) agreement signed in September 2024. This collaboration aims to develop PSPs, focusing on two major projects already in the pipeline – the 1 GW Yaganti and the 800 MW Rajupalem PSPs.
The state is also making strides in the large-scale adoption of green hydrogen projects. It is strategically positioned to capitalise on this emerging opportunity. Under the Andhra Pradesh Green Hydrogen and Green Ammonia Policy, 2023, the state aims to achieve a green hydrogen production capacity of at least 500 kilotonnes per annum (ktpa) or a green ammonia production capacity of up to 2 million tonnes per annum (mtpa) within the next five years, leveraging its abundant renewable energy resources. This ambitious shift to green hydrogen requires substantial capital investments to develop the necessary infrastructure, including solar and wind power generation facilities, green hydrogen production plants, and the manufacturing of essential equipment such as electrolysers, solar panels and wind turbines. According to a white paper by the New and Renewable Energy Development Corporation of Andhra Pradesh (NREDCAP), the state will need an investment of $10 billion-$15 billion to meet its 500 ktpa green hydrogen production target by 2030. Achieving this demands the creation of 10-15 GW of renewable energy capacity dedicated to green hydrogen production and 4-5 GW of electrolyser capacity. The report highlights that approximately 70 per cent of the total investment will be directed towards developing renewable energy infrastructure, with the remaining funds allocated for expanding electrolyser capacity.
The state has taken a leap forward with significant developments in green hydrogen. In February 2024, NTPC Green Energy Limited (NGEL) and Andhra Pradesh Industrial Infrastructure Corporation Limited signed a land lease agreement to establish an integrated green hydrogen hub near Pudimadaka village in Visakhapatnam. Entailing an investment of around Rs 1,850 billion, the facility will produce 1,500 tonnes per day (tpd) of green hydrogen and 7,500 tpd of green hydrogen derivatives, including green methanol, green urea and sustainable aviation fuel, primarily targeting the export market. The foundation for this project has already been laid. Further bolstering the state’s green hydrogen ambitions, in June 2024, AM Green secured the CertifHy EU RFNBO pre-certification for its green ammonia project in Kakinada. By August 2024, AM Green Ammonia reached a final investment decision. The facility, set to convert into a green ammonia production unit, is scheduled to commence operations by 2026.
Another key activity in the renewable evacuation space is REC Power Development and Consultancy Limited issuing a tender in October 2024 to set up an interstate transmission system project aimed at evacuating 4.5 GW of renewable power from the Kurnool-IV renewable energy zone Phase I in Andhra Pradesh.
Going forward, both the private sector and the state government have ambitious capacity expansion plans. In November 2024, Serentica Renewables announced plans to develop 10,000 MW of renewable energy projects in Andhra Pradesh, combining solar, wind and storage technologies to deliver round-the-clock (RTC) green power. In the same month, NGEL and NREDCAP signed a JV agreement to develop renewable energy and green hydrogen projects in Andhra Pradesh. The partnership will focus on establishing 25 GW of renewable energy capacity, producing 0.5 million metric tonnes per annum (mmtpa) of green hydrogen and derivatives, and developing 10 GW of PSPs. Furthermore, in January 2025, the Andhra Pradesh government approved several renewable energy projects worth Rs 27.23 billion, including a 1 mtpa green ammonia manufacturing facility in Kakinada.
Policy announcements
The Andhra Pradesh government is focused on creating a green economy and a thriving ecosystem for integrated clean energy across the value chain. It aims to achieve this through a robust framework designed to attract investments, thereby contributing to India’s renewable energy growth and climate change action. To support and lead the country’s net zero goals, the state government has formulated the Andhra Pradesh Integrated Clean Energy Policy (ICEP), 2024 to attract clean energy investments. This policy aims to add over 160 GW of renewable energy capacity, with the potential to attract investments worth approximately Rs 10 trillion. The policy offers incentives such as easy land acquisition and power subsidies. The plan includes generating 78.5 GW of solar energy, 35 GW of wind energy and 22 GW of pumped storage, and setting up 25 GWh of battery storage. The policy also focuses on developing green hydrogen (1.5 mmtpa), ethanol (1,500 million litres per day), compressed biogas (1,000 tpd) and cleantech manufacturing (25-30 GW), and setting up electric vehicle (EV) charging infrastructure (5,000 public charging stations). The policy will come into effect from the date of issuance (that is, from October 30, 2024) and remain applicable for a period of five years, from the date of policy issuance or when a new policy is issued.
Apart from this, the state has been striving to accelerate its transition to EVs. Against this backdrop, in December 2024, the state launched the Andhra Pradesh Sustainable Electric Mobility Policy 4.0 (2024-29) to position itself as a global hub for EV manufacturing while promoting sustainable transport and aiming for carbon neutrality (Scope 1 emissions) by 2047. The policy sets ambitious goals, including registering at least 200,000 electric two-wheelers, 10,000 electric three-wheelers and 20,000 four-wheeler battery EVs, alongside expanding charging infrastructure, with one station every 30 km along green channels and one per 3×3 km grid in e-mobility cities.
Outlook
Andhra Pradesh offers a remarkable solar power potential of approximately 38.5 GW and wind power potential of 74.9 GW at 120 metres, increasing to 123.34 GW at 150 m. Additionally, with a PSP capacity potential of 43.89 GW across 39 sites, the state is perfectly suited for co-located wind, solar and PSP plants. This makes the state an ideal destination for developing green hydrogen hubs and hybrid projects, capable of delivering RTC power.
Recognising this immense potential, the state government has taken proactive steps to solidify its position as a renewable energy leader. The decision to set up renewable energy zones is aimed at promoting green power plants, while offering viability gap funding to support projects utilising ultra-modern technologies. Detailed guidelines for the ICEP have been issued to attract investment, and plans are under way to develop large-scale renewable energy manufacturing zones for solar, wind, battery and electrolyser production. Innovation and research are integral to the state’s renewable energy strategy. The state’s plan to establish a global university for clean energy and circular economy underscores its commitment to leading the way in renewable energy research and development. By fostering innovation and collaborating with global experts, Andhra Pradesh is positioning itself as a hub for cutting-edge renewable energy technologies.
Moreover, the state’s focus on workforce development, private sector engagement and streamlined regulations is expected to drive investment and job creation. Recently, the Suzlon Group signed an MoU with the Andhra Pradesh State Skill Development Corporation to launch a green skill development programme. This programme aims to address the skill gap in the renewable energy workforce and create better job opportunities. Over the next four years, the programme aims to offer training to 12,000 people, including at least 3,000 women, in specialised areas of wind power manufacturing.
Net, net, the state government’s proactive efforts to float renewable energy policies, coupled with the ambitious expansion plans of private sector players and focus on skill development, are expected to drive further progress in Andhra Pradesh’s renewable energy sector.
