After state discoms calculated that around 10 GW of capacity is needed to supply free power to farmers in Andhra Pradesh, the state government decided to replace average power purchase cost with free solar power supply from 10 GW capacity. Pictured is Jama Masjid in Kurnool district, one of the regions where part of this capacity is likely to be established. (Photo Credit: Kurnool District Administration)
- APGECL has been announced as the nodal agency to implement 10 GW solar power capacity for agricultural use in the state of Andhra Pradesh
- State government identified districts like Kurnool, Anantapur, Prakasam and Kadap as having enough government land to be leased for projects under the program
- Distributed solar will be encouraged in places were government land is not readily available
- Competitive tenders will determine winners of these projects with whom APGECL will sign PPAs for 30-year duration
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The State Government of Andhra Pradesh has appointed Andhra Pradesh Green Energy Corporation Ltd. (APGECL) as the nodal agency for the implementation of 10 GW solar power capacity. This capacity will be used to generate power to supply to farmers for 9 hours straight.
In new details from the state cabinet, as reported by local daily The New Indian Express, APGECL is expected to execute the project in a phased manner on government land in Kadapa, Prakasam, Anantapur and Kurnool districts. Distributed solar projects may be planned in West Godavari, Chittoor and Nellore where government land is in short supply but has agricultural consumption.
The state government will lease this land to developers who will be selected through a competitive process for which a tender approval committee will be set up.
Mercom India Research said the APGECL, under the Andhra Pradesh Power Generation Company Limited (APGENCO), will enter into power purchase agreements (PPA) with winning developers for 30 years based on a build-operate-transfer (BOT) model. The tariff will be divided flat for the first 15 years, and the remaining years will have prefixed O&M charges to be paid with an annual increase of 4%.
The decision to have 10 GW capacity was taken after state discoms provided info on what they need to supply to the agricultural segment; the government will replace the average power purchase cost (one of the criteria to determine agricultural subsidies) with free solar power supply to the farmers.
The state government said APGECL can also participate in venture gap funding based bidding up to 2.5 GW under the Central Public Sector Undertaking Program (CPSU) Phase-II.