“Andhra Pradesh hosts two of India’s largest solar power plants, boasting a combined capacity of 4530 MW. Additionally, it boasts one of the country’s most significant floating solar projects! These achievements underscore the immense solar energy potential within the state. Furthermore, the state government is actively pursuing various policy initiatives to capitalize on this potential. In this blog, we delve into Andhra Pradesh’s solar portfolio, its policy landscape, and the opportunities it offers for solar businesses.”

“The Andhra Pradesh government doesn’t offer an independent subsidy. However, residential consumers installing grid-connected rooftop solar systems can access direct central financial assistance through the national portal for rooftop solar. The subsidy details are as follows:”

  • From 1kW to 2kW capacity: ₹30,000/ kW
  • For 3kW capacity: ₹30,000/ kW till 2kW and an additional ₹18,000.
  • For systems over 3kW capacity: ₹78,000 (fixed)

“In 2018, Andhra Pradesh unveiled its solar policy, aiming to achieve the following objectives:

  1. Pursue a minimum addition of 5,000 MW to the total solar power capacity within the next five years, addressing the state’s burgeoning energy demands sustainably.
  2. Establish solar parks equipped with necessary infrastructure to attract developers for solar power projects across the state.
  3. Foster dispersed generation to mitigate losses by eliminating upstream network costs.
  4. Introduce solar-powered agricultural pump sets to fulfill farmers’ daytime electricity requirements.
  5. Stimulate the growth of local manufacturing units to generate employment opportunities within the state.”

“Solar energy holds immense potential to emerge as a significant power source for Andhra Pradesh, particularly as its energy requirements continue to expand. Notably, agriculture accounts for approximately 24% of the state’s total energy consumption. Leveraging solar energy can play a pivotal role in alleviating this demand, particularly during daylight hours.

The state government is keen on harnessing this abundant solar potential to meet the escalating energy needs sustainably. Andhra Pradesh boasts several factors that make it an attractive destination for solar power projects:

  • It enjoys around 300 sunny days annually, with solar insolation exceeding 5 kWh/m2/day.
  • It is home to some of India’s top-performing electricity distribution companies, namely APEPDCL and APSPDCL.
  • The state boasts a reliable and efficient evacuation system, facilitating distributed generation.

To encourage the adoption of solar energy, the policy introduced various measures, including loans of up to ₹10 lakhs for rooftop solar installations. Additionally, initiatives such as 40% Accelerated Depreciation, a 10-year Tax holiday on solar projects, and loans of up to Rs.15 Crore for renewable energy projects aim to promote industrial-scale solar installations.”

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“Andhra Pradesh aims to increase its clean energy capacity to approximately 16,103 MW by the end of 2023 and 27,921 MW by 2029.

The primary economic sectors of Andhra Pradesh include agriculture, automobile and auto components, mining and minerals, textiles and apparel, IT, bulk drugs and pharmaceuticals, horticulture, and poultry farming.

Let’s examine the state through the lens of solar developers, dividing it into three segments for analysis.”

Energy consumption in this segment is lower compared to the other two segments. A solar solution of up to 30 kW is adequate for Residential & Agricultural consumers.

Energy consumption in this segment surpasses that of Residential & Agricultural consumers and can range up to 2 MW. Therefore, a 100 kW system typically suffices for this segment.

Energy consumption in these industries is substantial, necessitating solar solutions with capacities of 500 kW or higher.”

The state has developed a renewable energy capacity of 9.3 GW, with solar energy constituting 4.5 GW of this capacity. Additionally, state authorities assert that Andhra Pradesh possesses a solar potential exceeding 33 GW.

Andhra Pradesh hosts 5 extensive utility-scale solar installations, collectively boasting a capacity of 4160 MW. Notably, among these, the Kurnool Ultra Mega Solar Park (1000 MW) and NP Kunta Ultra Mega Solar Park (978.5 MW) rank among India’s largest solar power facilities.

Furthermore, Andhra Pradesh is undertaking the development of the world’s largest Integrated Renewable Energy Storage Project (IRESP). This initiative aims for a total capacity of 5230 MW, with 3000 MW sourced from solar energy.

In 2022, the AP government inaugurated a 3 MW floating solar project on the Meghadri Gedda Reservoir in Vishakhapatnam. Additionally, earlier this year, in January, the government announced intentions to procure 7000 MW of solar energy from SECI starting in 2024.

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