EnergyTariff – Andhra Pradesh Keeps Electricity Tariffs Unchanged for Next Three Years
EnergyTariff – Andhra Pradesh will continue providing stable electricity tariffs while strengthening its power sector through financial reforms and infrastructure improvements.
The Andhra Pradesh government has announced that electricity tariffs will remain unchanged for the next three years, continuing its policy of maintaining stable power charges for consumers. Energy Minister Gottipati Ravi Kumar said the decision reflects the government’s commitment to protecting households and businesses from additional financial pressure. He credited Chief Minister N. Chandrababu Naidu for prioritizing consumer welfare while introducing long-term reforms across the state’s energy sector.
Action Taken Report Highlights Sector Performance
The Minister released an Action Taken Report (ATR) on the energy sector white paper presented by the Chief Minister in 2024. According to him, the report is the first official review issued by the alliance government detailing the progress made after assuming office. It outlines the steps taken to improve financial stability, operational efficiency, and overall governance within the electricity sector.
Ravi Kumar said that unlike the previous administration, which approved multiple increases in electricity tariffs, the present government has chosen to maintain price stability. He stated that this approach is intended to provide certainty to consumers while strengthening the financial health of power utilities through better management practices.
Financial Review Points to Heavy Past Losses
The report presents a detailed assessment of the financial condition inherited by the current administration. It states that the power sector accumulated net losses of approximately Rs 1.29 lakh crore during the previous five-year period. According to the Minister, repeated tariff revisions placed an additional burden of Rs 32,166 crore on consumers, largely because electricity was purchased from the open market at significantly higher rates.
The ATR also notes that liabilities increased sharply over the same period, with outstanding debts of power utilities rising from Rs 72,826 crore to Rs 1,12,422 crore. Administrative shortcomings and delays in project execution reportedly contributed further financial losses estimated at Rs 47,741 crore.
Infrastructure Delays Added to Financial Burden
The report identifies delays in major power generation projects as one of the key reasons behind rising costs. It states that the expansion of the 800 MW unit at Vijayawada Thermal Power Station (VTPS) was delayed by 55 months, while the Krishnapatnam thermal power project experienced a delay of 44 months. Together, these setbacks reportedly resulted in losses exceeding Rs 13,000 crore.
It also mentions that changes in contract execution under the reverse tendering policy affected the progress of the Polavaram Hydroelectric Project, preventing its completion within the planned timeline and resulting in an estimated revenue loss of Rs 4,737 crore.
Consumer Support Measures and Operational Improvements
To reduce the impact of earlier financial liabilities on consumers, the government has absorbed Rs 4,497 crore in pending true-up charges. In addition, it has allocated Rs 15,790 crore towards electricity subsidies for the 2026-27 financial year. The Minister also announced a 13-paise per unit true-down rebate, describing it as a first-of-its-kind consumer benefit.
Operational performance has also improved over the past two years, according to the report. Average power procurement costs have been reduced from Rs 5.42 per unit to Rs 4.90 per unit, while transmission and distribution losses have declined from 12.05 percent to 9.99 percent through technical upgrades and improved network management.
Renewable Energy Push Strengthens Future Outlook
The Minister said better fuel management has enabled APGenco power plants to achieve a record peak generation of 6,160 MW on March 11 this year while maintaining a Plant Load Factor of more than 85 percent. He further stated that Andhra Pradesh has strengthened its position in the renewable energy sector through the Integrated Clean Energy Policy 2024, attracting investment commitments exceeding Rs 6 lakh crore over the last two years.