With the green signal from the judicial preview committee, the state government is planning to issue tenders for 10,000 MW capacity solar power plants in a phased manner. These plants, which would be developed under the build-operate-transfer (BoT) model, would come up in different parts of the state in order to ensure free power supply to the agriculture sector for the next 30 years.
The scheme is expected to provide significant economic benefits as the cost of solar power is less than the average power purchase cost incurred by the state discoms.
The subsidy expenditure incurred by the state government has almost tripled from Rs 3,186 crore in 2015-16 to Rs 8,354 crore in 2020-21. The average cost of supply has been increasing at the rate of 5.01% (compound annual growth rate) over the past five years.
At the same time, the state government is sanctioning more than 50,000 new agricultural pump-set connections every year, resulting in increasing agricultural consumption over the coming years. The payments made to APGenco and APPDCL were increased from Rs 4,679 crore in 2014-15 to Rs 14,293.37 crore in 2019-20 by the state government.
CMD, AP Solar Power Corporation Limited and chairman of APGenco, G Sai Prasad, said that the agriculture consumption accounts for nearly 30 per cent of total power consumed in the state.