Andhra Pradesh is aiming for a ₹10 lakh crore investment in the clean energy sector with the launch of a new policy designed to incentivize investments in solar, wind, and round-the-clock renewable energy projects, all with the goal of achieving net zero carbon emissions by 2047.
Chief Minister N. Chandrababu Naidu introduced the AP Integrated Clean Energy (ICE) Policy, which offers incentives such as streamlined land acquisition at reasonable prices and power subsidies for certain sectors.
According to the policy document, this initiative is projected to facilitate a total investment of ₹10 lakh crore and create direct and indirect employment opportunities for 750,000 workers. The policy aims to harness the state’s extensive renewable energy resources across wind, solar, and hybrid sources, along with storage capabilities from pumped storage projects, leveraging the state’s long coastline, six operational ports (with four more under development), and a skilled workforce to support the energy transition.
The Andhra Pradesh government is committed to fostering renewable energy generation through a supportive policy and investment framework that encourages competition and private sector participation while balancing the interests of all stakeholders. The policy will support the establishment of projects that harness abundant sunlight, wind energy, and pumped storage on water bodies.
Targets set by the state include 78.5 gigawatts of solar capacity, 35 GW of wind energy, 22 GW of pumped storage, and 1.5 million tonnes per annum of green hydrogen production capacity. Additionally, Andhra Pradesh aims to set up 25 GWh of battery energy storage, projects for producing ethanol and biogas from biomass, and 5,000 EV charging stations. The state also plans to develop 25-30 GW of cleantech manufacturing, generating jobs for the local workforce.
To enhance skill development, the government will establish the University for Green Energy and Circular Economy (UGC) in collaboration with the Government of India and private industries under a Public-Private Partnership (PPP) model. A Clean Energy Knowledge & Skill Development Center (CEKSDC) will also be created to act as a training hub and foster partnerships with academic institutions, think tanks, and industry.
Incentives in the policy include concessional land leases for all clean energy projects and renewable energy component manufacturing units. Stamp duty will be waived for mini-hydro and pumped storage projects, battery storage, biofuels, and manufacturing units, while capital subsidies will be provided for battery storage, green hydrogen, biofuels, and renewable energy manufacturing projects.
Electricity duties and other open access charges will also be waived. Additional incentives include a capital subsidy for electrolyzer and biofuel projects, reimbursement of net state GST for five years, waivers of electricity duty and intra-state transmission charges. Up to 25% capital subsidy is being offered for renewable energy manufacturing projects, along with net state GST reimbursement, off-take guarantees, and a power subsidy of ₹1 per unit for five to ten years.
The New and Renewable Energy Development Corporation of Andhra Pradesh (NREDCAP) will serve as the state nodal agency to facilitate access to land, assist with power evacuation and open access, help secure central government incentives, and provide necessary approvals and clearances.
The policy will remain in effect for five years. The ICE policy aligns with Andhra Pradesh’s ambitious goal of achieving net zero carbon emissions by 2047. With the renewed focus under this policy, the state is expected to attract significant investment over the next five years, vastly increasing its renewable energy capacity and solidifying its position as a leader in the energy transition.
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