GOVERNMENT OF ANDHRA PRADESH

ABSTRACT

Energr Dept. - Andhra Pradesh Integrated Clean Enerry Policy, 2024 - Orders
=:"i:1========= ==== ===== = =::== =
ENERGY (POWER-II) DEPARTMENT

G.O.Ms.No.37 Dated.30.lO.2024

,rr@...
ORDER:
Government after careful examination of the matter hereby notify the
Andhra Pradesh Integrated Clean Enerry Policy, 2024 appended to these
orders.

2. This Policy shall be valid for a period of 5 years from the date of issue of
the Policy notification. The Policy may be amended and modified during
implementation and the Policy shall be applicable to the entire State. The
Incentives mentioned in the Policy will be extended to the
Investors/Developers as per the operational guidelines to be notified
separately.

3. These orders issue with the concurrence of Finance department vide

their U.O.No.Note#35, Finance Dept, (Computer.No.2574894l, dt:29-lo-2o24.
(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)

K.VIJAYANAND
SPECI,AL CHIEF SECRETARY TO GOVERNMENT

To
The Vice Chairman& Managing Director, NREDCAP, Tadepalli.
The Chairman & Managing Director, APTRANSCO, Vidyuth Soudha,
Vijayawada.
The Managing Director, Andhra Pradesh Power Generation Corporation
Limited, Vijayawada.
The Chairman & Managing Director, Andhra Pradesh Solar Power
Corporation Limited, Tadepalli, Guntur District.
The Chairman & Managing Director, APSPDCL, Tirupati.
The Chairman & Managing Director, APCPDCL, Vijayawada.
The Chairman & Managing Director, APEPDCL, Visakhapatnam.
The Special Chief Secretar5r to Govt., Revenue Department.
The Special Chief Secretary to Govt., Finance Department.
The Secretary to Govt., Industries & Commerce Department.
The Principal Secretary to Govt., Water Resources Department.

Page 1 of 74
 .,..2::

The Special Chief Secretary to Govt., EFS&T Department.

The Chief Commissioner of Land Administration & Special Chief Secretary,
A.P., APIIC Towers, Mangalagiri.
Copv to:
The PS to Secretary to Chief Minister.
The P.S., to Minister for Energr.
The P.S to Chief Secretary to Govt.
The Commissioner of Industries Department, Vijayawada.
The P.S., to the Special Chief Secretar5r to Government, Enerry Dept.
The Secretary, Ministry of New & Renewable Enerry (MNRE), GoI,
New Delhi.
The Secretary, Ministry of Power, Gol, New Delhi.
The G.A (Cabinet) Dept.,
SF/ SCs(Computer No. 2574894)

/ /FORWARDED: :BY ORDER/ /

K.t ta^; ,

SECTION OFFICER

Page2of 74
 ANNEXURE
(Annexure to G.O.Ms.No.37, Energy (Power-II) Department,
Dt.30/10/2024)

ANDHRA PRADESH INTEGRATED CLEAN

ENERGY POLICY, 2024

1
 Contents
1. Glossary _______________________________________________________________ 5
2. Definitions______________________________________________________________ 9
3. Introduction ___________________________________________________________ 15
3.1 AP Journey in RE Sector _______________________________________________________ 17

4. Objectives _____________________________________________________________ 18
5. General Framework of the Policy __________________________________________ 19
5.1 Operating Period and Policy Scope ______________________________________________ 19
5.2 Eligibility ___________________________________________________________________ 21
5.3 Land Facilitation, Power Evacuation and Allotment _________________________________ 23
5.4 Resource Allocation __________________________________________________________ 24
5.5 Grid Connectivity and Power Evacuation Facility ___________________________________ 25
5.6 Fees and Charges ____________________________________________________________ 26
5.7 Transmission & Distribution/Wheeling Charges ____________________________________ 27
5.8 Cross Subsidy Surcharge & Additional Surcharge ___________________________________ 27
5.9 Electricity Duty ______________________________________________________________ 27
5.10 Open Access Facilities ______________________________________________________ 28
5.11 Energy Banking, Settlement & Balancing _______________________________________ 28
5.12 Disbursement of Capital Subsidy on Fixed Capital Investment (FCI) __________________ 29
5.13 Non-Agricultural Status _____________________________________________________ 30
5.14 Statutory Clearances _______________________________________________________ 30
5.15 Renewable Energy Certificate (REC) ___________________________________________ 30
5.16 Single Window Clearance ___________________________________________________ 30
5.17 Must run Status ___________________________________________________________ 30

6. Solar Power____________________________________________________________ 30
6.1 Solar Power Projects _________________________________________________________ 31
6.2 Incentives from State Government ______________________________________________ 33

7. Wind Power ___________________________________________________________ 36

7.1 Wind Power Projects _________________________________________________________ 36
7.2 Incentives from State Government ______________________________________________ 36

2
8. Wind-Solar Hybrid Power _________________________________________________ 38
8.1 Wind-Solar Hybrid Power Projects ______________________________________________ 38
8.2 Incentives from State Government ______________________________________________ 39

9. Renewable Economic Zones (REZs) _________________________________________ 39

10. Green Hydrogen and its derivatives ________________________________________ 40
10.1 Incentives from the State Government _________________________________________ 40

11. Biofuels _______________________________________________________________ 44

11.1 Incentives from the State Government _________________________________________ 45

12. Energy Storage _________________________________________________________ 46

12.1 Pumped Storage Power (PSP) Projects _________________________________________ 47
12.2 Battery Energy Storage Systems ______________________________________________ 50

13. Mini and Small Hydro ____________________________________________________ 53

13.1 Incentives from State Government ____________________________________________ 54

14. Electric Mobility – EV Charging Infrastructure ________________________________ 54

14.1 Incentives from State Government ____________________________________________ 54

15. Renewable Energy Manufacturing Zone (REMZ) ______________________________ 56

16. Promotion of New and Innovative RE (NIRE) Technologies ______________________ 57
17. General terms pertaining to the policy. ______________________________________ 57
17.1 Project/SPV Transfer/Name Change ___________________________________________ 57
17.2 Waste disposal ____________________________________________________________ 57
17.3 Project Timelines __________________________________________________________ 58
17.4 University for Green Energy & Circular Economy (UGC) ____________________________ 61
17.5 Clean Energy Knowledge & Skill Development Center (CEKSDC) _____________________ 61
17.6 State Nodal Agency ________________________________________________________ 62
17.7 Policy Implementation ______________________________________________________ 63
17.8 Project Monitoring Committee (PMC) __________________________________________ 63
17.9 Project Management Unit ___________________________________________________ 64
17.10 Speed of Doing Business ____________________________________________________ 64
17.11 Summary of Fees and Charges ________________________________________________ 66
17.12 Timelines of Clean Energy Projects ____________________________________________ 69

3
17.13 Timelines of RE Manufacturing Projects ________________________________________ 71
17.14 Regulation________________________________________________________________ 72
17.15 Mid Term Review __________________________________________________________ 72
17.16 Power to remove difficulties _________________________________________________ 72

4
1. Glossary
Abbreviation Expansion

1G First Generation
2G Second Generation
3G Third Generation
AIF Agriculture Infrastructure Fund

AP IDP Andhra Pradesh Industrial Development Policy

APDISCOMs Andhra Pradesh Power Distribution Companies

APERC Andhra Pradesh Electricity Regulatory Commission

APTRANSCO Transmission Corporation of Andhra Pradesh Limited

BESPA Battery Energy Storage Purchase Agreement

BESS Battery Energy Storage System

BG Bank Guarantee
CBG Compressed Biogas
CEA Central Electricity Authority
CEKSDC Clean Energy Knowledge & Skill Development Center

CFA Central Financial Assistance

CII Confederation of Indian Industry

CLAP Clean Andhra Pradesh

CNG Compressed Natural Gas
COD Commercial Operation Date

CPO Charge Point Operator

CPSU Central Public Sector Undertaking

CSS Cross Subsidy Surcharge

CTU Central Transmission Utility

DC Direct Current

DER Distributed Energy Resources (DER)

DISCOM Distribution Company

DPR Detailed Project Report
DT Distribution Transformer
EA Electricity Act

5
 Abbreviation Expansion

EBP Ethanol Blended Petrol

EHT Extra High Tension
EPR Extended Producer Responsibility

ESS Energy Storage System

ESY Ethanol Supply Year

EV Electric Vehicle

EVCI Electric Vehicle Charging Infrastructure

EVSE Electric Vehicle Supply Equipment

FAPCCI Federation of Andhra Pradesh Chambers of Commerce and Industry

FCI Fixed Capital Investment

FDRE Firm and Dispatchable RE power

FPOs Farmer Producer Organizations

GEOA Green Energy Open Access

GEDC Green Energy Development Charges

GH&D Green Hydrogen and its Derivatives

GHG Greenhouse gas

GoAP Government of Andhra Pradesh or State Government

GoI Government of India

GW Giga Watt

HT High Tension

ICE Integrated Clean Energy Policy

IDC Interest During Construction

ISTS Inter-State Transmission System
KLPD Kilo Litre Per Day

KTPA Kilo Tonne Per Annum

LoA Letter of Award

LT Low Tension

MD Managing Director

MLD Million Litre per Day

MNRE Ministry of New and Renewable Energy, Government of India

MoEFCC Ministry of Environment, Forest, and Climate Change

6
 Abbreviation Expansion

MoP Ministry of Power

MTPA Million Tonne Per Annum

MW Mega Watt

MYT Multi-Year Tariff

NA Non-Agricultural

NFC Near Field Communication

NISE National Institute of Solar Energy

NIRE New and Innovative Renewable Energy (RE) Technologies

NIWE National Institute of Wind Energy

NOC No Objection Certificate

NREDCAP New & Renewable Energy Development Corporation of Andhra Pradesh Ltd.

OA Open Access
OMCs Oil Manufacturing Companies
PCS Public Charging Station
PMU Project Management Unit
PoC Point of Contact
PPA Power Purchase Agreement
PSA Power Supply Agreement
PSP Pumped Storage Power
PSU Public Sector Utility

R&C Restriction and Control

RE Renewable Energy

REC Renewable Energy Certificate

REZ Renewable Energy Zone(s)

REMZ Renewable Energy Manufacturing Zone

RFID Radio Frequency Identification

RPPO/RPO Renewable Power Purchase Obligation/Renewable Purchase Obligation

RTC Round The Clock

SAF Sustainable Aviation Fuel

SATAT Sustainable Alternative Towards Affordable Transportation

SC Scheduled Caste

7
 Abbreviation Expansion

SECI Solar Energy Corporation of India

SGST State Goods and Services Tax

SHGs Self Help Groups

SIPB State Investment Promotion Board

SIPC State Investment Promotion Committee

SLDC State Load Despatch Center

SNA State Nodal Agency

SPSU State Public Sector Undertaking

SRTPVS Solar Rooftop Photovoltaic System

ST Scheduled Tribes

STU State Transmission Utility

ToD Time of Day

TPD Tonnes Per Day

UNFCC United Nations Framework Convention on Climate Change

VC Vice Chairman

VLE Village-level Entrepreneurs

VNM Virtual Net Metering

WEG Wind Energy Generators

ZLD Zero Liquid Discharge

8
2. Definitions
The terms used in this Policy, unless as defined below or repugnant to the context, shall have the same
meaning as assigned to them in the Electricity Act, 2003 and the rules or regulations framed there under,
including those issued/framed by the Appropriate Commission (as defined hereunder), as amended, or
re-enacted from time to time.

Advanced Bio-fuels:

1. Produced from lignocelluloses feedstock‟s (i.e., agricultural and forestry residues, e.g., rice & wheat
straw/corn cobs & Stover/ bagasse, woody biomass), non-food energy crops (i.e., grass, algae),
animal dung or industrial waste and residue streams, or any combination of above feedstock.

2. Having low CO2 emission or high GHG reduction and do not compete with food crops for land use.
Fuels such as Second Generation (2G) Ethanol, non-edible tree borne oils, short gestation non-edible
oil rich crops; green diesel from renewable sources and Industrial waste, bio fuels produced from
synthesis (syn) gas, drop-in fuels from renewable sources and industrial waste, algae based 3G bio
fuels, halophytes-based bio-fuels, bio-CNG, bio-methanol derived from black liquor and paper pulp,
Di Methyl Ether (DME) derived from bio-methanol, bio-hydrogen, drop-in-fuels from MSW
resource/feedstock material.

Aggregator(s) or Distributed Energy Resources (DER) Aggregators is an entity registered/ appointed

with/by the distribution licensee to provide aggregation of one or more services like demand response
services under the demand response mechanism, Distributed Generation, Energy Storage, etc., within a
control area. The aggregators shall support the DISCOM in implementation of Distributed Generation like
Solar Rooftop projects for residential & subsidized aggregation of consumers, empanelling vendors,
construction of systems, disbursement of subsidies of GoI, etc.

Aggregator Fee is a fee collected from the Discom for the activities that were undertaken by Aggregator.

Ancillary Service or “AS” in relation to power system operation, means the service necessary to
support the grid operation in maintaining power quality, reliability and security of the grid and includes
Primary Reserve Ancillary Service, Secondary Reserve Ancillary Service, Tertiary Reserve Ancillary
Service, active power support for load following, reactive power support, black start, and such other
services as defined in the Indian Grid Code/ AP Grid Code.

Banking means a facility through which the unutilized portion of energy (underutilization by the consumer
or excess generation over and above the schedule by the generator) from any of the Green Energy
Sources during a billing month is kept in a separate account and such energy accrued shall be treated in
accordance with the conditions laid down in the Andhra Pradesh Electricity Regulatory Commission
(Green Energy Open Access, Charges, and Banking) Regulation, 2024(Regulation No 3 of 2024) as
amended from time to time.

9
Battery Energy Storage Systems or “BESS” shall mean the system(s)/projects utilizing methods and
technologies such as electrochemical batteries (Lead Acid, Li-ion, solid state batteries, flow batteries,
etc.), providing a facility that can store chemical energy and deliver the stored energy in the form of
electricity, including but not limited to ancillary facilities (grid support, for example). Such systems may be
co-located with RE Generating Stations or may be operated/ connected on standalone basis at Grid
substation or Distribution substation.

Billing Cycle means the period for which the regular electricity bills are prepared for different categories
of consumers by the Distribution licensee as specified by the Commission.

Bio-CNG means purified form of Biogas whose composition & energy potential is similar to that of fossil
based natural gas and is produced from press mud, agricultural residues, animal dung, food waste, MSW,
Sewage water, and industrial waste.

Bioethanol means ethanol produced from biomass such as sugar containing materials, like sugar cane,
sugar beet, sweet sorghum etc.; starch containing materials such as corn, cassava, rotten potatoes, agri
food/pulp industry waste, algae etc.; and cellulosic materials such as bagasse, wood waste, agricultural
and forestry residues or other renewable resources like industrial waste, vegetable wastes, industrial
waste off gases or any combination of above feedstock.

Biofuels means fuels produced from renewable resources and used in place of or blended with diesel,
petrol, Natural Gas or other fossil fuels for transport (including Sustainable Aviation Fuel), stationary,
portable, and other applications.

Captive generating plant means a power plant as defined u/s 2 (8) and shall comply with qualifications
prescribed under Rule 3 of the Electricity Rules notified by Central Government u/s 3 of Act as amended
from time to time.

Commercial Operation Date (COD)refers to the actual time/ period, a project is completed after
achieving all the defined milestones and begins commercial operations.

Charge Point Operator (CPO) means any individual/entity operating the EV Charging Station.

Charge Point Developer (CPD) means any individual/entity who can undertake Supply, Installation,
Commissioning, Operation & Maintenance of electric vehicle charging stations.

Clean Energy Project(s) means and includes projects which generate electricity using renewable and
sustainable sources, aiming to minimize environmental impact and reduce dependence on fossil fuels as
approved by the Ministry of New & Renewable Energy, Government of India. These projects include solar,
wind, solar-wind hybrid, BESS, PSP, mini and small hydro, Green Hydrogen and its derivatives, Bio-fuels,
and EVCI.

Dedicated feeder (line) means any electric supply-line for point-to-point transmission which are required
for the purpose of connecting electric plants of a captive generating plant, cogeneration plant or

10
renewable energy source power plant such as solar, wind, small hydro, bio-mass, and municipal solid
waste to AP TRANSCO/DISCOM substations.

Desalination Plant is a facility that converts saline water into fresh water to be used in the production of
Green Hydrogen& its derivates or for any use in industrial processes.

Drop-in fuels mean any liquid fuel produced from Biomass, Agri-residues, wastes such as Municipal
Solid Wastes (MSW), Plastic wastes, Industrial wastes, etc., which meets the Indian standards for MS,
HSD and Jet fuel, in pure or blended form, for its subsequent utilization in vehicles without any
modifications in the engine systems and can utilize existing petroleum distribution system.

Electric Vehicle means a vehicle that can be powered by an electric motor that draws electricity from a
battery and is capable of being charged from an external source. This may include electric two-wheeler,
three-wheeler, quadricycle, four-wheeler, bus, trucks, etc.

Electric Vehicle Charging Infrastructure (EVCI) is a network of charging stations catering to diverse
charging requirement and includes components such as EVSE, connection to DISCOM‟s supply system,
Power Management System for energy optimization, energy distribution, grid stability and renewables
integration, Communication network to assist data exchange in real time and remotely manage EV
charging stations, cables, connectors, RFID tags, software applications, circuit breakers, solar panels (if
connected), civil work, smart meter, transformer, etc.

Electric Vehicle Supply Equipment (EVSE) means equipment in Electric Vehicle Charging
Infrastructure (EVCI) that supplies electrical energy for recharging the battery of electric vehicles.

Electric Vehicle Charging Station: Premises having any one or more EVSEs or combination thereof,
supporting upstream infrastructure and amenities as specified in subsequent sections of these guidelines.

Electrolyzer: a system or device that uses electricity to split water molecules into hydrogen and oxygen,
thereby producing hydrogen with zero emissions.
st st
Financial year means a period commencing on 1 April of a calendar year and ending on 31 March of
the subsequent calendar year.

Fixed Capital Investment (FCI) for the computation of capital subsidy shall exclude any expenditure
pertaining to land, Interest during Construction (IDC), financing costs, taxes and duties. FCI includes, but
not limited to, the following

 Building: Expenditure on construction of factory buildings, administrative buildings, and other

structures.
 Plant and Machinery: Cost of new plant and machinery including utilities (water and power
supply infrastructure, waste management systems and any other associated infrastructure
including ZLD), including installation and commissioning.
 Technology and Project management: Expenditure on technology acquisition and any
engineering services including project management.

11
Firm and Dispatchable RE Power: The term „firm and dispatchable power‟ denotes, the power profile
configuration that is defined in the RfS that is sought to be met by RE power sources and will include
configurations like assured peak power, Round the Clock RE with firm delivery of power at rated capacity
at any hour of the day as per demand or load following power delivery as specified by DISCOM, Clean
Energy Project with firm delivery of power for fixed hours of requirement by DISCOMs, etc.

Force Majeure means any event or circumstance which is beyond the reasonable direct or indirect
control and without the fault or negligence of the Clean Energy Producer or Developer and which results
in Clean Energy Producer‟s/Developer‟s inability, notwithstanding its reasonable best efforts, to perform
its obligations in whole or in part and may include rebellion, mutiny, civil unrest, riot, strike, fire, explosion,
flood, cyclone, lightning, earthquake, act of foreign enemy, war or other forces, theft, burglary, ionizing
radiation or contamination, Government action, inaction or restrictions, accidents or an act of God or other
similar causes;

Fuel Cell: A fuel cell is an electrochemical cell that converts the chemical energy of a fuel and an
oxidizing agent (often oxygen) into electricity through a pair of redox reactions.

Green Hydrogen and its derivatives shall be Green Hydrogen, Green Ammonia, and Green Methanol
or any fuel derived from Green Hydrogen, which are produced by the process of electrolysis using
renewable energy and by conversion of Biomass using pyrolysis of biogas or other biomass products.
Renewable energy also includes such electricity generated from renewable sources which is stored in an
energy storage system or banked with the grid in accordance with applicable regulations.

Gross Metering means a mechanism whereby the total energy exported from the Grid Interactive Solar
Rooftop Photovoltaic System and the total energy consumed by the prosumer from the DISCOM is
measured separately through appropriate metering arrangements and for the billing purpose, the energy
consumed by the prosumer is accounted for at the applicable retail tariff as per the Tariff Order and total
energy exported to the DISCOM is accounted for at feed-in-tariff as fixed by the Commission.

Infrastructure Sector means such sectors notified by Department of Economic Affairs in its Gazette
th
Notification no. 13/1/2017-INF dated 14 November 2017 and as amended from time to time.

Interconnection Pointmeans the interface of the Clean Energy Project with the network of distribution
licensee/Transco.

Net Zero means cutting greenhouse gas emissions to as close to zero as possible, with any remaining
emissions re-absorbed from the atmosphere by oceans and forests, for instance.

Open Access means the non-discriminatory provision for the use of transmission lines or distribution
systems or associated facilities with such lines or systems by any licensee or consumer or a person
engaged in generation in accordance with the Regulations issued by the Andhra Pradesh Electricity
Regulatory Commission.

12
Power Evacuation means a facility that allows generated power to be immediately transmitted from a
generating plant to the grid for further transmission/distribution to load centers.

Project Developer/ Developer is a company responsible for managing the development of Clean Energy
Project(s) or RE Manufacturing Project(s)or Solar Park or REZ or REMZ from inception to completion and
also manages the operations of such projects

Prosumers means a person who consumes electricity from the grid and injects electricity into the grid of
a distribution licensee.

Public Charging Station (PCS) shall mean EV charging station where any electric vehicle can get its
battery recharged.

Renewable resources are the biodegradable fraction of products, wastes and residues from agriculture,
forestry, tree-based oil other non-edible oils and related industries as well as the biodegradable fraction of
industrial and municipal wastes.

Renewable Source of Energy means sources of energy such as small hydro, wind, solar, biomass,
biofuel, cogeneration (including bagasse-based cogeneration), municipal solid waste, RE Hybrid, hydro,
storage (if the storage uses renewable energy) and such other sources/mechanism as recognized and
approved by the GoI or State Government.

RE Manufacturing Project(s)refers to industrial undertakings that design, produce, and assemble

components, systems, or equipment related to renewable energy technologies, such as: Solar
photovoltaic (PV) panels and modules, Wind turbines and components, Hydroelectric power equipment,
Geothermal energy systems, Biomass and bioenergy technologies and Energy storage systems. This
policy covers Solar photovoltaic (PV) panels and modules, Wind Turbines, battery and electrolyzers
manufacturing only.

Resident Welfare Association (RWA) means an association comprising of all the property
owners/residents within a Co-operative Group Housing Society, Multi Storied Building, Residential Colony,
or a similar body registered with the State Government.

Scheduled COD refers to the prescribed timeline for achieving the Commercial Operation Date (COD) of
a project (Clean Energy Projects/ RE Manufacturing Projects) without any of the extension period
permissible under the policy.

State Nodal Agency (SNA) means New & Renewable Energy Development Corporation of Andhra
Pradesh Ltd(NREDCAP) designated as SNA.

State Transmission Utility means the Board, or the Government company specified as such by the
State Government under sub-section (1) of section 39 of the Act.

Solar Rooftop Photovoltaic Power Plant or Solar Rooftop Photovoltaic System (SRTPVS)means the
Grid Interactive Solar Photovoltaic Power Plant that uses the sunlight for direct conversion into electricity
through photovoltaic technology, which is owned and operated by a prosumer(s) with his/her/their own

13
investment/third-party investment installed at his/her/their rooftops or walls or open land/space within their
premises or any open land outside the premises of the consumer(s) in case of group and virtual net
metering.

Virtual Net Metering means a mechanism whereby total energy exported from the Grid Interactive Solar
Photovoltaic system of a group of prosumers/society is exported to the grid through a gross meter. The
exported such energy is adjusted in the electricity service connection(s) of the same group or society of
consumers/prosumers in proportion to the share in their Grid Interactive Solar Photovoltaic system in
units (kWh/kVAh) to arrive at the net imported or exported energy by an individual consumer/prosumer in
the Group/Society from/to the Distribution licensee during the applicable billing period/cycle located within
the State (irrespective of the Discom/ERO). The net energy imported by the consumer/prosumers is billed
by the distribution licensee on the basis of the applicable retail tariff as per the tariff order. The net energy
exported by the prosumers is paid by the Distribution Licensee at the Feed-in-Tariff as fixed by the
Commission.

Provided that in case consumer/prosumer(s) is/are in the ambit of the Time of Day (ToD) tariff, the share
of exported energy of such prosumer(s) under virtual net metering shall be netted off against his/their
electricity consumption during off-peak hours.

Provided also that the applicable T&D losses and charges as per this Policy/MYT orders of the
Commission applicable for relevant periods from injection point to drawl point shall be deducted while
adjusting the generation against the consumption.

Wind-Solar Hybrid Project means a hybrid project if the rated power capacity of one resource is at least
25% of the rated power capacity of other resource. Further, each 1 (one) MW of contracted Wind Solar
Hybrid Project shall achieve a minimum CUF of 40%.

14
3. Introduction
Today, world is amid a major transition to clean energy due to growing concerns of climate change
th
andglobalwarming.The2015Parisagreement, and the CoP26 Summit(26 Conference of Parties) held in
0
2021, under the UNFCCC, aim to limit the increasing global warming by 2 C and achieve “Net Zero”
emissions by 2050. Government of India (GoI) has committed India‟s Nationally Determined
Contributions (NDCs) in alignment with the global efforts to mitigate climate change. The key NDCs
targets include:
a) Achieve 50 percent cumulative electric power installed capacity from non-fossil fuel-based energy
resources by 2030.
b) Reduce the total projected carbon emissions by2.5 – 3.0 billion tonnes from current level till 2030
by creation of additional carbon sink through incremental forest and tree cover.
c) Reduce the emission intensity of the GDP by 45% by 2030, from 2005level.

To achieve these objectives, GoI has set the target of adding around 500 GW RE capacity by
2030.Further, GoI launched “National Green Hydrogen Mission” in 2023 ,that aims to boost the domestic
production of Green Hydrogen to 5 Million Tonnes Per Annum (MTPA) by 2030, and to make India “an
export hub” for this clean fuel.

The Ministry of Power, Government of India in its order dated 22.07.2022 has prescribed the following
trajectory for the period from FY 2022-23 to 2029-30and Andhra Pradesh Electricity Regulatory
Commission (APERC) has specified the Renewable Power Purchase Obligation (RPPO) targets via
Regulation No 5 of 2022 as detailed below.
APERC
Ministry of Power, GoI RPO Trajectory Reg No 5
Year
of 2022
Wind RPO HPO Other RPO Total RPO Total RPO
2024-25 2.46% 1.08% 26.37% 29.91% 20%
2025-26 3.36% 1.48% 28.17% 33.01% 22%
2026-27 4.29% 1.80% 29.86% 35.95% 24%
2027-28 5.23% 2.15% 31.43% 38.81% -
2028-29 6.16% 2.51% 32.69% 41.36% -
2029-30 6.94% 2.82% 33.57% 43.33% -
Andhra Pradesh is one among the leading states in the country in adopting renewables. The total
nd
installed RE capacity in the state increased from 1.3 GW as on 2 June 2014 to 9.5 GW as on
st
31 August 2024. Further, the state is blessed with solar, wind, water resources that encourage RE
1 2
adoption, with solar power potential of around38.50GW and wind power potential of74.9 GW (at 120 m

1
As per NISE - State-wise Solar EnergyPotential in India (niti.gov.in)
2
As per NIWE - India's Wind Potential Atlas at 120m agl (niwe.res.in)

15
 3
level) and 123.34 GW (at 150 m level) and estimated PSP potential of 43.89 GW capacity for 39 sites in
the state. Additionally, the state has potential for co-located plants (wind and solar) along with PSP,
hence it is an ideal destination for setting up of Green Hydrogen Hubs and Hybrid Projects for supplying
Round the Clock Power (RTC).Some of the key aspects that boost the growth of RE adoption in Andhra
Pradesh include:
a) Availability of about 300 sunny days in a year with solar insolation of more than 5 kWh/m²/day.
b) Availability of 974km coastline, which is second largest in the country. Accessibility to
Visakhapatnam port – one of the major ports in the country, and 14 non-major ports. The
accessibility of ports and co-located sites can propel Andhra Pradesh as the global hub for export
of Green Hydrogen.
c) Availability of robust grid infrastructure with 15 Nos. of 400kV substations, 93 Nos. of 220 kV
substations, 212 Nos. of 132 kV substations, and 27,979.23 Ckm of EHT lines at Transmission
level, and 3,038 Nos. of 33/11 kV substations, 9,13,158 Nos. Distribution Transformers, and
26,262 Ckm of 33 kV lines at Distribution level.
d) Potential for establishing the Pumped Storage Power Projects (PSP), which are useful to balance
generation from these intermittent sources and to minimize the grid imbalances. Techno-
Commercial feasibility reports were prepared for 39 sites and the estimated potential is
around43.89GW.DetailedProjectReportsareunderpreparationformostviablelocationsinphased
manner.
e) Strong performance of the state electricity utilities, with APEPDCL, APSPDCL and APCPDCL
achieving A, B- and B- ratings respectively, as per the 12th edition of integrated rating of
DISCOMs

Government of Andhra Pradesh (GoAP) is focused on creation of green economy and thriving
ecosystem for Integrated Clean Energy across the value chain, through a robust framework to attract
investments, there by contributing to India‟s Renewable Energy growth and driving action in mitigating
climate change. To achieve and lead the country‟s goals of net zero, Government of Andhra Pradesh
has formulated ““Andhra Pradesh Integrated Clean Energy Policy, 2024” for attracting clean energy
investments. This policy aims to add over 160 GW of renewable energy capacity, with a potential to
attract investments worth ~INR 10,00,000 Crores, thereby generating an estimated
employmentfor7,50,000, both direct and indirect. The policy will propel Andhra Pradesh to become a
clean energy hub and contribute towards self-economic reliance.
Capacity Addition/Manufacturing
Sl.No Clean Energy
Capacity
1 Solar 78.50 GWp
2 Wind 35 GW
3 Pumped Storage 22 GW

3
As per NIWE - 150m-report.pdf (niwe.res.in)

16
 Capacity Addition/Manufacturing
Sl.No Clean Energy
Capacity
4 Battery Energy Storage 25 GWh
5 Green Hydrogen 1.50 MTPA
Ethanol – 1,500 KLPD
6 Biofuels
Bio CNG/CBG – 10,000 TPD
7 EV Charging Infrastructure 5,000 PCS
Solar Manufacturing (Across the value chain
8 20 GW
Mine/Polysilicon to Module)
9 Wind Turbine Manufacturing No pre-set limit
10 Battery Manufacturing 5,000 MWh
11 ElectrolyzersManufacturing 3,000 MW

The capacity additions in the state have been planned for AP Discoms procurement, export of power to
other states, Green Hydrogen production and its derivatives and also to meet Commercial & Industrial
(C&I) consumption under open access route. The table summarizes the expected capacity additions
under each of the RE source.
AP DISCOMs GH- Open Access
Sl.No RE Source RE Export
procurement Power route
1 Solar (GWp) 36.7 10 28.8 3
2 Wind (GW) 15 10 8.6 1.8
3 BESS (GWh) 16 - 5.6 3.6
4 PSP for RTC (GW) 3 5 13.9 -

3.1 AP Journey in RE Sector

Andhra Pradesh has been playing a major role in implementing the clean energy initiatives of GoI and
has contributed to the development to large-scale solar park(s) and green energy corridors for power
evacuation, and improvising resources for accelerating the development of RE sector in the country.
GoAP has notified the following RE policies vide following GOs for promotion of Wind Power, Solar
Power, Wind-Solar hybrid Power, PSPs, and Green Hydrogen:
a) AP Solar Power Policy –2018 issued vide G.O.Ms.No.1, dated.03.01.2019.
b) AP Wind Power Policy –2018 issued vide G.O.Ms.No.2, dated.03.01.2019.
c) AP Wind Solar Hybrid Power Policy -2018 issued vide G.O.Ms.No.3, dated.03.01.2019.
d) Amendment order G.O. Ms No.35 dated 18.11.2019 and G.O. Ms No. 1 dated 01.03.2021.
e) AP RE Export Power Policy 2020 issued vide GO Ms No. 20 Dated 17.07.2020.
f) Andhra Pradesh Pumped Storage Power Promotion Policy 2022 vide G.O. Ms. No. 25, dated.
20.12.2022.

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 g) Andhra Pradesh Green Hydrogen & Green Ammonia Policy – 2023 vide G.O. Ms No: 14 dated
20.06.2023.

Globally, emphasis on clean energy adoption is driven by growing concerns about greenhouse gas
emissions and climate change. Electricity consumption in Andhra Pradesh has been growing at a CAGR
of 6.7% in the last 10 years (from FY 2014-15 to FY 2023-24), and the state is poised for rapid industrial
growth driven by infrastructure investments, increasing energy needs. While significant conventional and
RE capacities have been contracted to meet the growing energy demand, developments in clean energy
domain such as technological advancements, introduction of FDRE and RTC power, focus on balancing
capacities such as Energy Storage etc., are gaining traction, calling for Andhra Pradesh to reposition itself
as one of the dominant states in the country for investments in clean energy technologies. As per the
CEA‟s resource adequacy plan, the projected contracted solar power capacity for AP in FY 2031-32 is
39.64GW, while the projected contracted wind power capacity is 25.79GW and energy storage capacity is
9GW.

However, RE adoption requires development of a policy framework that ensure energy security and
equity, while meeting carbon reduction and pollution mitigation targets. Government of Andhra Pradesh
is committed to promote generation from renewables by creating a more conducive policy & investment
framework to spur competition and private participation in the sector while maintaining a balance in the
interests of all stakeholders. Thus, the “Andhra Pradesh Integrated Clean Energy Policy, 2024”
enables a robust regulatory framework for attracting investments in the clean energy sector, creating the
level playing field for the investments in this sector through creation of local employment opportunities
and utilization of available resources in a sustainable manner.

4. Objectives
a) To provide a framework for large scale promotion of Renewable Energy (RE), Pumped Storage
Power (PSP), Green Hydrogen and its derivatives by optimum utilization of available resources
and position Andhra Pradesh as a preferred destination for investments in Renewable Energy.
b) To leverage the 4T‟s framework of Trends, Technology, Transformation, Trade to deliver local,
national, and global objectives, by blending our abundant local resources into the national policy,
while contributing to the global targets of carbon emission reduction.
c) To transform the power sector of AP through 4Ds of De-carbonization, Democratization,
Decentralization, and Dynamic/Digitalized grid coupled with a policy framework.
d) To contribute to the Gross State Domestic Product (GSDP) of Andhra Pradesh through the
investments in RE sector and creation of employment opportunities in the state.
e) To harness the Renewable Energy and PSP capacity available in the state and facilitate
development of ~160GW of additional RE and PSP capacities.
f) To promote decentralization of renewable energy generation and develop ecosystem for
distributed Solar generation, i.e., Solar Roof Top systems, Solar Pumps, etc.
g) To meet power demand within the state and export surplus power outside Andhra Pradesh.

18
 h) To meet RPO, HPO, ESO, etc., as notified by the Ministry of Power, Govt of India and APERC.
i) To achieve higher EV penetration by enabling regulatory framework for creation of EV Charging
Infrastructure in the state
j) To develop Renewable Energy Parks (including hybrid parks), Renewable Energy Manufacturing
Parks in the state.
k) To create energy storage market in the State to integrate more RE into the grid and offer grid
support services, such as peak reduction, curtailment management, contribution to reliability
needs, transmission deferrals, intraday and seasonal variation management, and others.
l) To develop AP as a storage capital and clean energy hub in the country and the preferred
destination for clean energy innovative projects.
m) To support the development of eco-system for production of Green Hydrogen and its derivatives
and make Andhra Pradesh the preferred destination for production and export of Green Hydrogen
and its derivatives.
n) To promote setting up of equipment manufacturing facilities for Green Hydrogen and its
derivatives in the State.
o) Encourage new initiatives, pilot projects and emerging energy technologies in the State.
p) To promote solar &wind generation and attract investments for local solar& wind manufacturing
facilities in the State and the value chain of manufacturing for clean energy technologies.
q) To achieve Net Zero emissions by 2047.
r) To establish a University for Green Energy & Circular Economy (UGC), offering courses and
certification programs, and encouraging entrepreneurship and skilling among youth for
employment opportunities in Clean Energy Projects and RE Manufacturing Projects.
s) To promote clean energy skill development center and forge partnerships with universities to
establish AP as clean energy research and development hub.

5. General Framework of the Policy

5.1 Operating Period and Policy Scope
This policy will be known as “Andhra Pradesh Integrated Clean Energy Policy - 2024” and shall come
into operation with effect from the date of issuance and shall remain applicable for a period of five (5)
years, from the date of issuance of policy or till such time a new policy is issued.

The policy focuses on the following clean energy technologies:

a) Solar Power
b) Wind Power
c) Wind-Solar Hybrid Power
d) Mini and Small Hydro
e) Pumped Storage Plants
f) Battery Energy Storage Systems

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 g) Green Hydrogen and its derivatives
h) Biofuels
i) EV charging infrastructure
j) RE Manufacturing Projects including solar, wind, battery and electrolyzers.

Clean Energy Projects and RE Manufacturing Projects that are commissioned or achieved financial
closure/under construction in the State during the operative period shall be eligible for incentives
declared under this policy.

All Clean Energy Projects and RE Manufacturing Projects availing incentives under this policy shall
not be eligible for any additional incentives under the AP Industrial Development Policy (IDP) or other
policies issued by GoAP.

This policy shall be applicable for all Clean Energy Projects and RE Manufacturing Projects allocated
during the operative period. Clean Energy Projects and RE Manufacturing Projects commissioned
during the operative period (or) achieved Financial Closure (FC) during the operative period. Such
projects which have achieved FC shall be given additional time as follows:

 6 months for BESS projects

 18 months for solar, wind& wind-solar hybrid projects
 27 months for battery manufacturing projects
 30 months for mini and small hydro, Green Hydrogen & its derivatives, biofuels and RE
Manufacturing (solar, wind& electrolyzer) projects
 36 months for PSP

5.1.1 Migration of Projects from Previous Policy (ies)

All Clean Energy Projects and RE Manufacturing Projects allocated/sanctioned under previous policy
(ies)/G.O.s. shall be given liberty to migrate to the ICE policy. All charges, incentives, and milestones/
timelines including extensions to be adhered as per ICE policy. However, all such projects shall be
eligible to migrate under ICE Policy subject to following conditions being met

 Projects which have not shown any progress or not adhered timelines/ conditions or not
commissioned as per the timelines indicated in allocation letter/ Implementation
agreement/G.Os shall not be permitted to migrate.
 Projects with allocated resources (Solar, Wind, Hybrid, PSP) under construction within
timelines indicated in sanction/allocation letter/ Implementation agreement/G.Os will be
allowed to migrate under ICE policy and such projects shall also adhere to the timelines
stated in the respective sanction/allocation letter/implementation agreement/ G.O.s
 However, such migrated projects to ICE policy shall pay all the applicable charges, subject to
adjustment of any charges that were paid in previous policy(ies), under the ICE policy and

20
 shall comply with the prescribed timelines of ICE policy (project specific) to avail the
incentives under ICE policy.
 All RE Manufacturing Projects allocated/ sanctioned in previous policy(ies)/ G.O.s shall be
eligible to migrate under ICE Policy along with captive resources (land, solar, wind, PSP etc.),
if any, and shall adhere to the commissioning timelines prescribed for the RE Manufacturing
Projects under ICE Policy.

All the projects allocated under previous policies that are unable to migrate because of non-
adherence of timelines stated there in and also not commissioned /that have not completed as per
the timelines including extension(s)/ conditions shall be treated as deemed cancelled and the
allocated resources will be made available for fresh allocation under the ICE policy. All the previous
policies covered under clause 3.1shall cease to exist after the notification of the ICE policy.

This Policy will be evaluated on regular basis to assess its impact, and to ensure inclusion of any new
RE market/guidelines from GoI/GoAP that may evolve during the Policy period. New and Renewable
Energy Development Corporation of A.P. Ltd (NREDCAP) shall act as the State Nodal Agency under
this policy.

5.2 Eligibility
All registered companies, Government entities, partnership companies/firms, individuals, and all
consumers of APDISCOM(s) will be eligible for setting up of Clean Energy Projects within the State
for sale of electricity/captive use, in accordance with the Electricity Act – 2003, as amended from time
to time. The entity desiring to set up Clean Energy Project shall intimate the SNA and submit the DPR
of the project with the details of technical and financial capabilities of the Developer, based on which
the SNA will allocate the capacity for development.

SNA shall apprise the existing installed capacity, existing generating capacity, required installed
capacity and generating capacity. Before allocating the capacity for development, the SNA shall
apprise whether the proposal is technically, financially, and commercially feasible. SNA shall also
apprise whether Developer has the required technical, commercial, managerial, and financial
capability to execute the project.

With respect to technical eligibility criteria, Project Developers should have past experience in
developing RE projects or projects related to industry/ Infrastructure Sector.

The net worth requirement for seeking allocation of resources shall be as follows:

 Solar: INR 50 Lakhs/MWp

 Wind: INR 100 Lakhs/MW
 PSP, Small and Mini Hydro: INR 50 Lakhs/MW

No net worth requirement for setting up RE Manufacturing Projects (Battery, Electrolyzer, Solar,
Wind), GH & its derivatives and Biofuel projects. However, Developer shall submit the detailed project

21
report including background of company, technology tie-ups, indicative financing plan, sources of
funds, project timelines etc.

Biofuels – Eligibility for type of units for ethanol production:

a. Green-field standalone distilleries (single feed or dual feed) producing 100% fuel-grade Ethanol
and supplying only to Oil Manufacturing Companies (OMCs) under Ethanol Blended Petrol (EBP)
Programme of Government of India.

b. Existing distillery units, expanding or diversifying into ethanol production, should have clearly
demarcated unit, to be eligible for assistance under this policy provided that production capacity
of existing distillery/unit must not be reduced.

c. The quantum of assistance to expanding or diversifying units shall be at par with new standalone
units. Conversion/Switchover from existing distillery units to ethanol production units shall not be
eligible for incentives under this policy.

d. Ethanol units which are set-up on ZLD (Zero Liquid Discharge) basis shall be considered under
this policy.

e. New ethanol units can only be setup in a block categorized as safe area as per the Block-wise
Groundwater Resource Assessment 2020 and subsequent assessments conducted by the
Central Ground Water Authority from time to time.

Biofuels –Eligibility for type of units for bio-CNG/CBG production:

a. Green-field standalone CBG projects shortlisted under Sustainable Alternative Towards

Affordable Transportation (SATAT) Scheme.

b. Green field or brown field units producing 100% fuel-grade bio-CNG/CBG and supplying only to
Oil Manufacturing Companies (OMCs) under National Biofuel Policy.

c. Ethanol/CBG units which are set-up on ZLD (Zero Liquid Discharge).

Biofuels –Eligibility for type of Feed stocks/Raw materials:

a. Biofuel production from all feed stocks/raw materials permitted under National Policy on Biofuels,
2018 and by the National Biofuel Coordination Committee shall be allowed in the State of Andhra
Pradesh.

b. Subsequent permission of any additional feedstock/raw material for Biofuel production by

National Biofuel Coordination Committee shall be automatically allowed for Biofuel production in
the State of Andhra Pradesh.

PSP eligibility

a. Any Developer setting up the PSPs either for Captive/Group Captive use and/or for selling of
electricity to the utilities or third parties within the State or export to other States in accordance

22
 with the relevant Central/State regulations and/or Standard Bidding Guidelines (SBGs) issued
and amended from time to time.

Mini and Small Hydro eligibility

a. Any Project developer setting up mini and small hydro projects that are self-identified by the
Project developers and commissioned during the policy period (or)

b. Projects where resources are allocated by the state government and commissioned during the
policy period.

5.3 Land Facilitation, Power Evacuation and Allotment

a. SNA will compile and provide a list of all the available land parcels/resources from revenue/other
government departments and APTRANSCO will provide list of available substations (MW
availability including upcoming/ planned sub-stations) for power evacuation. These lists shall be
provided on a quarterly basis by SNA. Developer (s) to apply based on the available land parcels
and substations.
b. Developer (s) to apply for allotment of the land to the revenue/concerned government department
and SNA to facilitate the transaction by liasoning between the government department and
Developer.
c. Government/ Revenue/concerned department to allot the land to the Developer on alienation
basis for lease up to a maximum 30 years (33 years in case of PSP, Mini and Small Hydro
Projects and further extendable at a later stage), including the construction period. The land
allotment shall be done as per the existing Andhra Pradesh Land Allotment Policy 2012 or any
other GoAP directions and its amendments from time to time.
d. Deemed Non-Agricultural status will be accorded for the land utilized for development of any
Clean Energy Projects and RE Manufacturing Projects. However, an application has to be
submitted to Revenue Department for one time land conversion. Any applicable fee for such land
conversion shall be exempted for all types of Clean Energy Projects and RE Manufacturing
Projects eligible under the policy.
e. Given the nature and long gestation period of PSP & Mini and Small Hydro projects, Developers
are also permitted for outright purchase of revenue/government land at the rate of INR 5 lakh/
acre or basic value, whichever is higher.
f. The land lease rate for revenue/government/private/patta land will be.
 INR 31,000/acre/year with 5% escalation for every 2 years for Clean Energy Projects (except
for biofuels & GH Hub)
 INR 15,000/acre/year with 5% escalation for every 2 years for biofuels projects (only for
revenue/government land)
 INR 1,00,000/acre/year for Green Hydrogen Hubs at ports (only for revenue/government
land)

23
 The land lease shall be paid to the concerned government department/ SNA from the date of
possession.

g. In case of forest areas, the Developer shall submit the application through the SNA to the forest
department, to consider for allotment as per the guidelines/regulations laid down by the forest
department from time to time.
h. If the project is to be set up in private land, then the eligible Developer shall procure the land from
the landholder on their own.
i. Land parcels will be identified by SNA to encourage Biofuels projects.

5.4 Resource Allocation

a. Objective of resource allocation is to ensure optimal utilization of available resources like land,
water, natural resources (Wind, PSP potential sites), along with the available power evacuation
including upcoming/ planned capacities with APTRANSCO.
b. SNA shall coordinate and facilitate resource allocation to the Developer. SNA will support the
Developer in coordinating with APTRANSCO/ APDISCOMs to verify the project feasibility.
c. Resource allocation will be on first-cum-first serve basis however preferential land allocation shall
be provided for RE Manufacturing Projects(Solar, Wind, Battery, Electrolyzers) and bio-fuel
projects including energy plantation feed stocks and its storage infrastructure for ensuring raw-
materials supplies. These projects have high employment potential and would benefit the state in
generating employment opportunities.
d. Land allocation shall be provided on the basis of high value addition (INR/Acre) in the following
order of priority as: Green Hydrogen& its derivatives, RE RTC with Storage, Hybrid Co-located
Projects, PSP, Wind Projects, Solar Parks, Stand-alone Solar Projects.
e. In case of Pumped Storage Projects, Project Sites identified by the SNA or self-identified by
Project developers, the projects shall be allotted on nomination basis to CPSU/State level PSUs
and first-cum-first serve basis for others by paying applicable costs incurred by SNA for DPR/ pre-
feasibility reports.
f. The Developer shall submit Detailed Proposals to the SNA along with project details, technical &
financial strengths, timelines for completion, etc. After detailed scrutiny of the project proposals,
SNA shall allot the required resources to the Developer.
g. In case of sites identified by the Developer, the Developer shall seek approval of the SNA after
paying necessary charges as detailed out in this policy.
h. The Developer shall obtain all statutory clearances that are required from Central and State
Governments. The SNA extend necessary support to get the clearances.
i. The Developer shall bear the entire cost of the project from investigation to commissioning and
subsequent operation and maintenance.
j. SNA shall not bear liability of any kind on part of Developer.

24
 k. In case of resources allocated by SNA such as Wind, Solar, Wind-Solar Hybrid, the state shall
have the right of first refusal of up to 30% of the allotted project capacity and tariff shall be
determined by SERC under Section 62. Alternatively, Discoms shall procure through Tariff Based
competitive bidding.
l. In case of PSP (Other than Captive resources), the state shall have the right of first refusal of the
entire allotted project capacity and tariff shall be determined by SERC under Section
62.Alternatively, Discoms shall procure through Tariff Based competitive bidding.
m. For the PSP sites identified by SNA, process of DPR preparation is undertaken by the SNA
including clearances till the date of allotment of project to the Developer. Developer will take over
the responsibility of balance process of DPR preparation and obtaining clearances from the date
of allotment of project by paying the cost incurred by SNA till the date of allotment of the project.
Thereafter, the responsibility of DPR & clearances shall stand transferred to the Developer. SNA
will work with the Developer for balance process of DPR preparation and obtaining remaining
clearances.

5.5 Grid Connectivity and Power Evacuation Facility

a. Grid integration shall be in accordance with the Central Electricity Authority‟s (Technical
Standards for Connectivity to the Grid) Regulations, 2019 and amendments thereto from time to
time. Grid stability and safety is paramount and should be ensured due to intermittent nature of
renewable energy.
b. Power evacuation costs shall be applicable as per the Andhra Pradesh Electricity Regulatory
Commission Power Evacuation from Captive Generation, Cogeneration and Renewable Energy
Source Power Plants (Regulation No. 3 of 2017) and its amendments from time to time.
c. The power generated from Clean Energy Projects shall be injected at an appropriate voltage at
the sub-station and/or interconnection point of the APTRANSCO/ APDISCOM(s). The Eligible
Developer shall bear the entire cost of construction of power evacuation facilities from the project
upto the interconnection point and/or up to APTRANSCO/ APDISCOM(s) substation.
d. Connection to the CTU network: The Project developers shall follow the procedure laid down
by the central agencies and State Government/State Nodal Agency. All liabilities on account of
connecting to the CTU shall be borne by the Developer.
e. Connection to the CTU through STU network: The application process for availing connectivity
to STU shall be on similar lines as that of CTU and STU shall follow the same guidelines as
connectivity can be granted before the project can get commissioned. Two options shall be
provided for connecting to CTU network through STU.
i. Option-1: Project developer may connect to STU, by laying connecting line to the STU grid
substation at his cost and transferring the line asset to STU prior to commissioning.
Alternatively, the connecting line may be built by STU at the cost of the Developer if the
Developer so chooses. Developers using the Intra-State Transmission network shall pay for
Transmission charges and losses as prescribed by APERC in the Transmission Tariff Order.

25
 ii. Option-2: Project developer may bear the entire cost of existing or new external
evacuation infrastructure including connecting line, grid substations and upstream network
up to CTU. The construction of new network infrastructure shall be done under the
supervision of STU and the assets shall be handed over to STU before commissioning. The
new network augmentation required for this purpose shall be determined by STU or at the
discretion of the Developer, the Developer may pay a normative capital cost of INR 25
Lakh/MW or actual cost, whichever is higher, to expedite the connectivity and take care of
the existing cost of the network or augmentation requirements on normative basis.
Developers opting for this option shall pay only the O&M charges (for number of Bays) as
decided by STU and the transmission charges shall be exempted for entire life of the
project. There shall be no exemption on energy losses.
f. APTRANSCO/ APDISCOM(s) will dispose the proposals for the technical feasibility for evacuation
within 14 days from the date of receipt of application. Any upstream system strengthening
requirement shall be borne by APTRANSCO/ APDISCOM(s) on priority basis.
g. GoAP shall support for creation and strengthening of Transmission and Distribution network for
evacuation of power from RE projects

5.6 Fees and Charges

The fees and charges applicable for all the projects under the policy is provided in clause17.11. Each
of the charges shall be payable by the Project developers within the stipulated timelines as decided
by the SNA.

a. All the fees and charges except PBG are non-refundable once paid.
b. The Developer shall pay the applicable GST in addition to the above fees and charges.
c. The applicable fees and charges may be revised from time to time as notified by the Government
of Andhra Pradesh.
d. The Performance Bank Guarantee shall be submitted by the Developer from the date of
Resource allocation/ LOA and shall be kept with SNA until COD of the project. Additionally, the
PBG shall be extended on case-to-case basis upon confirmation by SNA as per the project
extensions granted from time to time.
e. The Performance Bank Guarantee shall be returned to the Project developer after commissioning
of the project. In case part capacity is commissioned, the proportionate Performance Bank
Guarantee may be returned.
f. Green Energy Development Charges shall be paid by the Developers to GoAP throughout the life
of the project from Scheduled CoD.
g. In case of SRTPVS and other applications, the fees shall be payable as per the operating
guidelines of the policy.
h. In respect of projects already allotted/sanctioned, the fees that are applicable at the time of
capacity allocation shall only be applicable. However, in case of capacity transfer, name change,

26
 change of location and project time extensions, the Project developers shall pay the applicable
fees.

5.7 Transmission & Distribution/Wheeling Charges

a. Intrastate Transmission charges shall be paid by the Developer in 15 minutes block-wise only for
the scheduled capacity of generation. For energy storage projects, intrastate transmission
charges shall be applicable only on generation and losses to be paid on both sides i.e. drawl and
injection.
b. Distribution/wheeling charges shall be waived off if the injection and withdrawal of power are at
the same voltage levels. However, if the injection and withdrawal of power are at different voltage
levels irrespective of the DISCOM‟s boundaries, distribution/wheeling charges shall be levied at
injection point as follows:
 For LT Consumers, distribution/wheeling charges shall be paid on per unit basis (INR/kWh),
and
 For HT Consumers, distribution/wheeling charges shall be paid as per the block wise (15
mins) charges for the applicable number of blocksfor the scheduled capacity.
c. The above method of charges shall be applicable for a period of 25 years. However, Wheeling
charges will be determined by APERC from time to time.

5.8 Cross Subsidy Surcharge & Additional Surcharge

a. Cross-subsidy surcharge and additional surcharge shall not be applicable for consumption from
Clean Energy Projects fulfilling the criteria of Captive generating plant as per Electricity Rules
2005& amendments. The Clean Energy Projects not fulfilling the criteria of Captive generating
plant shall be considered as third-party sale projects and Cross-subsidy surcharge and Additional
surcharge shall be levied as determined by APERC from time to time for consumption from third
party Clean Energy Projects.
b. In case of RE Manufacturing Projects, covered under the policy, the cross-subsidy surcharge
shall be exempted for a period of 10 years in case of open access /third party procurement.

5.9 Electricity Duty

a. Electricity Duty for Clean Energy Projects shall be paid as determined by the Government of
Andhra Pradesh and its amendments from time to time.
b. In case of RE Manufacturing Projects, the electricity duty shall be reimbursed for a period of 10
years irrespective of Discom/ Open Access/ captive/third party procurement. Any additional
exemptions or special provisions shall be addressed in the relevant sections of the policy.

27
5.10 Open Access Facilities
a. The open access facilities will be governed by the Andhra Pradesh Electricity Regulatory
Commission (Green Energy Open Access, Charges, and Banking) Regulation, 2024(Regulation
No. 3 of 2024) and its amendments from time to time.
b. Open access shall be eligible for all consumers with contracted demand or sanctioned load of
100 kW or more through single connection or multiple connections aggregating to a 100 kW or
more located in the same division of a DISCOM, except for captive consumers who shall not have
any load limitation.
c. OA/Connectivity for all new green energy generators shall be as per the provisions of Andhra
Pradesh Electricity Regulatory Commission Power Evacuation from Captive Generation,
Cogeneration and Renewable Energy Source Power Plants (Regulation No. 3 of 2017).
d. OA approvals to be provided by SLDC and OA approvals shall be permissible only prior to 12
months before COD. In case of delay in COD, after OA approvals, such OA approvals shall be
deemed cancelled and the Project developer shall request for a new approval only after
commissioning of the project.
e. In case of delay in projects commissioning, after receiving OA approval, the associatedOA
approval shall be deemed cancelled and the Project developer shall request for a new approval
only after commissioning of the project.
f. The charges to be levied for GEOA consumers shall be as per theAndhra Pradesh Electricity
Regulatory Commission (Green Energy Open Access, Charges, and Banking) Regulation, 2024
(Regulation No. 3 of 2024) and its amendments from time to time. The charges shall be limited to
transmission charges, wheeling charges, cross subsidy charges, standby charges, banking
charges, SLDC fees and charges, losses and processing fees and any others as determined by
the commission. Transmission and Distribution/Wheeling charges shall be payable as per clause
5.7.

5.11 Energy Banking, Settlement& Balancing

a. Energy accounting and banking for all Clean Energy Projects, including SRTPVS, shall be as per
the regulations framed by APERC from time to time in accordance with the Green Energy Open
Access Rules 2022 notified by the Ministry of Power, Govt of India. In case of the consumers
availing energy banking facility, the settlement of renewable energy against consumer‟s
consumption shall be carried out on billing cycle basis upon payment of applicable banking
charges as determined by APERC from time to time in the Green Energy Open Access 2024.
Banking charges for residential SRPTVS shall be applicable as per APERC (The Grid Interactive
Solar Rooftop Photovoltaic System under Gross/Net Metering) Regulation 2023 (Regulation No 4
of 2023).

28
 b. Energy Settlements and balancing of all the intra-state Green Energy Open Access of
Generators/ Consumers shall be done as per Regulation 2 of 2006 and its amendments from time
to time.
c. Energy banking shall be on monthly billing cycle basis. Each calendar month shall be treated as
one billing cycle and the banked energy should be used in the same billing cycle. The unutilized
energy, banking charges, maximum applicable banking, processing fee for open access, all the
applicable charges to be levied for green energy open access and other provisions shall be as
per GEOA Regulations 2024 and its amendments.
d. The policy defines the hours of supply to ensure grid stability and ensure equity for energy
banking and settlement.
 Off-peak Hours (solar time): 9AM-5PM
 Peak Hours: 5AM-9AM & 7PM-11PM
 Normal Hours: 11PM-5AM & 5PM-7PM

Due to the emergence of democratization of energy, and intermittency of renewable energy, these
hours of supply shall be redefined by APTRANSCO from time to time.
e. DISCOMs shall seek approval from APERC to redefine the peak hours, normal hours and off-
peak hours as defined under the policy. These hours of supply to be adopted for RE generation
and inclusion in Retail Supply Tariff for the applicable year and its amendments approved by the
commission from time to time.
f. The credit for energy banked shall be adjusted during the same banking cycles as per the energy
injected in the respective hours of banking determined under the policy. The energy banked
during peak hours shall be permitted to be drawn during peak as well as off-peak and normal
hours. The energy banked during off-peak (solar) hours shall be permitted to be drawn during off-
peak (solar) hours only and energy banked during normal hours shall be drawn during normal
and off-peak hours. Provided that the drawl of banked energy during the peak load hours as
mentioned in the policy and approved by the Commission shall not be permitted if R&C measures
are in force.
g. To ensure grid stability, the maximum allowed banking capacity at grid level shall be capped at
5% of the peak grid demand (700 MW) for FY 2024-25. Thereafter, additional banking capacity at
5% of the incremental peak grid demand year-on-year shall be allowed. AP TRANSCO shall
estimate the peak grid demand for the ensuing financial year and SLDC shall notify the allowable
maximum banking capacity at grid level. Developers/ OA users shall apply along with duration
and get allocation of banking within the limits stipulated from time to time.

5.12 Disbursement of Capital Subsidy on Fixed Capital Investment (FCI)

In case of investments proposed by Clean Energy Projects and RE Manufacturers under various
phases and value chain wise, then the Capital subsidy shall be disbursed phase wise/ unit wise and

29
 or value chain wise whichever is applicable based on the targeted phasing and value chain defined in
the Detailed Project Report/Proposals submitted to SNA.

5.13 Non-Agricultural Status

Deemed Non-Agricultural status will be accorded for the land utilized for development of any Clean
Energy Projects and RE Manufacturing Projects. However an application has to be submitted to
Revenue Department for one time land conversion. Any applicable fee for such land conversion shall
be exempted for all types of Clean Energy Projects and RE Manufacturing Projects eligible under the
policy.

5.14 Statutory Clearances

a. All the Clean Energy Projects (except PSP, Mini & Small Hydro projects) shall be exempted from
obtaining any NOC/Consent for establishment under pollution control laws from AP Pollution
Control Board.
b. In case of PSP, Mini& Small Hydro projects, the SNA shall facilitate in faster issuance of
Environmental Clearances (EC) & Forest Clearances (FC).

5.15 Renewable Energy Certificate (REC)

All projects developed during the operative period of this policy will be eligible for REC benefits
subject to APERC Renewable Power Purchase Obligation (Compliance by Purchase of Renewable
Energy/Renewable Energy Certificates) regulations, 2022 and its amendments from time to time.
Deemed injection into the grid for in-house/co-located solar generation of prosumers will also be
eligible for REC benefits subject to applicable guidelines in the APERC Regulation No 5 of 2022.

5.16 Single Window Clearance

NREDCAP will develop a portal for facilitating single window clearance for all projects under this
policy. The services of this single window clearance portal will be made available to all the projects
under this policy for obtaining time bound statutory clearances.

5.17 Must run Status

Injection from Clean Energy Projects covered under the policy scope shall be considered to be
deemed scheduled.

6. Solar Power
Andhra Pradesh, with its abundant solar resources, has set an ambitious target to significantly
expand its solar power generation capacity. The state aims to align with the Central Government's
target of achieving 500 GW of renewable energy capacity by 2030, solar power being a critical
component. The state aims to tap into the potential of the abundant solar resources, along with
encouraging decentralization of solar power generation through distributed generation through central

30
 schemes like PM Surya Ghar Yojana, Solarization of feeders through PM KUSUM scheme, or any
new schemes announced during the policy period etc. The policy looks to take forward the work done
under the previous Andhra Pradesh Solar Policy 2018 and promote solar power along with
manufacturing in the state.

6.1 Solar Power Projects

6.1.1 Solar Projects for Sale of Energy within Andhra Pradesh:

Selection of projects under In STS category (excluding open access projects) shall be through a
competitive bidding process notified by the Ministry of Power, as per the requirement of APDISCOMs
to fulfil RPO target fixed by the APERC or any requirements beyond RPO target subject to the
approval of the APERC.

Project developer shall be allowed to develop the MW scale solar projects through open access route
under this Policy for sale of energy within the State subject to evacuation feasibility. Project developer
is allowed to setup the off-grid solar project within the same premises for self-consumption duly
informing the DISCOMs.

In case, the solar PV project is setup within the premises of a consumer which is connected to the
grid interface of DISCOMs or AP TRANSCO, they shall pay the grid support charges and other
applicable charges as determined by the APERC from time to time. However, the Project developer is
exempted from payment of such charges if the project setup within the premises is not connected to
the grid interface.Net-metering facility shall be allowed for solar projects installed within the premises
and settlement and compensation for the surplus power exported to the Grid shall be as per the
APERC (The Grid Interactive Solar Photovoltaic system under Gross/Net metering) Regulation, 2023
and any other regulation/orders issued by the APERC from time to time.

6.1.2 Solar Projects for Sale of Energy outside Andhra Pradesh:

Selection of projects under ISTS category shall be through a competitive bidding process as
conducted by intermediaries such as SECI, NTPC and others. Project developer can also develop the
MW scale projects under open access route under this Policy for sale of energy outside the Andhra
Pradesh State with guidelines issued by appropriate authorities from time to time.

6.1.3 Solar Rooftop Photovoltaic Power Plant or Solar Rooftop Photovoltaic System (SRTPVS)

a. The Government of Andhra Pradesh shall promote grid connected SRTPVS on public buildings,
domestic buildings, commercial and industrial establishments, and others through net
metering/gross metering arrangements as per the APERC (The Grid Interactive Solar
Photovoltaic system under Gross/Net metering) Regulation, 2023 and its amendments/Tariff
Orders/Guidelines/Orders issued from time to time. There are no administration charges payable
for installations of SRTPVS projects below 5kWp.

31
 b. SRTPVS Projects will be promoted in the Government and domestic sectors under “PM- Surya
Garh: MuftBijili Yojana” or any other Scheme of the Government of India and Government of
Andhra Pradesh. It is targeted to empower at least 10 Lakh households to generate their own
electricity by installing grid connected SRTPVS projects under this Policy.It is targeted to cover all
the owned buildings of State Government Departments, institutions, organisations on saturation
mode on CAPEX and/or RESCO mode if required by availing the services of Scheme
Implementation Partners (SIPs) designated by the MNRE. Any SRTPVS in
Government/Corporations/Institutions shall be implemented through SNA only.
c. The Government of India incentives under MNRE schemes (or any others) such as Central
Financial Assistance, concessional custom duty on specified items and others shall be extended
to the Project developer under this Policy.
d. Government shall enable the provision for Distributed Energy Resource (DER) aggregation for
SRTPVS to fasten the implementation of Rooftop solar in the state. DER aggregators are
necessary for large-scale implementation of residential SRTPVS for AP DISCOMs and achieving
the state‟s goal of democratisation of power generation. DER aggregators shall undertake
customer acquisition, coordinate necessary approvals with DISCOMs, install the SRTPVS,
support in CFA disbursement, O&M, etc, for a service/aggregator fee.

6.1.4 Distributed Solar Generation (Solar pumps, Solarization of Agricultural Feeders, Solar PV
Street Lights, Solar Off Grid Standalone systems, Solar Lanterns, etc.,)

Solarization of existing grid connected Irrigation pumps through feeder Solarization i.e.,
connecting the solar project at Substation bus [subject to the evacuation feasibility], and
Solarization of grid connected Irrigation pumps as per the guidelines or prevailing schemes of the
State Government/Central Government including PM-KUSUM or any other forthcoming
schemes/programs. GoAP shall also promote Standalone Solar PV Street Lightings, Domestic
solar PV systems, Solar Lanterns, etc.

6.1.5 Floating Solar Projects

a. Floating solar on existing reservoirs/dams of hydro stations or any other water bodies including
reservoirs and lakes shall be promoted under this policy. The State will allocate the water body on
long term lease/rental basis for development of projects under In STS and ISTS programs for
sale of energy to DISCOMs/Procurers or licensed intermediaries like SECI or Urban Local Bodies
by utilization of the lake/reservoir water bodies, canal tops and canal bunds.
b. These floating Solar Projects can be developed with or without energy storage system. All
components of the Floating Solar PV plant shall be in accordance with technical specifications
given in relevant IS/IEC Standards. The design and commissioning shall be as per latest
IS/IEC/BIS standards and the project shall not cause any environmental concerns to the water
bodies.

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 6.1.6 Solar Parks

a. The Government of A.P will encourage large scale development of solar parks which could
accommodate large scale solar projects along with storage, utilizing the abundant resource
availability of solar in certain parts of Andhra Pradesh. The capacity size of a solar park shall be
0.5GWor above for both government and private solar parks. One time processing fee of INR
2,000/acre to be paid by Developer for allocation of capacity in the park. NREDCAP to act as a
State Nodal Agency for allotment of revenue/government land.
b. Development of Solar Parks by State entities - APSPCL shall be the nodal agency for
development of solar parks. APSPCL to develop necessary infrastructure required for solar parks
such as power evacuation system, administrative building, infrastructure including road, water,
drains, ducts etc. APSPCL may recover applicable charges from solar Project developers i.e.
Lease charges, infrastructure/ development charges, utilities charges, O&M charges for
infrastructure, O&M of plant etc. Alternatively, provision for Private Developers to set up solar
parks with plug and play facilities for solar power projects with priority allotment of land parcels
(on lease basis).
c. Development of Solar Parks by Private Developers –Government shall encourage dedicated
private solar parks. NREDCAP shall act as the State Nodal Agency for allotment of
revenue/government land. Park developer to develop necessary infrastructure required for solar
parks such as power evacuation system, administrative building, infrastructure including road,
water, drains, ducts etc. Park developer may recover applicable charges from solar Project
developers i.e. Lease charges, infrastructure/ development charges, utilities charges, O&M
charges for infrastructure, O&M of plant etc.
d. All the entities in the solar parks should be focused on the demands of small consumers and
consumption within the state, followed by export to other states. AP DISCOMs may procure
power from projects set up in the solar parks through a tariff based competitive bidding
mechanism to meet their energy/RPO requirements.

6.2 Incentives from State Government

6.2.1 Incentives& applicable charges for all solar power projects

To enable solar power capacity addition in the State, following incentives shall be provided for eligible
Developers for those projects setup during the operative period of this policy. In addition to the below
mentioned incentives, the applicable fees & charges for all types of solar projects shall be applicable
as per clause 5.6&clause 18.1.In addition to the charges mentioned in , the applicable charges and
incentives are as below:

a. Transmission and Distribution/Wheeling Charges

Applicable T&D charges shall be paid as mentioned in the clause 5.7 of the policy.
b. Energy Banking, Settlement & Balancing

33
 Banking shall be applicable as per the Green Energy Open Access Regulations 2024 as detailed
in the clause5.11of the policy.
c. Reactive Power Charges
The reactive power charges shall be payable in compliance with the Indian Electricity Grid Code
(IEGC). Reactive power charges for SRTPVS connected to 33kV shall be INR 0.25/kVARh up to
10% of net active energy generated at that level & INR 0.50/kVARh thereafter.
d. Virtual Net Metering/ Gross Metering
The gross/net metering for SRTPVS will be governed by the APERC (The Grid Interactive Solar
Rooftop Photovoltaic System under Gross/Net Metering) Regulation 2023 (Regulation No 4 of
2023) and its amendments from time to time.
e. Distributed Energy Resource (DER) Aggregation Fee
DER aggregation to be provided for Solar Roofto pand an aggregation/service fee shall be
payable by the DISCOM to the aggregator. A service charge/ aggregators fee shall be payable of
INR 1,500/kWp for the first 2 kW and thereafter INR 1,000/kWp.
f. SGST on SRT projects
GoAP shall provide reimbursement of 100% SGST on SRT projects implemented for
domestic/residential consumers or any government buildings under PM Surya Ghar scheme. This
shall be paid in addition to any support provided by GoI under its schemes.

6.2.2 Incentives& applicable charges for solar manufacturing

The disbursement of capital subsidies on FCI shall be payable as per clause 5.12. The applicable
incentives and charges are as below:

a. Capital Subsidy
Capital subsidy shall be provided on 25% of the Fixed Capital Investment (FCI) of manufacturing
plant including Captive generating plant and captive mines. The capital subsidy shall be paid over
a period of 5 years from COD of the solar manufacturing project/ unit/ phase.
b. Land
GoAP/ NREDCAP shall facilitate procurement/ Acquisition of land on actual cost basis for the
manufacturing plant. There shall be preferential allotment of captive resources for the projects
allocated under Production Linked Incentives (PLI) scheme. Priority allotment of revenue/
government land on long-term lease basis at INR 31,000/acre/year with 5% escalation for every 2
years.
c. Provision for land conversion
Deemed Non-Agricultural status will be accorded for the land utilized for development of Solar
Manufacturing Projects. However, an application has to be submitted to Revenue Department for
one time land conversion. Any applicable fee for such land conversion shall be exempted for all
types of Solar Manufacturing Projects eligible under the policy.
d. Open Access Charges and Energy Banking

34
 Exemption of Open Access Charges including Transmission charges, Distribution/ Wheeling
charges and Cross Subsidy Surcharge for 10 years. Energy Banking shall be as per GEOA
Regulations 2024.
e. SGST Reimbursement
GoAP shall provide reimbursement of 100% net SGST on sale of products for a period of 5 years.
f. Production linked incentive
Production linked incentive (PLI) shall be provided as per the applicable MNRE guidelines.
g. Subsidy on Power Costs & Electricity Duty
 For all the Solar Manufacturing projects qualified under PLI/Non-PLI subsidy on electricity
tariff of INR 1.0/unit (kVAh) for 10 years from COD shall be provided for the manufacturing
plant.
 The Electricity Duty as applicable shall be reimbursed for a period of 10 years. Thereafter, the
electricity duty shall be payable as applicable from time to time.
h. Preferential banking capacity allotment
 RE manufacturing units having presence from Mine - Module (Vertically Integrated Solar PV
value chain) and allocated Production Linked Incentive (PLI) under “National Programme
under High Efficiency Solar PV Module” scheme issued by GoI shall be given priority for
banking of energy/banking capacity allotment for a period of 25 years from the COD of the
Captive generating plant.
i. Industrial water
Industrial water shall be provided at the doorstep of the manufacturing facility and 25% exemption
shall be payable of the applicable industrial water charges for 10 years. Thereafter, the water
charges shall be payable as per the applicable rates from time to time.
j. Connectivity
Power connectivity to the manufacturing facility shall be provided at the doorstep based on
APERC (Licensee‟s Standards of Performance) Regulation, 2004 (Regulation No. 7 of 2004).The
manufacturing unit shall be exempt from payment of applicable development and supervisory
charges for power connectivity to the unit. The power evacuation connectivity to the captive
generating plant shall be provided on the basis of high value addition (INR Cr/Acre)for allocation
of the manufacturing unit and shall be guided as per the APERC Power Evacuation from Captive
Generation, Cogeneration and Renewable Energy Source Power Plants (Regulation No 3 of
2017) and its amendments from time to time.
k. Off-take guarantee
The distribution licensee shall provide off-take guarantee of 10% of total annual solar capacity
(MW) procured by DISCOM to the solar manufacturers at L1 tariff discovered in AP DISCOMs
procurement or SECI bids (last quarter). The off-take guarantee shall be applicable only for
manufacturing facilities present across the value chain of Ingot -Wafer-Cell-Module and for 5
years from the COD of the manufacturing facility.

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7. Wind Power
With its long coastline and favourable wind conditions, Andhra Pradesh is poised to become a leader
in wind energy production. The policy aims to increase the state‟s wind power capacity in line with the
Central Government's target of achieving 140 GW of wind energy by 2030. This policy aims to
promote new wind power projects and repowering of existing wind power projects.

7.1 Wind Power Projects

7.1.1 Wind Projects for Sale of Energy within Andhra Pradesh:

Selection of projects under InSTS category (excluding open access projects) shall be through a
competitive bidding process, as per the requirement of APDISCOMs to fulfil RPO target fixed by the
APERC or any requirements beyond RPO target subject to the approval of the APERC. Project
developer shall be allowed to develop the MW scale wind power projects through open access route
under this Policy for sale of energy within the State subject to evacuation feasibility.

7.1.2 Wind Projects for Sale of Energy outside Andhra Pradesh:

Selection of projects under ISTS category shall be through a competitive bidding process as
conducted by intermediaries such as SECI, NTPC and others. Project developer can also develop the
MW scale projects under open access route and for sale of energy outside the Andhra Pradesh State
as per this Policy and with guidelines issued by appropriate authorities from time to time.

7.1.3 Repowering of Existing Wind Power Projects

The Government of Andhra Pradesh will promote repowering of existing wind turbines which have
completed at least 10 years in operation. Repowering shall include provisions for repowering existing
wind power projects by replacing lower-capacity, lower-hub-height WTGs with more advanced,
higher-capacity WTGs in line with the National Repowering and Life Extension Policy for Wind Power
Projects, 2023.In the case of power being procured by AP discoms through PPA, the power
generated corresponding to average of last three years‟ generation prior to repowering would
continue to be procured on the terms of PPA in-force, as approved by the commission and remaining
additional generation may be purchased by discoms as per their requirements at a tariff discovered
through competitive bidding, subject to the approval of commission. The repowered wind projects
shall also be allowed to use the additional power for captive/group captive or third-party sale within
and/or outside the State. The pre-feasibility for evacuation of repowered energy through STU or CTU
(as the case may be) shall be assessed by the Project developer.

7.2 Incentives from State Government

7.2.1 Incentives & applicable charges for wind power projects

To enable wind power capacity addition in the State, following incentives shall be provided for Eligible
Developers for setting-up projects during the operative period of this policy. In addition to the below
mentioned incentives, the applicable fees & charges for all types of wind projects shall be applicable

36
 as per clause 5.6&clause 18.1.In addition to the charges mentioned in clause 18.1, the applicable
charges and incentives are as below:

a. Transmission and Distribution/Wheeling Charges

Applicable Transmission &Distribution/Wheeling charges shall be paid as mentioned in the clause
5.7 of the policy.
b. Energy Banking, Settlement & Balancing
Banking shall be applicable as per the Green Energy Open Access Regulations 2024 as detailed
in the clause 5.11of the policy.
c. Reactive Power Charges
The reactive power charges shall be payable in compliance with the Indian Electricity Grid Code
(IEGC). Reactive power charges shall be INR 0.25/kVARh up to 10% of net active energy
generated &INR 0.50/kVARh thereafter.

7.2.2 Incentives& applicable charges for wind turbine manufacturing facilities

The disbursement of capital subsidy on FCI shall be payable as per clause 5.12. The applicable
incentives and charges to be payable are given below:

a. Capital Subsidy
Capital subsidy shall be provided on 25% of the Fixed Capital Investment (FCI) including Captive
generating plant. The capital subsidy shall be paid over a period of 5 years from COD of the
manufacturing project.
b. Land
GoAP/ NREDCAP shall facilitate procurement/ Acquisition of land on actual cost basis
(Manufacturing plant).Priority allotment of revenue/ government land on long-term lease basis at
INR 31,000/acre/year with 5% escalation for every 2 years.
c. Provision for land conversion
Deemed Non-Agricultural status will be accorded for the land utilized for development of Wind
Manufacturing Projects. However, an application has to be submitted to Revenue Department for
one time land conversion. Any applicable fee for such land conversion shall be exempted for all
types of Wind Manufacturing Projects eligible under the policy.
d. Open Access Charges and Energy Banking
Exemption of Open Access Charges including Transmission charges, Distribution/ Wheeling
charges, and Cross Subsidy Surcharge for 10 years. Energy Banking shall be as per GEOA
Regulations 2024.
e. SGST Reimbursement

GoAP shall provide reimbursement of 100% net SGST on sale of products for a period of 5 years.

f. Production linked incentive

Production linked incentives shall be payable as per applicable MNRE guidelines, if any.

37
 g. Subsidy on Power Costs/ Electricity Duty
Subsidy on electricity tariff of INR 1.0/kWh for 10 years from COD of the manufacturing plant. The
Electricity Duty as applicable shall be reimbursed for a period of 10 years. Thereafter, the
electricity duty shall be payable as applicable from time to time.
h. Industrial water
Industrial water shall be provided at the doorstep of the manufacturing facility and 25% exemption
of the applicable industrial water charges for 10 years. Thereafter, the water charges shall be
payable as per the applicable rates from time to time.
i. Connectivity
Power connectivity to the manufacturing facility shall be provided at the doorstep based on
APERC (Licensee‟s Standards of Performance) Regulation, 2004 (Regulation No.7 of 2004).The
manufacturing unit shall be exempt from payment of applicable development and supervisory
charges for power connectivity to the unit.
j. Off-take guarantee
The distribution licensee shall provide off-take guarantee of 10% of total annual wind capacity
(MW) procured by DISCOM to the WTG manufacturers at L1 tariff discovered in AP DISCOMs
procurement or SECI bids (last quarter). The off-take guarantee shall be applicable for 5 years
from COD of the manufacturing facility.

8. Wind-Solar Hybrid Power

Solar and wind power are variable and unpredictable in nature, posing certain challenges on grid
security and stability. Studies reveal that, solar and wind resources are complimentary to each other
and hybridization of these two technologies would help in minimizing the variability apart from
optimally utilizing the infrastructure including land and transmission system. Andhra Pradesh, with its
abundant solar and wind resources, has set an ambitious target to significantly expand its solar, wind
and wind-solar hybrid power generation capacity. The policy aims to take forward the work done
under the previous Andhra Pradesh Wind Solar Hybrid Policy 2018 to promote hybrid green energy
generation in the state.

8.1 Wind-Solar Hybrid Power Projects

Hybrid projects can be Wind-Solar projects with or without energy storage system. The rated capacity
of one resource (wind or solar) shall be as per the National Wind-Solar Hybrid Policy 2018, vide
notification No.238/78/2017-Wind, dated 14 May 2018, issued by the Ministry of New & Renewable
Energy and its amendments or as per the guidelines issued by MNRE for Hybrid Projects. Other
provisions as per the National Wind-Solar Hybrid Policy 2018 shall be applicable. This Policy is
applicable for hybridization of existing or under construction Wind or Solar projects into hybrid
projects and also for new Wind-Solar Hybrid projects. New wind-solar hybrid projects shall be
encouraged for third party use, captive usage, and sale within the state through competitive bidding
process.

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8.2 Incentives from State Government
8.2.1 Incentives& applicable charges for wind-solar hybrid power projects

To enable wind-solar hybrid power capacity addition in the State, following incentives shall be
provided for Eligible Developers for setting-up project during the operative period of this policy. In
addition to the below mentioned incentives, the applicable fees & charges for all types of wind-solar
hybrid projects shall be applicable as per clause 5.6&clause 18.1. In addition to the charges
mentioned in clause 18.1, the applicable charges and incentives are as below:

a. Transmission and Distribution/Wheeling Charges

GoAP shall provide 50% exemption on Transmission and Distribution/ Wheeling Charges for
wheeling of power generated from wind-solar hybrid projects from the COD for a period of 5
years. Thereafter, the transmission and distribution/wheeling charges shall be payable in full as
applicable from time to time.
b. Energy Banking, Settlement & Balancing
Banking shall be applicable as per the Green Energy Open Access Regulations 2024 as detailed
in the clause 5.11 of the policy.
c. Reactive Power Charges
The reactive power charges shall be payable in compliance with the Indian Electricity Grid Code
(IEGC). Reactive power charges shall be INR 0.25/kVARh up to 10% of net active energy
generated &INR 0.50/kVARh thereafter.

9. Renewable Economic Zones (REZs)

a. The Government of A.P will encourage large scale development of renewable economic zones
which could accommodate solar, wind and wind-solar hybrid plants along with storage given the
abundant resource availability of both solar and wind in certain parts of Andhra Pradesh.
NREDCAP/APSPCL or any other agency as notified by GoAP(Nodal Agency) for development of
REZ. Nodal agency to develop the plug & play infrastructure for REZ which would subsequently be
recovered from Project developers located in the parks by levying development and O&M charges.
REZ hosting the projects should be focused on the consumption within the state, followed by export
to other states.
b. REZ Developer to develop necessary infrastructure required for REZ such as power evacuation
system, administrative building, infrastructure including road, water, drains, ducts etc. REZ
Developer may recover applicable charges from Project developers i.e. Lease charges,
infrastructure/ development charges, utilities charges, O&M charges for infrastructure, O&M of plant
etc.
c. The REZ shall follow the contours of the policy and shall pay all the applicable fees and charges as
per clause 5.6upon allocation along with the applicable GEOA charges as per the GEOA
Regulations 2024.

39
10. Green Hydrogen and its derivatives
Green hydrogen represents the next frontier in the clean energy transition, offering a sustainable
alternative to fossil fuels in industries and transportation. Green Hydrogen and its derivatives reduce
greenhouse gas emissions by replacing fossil fuels in hard-to-abate sectors, such as refineries,
fertilizers, steel, transport, etc., enabling clean energy storage, and producing low carbon chemicals.
Thus, Green Hydrogen and its derivatives are important pillars of the net zero economy. Andhra
Pradesh has been instrumental in advancing the Government of India's energy initiatives, introducing
several measures like investor-friendly solar and wind power policies, developing green energy
corridors for power transmission, and allocating land to expedite the growth of the renewable energy
sector in the state.

The state boasts the second-longest coastline in India, featuring six operational ports, with additional
ports under development to enhance export capabilities. It also has a strong infrastructure network of
roads and railways connecting major industrial hubs, abundant water resources from the Godavari
and Krishna rivers, and rich natural resources. Andhra Pradesh is well-positioned to produce cost-
effective Green Hydrogen leveraging its resources. The state‟s ports, equipped with infrastructure for
storing liquid nitrogen, can also be used for storing and exporting Green Hydrogen, making it more
affordable for international users.

This policy supports the production, storage, and utilization of Green Hydrogen and its derivatives,
aligning with the National Green Hydrogen Mission. It encourages the establishment of Green
Hydrogen and its derivatives production facilities using renewable energy and biomass, with
incentives for rapid deployment of renewable energy and Electrolyzer capacities to achieve
economies of scale.

To minimize the cost of renewable energy and to enable green hydrogen ecosystem, the policy
proposes to extend various supporting incentives for transmission, connectivity, banking, open
access, and energy storage for Green Hydrogen production projects.

10.1 Incentives from the State Government

10.1.1 Incentives for producers of Green Hydrogen & its derivatives

The following incentives shall be provided for the Green Hydrogen and its derivatives projects set
up during the policy operative period:

a. Capital Subsidy
i. Capital Subsidy for Electrolyzer-based Green Hydrogen Projects on Electrolyzer:

Capital subsidy of 25% only on plant and equipment costs of Electrolyzer stack, subject to a
maximum of INR 1 Cr. per MW or INR 1 Cr. per 1,400 TPA shall be paid to the Developer
over a period of five (5) years post commissioning of the plant. The subsidy shall be eligible

40
 only for plants with minimum capacity of 150 KTPA of Green Hydrogen and applicable only
for first 10 plants or up to 1.5 MTPA capacity whichever is achieved first.
ii. Capital Subsidy for Integrated Green Ammonia and Green Methanol Facilities:

Capital subsidy of 25% shall be provided on plant & equipment costs (including Electrolyzer
stack) for integrated Green Ammonia & Green Methanol (including Biogenic Carbon)
production facilities, subject to a maximum of
 INR 1.85Crore per KTPA production unit of Green Ammonia facility
 INR 2.25 Crore per KTPA production unit of Green Methanol facility
The subsidy shall be paid to the Developer over a period of five (5) years post
commissioning of the plant.
All incentives provided under Green Hydrogen, Green Ammonia, Green Methanol are also
applicable to produce SAF derived from Green Hydrogen & its derivatives.
b. Capital Subsidy on Desalination Plant

Capital subsidy of 20% on Fixed Capital Investment (FCI) of desalination plant set up for Green
Hydrogen and its derivatives subject to a maximum of INR 1 Cr. per MLD shall be paid to the
Developer over a period of five (5) years post commissioning of the plant. Desalination plant may
be setup by Project developer, or any third party are eligible for capital subsidy.

c. Finance assistance for Green Hydrogen Hubs

In addition to the Central Financial Assistance (CFA) provided by Central Government, the state
will provide up to 25% of the cost, up to INR 10 Crore, for infrastructure related to power, water &
roads required to develop Green Hydrogen Hubs within the state, limited to one hub per port and
the incentives will be disbursed in five (5) years from the time of approval by the SNA. The
available government/ revenue land parcels in port vicinity shall be leased at INR 1 Lakh per acre
per year.
d. Provision for land conversion

Deemed Non-Agricultural status will be accorded for the land utilized for development of Green
Hydrogen and its derivatives projects. However, an application has to be submitted to Revenue
Department for one time land conversion. Any applicable fee for such land conversion shall be
exempted for all types of Green Hydrogen and its derivatives projects eligible under the policy.

e. SGST Reimbursement

GoAP shall provide reimbursement of 100% net SGST revenue to the Developer from sale of
Green Hydrogen and its derivatives within the State for a period of five (5) years from COD.

f. Other infrastructural requirements

Industrial water shall be provided at the doorstep of the manufacturing facility and 25% exemption
of the applicable industrial water charges for 5 years. Thereafter, the water charges shall be

41
 payable as per the applicable rates from time to time. Any other charges on power & other
infrastructure shall be paid as applicable from time to time.

g. Intra-State Transmission Charges for wheeling of power

50% of Intra-state transmission charges shall be exempted to the Developer for a period of five
(5) years from COD for the power procured from Renewable Energy (with or without storage)
plants located within the State subject to maximum of INR 15 Lakhs per MW per year of installed
Electrolyzer capacity and thereafter shall be paid as applicable from time to time.

h. Transmission Losses

Applicable losses to be paid for sourcing Renewable Energy for Green Hydrogen and its
derivatives generation.

i. Cross Subsidy Surcharge:

The cross-subsidy surcharge, as applicable to the Energy Intensive Industry category, shall be
exempted for energy drawn from Renewable Energy plants located within the State for production
of Green Hydrogen and its derivatives for a period of five (5) years from the COD.

j. Additional Surcharge:

100% exemption of Additional Surcharge for a period of five (5) years from COD and thereafter
shall be paid as applicable from time to time.

k. Electricity Duty:

100% reimbursement of Electricity Duty for the power consumed for production of Green
Hydrogen and its derivatives from RE plants (with or without storage) for a period of five (5) years
from COD and thereafter shall be paid as applicable from time to time.

l. Energy Banking, Settlement &Balancing:

Banking shall be applicable as per the Green Energy Open Access Regulations, 2024 as detailed
in the clause 5.11 of this policy.

m. Renewable Energy for production:

th
As per Green Hydrogen Policy notified by Ministry of Power, Govt. of India on 17 February 2022,
the State will promote production of Green Hydrogen and its derivatives by using Renewable
Energy and/or Biomass from any of the following ways:
 Open access route from co-located or differently located RE plant.
 Captive route from co-located or differently located RE plant set up by the Developer.
 Third-party sale/Power exchange.
 Procuring from APDISCOMs and shall only pay the cost of procurement as well as the
wheeling charges, if applicable and a small margin as determined by the State Commission.

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 n. Other Incentives

Any other incentives as provided by the Central Government for production of Green Hydrogen
and its derivatives shall be extended by the SNA to the Developer without any financial
commitment by the State Government. All incentives provided for Green Hydrogen/Green
Ammonia/Green Methanol are also applicable to produce SAF derived from Green Hydrogen &
its derivatives.

10.1.2 Incentives for Electrolyzer Manufacturing facilities:

The following incentives shall be provided for the Electrolyzer Manufacturing units for production of
Green Hydrogen and its derivatives set up during the policy operative period:

a. Capital Subsidy

Capital subsidy of 25% on Fixed Capital Investment (FCI)for manufacturing of electrolyzer over 5
years from COD. The minimum size of the plant shall be 500 MW of Electrolyzers production per
annum and the subsidy shall be applicable only for first 5 plants or up to 3,000 MW capacity
whichever is achieved first.
b. Provision for land conversion

Deemed Non-Agricultural status will be accorded for the land utilized for development of
Electrolyzer Manufacturing projects. However, an application has to be submitted to Revenue
Department for one time land conversion. Any applicable fee for such land conversion shall be
exempted for all types of Electrolyzer Manufacturing projects eligible under the policy.

c. SGST Reimbursement

GoAP shall provide reimbursement of 50% net SGST revenue to the Developer for a period of
five (5) years.
d. Electricity Duty

100% reimbursement of Electricity Duty for a period of five (5) years from COD for manufacturing
of Electrolyzers and thereafter shall be paid as applicable from time to time.
e. Power Subsidy

Reimbursement of Power Tariff at INR 1/kWh for a period of five (5) years and thereafter shall be
paid as applicable from time to time.
f. Industrial water:
Industrial water shall be provided at the doorstep of the manufacturing facility and 25% exemption
of the applicable industrial water charges for 10 years. Thereafter, the water charges shall be
payable as per the applicable rates from time to time.

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 10.1.3 Incentives for Hydrogen Refueling Stations

a. Capital Subsidy
Capital subsidy of 25% on Fixed Capital Investment (FCI) for hydrogen refueling plants for the
first 10 units shall be paid to the Developer over a period of five (5) years from commissioning of
the plant post approval from SNA.
b. SGST Reimbursement

GoAP shall provide reimbursement of 100% net SGST for purchase of machinery for refueling
stations for a period of five (5) years from commissioning of the plant post approval from SNA.

11. Biofuels
India is one of the fastest growing economies in the world and achieving energy security remains
critical for India‟s growth. India is currently world‟s third biggest oil consuming and importing nation
and its energy security remain vulnerable until alternate fuels to substitute/supplement crude oil-
based fuels are developed indigenously.

In order to cut India‟s dependence on the imports of fossil fuels and encourage production of
sustainable and alternate fuels, Government of India (GoI) has notified National Policy on Biofuels
2018 - Ethanol Blended Petrol Programme, National Biodiesel Mission, Biodiesel Blending
Programme - to promote Biofuels in the Country and setup a target of 20% blending of ethanol in
petrol by Ethanol Supply Year (ESY) 2025-26 and 5% blending of biodiesel in diesel/direct sale of
biodiesel by 2030.

In addition, the Government of India has launched the SATAT (Sustainable Alternative Towards
Affordable Transportation) scheme to promote the production of Bio-CNG/Compressed Biogas
(CBG), targeting 15 MMT of Bio-CNG/CBG by 2023 from 5,000 plants across the country. The
government has also introduced the “Waste to Energy” program to support the development of
projects that generate Biogas, Bio-CNG,Power, or producer/syngas from urban, industrial, and
agricultural wastes or residues.

Andhra Pradesh has been playing a pivotal role in supporting Government of India‟s various initiatives
in the energy domain and has been rolling out several initiatives such as investor friendly solar and
wind power policies, development of large-scale solar park(s) and green corridors for power
evacuation and providing lands for accelerating development of RE sector in the State.

Andhra Pradesh is an agrarian economy, with 62% of its population dependent on agriculture. The
prospective increase in the production of agricultural commodities such as sugarcane, broken rice,
maize, sugar beet, sweet sorghum, corn, cassava, etc., along with initiatives like “Clean Andhra
Pradesh (CLAP)” for waste management through public participation, provides significant scope and
impetus for establishment of Biofuel plants (bioethanol, biodiesel, bio-CNG/Compressed Biogas

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 (CBG), etc.) in the State. Additionally, as one of the top crude oil consuming states, Andhra Pradesh
has immense potential for Biofuel production to meet blending targets with petrol or diesel.

In order to realize India‟s vision of increasing the use of biofuels in the energy and transportation
sectors, the Government of Andhra Pradesh hereby notifies this policy to promote production and
attract potential investors in industries manufacturing Biofuels such as ethanol, bio-CNG/Compressed
Biogas (CBG), etc., in the State.

11.1 Incentives from the State Government

11.1.1 Incentives for producers of Biofuels

The following incentives shall be provided for the Biofuels projects set up during the policy
operative period:
a. Capital Subsidy
i. CBG Plant:
Capital subsidy of 20% on Fixed Capital Investment (FCI) of CBG plant, subject to a
maximum of INR 1 Cr per TPD capacity of CBG plant and shall be provided over a period of
5 years post COD. The subsidy shall be eligible only for plants with minimum capacity of 10
TPD of CBG plant. The subsidy shall be applicable only for first 1,000 plants or up to 10,000
TPD capacity whichever is achieved first.
ii. 2G Ethanol:

Capital subsidy of 20% on Fixed Capital Investment (FCI) of 2G Ethanol plant, subject to a
maximum of INR 1.5 Cr per KLPD capacity of 2G Ethanol plant and shall be paid over a
period of 5 years post COD. The subsidy shall be eligible only for plants with minimum
capacity of 25 KLPD of 2G Ethanol. The subsidy shall be applicable only for first 50 plants or
up to 1,500 KLPD capacity whichever is achieved first.
iii. 1G Ethanol: Nil
b. SGST Reimbursement for 1G&2G Ethanol and CBG Plants

GoAP shall provide reimbursement of 100% net SGST revenue to the Developer for sale of 1G &
2G Ethanol and CBG in the State for a period of five (5) years from COD.
c. Electricity Duty for 1G&2G Ethanol and CBG Plants

100% reimbursement of Electricity Duty for power consumed for production of Biofuels for a
period of five (5) years from COD.
d. Power Subsidy
Reimbursement of Power Tariff at INR 1/kWh for a period of five (5) years and thereafter shall be
paid as applicable from time to time.
e. Biomass Collection/Subsidy for setting up 2G Bio Ethanol plant
Capital subsidy of 20%for Co-operative agencies for biomass processing equipment shall be paid
to the Developer over a period of five (5) years through Agriculture Infrastructure Fund (AIF) and

45
 other applicable routes. The Policy incentivizes local bodies and farmers to establish feedstock
collection centres with storage facilities, using benefits from the Andhra Pradesh Industrial
Development Policy (APIDP). Manufacturers are required to source feedstock from these centres.
f. Land

Land lease charges of revenue/government/private/patta land shall be INR 15,000 per acre per
year with 5% escalation for every 2 years for biofuel plants.
g. Provision for land conversion
Deemed Non-Agricultural status will be accorded for the land utilized for development of biofuels
projects. However, an application has to be submitted to Revenue Department for one time land
conversion. Any applicable fee for such land conversion shall be exempted for all types of
biofuels projects eligible under the policy.
h. Single Window Clearance

NREDCAP will develop a portal for facilitating single window clearance for all projects under this
policy. The services of this single window clearance portal will be made available to all the
projects under this policy for obtaining time bound statutory clearances for establishing Biofuel
plants.
i. Feedstock Collection Centres

This policy provides support to local bodies/farmers/concerned stakeholders for setting up of

feedstock collection centres with feedstock storage facilities. The manufacturers shall be
mandated to procure the feedstock/raw materials from such feedstock collection centres.
j. Other Incentives

Any other incentives as provided by the Central Government for production of Biofuels shall be
extended to the Developer without any financial commitment by the State Government. All
incentives provided under biofuels category are also applicable to produce SAF derived from
biofuels.

12. Energy Storage

CEA in its Report titled “Optimal Generation Capacity Mix for 2029-30” projected the solar and wind
generation capacities would be 140 GW and 280 GW respectively by 2029-30 and requirement of 10
GW PSP and 27 GW of BESS capacities. Identifying the importance of Energy Storage Systems,
Ministry of Power (MoP) has undertaken various initiatives to promote these technologies as
highlighted below:

a. Introduction of Energy Storage Obligations (ESO) for the DISCOMs to procure 4% of total
RPO requirement through Energy Storage systems by FY 2030.
th
b. MOP vide notification dated. 29 January 2022“Clarification regarding usage of ESS in
various applications across the entire value chain of power sector” highlighting that ESS can
be utilized either on stand-alone basis or in complementary with power generation,

46
 transmission, and distribution. ESS shall be accorded status based on its application area i.e.,
generation, transmission, and distribution. Additionally, ESS Developers have the flexibility to
Sell, lease, or rent storage space to any utility engaged in generation or transmission or
distribution or to a load dispatch Centre. The owner of ESS may use part or all of the storage
space to buy, store, and sell electricity at a later time.
th
c. MOP vide dated9 June 2023, issued Guidelines for Tariff based Competitive bidding process
for Procurement of Firm and Dispatchable Power from Grid connected Renewable Power
Projects with Energy Storage Systems
d. In August 2023, MOP has issued National Framework for Promoting Energy Storage Systems
e. The Central Electricity Regulatory Commission (Ancillary Services) Regulations, 2022 enable
ESS to provide Secondary Reserve Ancillary Service (SRAS) and Tertiary Reserve Ancillary
Service (TRAS), under certain conditions. This development will generate a new source of
income for Energy Storage System (ESS) service providers, incentivizing investments in the
energy storage sector and driving growth.

Building on the momentum from various central government initiatives, Andhra Pradesh state has
come up with a policy on pumped storage in 2022. With a renewed vision to establish Andhra
Pradesh as the "Storage Capital of India", the subsequent sections of the Policy shall highlight the
key incentives and provisions provided for Energy Storage Systems, both Pumped Storage Power
(PSP) and Battery Energy Storage Systems (BESS).

12.1 Pumped Storage Power (PSP) Projects

In April 2023, the Ministry of Power introduced guidelines for pumped storage hydropower projects,
acknowledging their crucial role in grid stability and meeting peak power demands. The guidelines
offer recommendations for the PSP market, policies, and safe development practices. Key aspects
include:

 Budgetary support for construction of roads and bridges by Hydro Power Project developers,
including PSPs up to Rs 1.5 crore/MW for projects up to 200 MW and up to Rs 1 crore/MW
for projects above 200 MW.
 Monetization of ancillary PSP services to meet critical electricity market requirements.
 Directions on offering tax incentives and land acquisition fee exemptions for off-river projects.
 Eliminating upfront premiums for project allocation.
 Identifying and safe development of abandoned mines as potential PSP sites.

To ensure timely clearances for Pumped Storage Projects, the Central Electricity Authority has
issued Guidelines for Formulation of Detailed Project Reports for Pumped Storage Schemes in June
2023. In addition, since no tariff/financial evaluation is required to be done by CEA for PSP projects
allotted through Tariff Based Competitive Bidding or as part of integrated Clean Energy Project or as

47
 Captive generating plant, CEA has reduced the timeline for concurrence of such projects to 50 days.
For other PSPs, the timeline for concurrence has been reduced to 90 days.

On August 22, 2024, MOP has introduced draft guidelines for competitive bidding to procure storage
capacity and stored energy from Pumped Storage Plants, aiming to establish a transparent,
equitable, and standardized framework that distributes risk fairly among stakeholders.

Andhra Pradesh is at forefront in the country in identifying potential PSP sites totaling34 GW
capacity near to the existing reservoirs and off-the-river locations for promotion of Pumped Storage
Hydro Power Projects. Taking into consideration the RE capacity addition targets, HPO targets and
the huge PSP potential within the State, the State Government to encourage, develop and promote
PSP projects by Developers notified “Andhra Pradesh Pumped Storage Hydro Power Projects Policy
2022”.

As part of the Integrated Clean Energy Policy 2024, the Government of Andhra Pradesh is
introducing a revised policy framework to drive the development of Pumped Storage Power (PSP)
projects. This updated policy considers the significant advancements made since the previous policy
was released and addresses the evolving needs of Developers, ensuring a more conducive
environment for PSP growth.

12.1.1 Incentives from State Government

a. Resource Allocation
Resource allocation process shall be done as per clause 5.4of the policy.
b. Land allotment/ facilitation
Concessional land allotment /facilitation shall be done as per clause 5.4 of the policy.
c. Budgetary Support
Ministry of Power guidelines dated 10.04.2023 extends its Budgetary Support in the form of
reimbursement towards Cost of Enabling infrastructure such as all Roads and Bridges required to
connect major components like Dam, Powerhouse, pressure shaft, etc. to the nearest
State/National Highway. SNA shall facilitate the Developer for getting “in principle” approval for
the grant from Ministry of Power.
d. Grid Connectivity & Power Evacuation
Grid connectivity & power evacuation shall be provided as per clause 5.5 of the policy.
e. Waiver of Stamp Duty & registration fee
In line with MOP guidelines dated 10.04,2023 to promote development of Pump Storage Projects,
Stamp duty and registration fees shall be exempted for land to be acquired by off-the-river PSP
projects.
f. Water allocation & Charges

In line with MOP guidelines dated 10.04,2023 to promote development of Pump Storage Power
Projects, no water cess shall be levied. GoAP shall facilitate water allocation on priority as per the

48
 Industrial Water Supply Policy / guidelines issued by the Water Resources Department. Water for
one time filling and annual recoupment shall be charged as per applicable rates, as amended
from time to time.

g. Electricity Duty
Electricity Duty is exempted on conversion losses for the period of 25 years.
h. Cross Subsidy Surcharge (CSS)
Cross Subsidy Surcharge shall be levied only on final consumption or sale of electricity.
i. Free Royalty Power
No imposition of requirement of free power to home state (Andhra Pradesh)
j. Market reforms

APERC may devise appropriate rules in line with MOP‟s Guidelines to promote development of
Pump Storage Power Projects dated 10.04.2023, to create market for ancillary services, thereby
provide appropriate market signal for PSP generators. ln the event of capacity contracted not
being fully utilized by the contracting agency, the Developer would be free to transfer the usage of
the capacity to other interested entities so that resources do not remain idle. The gains made
shall be shared with the original beneficiary in the ratio of 50:50.

k. Cost of Local Area development

Developers shall follow the guidelines issued by the Government of India from time to time for
promotion of Hydro Power Projects.
l. Rehabilitation & Resettlement
Developers shall mandatorily follow the provisions of Rehabilitation & Resettlement Policy of the
Government of India and Government of Andhra Pradesh scrupulously at their own cost.
m. Input Power

If Developer sets up Captive generating plant for the purpose of meeting input power requirement
for PSP, the SNA shall facilitate allotment of project as per „AP Integrated Clean Energy Policy
2024‟.Energy Banking facility will not be extended for such Captive generating plants.

n. Transmission Charges
Applicable Transmission charges shall be paid as mentioned in the clause 5.7 of the policy.
o. Distribution/Wheeling Charges
Applicable Distribution charges shall be paid as mentioned in the clause 5.7 of the policy
p. Approvals & Clearances
SNA shall expedite the issuance of statutory clearance including Pollution Clearance,
Environment Clearance and Forest Clearance for Pumped Storage Power (PSP) projects from
concerned Ministry and authorities at both the central and state levels.
q. Others

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 Upon Developer's request, APGENCO/APTRANSCO may offer expertise in planning,
construction, and operation of Pumped Storage Projects (PSPs), subject to availability. The SNA
will facilitate consultancy services from APGENCO/APTRANSCO.

12.2 Battery Energy Storage Systems

Ministry of Power vide resolution dated 10.03.2022 has issued detailed guidelines for procurement
and utilization of BESS as part of generation, transmission, or distribution assets, or along with
ancillary services aimed to create a comprehensive framework for the procurement, integration, and
optimization of BESS in India's renewable energy sector, ensuring transparency, standardization,
and risk-sharing to maximize grid efficiency, flexibility, and bankability.

Central government has taken following key initiatives for the promotion of BESS:

 The Ministry of Power, vide note dated October 11, 2022, has included Battery Energy Storage
Systems (BESS) in the list of eligible generators permitted to participate in the High Price Day-
Ahead Market (HP-DAM) segment of the Energy Exchange. This would enable BESS Developers
to take suitable advantage of the price differential between Peak and Off-Peak tariffs.
 To ensure financial sustainability and commercial success, National framework for promoting
energy storage systems specified that Energy Storage System (ESS) Developers and
intermediary agencies will be allowed to offer a variety of market-driven energy and power
products, enabling them to tap into diverse revenue streams and maximize their economic
potential. These products may include:
a) Spot Energy Market
b) Capacity Market/Energy Arbitrage (boosting capacity value by shifting off-peak
generation to peak times)
c) Provision of ancillary services to the grid
d) Providing storage to other generating stations
e) Bundling to make RE firm and dispatchable RE power.
f) Replacing diesel generators in various sites such as construction sites, commercial and
residential areas, and islands
g) Any other product that meets market demand or requirements

MOP vide its “guidelines for procurement and utilization of Battery Energy Storage Systems as part
of generation, transmission, and distribution assets, along with ancillary services” dated 11.03.2022,
has identified following business cases regarding utilization of BESS in supply of energy and grid
maintenance:

i. RE Supply with BESS where BESS is included as part of the Clean Energy Project, utilized to
meet Peak power and firm dispatchable RE requirements of Procurers.

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 ii. BESS with transmission infrastructure: By maximizing transmission capacity and reducing
congestion, it minimizes the need for new infrastructure, making the grid more efficient and cost-
effective.
iii. Storage for ancillary services: The system operator (RLDC/NLDC and SLDCs) may use BESS
for frequency control and balancing services to manage the inherent uncertainty/variations in load
and generation.
iv. Storage for Distribution: BESS can help Discoms in managing Peak load and grid resilience,
Portfolio management and flexible operations, support large-scale electric vehicle adoption,
Extend asset life through optimal asset shifting.
v. Other options such as Arbitrage operation, sell storage space for a particular duration by
charging capacity charges, or utilize as merchant capacity.

The Government of Andhra Pradesh introduces the Battery Energy Storage Systems (BESS) policy
as part of the ICE policy, aligning with the national framework. GoAP to encourage BESS/DER
Aggregators who can provide “Storage as Service” can set up BESS projects in the state and can
cater the services specified below:

Consumer Category Services Offered by Aggregator

Ancillary services as per CERC Ancillary Services Regulation, 2022 and
Central Grid
its amendments
Ancillary services as per SERC Regulations/State Grid
State Avoidance of DSM/UI Charges
Sharing of Transmission/Distribution losses
All consumers Arbitrage of power cost/exchange
(OA/Captive/Discoms) Storage/Demand Response service to all consumers

To leverage the abovementioned market opportunities, the state intends to empower BESS/DER
aggregators with the following market models:

i. Cost Plus model (For procurement of Power/Services)

ii. Competitive bidding (For procurement of Power/Services)
iii. Storage as a Service (SAAS) - Sharing of profit/benefit between the parties (75:25 basis
between Developer and Discom)for any applications/ use cases – Avoiding/ deferment of
Capex, Avoidance of UI charges, demand response etc.

12.2.1 Incentives from State Government

a. Transmission Charges
Applicable Transmission charges shall be paid as mentioned in the clause 5.7 of the policy.
b. Distribution/Wheeling Charges

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 For Charging & Discharge of BESS in the distribution license area, distribution/ wheeling charges
shall be waived off for 12 years from COD and thereafter levied as Block wise charges (15 mins)
for applicable no. of blocks. The distribution/ wheeling charges for sale of power from BESS
through OA shall be payable as per clause 5.7.
c. Electricity Duty
Electricity duty on conversion losses is waived off for the lifetime of BESS projects.
d. Cross Subsidy Surcharge (CSS)
Cross Subsidy Surcharge (CSS) shall only be levied on final consumption of electricity.
e. SGST Reimbursement

GoAP shall provide reimbursement of 100% net SGST revenue accrued to the state on the
services provided by BESS for a period of five (5) years from COD.
f. Market Reforms
APERC may devise appropriate rules in line with MOP‟s Guidelines to promote the development
of BESS to create market for ancillary services, thereby provide appropriate market signal for
Aggregators.
g. Storage as Service
APTransco and AP Discoms shall identify and notify the list of vacant land parcels at/near EHT
substations, and Distribution sub-stations for setting up of BESS by Aggregators. This would yield
benefit to state utilities such as avoidance of (n-1) contingency at the planning stage, avoidance
of overloading of the T&D lines or deferment of T&D capex. The savings shall be shared between
the state entity and the Private Developer on 75:25 basis between Developer and Discom.

12.2.2 Incentives for Battery manufacturing units

a. Land
GoAP/ NREDCAP shall facilitate procurement/ Acquisition of land on actual cost basis.
b. Water

Water supply shall be provided (as per availability with irrigation dept.) at 50% of existing
industrial water supply tariff for the initial 3 years from COD.25% of the cost of water treatment
plant wherever necessary, shall be reimbursed with a limit of INR. 2 crores per BESS
manufacturing unit.
c. Capital Subsidy
Capital subsidy of 20% will be provided on the fixed capital investment for battery manufacturing
units, disbursed annually over 5 years from the Commercial Operation Date (COD). The 20%
capital subsidy for battery manufacturing units is applicable only for initial projects, until the
cumulative capacity reaches 5,000 MWh. However, all the other incentives shall be extended to
the eligible Battery Manufacturing projects.
d. Stamp Duty

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 100% stamp duty paid on purchase or lease of land, lease of land/shed/buildings, mortgages and
hypothecations related to BESS manufacturing plant shall be reimbursed.
e. Power subsidy
Fixed power cost reimbursement @ INR1.00 per unit for a period of 5 years from COD of the
battery manufacturing unit.
f. Electricity Duty
Electricity duty will be reimbursed for a period of 5 years.
g. Cross Subsidy Surcharge
Cross subsidy surcharge (CSS) is waived off for 10 years from COD.
h. SGST Reimbursement
100% net SGST accrued to the state will be reimbursed for a period of 5 years.
i. Off-take guarantee
10% of the manufacturing capacity shall be off taken by GoAP at average of AP DISCOM
procurement or latest SECI‟s standalone BESS tender discovered rates (in the last quarter)
j. Recycling units
Battery recycling plants will be incentivized to mine for compounds from used batteries.

13. Mini and Small Hydro

This Policy will promote generation of energy through mini and small-hydro projects in the State.
Procurement of energy from mini and small-hydro projects shall be based on the tariff based
competitive bidding process as per the requirement of DISCOMs, subject to the approval of the
APERC. Mini and Small-hydro projects allotted under open access category are permitted to use the
power for captive/group captive or third-party sale within the State.
The Government of AP will promote Mini and Small Hydro Projects as per the guidelines or
prevailing schemes of State Government/Central Government including the MNRE‟s scheme on
“Small Hydro Power Programme” and its amendments or any other forthcoming schemes/programs.
The Project developer shall obtain various statutory clearances including but not limited to techno-
economic clearances, Forest and Environmental (if necessary) clearances, clearance regarding
water availability and others required for the project development. Payment of royalty shall be as per
the Orders of Irrigation/WRD, GoAP issued from time to time.
The policy shall be applicable for all project self-identified by Project developers or for all projects
where resources are allocated by GoAP. Discoms shall procure power from all these projects and
such procured power is eligible for meeting HPO of Discoms. In addition to the budgetary support
that can be availed from MNRE as per the central government policies, these projects shall also be
eligible for
 Capacity/Fixed Charges in INR/MW/Year or
 Tariff without any ceiling on CUF

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 The power procured by Discoms from such Mini and Small Hydro projects shall be eligible for
meeting HPO.

13.1 Incentives from State Government

13.1.1 Incentives& applicable charges for mini and small hydro power projects

a. Resource & Land Allocation

Resource allocation process and details of concessional land allotment is mentioned in clause 5.3
&5.4 of the policy. GoAP shall provide a provision for an outright purchase of land by Developer
at INR 5 lakhs/acre or basic value, whichever is higher, for the project, given the long gestation
period and project life.
b. Determination of Tariff
Discoms shall procure either through competitive bidding route or Commission determined
generic tariff without having any ceiling on CUF/ PLF.
c. Transmission and Distribution/Wheeling Charges
Applicable T&D charges shall be paid as mentioned in the clause 5.7 of the policy.
d. Energy Banking, Settlement & Balancing
Banking shall be applicable as per the Green Energy Open Access Regulations 2024 as detailed
in the clause 5.11 of the policy.

14. Electric Mobility – EV Charging Infrastructure

Andhra Pradesh has witnessed a remarkable surge in Electric Vehicle (EV) registrations from
1,939no‟s in 2018-19 to 36,291 no‟s in 2023-24with 80%CAGR, driven primarily by the policy
initiatives during this period. The growth was led by electric two-wheelers, followed by electric three-
wheelers and electric four-wheelers, indicating a significant shift towards sustainable transportation
4
in the state .

The electric vehicle (EV) sector's fast-evolving landscape demands a flexible and adaptive policy
framework, necessitating regular updates and revisions to keep pace with the latest developments
and trends. Therefore, the Energy Department, GoAP is revising the policy related to Electric Vehicle
Charging Infrastructure (EVCI) as part of the ICE policy, since this aspect of the EV mobility value
chain is closely tied to electricity sector. The policy details for the remaining components of the EV
value chain can be found in the policy document to be released by the Department of Industries &
Commerce and GoAP.

14.1 Incentives from State Government

14.1.1 Incentives for Electric Vehicles Charging Infrastructure (EVCI) projects.

a. Land

4
Vahan Portal Dashboard

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 SNA shall invite tenders through competitive bidding for identification of Charge Point Operators
(CPO) who shall install and operate EV charging stations at the sites notified by the SNA.
Government/Public entity sites shall be offered at floor price of Rs. 1 per unit to private CPOs as
per MOP guidelines 2024. SNA shall charge PMA charges for the same.

b. Capital Subsidy

Capital Subsidy of 25% on cost of public charging station (excluding land, cost of electricity
connection, DTR, any civil costs)subject to a maximum of INR 3 Lakhs/PCS for the first 5,000 EV
Public Charging Stations over a period of 5 years.

i. State Corporations, Dist. Headquarters, Private commercial buildings /apartments

/societies (>500 flats/ houses) – 1,000 no‟s
ii. State Highways – 150 no‟s; NHs – 1,500 no‟s.
iii. National Highways – 1,500 no‟s.
iv. Municipalities, Towns, MHQs – 1,000 no‟s

SNA can aggregate the available sites in collaboration with various government entities and call
for tenders from eligible CPOs for establishing EV PCS. However, State government entities with
suitable sites can independently issue tenders. Capital subsidy shall be extended to first 5,000
EV PCS established by SNA, State govt. entities, and Private Developers or CPOs.

The specified EV PCS numbers for various categories as per 14.1.1.b(i) are indicative numbers,
however the numbers may vary with in the categories as per market conditions. But in total the
incentive shall be given to only first 5,000 charging stations which shall be allocated to CPDs and
CPOs in an equitable manner.

c. Charging Infrastructure Connectivity and Tariff

A separate EV tariff category with ToD tariff and Dynamic tariff mechanisms to CPOs. The
maximum ceiling tariff (MCT) of INR 15 per unit for EV end-consumers or as determined by
APERC in line with guidelines issued by MoP.DER Aggregators shall be empowered to operate
Smart EV charging stations for Demand Response management. EV charging stations can avail
input power from any Open Access/Green OA generator. Green OA shall be governed as per
APERC Green Energy Open Access, Charges, and Banking Regulation 2024.
d. Mandates

All new permits for commercial complexes, housing societies and residential townships with a
built-up area 5,000 sq.mt and above will mandate charging stations. Public parking spaces will be
mandated to have charging stations. Municipalities shall issue provisional permissions online
immediately to setup charging/battery swapping stations. Any verification shall only be posting
sanction of provisional permission. City codes will be modified for both public places and private
buildings in order to make the infrastructural changes needed for charging infrastructure. Urban

55
 local bodies, Municipality rules/regulations will be modified to allow charging and stations to be
setup within its limits as and when required.

e. IT & Communication

NREDCAP shall develop an integrated mobile application to enable EV users to identify existing
EV Public charging stations, communicate to Central Management Systems (CMS) of charging
equipment for effective coordination of Time of Day (ToD), Time of Use (ToU) tariffs and share
sales data with Discoms. Cloud charging features will be encouraged to have all metering and
transactions done digitally with payment apps, NFC enabled devices, RFID tags, etc., while
keeping it flexible and customer friendly.

f. Others
NREDCAP shall facilitate CPO in getting the applicable central government subsidies towards
establishment of EV Public Charging Stations under FAME-II or other schemes announced from
time-to-time. Third party EV charging service providers can also setup their own renewable
energy generating stations at their premises only for charging electric vehicles.
g. Quality and Standards

Standards for charging equipment will also be created in close association with the central
government departments and scientific bodies. The state will follow the charging specifications as
per the guidelines issued by Department of Heavy Industries, GOI.

15. Renewable Energy Manufacturing Zone (REMZ)

a. The Government of A.P will encourage large scale development of Renewable Energy
Manufacturing zones (REMZ) which would accommodate RE Manufacturing Projects (solar, wind,
battery and electrolyzers manufacturing). APSPCL shall be the Nodal Agency for REMZ and in
coordination with other GoAP departments shall establish REMZ as a dedicated manufacturing hub.
Nodal agency shall provide last mile connectivity for power, roads, water, etc. to each of the
manufacturing units within the REMZ. APSPCL to develop the plug & play infrastructure for REMZ
which would subsequently be recovered from Developers located in the REMZ by levying
development charges.
b. REMZ Developer to develop necessary infrastructure required for REMZ such as power evacuation
system, administrative building, infrastructure including road, water, drains, ducts etc. REMZ
Developer may recover applicable charges from Project developers i.e. Lease charges,
infrastructure/ development charges, utilities charges, O&M charges for infrastructure, O&M of plant
etc.
c. The REMZ shall follow the contours of the policy and shall pay all the applicable fees and charges
as per clause 5.6 upon allocation along with the applicable GEOA charges as per the GEOA
Regulations 2024.

56
16. Promotion of New and Innovative RE (NIRE) Technologies
a. The Government of A.P designated SNA shall encourage and promote NIRE technologies in the
state. NIRE technologies including offshore, geothermal, tidal, other oceanic energies, storage (other
than PSP and BESS), carbon capture & sequestration, etc. Demonstration of the new RE technology
or the pilot would be enabled on fast-track basis with focused support from the SNA and CEKSDC.
b. GoAP shall provide Viability Gap Funding (VGF) or capital subsidy at 20% for the demonstration/
pilot projects with capacity not exceeding 5 MW with a maximum limit of INR 5 Crores/project. The
capital subsidy shall be disbursed to Developer in a phased manner with 10% before COD and 10%
after COD in 2 years.
c. Discoms shall procure the power from NIRE technologies at the tariff determined by APERC.

17. General terms pertaining to the policy.

17.1 Project/SPV Transfer/Name Change
a. The policy provides for Project/SPV transfers/name change of a project with approval from SIPC,
SIPB and Government of Andhra Pradesh. The transferee shall meet the eligibility criteria as per
clause 5.2 of this policy. Such transfer shall be allowed for project/SPV transfer in part or full
capacity to any other party(ies) before the commissioning of the project, along with the resources
including land, connectivity (STU) and any other approvals already in place, as applicable.
Project/SPV transfer in part/full capacity shall be allowed for multiple times to 100% subsidiary
(ies)/parent entity at any stage of the Project. Project developer shall seek name change of the
Project/SPV for part/full capacity. The Project/SPV transfer shall be applicable for all the Clean
Energy Projects covered under the policy.
b. Applicable transfer fee/name change fee as per clause 17.11shall be payable for each such
transfer/name change.

17.2 Waste disposal

a. Ministry of Environment, Forest, and Climate Change (MoEFCC), Government of India has notified
the E- Waste (Management) Rules, 2022 on 2nd November 2022. These rules have been notified for
environmentally sound management of e-waste generated from electrical and electronic equipment,
including solar photo-voltaic (PV) modules or panels or cells.
b. As per these rules, every manufacturer and producer of solar photo-voltaic modules or panels or
cells has been mandated to obtain registration, maintain inventory of solar PV modules, store the
waste generated from Solar PV modules/panels/cells up to the year 2034-35 as per the guidelines
laid down under the rules, file annual returns, comply with Standard Operating Procedures, and
process the waste other than solar PV modules as per the applicable waste management rules.
c. Further, Recycling of solar photo-voltaic modules or panels or cells shall be mandated for recovery
of material as laid down by the Central Pollution Control Board. All the Developers shall abide by the

57
 above rules, or any other regulations/rules notified by the Government of India or Government of
Andhra Pradesh for disposal of waste generated from Clean Energy Projects.
d. Central Pollution Control Board has issued Battery Waste Management Rules, 2022 for
environmentally sound battery waste management and conservation of natural resources. These
rules mainly emphasize on Extended Producer Responsibility (EPR) wherein
manufacturers/importers responsible for collection, recycling/refurbishment waste batteries
prohibiting landfill disposal and incineration. The rules have mandated annual targets for the
manufacturers.
e. The MoEFCC Biofuel Waste Management Guidelines, 2018, aim to ensure environmentally sound
management of biofuel waste through segregation, storage, treatment, and disposal. The guidelines
emphasize recycling and energy recovery from waste and encourage the use of composted biofuel
waste as fertilizer.
f. Similarly, The CPCB Biofuel Waste Management Rules, 2019, provide a regulatory framework for
biofuel waste management, outlining responsibilities for manufacturers, producers, and disposers.
The rules also specify standards for treatment and disposal facilities.
g. Also, The National Biofuel Policy, 2018, promotes the development and use of biofuels, focusing on
sustainability, energy security, and environmental protection. The policy encourages research and
development in biofuel waste management and conversion of waste to energy.

17.3 Project Timelines

a. The time schedule for completion of Clean Energy Projects and RE Manufacturing Projects that
utilize resources allocated by GoAP, such projects shall be bound by the timelines as defined in the
policy. However, if those projects are allocated through bidding process without any resource
allocation by the state, they will be governed by the bid document and Power Purchase Agreement.
b. In case of land & resource allocation by the SNA, all the projects shall follow the prescribed timelines
as detailed below or as decided by SNA to meet the project milestones. The milestones are divided
into two phases of (A) Allotment &(B) Project Construction Schedule. The detailed project milestone
timelines shall be applicable as per clause18.2 (Clean Energy Projects)&clause18.3 (RE
Manufacturing Projects).
c. In the allotment phase, a project shall achieve 7 milestones within the combined prescribed timeline
and the maximum extension timeline based on each type of project. A project shall achieve the
milestones of payment of applicable fees, DPR approval, connectivity approval & agreement, land
(sale/lease) and commercial agreement to achieve financial closure.
d. In the project construction schedule phase, a project shall achieve 4 milestones until the
commissioning of the project. The milestones include achieving placement of equipment order, start
of construction, mid-term status and commissioning of the project.
Sl.No. Project Milestones

58
 A Allotment (SNA)/ LOA

a1 Payment of applicable fee/ charges

a2 DPR approval in case of PSP

Connectivity approval (ISTS/STU) -STU to follow ISTS process i.e., 50% of land required for
a3
setting up project to be under applicant possession or duly paying BG amount

a4 Connectivity Agreement (copy to be submitted to SNA)

a5 Land (Sale or Lease)

a6 Commercial Agreement (PPA)

Financial closure (Letter or in principle approval from banker/ Banker consortium to be submitted
a7
SNA)

B Project Construction Schedule

b1 Placement of Equipment Order (Payment proof to be submitted)

b2 Construction start date (Intimation to be sent SNA)

b3 Construction status updated by Developer (Quarterly progress update to SNA)

b4 Scheduled COD of the Project

e. A maximum extension period of 12 months for PSP and 6 months for other projects shall be
provided. The non-achievement of any of the pre-defined project milestone timelines including the
maximum extension period in the allotment phase, the project shall be deemed cancelled along with
the capacity allotment.
f. The timeline for completion of each project along with the maximum extension available under the
policy:

Maximum extension of timeline

5
Scheduled COD timeline
Category of Project Financial Closure (FC) allowed before FC on payment of
from the allotment (T0)
from the allotment (T0) applicable time extension fee

Solar 6 months 24 months 6 months

Wind 6 months 24 months 6 months

Solar – Wind Hybrid 6 months 24 months 6 months

5
Without any permissible extension period

59
Mini and Small Hydro 6 months 36 months 6 months

Pumped Hydro
12 months 48 months 12 months
Storage

BESS 12 months 18 months 6 months

Green Hydrogen and

6 months 36 months 6 months
its derivatives

Biofuels 6 months 36 months 6 months

EVCI NA 6 months 6 months

Solar Manufacturing 6 months 36 months 6 months

Wind Manufacturing 6 months 36 months 6 months

Battery Manufacturing 21 months 48 months 6 months

Electrolyzers
8 months 36 months 6 months
Manufacturing

g. Project developers shall handover the resources to the SNA within 14 days from intimation of
deemed cancellation. Thereafter, the resources shall be made available for allocation to other
Project developers.
h. SNA shall provide the maximum extension time, subject to payment of time extension fee at INR
20,000 per MW per month of delay along with the applicable GST.
i. In case the project under construction requires additional time beyond 6/12 months (permissible time
extension), subject to verification by SNA, shall be permitted by levying penalty of 0.25% of project
cost per quarter (in parts thereof) for a period of maximum 6 months. Beyond 6 months of delay, no
incentives shall be available for the project.
j. If forest land diversion is required, the commissioning timeline will be extended by up to one year
from the date of submission of the request with necessary documents, without any additional fees.
k. In case part capacity is commissioned within the overall allowed time period, the remaining capacity
will be cancelled, and the Performance Bank Guarantee of uncommissioned capacity will be en
cashed /forfeited.
l. Government of Andhra Pradesh/NREDCAP will cancel the project allotment and will encash/forfeit
the Performance Bank Guarantee if the project is not commissioned as per the stipulated timelines.
m. The Project developer shall submit the quarterly progress reports to SNA on regular basis.

60
17.4 University for Green Energy & Circular Economy (UGC)
a. GoAP shall collaborate with GoI and industry(ies) for establishment of a University for Green
Energy& Circular Economy (UGC),under Public Private Partnership (PPP) route which shall play a
pivotal role in creation of manpower for Clean Energy Projects and RE Manufacturing Projects.
b. UGC shall be a dynamic knowledge and training hub for clean energy, with training facilities for
corporates and certification programs. UGC will involve active industry participation, partnership with
academia, think tanks & industry and build intellectual capital for clean energy sector along with
technology transfer. UGC shall be accorded deemed university status.
c. UGC shall focus on creating a talent pool across the Clean Energy Projects value chain in the state
by focusing on
 Tailor made curriculum to meet clean energy industry requirements.
 Bringing new programs with innovative pedagogies in collaboration with industry & academia
 UGC shall offer courses: UG, PG, PHDs, Integrated Degree in Green Energy and Deep
technology.
 Certification Programs (1 Year/6 Months) & Continuous Short-term courses both in person
and online for existing workforce as well as graduate trainee students
 Students trained in Entrepreneurship.
 Skilling the youth of the State for improved employability

17.5 Clean Energy Knowledge & Skill Development Center (CEKSDC)

a. NREDCAP along with Andhra Pradesh Skill Development Corporation will establish a Clean Energy
Knowledge & Skill Development Center (CEKSDC) along with industry participation. The key focus
of CEKSDC shall be to become a knowledge and training hub of clean energy in India.
b. The Center shall form active partnerships with Academia, Think Tanks & Industry for certification
courses & training programs. CESKDC to facilitate Learning & Development requirements for
existing workforce and future workforce. CEKSDC to be available for private, public companies,
universities etc.
c. Skill Development Support for Green Hydrogen and its derivatives

To create a pipeline of skilled workforce tailored for the needs of Green Hydrogen and its derivatives
production, SNA shall undertake following interventions:

i. Facilitate the development of a sustainable Green Hydrogen and its derivatives ecosystem by
promoting collaboration among various stakeholders such as academic institutions,
Renewable Energy Developers, hydrogen producers, industry consumers, think-tanks, etc.
ii. Introduce courses related to production of Green Hydrogen and its derivatives and
manufacturing of Green Hydrogen equipment and its ancillaries in existing Skill Development
Centres in the State based on the curriculum developed in coordination with industry using
skill gap mapping.

61
 iii. Develop digital platform with database of manpower available in the State to match skilled
manpower with requirements of manpower in manufacturing of Green Hydrogen
equipment/production of Green Hydrogen and its derivatives.
iv. Facilitate apprenticeship training for all the eligible students at Green Hydrogen equipment
manufacturing plants or Green Hydrogen and its derivatives production plants.
v. Explore technology demonstration and proof of concept pilots for green hydrogen
applications in emerging use cases such as heavy-duty transport, energy storage, etc.
d. Skill Development Support for Biofuels

To build a specialized workforce equipped for Biofuels production, SNA shall introduce the
following interventions:

i. The policy will encourage a minimum of 100 village/Mandal-level entrepreneurs (VLEs)

through identified skilling centres.
ii. The policy will encourage and support farmers/FPOs/SHGs to enhance skilling for Biomass
aggregation and sales.

17.6 State Nodal Agency

a. New and Renewable Energy Development Corporation of A.P. Ltd (NREDCAP) shall act as a State
Nodal Agency (SNA) under this policy and as decided by the State Government from time to time.
NREDCAP, as an organization shall be strengthened as the State Nodal Agency (SNA)in line with
the ambition of AP to become a Clean Energy Hub in the country & Global Export Hub for Green
Hydrogen. The SNA and/or designated offices by the SNA shall be responsible for the following
activities:
i. Registration of all projects and classification of the projects in the single window clearance
provision through the Energy Department portal, GoAP for associated approvals and
clearances.
ii. Scrutiny of all issues/proposals and submission of the same to Energy Department for further
consideration
iii. Verification and recommendation of proposals to GoAP
iv. NREDCAP shall be responsible for capacity allotment for upto 40 MW and to recommend
capacity allotment beyond 40 MW to Government of AP.
v. Identify the available Government/Revenue/Private/Patta Lands for lease basis and facilitate
the allotment of Government Land/acquisition of private land for projects and provide land
near Ports for storage.
vi. Facilitate water allocation on priority as per the Industrial Water Supply Policy/Guidelines and
subject to guidelines issued by the Water Resources Department.
vii. Facilitate in getting power evacuation and/or Open Access as per the regulation issued by
APERC/CERC and amended from time to time.
viii. Collection of associated fees/charges for allotment of resources.

62
 ix. Act as single window clearance facilitator for allotment of projects/clearance of proposals
received from Private sector/CPSUs/SPSUs.
x. Coordination with all the relevant stakeholders for all statutory clearances/approvals
applicable for all the Clean Energy Projects and RE Manufacturing Projects.
xi. Monitor progress of project development continuously until projects are commissioned. The
Project developer shall be obliged to allow unhindered access to the project site and provide
requisite information to the SNA/any other entity nominated by of the SNA for proper
monitoring of the project progress.
xii. Disbursement of incentives after duly verifying the claims and processing the incentives
through the Project Monitoring Committee.
xiii. Impose penalties and/or de allocate projects in case of default of timelines/non-compliance/
non-performance by the Developers in accordance with the defined project milestone
timelines.
xiv. Co-ordinate with MoP/MNRE/SECI/CERC/CTUIL/CEA/PGCIL/APERC/APTRANSCO/
POSOCO/DISCOM(s) and any other Central/State agencies in obtaining necessary
clearances, approvals, incentives, grants, and subsidies for GoI sponsored schemes.
xv. Coordinate with APDISCOMs, APTRANSCO and support the APERC in framing various
Regulations and orders that are required for implementation of this Policy.
xvi. For ease of administering the incentives and operationalizing the ICE policy, detailed
operational guidelines will be issued separately by Energy Department within 45 days from
the notification of the ICE policy.

17.7 Policy Implementation

a. State Investment Promotion Committee (SIPC)and State Investment Promotion Board (SIPB)-
For creating an enabling structure to expedite decision making pertaining to investment promotion in
the State, SIPC and SIPB have been constituted by the Government. NREDCAP shall receive all the
investment proposals pertaining to Clean Energy Projects and RE Manufacturing Projects. A detailed
process of evaluation (technical and financial eligibility) will be undertaken by NREDCAP to carry out
initial screening of all the proposals. Thereafter NREDCAP shall recommend the proposals to
Energy Department. Energy Department shall place the proposals before SIPC. After scrutiny of all
investment proposals by SIPC, the same shall be forwarded to SIPB. The SIPB shall review the
investment proposals and recommend the same to the Government of Andhra Pradesh. The final
decision to approve any investment proposal will rest with the Government of Andhra Pradesh.

17.8 Project Monitoring Committee (PMC)

a. A “High Level Committee” constituted with the following members will monitor the progress of
implementation of the Clean Energy Projects and RE Manufacturing Projects cleared under the
policy:
i. Secretary, Energy Department, GoAP (Chairman)

63
 ii. CMD, AP TRANSCO
iii. CMD of APDISCOMs
iv. VC & MD, NREDCAP (Member-Convener)
v. Representative of Revenue, Finance & Industries Departments
vi. Representative of FAPCCI/CII/AP Chambers
vii. Representatives of Project Developers & Manufacturers Associations if any
b. The PMC shall be chaired by Secretary, Energy Dept, GoAP and VC& MD, NREDCAP as the
Convener and PMC shall convene once in 2 months. The twin objectives of PMC will be to monitor
projects & expedite approvals.
c. If any difficulty arises in giving effect to this policy, the High-Level Committee is authorized to issue
clarification as well as interpretation to such provisions, as may appear to be necessary for removing
the difficultly either on its own motion or after hearing those parties who have represented.

17.9 Project Management Unit

a. A Project Management Unit (PMU) shall be constituted under the supervision of SNA. The PMU will
support SNA in monitoring of projects, facilitating approvals & stakeholder management. The PMU
shall consist of experts from diverse fields to support and advise the SNA in tracking and monitoring
the progress of all the projects.
b. The SNA shall define various milestones from project award/allotment till commissioning for each
technology separately.
c. Once a project site is awarded/allocated, the SNA shall continuously monitor progress of
development till it is commissioned. The Project developer shall be obliged to allow unhindered
access to the project site and provide requisite information to the SNA/ any other entity nominated
by the SNA for proper monitoring of the project progress.

17.10 Speed of Doing Business

a. Single Window Clearance shall be applicable for the projects as per the operating period specified in
this policy. Single Window Clearance aims to create a single stop for facilitating necessary
clearances required for commissioning of these projects.
b. The SNA shall be responsible for “single window clearance” for these projects. It shall create the
online portal for filing and tracking of applications. It shall also allow payments to be made
electronically to obtain timely approvals online. Under this system:
i. The applicant shall register through the Single window clearance provision on the Energy
Department Portal, GoAP.
ii. On registration, applicant will be given a unique ID and password for future reference.
iii. The application form along with prescribed attachments shall be submitted/ uploaded
online, wherever feasible. Other attachments (wherever necessary) shall be sent to the
concerned designated competent authority through courier and can be tracked online

64
 through a built-in system as per guidance available in the Single window clearance portal
of NREDCAP.
iv. On receipt of application form, the system will automatically forward it to the concerned
competent authorities.
v. All competent authorities will be provided online access to the Energy Dept. Portal through
a secure user id and password, to process the applications forwarded to them.
vi. For additional attachments dispatched by courier to respective departments, the
concerned competent authority shall enter the date of receipt in the system which will be
the reference date specific to clearance/department.

65
 17.11 Summary of Fees and Charges
Fees and Mini and Small
S.No. Solar Wind Hybrid PSP BESS GH Biofuels
Charges Hydro

Charges to
be paid for 2G Ethanol –
installed INR INR
Application Fee INR INR INR
1. capacity of Nil Nil 25,000/KTP 25,000/KLPD
(One time) 25,000/MWp 25,000/MW 5,000/application
Solar and A CBG – INR
Wind: INR 25,000/TPD
25,000/MW

Charges to
be paid for
installed
Facilitation/ capacity of
INR INR INR
2. Allotment Fees Solar and NA INR 1,50,000/MW NA NA
25,000/MWp 1,50,000/MW 50,000/MW
(One time) Wind subject
to maximum
of 1,50,000:
/MW

Charges shall 2G Ethanol –

Performance be paid for INR INR
INR INR INR As per
3. Bank each source, INR 1,00,000/MW 1,00,000/KT 1,00,000/KLPD
1,00,000/MWp 2,00,000/MW 50,000/MW tender
Guarantee* i.e., Solar, PA CBG –
Wind. 1,00,000/TPD

66
 Fees and Mini and Small
S.No. Solar Wind Hybrid PSP BESS GH Biofuels
Charges Hydro

Onetime local
area as per
INR INR INR
4. development Central NA INR 50,000/Acre Nil Nil
50,000/Acre 50,000/Acre 50,000/Acre
fund (One time Policies
for RE export)

Nil for Discom procurement. INR 1 Lakh/MW year from

Green Energy
scheduled COD for 12 years & INR 1.5 Lakhs/MW/year for the
Development
5. next 13 years and thereafter INR 2 Lakhs/MW/year, wherever it NA NA NA NA
Charges
is applicable. In case of hybrid the above charges shall be paid
(Annually)
for each source, i.e., Solar, Wind.

Payable as
INR 50 INR 100 per solar & INR 50
6. Net worth NA INR 50 lakhs/MW NA NA
lakhs/MWp lakhs/MW wind lakhs/MW
capacities

2G Ethanol –
INR INR INR
Time extension INR INR INR INR
7. #
20,000/M INR 20,000/MW 20,000/KTP 50,000/KLPD
fee 20,000/MWp 20,000/MW 20,000/MW 20,000/MW
W A CBG – INR
50,000/TPD

INR
Transfer/ Name INR INR INR INR
8. 50,000/M INR 50,000/MW NA NA
Change fee ** 2,00,000/MWp 2,00,000/MW 2,00,000/MW 2,00,000/MW
W

67
 Fees and Mini and Small
S.No. Solar Wind Hybrid PSP BESS GH Biofuels
Charges Hydro

INR
Distributed
1,500/kWp for
Energy
the first 2 kW
9. Resource (DER) NA NA NA NA NA NA NA
and thereafter
Aggregation
@ INR
Fee
1,000/kWp.

Onetime
Processing Fee
for land (One INR INR
10. - Nil NA Nil Nil Nil
time; applicable 2,000/Acre 2,000/Acre
for Solar Parks
& REZ)

INR
15,000/Acre/Ye
Land Lease
ar @5%
Charges (Rev/ INR 31,000/Acre/Year @5% escalation every 2 years INR 31,000/Acre/Year @5%
11. NA escalation
Govt./ Pvt/ Patta escalation every 2 years
every 2 years
land) (Annually)
(Only for Rev/
Govt. land)

Remittance to
GoAP – from INR 31,000/Acre/year INR
12. INR 31,000/Acre/year NA
land 15,000/Acre/year
lease(Annual fee

68
 Fees and Mini and Small
S.No. Solar Wind Hybrid PSP BESS GH Biofuels
Charges Hydro

for Rev/ Govt.)

Remittance to
NREDCAP –
from land
13. INR 1,000/Acre/year NA INR 1,000/Acre/year
lease(Annual fee
forPvt/
Pattaland)

* - PBG is one time payable by the Project developer. SNA shall return PBG upon COD
# - To be paid monthly for maximum extension period of the project from any of the predefined milestone timeline in allotment phase and after the
scheduled COD of the project in construction phase of a project
**SNA will examine and submit the proposals with recommendations to Energy department. Thereafter, the Energy department shall place the
proposals before SIPC, SIPB and GoAP to seek approval. The final decision to approve any such requests will rest with the Government of Andhra
Pradesh.

17.12 Timelines of Clean Energy Projects

Mini &
Project Milestone Solar Wind Hybrid Small PSP BESS GH&D Biofuels EVCI
Hydro

A Allotment (SNA)/ LOA T0 T0 T0 T0 T0 T0 T0 T0 T0

Payment of applicable fee/

a1 3 months 3 months 3 months 3 months 3 months NA 3 months 3 months 2 weeks
charges

a2 DPR approval in case of PSP - - - - 12 months - - - NA

69
 Mini &
Project Milestone Solar Wind Hybrid Small PSP BESS GH&D Biofuels EVCI
Hydro

Connectivity approval
(ISTS/STU)
 STU to follow ISTS
a3 process i.e., 50% of land 2 months 2 months 2 months 2 months 2 months 1 month - - -
required for setting up
project to be under
applicant possession or
duly paying BG amount

As per
Connectivity Agreement (copy
a4 4 months 4 months 4 months 4 months 4 months 1 month NA NA Discom
to be submitted to SNA)
timelines

a5 Land (Sale deed or Lease) 6 months 6 months 6 months 4 months 12 months 3 months 6 months 6 months 3 weeks

Commercial Agreement
a6 6 months 6 months 6 months 6 months 12 months 1 month 6 months 6 months NA
(PPA/PSA/BESPA)

Financial Closure (Letter or in

principle approval from banker/
a7 6 months 6 months 6 months 6 months 12 months 12 months 6 months 6 months NA
Banker consortium to be
submitted SNA

B Project Construction Schedule

Placement of Equipment Order

b1 (Payment proof to be 8 months 8 months 8 months 8 months 15 Months 12 months 8 Months 8 Months 1 month
submitted)

Construction start date 10 10 10 10

b2 10 months 10 months 17 months 12 months
(Intimation to be sent SNA) months months months months

Periodic status update by 24 months 15 month and 12 months and every

b3 12 months and every quarter thereafter 3 months
Developer and every 18months quarter thereafter

70
 Mini &
Project Milestone Solar Wind Hybrid Small PSP BESS GH&D Biofuels EVCI
Hydro

(Quarterly Progress) quarter

thereafter

24 24 36 36
b4 Scheduled COD of the Project 24 months 36 months 48 months 18 months 6 months
months months months months

17.13 Timelines of RE Manufacturing Projects

Electrolyzer
Project Milestone Solar Mfg. Wind Mfg. Battery Mfg.
Mfg.

A Allotment (SNA)/ LOA T0 T0 T0 T0

a1 Sample DPR/ DPR approval 2 months 2 months 6 months 2 months

a2 Project approvals (Utilities & Industries) 4 months 4 months 9 months 4 months

a3 Land (Sale or Lease) 5 months 5 months 12 months 6 months

a4 Commercial / Off-take Agreement 6 months 6 months 15 months 8 months

Financial closure (Letter or in principle approval from

a5 6 months 6 months 21 months 8 months
banker/ Banker consortium to be submitted SNA)

B Project Construction Schedule

Placement of Equipment Order (Payment proof to be

b1 8 months 8 months 24 months 10 months
submitted)

b2 Construction start date (Intimation to be sent SNA) 10 months 10 months 30 months 12 months

71
 Electrolyzer
Project Milestone Solar Mfg. Wind Mfg. Battery Mfg.
Mfg.

b3 Raw material Sourcing 30 months 30 months 30 months 16 months

Scheduled COD of the Project (Commercial Operations of the

b4 36 months 36 months 48 months 36 months
plant)

17.14 Regulation
The provisions of this policy shall be the guiding principles for Andhra Pradesh Electricity Regulatory Commission (APERC) to enable the
implementation of the policy. AP DISCOMs and AP TRANSCO shall approach the commission for the required amendments and changes for
issuance of orders based on the policy provisions.

17.15 Mid Term Review

State Government may undertake a mid-term review of this policy after a period of two (2) years, or as and when the need arises in view of any
technological breakthroughs or to remove any difficulties pertaining to implementation of the policy or any inconsistency with Electricity Act 2003,
rules and regulations made there under or any Government of India policy.

17.16 Power to remove difficulties

If any difficulty arises in giving effect to this policy, Energy Department is authorized to issue clarification as well as interpretation to such
provisions, as may appear to be necessary for removing the difficulty either on its own motion or after hearing those parties who have represented
for change in any provision.

K.VIJAYANAND
SPECIAL CHIEF SECRETARY TO GOVERNMENT

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