Andhra Pradesh is set to procure 1,600 MW of coal-based thermal power to meet the State’s rising electricity demand and strengthen long-term energy security.

The Andhra Pradesh Electricity Regulatory Commission (APERC) has granted in-principle approval for the procurement, enabling the State DISCOMs to initiate the competitive bidding process, according to an official release.

The power will be procured through tariff-based competitive bidding under Section 63 of the Electricity Act, 2003, following the Design, Build, Finance, Own and Operate (DBFOO) model.

The initiative is expected to provide a major opportunity for power developers seeking long-term supply contracts in Andhra Pradesh, where electricity consumption and peak demand are projected to rise significantly over the next decade.

The proposed 1,600 MW procurement constitutes the first phase of the State’s long-term thermal capacity addition programme. It follows the Central Electricity Authority’s Resource Adequacy Plan for Andhra Pradesh, which recommends the phased addition of about 5,588 MW of coal-based thermal power capacity by 2035-36 to ensure reliable power supply.

The procurement process was initiated following a review meeting chaired by Chief Minister N. Chandrababu Naidu on April 27, 2026.

The additional thermal capacity is expected to provide firm and dispatchable power to support the grid during periods of peak demand and when renewable energy generation is low, the release said.