Andhra Pradesh Chief Minister Directs Major Power Sector Overhaul to Achieve ₹4 Per Unit Target
In a significant move aimed at transforming the state's energy landscape, Andhra Pradesh Chief Minister N Chandrababu Naidu has issued a clear directive to officials: intensify all efforts to drastically reduce power purchase costs and bring the average price down to ₹4 per unit. The instruction came during a comprehensive review of the energy department held at the secretariat on Tuesday, where the CM emphasized that this reduction must be achieved while ensuring the financial burden on consumers is minimized as much as possible.
Roadmap for Debt Repayment and Tariff Stability
Beyond the immediate cost-cutting goal, Chief Minister Naidu also mandated that officials prepare a detailed and clear roadmap to repay the mounting debts accumulated by the state's power utilities. Critically, he stressed that this debt repayment should be accomplished without resorting to increases in electricity tariffs for consumers. This dual focus on fiscal responsibility and consumer protection forms the cornerstone of the proposed energy sector reforms.
Projected Savings and the Push for Greater Efficiency
During the review, energy department officials presented their projections. They informed the Chief Minister that, through planned reforms across various segments of the power sector, the power purchase burden could be reduced by a substantial ₹1.32 per unit by the 2028–29 financial year. Their current steps are aimed at bringing the purchase cost down to approximately ₹4.10 per unit by that timeframe.
However, CM Naidu insisted on a more ambitious target, pushing for the achievement of the full ₹4 per unit mark. He underscored the critical importance of adopting new technologies and fostering innovation to improve overall operational efficiency and drive down costs further. The Chief Minister pointed to recent successes, noting that efficient management practices within the power utilities had already yielded savings of about ₹339 crore during the 2025–26 financial year. He called for these effective measures to be scaled up significantly across the board.
Embracing the Global Green Energy Transition
Chief Minister Naidu highlighted that the global energy sector is currently undergoing a rapid and profound transformation, with a powerful and accelerating shift towards green and renewable energy sources. He described this global trend as a potential game-changer for the coming years, indicating that Andhra Pradesh must position itself strategically within this new paradigm to secure long-term benefits and sustainability.
Building a Foundation for the Future: Education and Innovation
Looking beyond immediate cost savings, the Chief Minister outlined a visionary plan for the sector's future. He instructed officials to move forward with establishing a dedicated energy university. This institution would be tasked with promoting cutting-edge research, fostering innovation, and developing advanced technologies specifically for the energy sector.
Furthermore, he called for the strengthening of the existing centre of excellence for energy transition. A key component of this strategy involves setting up a specialized incubation fund designed to support startups and entrepreneurial ventures in the energy space. The plan includes providing margin money assistance to help bring innovative ideas and sustainable solutions to market.
Expanding Utility Roles and Protecting Consumers
In a forward-looking statement, the Chief Minister emphasized that the state's power utilities should evolve beyond their traditional roles. He envisions them developing the expertise to offer consultancy services to other states and organizations, thereby creating a new revenue stream and sharing best practices.
On the consumer front, CM Naidu noted that the government has already taken proactive steps to shield the public from financial strain. Specifically, the administration avoided passing on the 'true-up' cost burden to consumers and instead achieved a tariff reduction of 13 paise through 'true-down' adjustments. He assured that any further reduction in power purchase costs achieved through these reforms would translate into direct, tangible benefits for the people of Andhra Pradesh, reinforcing the government's commitment to affordable and reliable power for all.
