APERC Approves 400 MW Wind-Solar Hybrid Project in Andhra Pradesh

In a landmark decision, the Andhra Pradesh Electricity Regulatory Commission (APERC) has granted approval for the amended Power Purchase Agreements (PPAs) between the Southern Power Distribution Company of Andhra Pradesh Ltd. (APSPDCL) and four subsidiaries of Axis Energy Ventures.

The agreements involve procurement of 400 MW of wind-solar hybrid power, 100 MW each from Axis Renewable Energy Park (Penna), (Krishna), (Andhra Pradesh), and (Tungabhadra).

The 25-year pact, finalised under the state’s renewable energy framework, secures a fixed tariff of INR 4.60 per unit, a strategic discount to current and projected market rates, to shield consumers from future price volatility while advancing grid reliability.

The four subsidiaries viz., Axis Renewable Energy Park (Penna), (Krishna), (Andhra Pradesh), and (Tungabhadra), will each supply 100 MW under the agreement.

APERC’s approval of a locked-in tariff, significantly lower than the existing INR 5.12 per unit average power purchase cost (APPC), ensures financial predictability for distribution companies (DISCOMs) and end-users.

This rate undercuts recent national bids for similar hybrid projects, which fetched INR 4.64–INR 4.72 per unit, and avoids interstate transmission charges, enhancing cost efficiency.

To address grid intermittency concerns, the projects will integrate advanced energy storage systems, guaranteeing 90 percent of contracted capacity during critical morning and evening peak periods (two hours each).

This 'firm and dispatchable' supply model, aligned with central FDRE (Firm and Dispatchable Renewable Energy) guidelines, marks a shift from conventional solar/wind setups, which typically lack storage and achieve lower annual efficiency (40–52 percent CUF). The hybrid plants target a 60 percent capacity utilization factor (CUF), with penalties of 1.5× the tariff for underperformance.

A pioneering 50:50 split of Renewable Energy Certificates (RECs) between APSPDCL and Axis Energy, uncommon in developer agreements, ensures shared benefits from clean energy incentives. Pre-commissioning power generation will be treated as 'deemed banked energy,' purchasable by DISCOMs at half the annual APPC rate or sold by Axis via open access, fostering flexibility.

Originally conceived under a 2018 state MoU, the project gained urgency after the Andhra Pradesh High Court mandated honoring legacy renewable commitments.

It now aligns with the state’s 2030 target of 72.60 GW renewable capacity and national RPO goals (43.33 percent by 2030). APSPDCL must submit finalised agreements within 30 days, incorporating dynamic peak-hour definitions to accommodate evolving grid needs.

Beyond clean energy, the initiative is poised to generate employment, stimulate local economies, and bolster state revenues. By prioritising consumer safeguards through fixed tariffs and penalties,

APERC balances affordability with innovation, cementing Andhra Pradesh’s leadership in India’s renewable transition. This decision underscores the state’s commitment to sustainable growth, setting a precedent for hybrid projects nationwide.