Electricity tariff cut by 13 paise per unit

Amaravati: The Andhra Pradesh Cabinet on Thursday took a wide range of decisions to streamline the power sector, including slashing “true-up” charges for 2019–2024 to Rs 4,998 crore (from the previously estimated Rs 12,771.96 crore) which will be borne by the state government, thereby reducing electricity tariff by 13 paise per unit.

The Cabinet meeting, chaired by Chief Minister N Chandrababu Naidu at the Secretariat, also approved strategic measures across education, logistics, industry, tourism, and mineral sectors.

Briefing the media, Information and Public Relations Minister K Parthasarathi said that the government recalculated electricity “true-up” charges for 2019–2024.

For context, true-up charges, in the case of non-solar consumers, represent accumulated costs utilities couldn't recover from consumers in prior periods due to regulatory reasons, thus creating a significant additional charge.

Although previous estimates from DISCOMs pegged true-up charges at Rs 12,771.96 crore, the Cabinet approved Rs 4,998 crore, which will be borne by the state government. Electricity tariff have been reduced by 13 paise per unit, from 59 paise to 46 paise, with a target to reach 46 paise per unit by next year. Measures to reduce transmission losses and improve efficiency are under way to manage the energy sector debt of Rs 20,000 crore.

The government sanctioned Rs 944.53 crore for student kits, benefitting over 39.5 lakh students for the 2024–25 academic year, while addressing delays from the previous administration in supply and vendor payments. Teacher transfers have also been optimised to resolve staffing shortages.

The Cabinet approved the formation of the Andhra Pradesh Logistics Infrastructure Corporation with Rs 250 crore capital, consolidating road, canal, airport, and maritime development under a single body to optimise future expenditures.

Further, the Cabinet approved several major industrial projects, boosting investment and employment. Etherial Exploration Guild, Tirupati, will invest Rs 578 crore in rocket engines (382 jobs); Pioneer Clean Yams, Chittoor Rs 159 crore in flight training (600 jobs), and Radhika Vegetable Oil, Vizianagaram Rs 234 crore in a palm oil unit (165 jobs). Tata Power Renewable Energy will invest Rs 6,675 crore in 10 GW ingot and wafer manufacturing (1,000 jobs), while Ramako Cements will expand its unit with Rs 1,500 crore (300 jobs). The MSME Cluster Development Program received Rs 200 crore for 45 common facility centers, creating 7,500 jobs. Additional projects in food processing, steel, and solar modules will generate thousands of additional employment opportunities.

Tourism projects include 5-star and 3-star resorts at Suryalanka Beach and municipal micro-breweries. The government has sanctioned Rs 5,000 crore under the Jal Jeevan Mission to increase potable water supply, raising total allocation from Rs 10,000 crore to Rs 12,000 crore.

In the mineral resources segment, amendments to the Andhra Pradesh Minor Mineral Concession Rules, 1966, were approved, introducing nomination-based leases with upfront premiums to enhance transparency and revenue.