Andhra Pradesh Clears Competitive Bidding for 1,600 MW Coal-Based Thermal Power Under DBFOO Model
Andhra Pradesh will procure 1,600 MW of coal-based thermal power to meet rising electricity demand and strengthen long-term energy security. The Andhra Pradesh Electricity Regulatory Commission (APERC) has granted in-principle approval to the state's power distribution companies to initiate competitive bidding for the capacity.
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. Bidding will use standard Request for Qualification, Request for Proposal and Power Supply Agreement documents notified by the Union Ministry of Power.
The 1,600 MW procurement forms the first phase of a larger capacity addition programme. The Central Electricity Authority's Resource Adequacy Plan for Andhra Pradesh has recommended phased addition of approximately 5,588 MW of coal-based thermal generation capacity by FY 2035-36, of which this tranche is the initial component.
The process follows a review meeting chaired by Chief Minister N. Chandrababu Naidu on April 27, 2026, after which distribution companies and the Andhra Pradesh Power Coordination Committee (APPCC) were directed to begin procurement steps. The APPCC approved the proposal on June 11, and APERC granted in-principle clearance on August 6.
The planned capacity is intended to provide firm, dispatchable power to support industrial growth, urbanisation and electricity-intensive investment in the state. Officials noted that thermal generation will complement Andhra Pradesh's expanding renewable energy portfolio by supporting grid stability during evening peak periods.