Telangana Cabinet Approves Third DISCOM And Major Renewable Energy Expansion Strategy

The Telangana Cabinet has approved the establishment of a third power distribution company (DISCOM) in the state, marking a major step toward improving electricity management and preparing for future demand growth. The decision was taken at a Cabinet meeting held on November 25, where several key measures were discussed to strengthen power infrastructure and enhance renewable energy capacity.

Currently, Telangana is served by two DISCOMs — Northern Power Distribution Company Limited (NPDCL) and Southern Power Distribution Company Limited (SPDCL). The new DISCOM will be created to manage specific categories of high-demand electricity consumers. All agricultural power connections, lift irrigation schemes, Mission Bhagiratha drinking water supply systems, safe drinking water projects, and power connections under the Hyderabad Metro Water Supply and Sewerage Board (HMWSSB) will be brought under the scope of the new distribution company. This move is aimed at streamlining operations, improving service efficiency, and ensuring better reliability for essential sectors.

Briefing the media after the Cabinet meeting, Industry Minister D. Sridhar Babu stated that the government held an extensive review of the state’s rising electricity requirements. The Cabinet examined power demand projections over the next ten years, along with the expected increase in generation and consumption patterns. The Minister emphasized that Telangana needs to take substantial steps to strengthen its power supply system, particularly by accelerating renewable energy adoption.

To support this objective, the Cabinet has decided to issue tenders immediately for procuring 3,000 megawatts of solar power. These tenders will be floated with clear time-bound agreements for supplying power for a period of five years. This action reflects the government’s intention to increase the share of clean energy in the state’s power mix while reducing dependence on conventional sources.

Additionally, the Cabinet has focused on expanding pumped storage power, which helps balance intermittent renewable generation. It approved plans to issue tenders for 2,000 megawatts of pumped storage power purchase. Companies and investors will be granted permission to establish pumped storage power plants, and existing memorandums of understanding (MoUs) with DISCOMs will be reviewed. The Cabinet has also given approval for establishing 10,000 megawatts of pumped storage capacity across Telangana. The state government has committed to providing suitable land and water for such projects, with the condition that generated electricity must first be offered to the state DISCOMs.

As part of its Clean and Green Energy Policy aimed at promoting industrial growth, the Cabinet agreed to permit newly established industries to generate their own captive electricity without any upper limit on capacity. The government will offer immediate approval for captive power generation applications to attract investments and encourage self-sufficiency among industries.

The Cabinet also approved the construction of a new 800 MW power plant at the Ramagundam Thermal Power Station under NTPC. It has directed officials to explore possibilities for additional NTPC power plants in Palvancha and Maktal. To strengthen urban power infrastructure, the Cabinet decided to develop an underground electricity cable system in Hyderabad, modeled on Bengaluru’s system. The project cost is estimated at around ₹14,725 crore and will involve placing electricity lines, T-Fibre network cables, and various cable systems underground. Hyderabad will also be divided into three sections based on electricity circles to improve operational efficiency.

These decisions demonstrate Telangana’s commitment to modernizing its power sector, increasing renewable energy capacity, and ensuring reliable electricity for both urban and rural consumers. The measures are expected to support economic growth, attract new industries, and enhance overall service quality across the state.