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					</table>Commercial and industrial (C&amp;I) units investing in renewable energy projects have access to a growing range of bank financing options, including green loans with concessional interest rates, longer repayment periods, and collateral-free funding for eligible borrowers.
Banking industry representatives said that the access to favorable financing depends on a business’s financial track record, project cash flows, promoter credibility, and realistic implementation timelines.
Green Financing Options
Kameshwar Rao, AGM at Small Industries Development Bank of India (<a href="https://www.sidbi.in/en/" target="_blank" rel="noopener">SIDBI</a>), said the bank has dedicated products for clean energy and sustainability projects, including rooftop solar, energy efficient equipment, and waste management projects.
SIDBI provides collateral-free financing of up to ₹150 million (~$1.56 million) under one of its financing products for brownfield projects. Eligible borrowers must have been operating for at least three years and demonstrate cash profits, Goods and Services Tax (GST) compliance, and a steady loan repayment track record. Financing above ₹150 million (~$1.56 million) may require collateral depending on the borrower&#8217;s financial and other parameters.
The repayment period can extend up to 10 years, including a moratorium of up to 18 months.
Rao said interest rates are determined through an internal rating system that considers borrower, project, and market-specific factors. GST compliance, statutory obligations, and previous repayment records are also considered while determining rates.
For qualifying brownfield proposals of up to ₹150 million, SIDBI can complete the approval process within five working days, provided borrowers meet the specified parameters. The documentation process can also be completed digitally.
M Phanindra, Chief Manager &amp; Branch Head at <a href="https://bankofmaharashtra.bank.in/" target="_blank" rel="noopener">Bank of Maharashtra</a>, said the bank offers multiple financing options for renewable energy projects. Lending terms depend on the borrower’s internal credit rating, collateral availability, and repayment history.
The bank can structure loans using a combination of collateral and Credit Guarantee Fund Trust for Micro, Small and Medium Enterprises (MSMEs) guarantee cover, depending on its assessment of the borrower. For borrowers with stronger internal ratings, the bank can finance up to 80% of the project cost, with the borrower contributing the remaining 20%.
Proposals above ₹100 million (~$1.04 million) may also qualify for MSME financing, subject to the applicable turnover and investment criteria. Equipment finance can cover eligible requirements, including machinery and project installation.
For MSMEs, green financing rates depend on the borrower’s CIBIL MSME Rank (CMR) and collateral support. Phanindra said rates for a CMR-1 borrower can start at around 8.35% with collateral and around 8.9% without collateral, while rates for lower-rated borrowers can reach about 13.35%.
Financial Discipline
Bank executives emphasized the importance of accurate financial and GST records, which give lenders greater visibility into a borrower&#8217;s transactions and financial position. Banks assess turnover, repayment history, existing banking relationships, and other financial parameters when evaluating proposals.
Phanindra noted lenders also assess the promoter’s ability and commitment to execute the project, along with the selection of credible vendors.
A strong financial track record alone may therefore not be sufficient. Vendor selection and the promoter&#8217;s ability to execute the project on schedule can also influence financing decisions.
Project Timelines
Rao identified delays in obtaining project approvals as a major challenge for solar project developers and their lenders.
Developers may initially expect projects to be implemented within six to eight months but subsequently seek extensions to the moratorium when approvals are delayed. Such extensions can create challenges for lenders because they are subject to regulatory requirements and may affect loan classification.
Rao recommended developers factor potential approval delays into implementation schedules rather than base financing plans on aggressive commissioning assumptions. More realistic timelines can help align project cash flows with repayment obligations.
Rao also cautioned businesses against developing renewable energy projects solely to access government incentives, emphasizing that the underlying investment must remain commercially viable.
“It is an investment. It is not an expense,” he said, adding that renewable energy projects can generate savings and improve cash flows.
Banks can also provide for some execution uncertainty while structuring loans. Rao said lenders may include contingencies of around 10% to help promoters manage unexpected costs or project delays.
These insights were shared by speakers during a session ‘Attractive Financing Options: Easy and Affordable Loans’ at Mercom India’s C&amp;I Clean Energy Meet held in Visakhapatnam recently.
Mercom India hosts C&amp;I Clean Energy events in different cities across India to help businesses understand and address challenges associated with renewable energy adoption, including technology selection, financing, project economics, and execution. The next C&amp;I event will be <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-lucknow" target="_blank" rel="noopener">held</a> in Lucknow on October 9, 2026.

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					</table>Renewable energy accounted for 54.7% of Andhra Pradesh’s power mix as of June 2026, with solar contributing about 28% and wind 14%. The state ranked sixth in India in rooftop solar installations and accounted for about 4% of the country’s 27.3 GW of installed rooftop solar capacity as of June 2026.
Industry experts said the state’s commercial and industrial (C&amp;I) rooftop solar segment still has significant room for growth.
C&amp;I Solar Adoption
Seshagiri Meka, Managing Director at <a href="https://www.winsolindia.com/" target="_blank" rel="noopener">Winsol Clean Tech Solutions</a>, noted C&amp;I solar adoption in Andhra Pradesh is higher than rooftop solar data suggests, as several businesses operate behind-the-meter systems that are not captured in net-metering statistics.
Meka said rooftop and behind-the-meter projects can offer attractive economics as consumers avoid some of the infrastructure costs associated with open access projects.
He added that solar awareness is already high among several industrial segments in Andhra Pradesh.
Economics of Rooftop Solar
Rahul Makahaniya, Chief Marketing Officer at <a href="https://soleosenergy.com/" target="_blank" rel="noopener">Soleos Energy</a>, said businesses should avoid repeatedly postponing solar investments in anticipation of further declines in equipment prices. Any delay also means foregoing potential electricity cost savings.
Lengthy internal approval processes and financing constraints are among the primary reasons C&amp;I solar projects are delayed.
Makahaniya said companies should first define their objective for adopting solar, whether to improve cash flow through electricity savings or meet renewable energy and sustainability requirements.
A clearly defined objective can help businesses select an appropriate procurement model and shorten the decision-making process.
CAPEX or RESCO
Makahaniya said the choice between the capital expenditure (CAPEX) and renewable energy service company (RESCO) models depends largely on a company’s capital availability and growth plans.
Under CAPEX, consumers invest in and own the solar project and the model generally results in a lower levelized cost of electricity.
Under RESCO, a developer invests in the project and sells electricity to the consumer. The consumer avoids the upfront capital expenditure and can begin realizing savings once the project starts generating power.
Companies with surplus capital may prefer CAPEX, while businesses seeking to preserve capital for expansion may opt for RESCO.
Makahaniya said a 1 MW behind-the-meter rooftop solar project could cost around ₹30 million (~$337,000), with a levelized cost of electricity of approximately ₹2.5 (~$0.026)/kWh. Under the RESCO model, tariffs could range from ₹3.5 (~$0.036)/kWh to ₹3.75 (~$0.039)/kWh. Annual operations and maintenance costs could range from ₹400,000 (~$4,500) to ₹500,000 (~$5,600)/MW.
Meka added that no single model suits every C&amp;I consumer. The appropriate option depends on the company’s business segment, capital allocation priorities, energy requirements, and internal approval processes.
Solar Plus Storage
Makahaniya said battery storage should be evaluated based on its intended application because adding batteries increases the effective cost of solar power.
Meka said adding battery storage could increase project costs by around 30% and extend the payback period by approximately 1.5 years to around five years.
For residential consumers, batteries currently make more sense for backup power than for reducing electricity costs through energy arbitrage.
He added that rooftop solar can reduce electric vehicle charging costs at homes by replacing higher-cost grid electricity with solar power.
Meka said rooftop solar systems are typically synchronized with the grid and should not be considered standalone sources of uninterrupted power. Consumers requiring continuous supply need to evaluate separate backup arrangements.
Maintaining Project Performance
Meka said weather conditions can significantly affect solar generation. Cloud cover, rainfall, mist, and other atmospheric conditions can cause variations in output.
The experts said project financial models must account for the gradual degradation of solar modules rather than assume first-year generation levels throughout the project lifetime.
Proper operations and maintenance are equally important. Improper module-cleaning practices can damage the glass and affect generation, while routine inspections can identify problems with cables, connections, and other equipment before they lead to major failures.
Meka added that dust and particulate emissions around industrial facilities can further affect module performance and increase maintenance requirements.
Comparing Project Costs
Makahaniya said C&amp;I consumers should not compare solar proposals solely on headline prices, as equipment and project configurations can vary substantially.
Businesses should first standardize their bill of quantities, including equipment brands, models, configurations, walkways, and other project components, before seeking quotations from multiple vendors.
This enables a like-for-like comparison of project costs.
Policy Clarity
Meka said greater regulatory clarity would help accelerate C&amp;I rooftop solar adoption in Andhra Pradesh.
Frequent regulatory amendments can make it difficult for consumers to determine which provisions are currently applicable. Clearer communication of the prevailing regulatory framework could make project planning easier.
He said additional requirements that increase project costs could face resistance from consumers as the market adjusts to domestic-content requirements.
Makahaniya said businesses should evaluate available procurement options instead of delaying investments solely in anticipation of future policy, technology, or equipment price changes.
Depending on their energy requirements, capital availability, and site characteristics, C&amp;I consumers can evaluate CAPEX, RESCO, behind-the-meter, rooftop, and ground-mounted solar models.
Businesses should view solar not only as a green energy initiative but also as a financial investment driven by potential electricity cost savings.
These views were shared during Mercom India’s C&amp;I Clean Energy Meet held in <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-vizag" target="_blank" rel="noopener">Vizag</a>.
The next Mercom India C&amp;I Clean Energy Meet will be held in <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-lucknow" target="_blank" rel="noopener">Lucknow</a> on October 9, 2026.

C&I Units Shouldn’t Delay Solar Adoption Hoping Equipment Costs Will Fall

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					</table>The rapid expansion of data centers in Visakhapatnam (Vizag) could reshape the renewable energy market by creating large, round-the-clock power loads and accelerating demand for hybrid renewable energy, energy storage, and supporting transmission infrastructure.
Unlike conventional commercial loads, data centers require continuous and highly reliable electricity. Meeting this demand with clean energy would require a combination of solar, wind, storage, and grid supply rather than standalone solar projects.
Andhra Pradesh plans to allow data centers with a connected load of at least 300 MW to operate internal distribution systems and procure electricity directly from renewable energy generators, captive projects, and power exchanges. At least 51% of their electricity consumption must come from renewable sources.
Under the Andhra Pradesh Data Center Policy (4.0) effective until 2029, the state has set a target of adding up to 1 GW of data centers. The Ministry of New and Renewable Energy has also identified 5 GW of demand from proposed green hydrogen and green ammonia projects in the Visakhapatnam area. Visakhapatnam is being promoted as a data center hub.
According to the state’s <a href="https://apit.ap.gov.in/" target="_blank" rel="noopener">Information Technology, Electronics and Communications Department</a>, Google, in partnership with AdaniConneX and Nxtra by Airtel, broke ground on an AI hub in Visakhapatnam in April 2026. Google has committed approximately $15 billion between 2026 and 2030 toward the broader development, including gigawatt-scale data center infrastructure.
Apart from this data center in Vizag, the state has also approved a 1,000 MW facility by Renew AP Green Data Center, a 436 MW project by Data Center Holdings India, a 512 MW project by AM AI Factory, and a gigawatt-scale AI data center by Reliance Industries.
The state has also approved 500 MW data centers by Sify Infinit Spaces and a 100 MW data center by CtrlS Datacenters. Another 486 MW data center by Data Center Holdings India has also been approved.
The emergence of data centers comes as Andhra Pradesh strengthens its transmission infrastructure to accommodate large new electricity loads.
In July 2026, REC Power Development and Consultancy <a href="https://www.mercomindia.com/recpdcl-announces-winner-of-4-5-gw-transmission-project?utm_source=chatgpt.com" target="_blank" rel="noopener">auctioned</a> an interstate transmission system project primarily designed to meet the power requirements of 4.5 GW of green hydrogen and green ammonia projects in the Visakhapatnam area. The transmission project was also envisaged to serve data center loads around Pendurthi and Visakhapatnam.
The convergence of green hydrogen, data centers, and other industrial loads could accelerate the need for transmission expansion alongside renewable generation and storage.
Storage Demand Could Rise
Adding large, round-the-clock data center loads to the grid could strengthen the commercial case for solar-wind hybrid projects paired with battery and pumped storage.
Andhra Pradesh already has a pipeline of 3 GW of solar-wind projects integrated with pumped storage and 2.01 GW of solar-wind hybrid projects. The state has also targeted 25 GWh of battery energy storage and 22 GW of pumped storage capacity.
In 2025, Andhra Pradesh Transmission Corporation <a href="https://www.google.com/goto?url=CAESlwEB6zswFUQTNuk8zY6DnRCZ5YSwnve22G8cDHugeSUXmm7FvZDuhW9usBJ4GjU54eVhpax33G62GfaOg6e-m98XLtHMg9Nr2j1zy5TQ6muvCIBcWIQlIqrG32s9tkcSp33-PMSTVtAXBhqH-oj3zystgQOKplnxZs5u2b-BgBl5ZbhyjmGIe7tNzjmz7G-Eamvj02XAacDS" target="_blank" rel="noopener">auctioned</a> a 1,000 MW/2,000 MWh standalone battery energy storage system project, while several other battery and pumped storage projects are under development.
The expansion of renewable energy and storage could, in turn, support the state’s broader clean energy manufacturing ambitions.
Under the Integrated Clean Energy Policy, Andhra Pradesh has targeted 20 GW of solar manufacturing capacity, 5,000 MWh of battery manufacturing capacity, and 3,000 MW of electrolyzer manufacturing capacity.
The growing power demand from data centers and the evolving renewable energy procurement strategies of commercial and industrial (C&amp;I) consumers will be among the key themes <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-vizag" target="_blank" rel="noopener">discussed</a> at the C&amp;I Clean Energy Event in Visakhapatnam on September 24.

Vizag Data Center Boom Could Drive Hybrid Renewables, Energy Storage Market

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					</table>Andhra Pradesh’s commercial and industrial (C&amp;I) renewable energy market is entering a new phase, as regulatory changes, a growing open access project pipeline, and rising demand from energy-intensive industries create new opportunities for renewable energy procurement.
The state has 5.14 GW of open access projects in the pipeline, including solar-wind projects with pumped storage, solar-wind hybrid projects, and standalone solar projects.
However, Andhra Pradesh&#8217;s open access market remains relatively underdeveloped. Open access accounts for only around 18% of the state&#8217;s cumulative large-scale solar capacity, indicating considerable room for expansion.
At the same time, renewable energy procurement is becoming more complex. Higher network charges, time-of-day (ToD) tariffs, evolving green energy open access regulations, and the growing role of hybrid and storage-backed projects are changing how businesses evaluate their power procurement strategies.
These market dynamics will be central to discussions at Mercom India&#8217;s <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-vizag" target="_blank" rel="noopener">Vizag C&amp;I Clean Energy Meet 2026</a>, on September 24, 2026. Designed as a focused, closed-door forum, the Meet will connect pre-qualified C&amp;I consumers with a select group of renewable energy solution providers and financiers for direct discussions around energy requirements, project economics, and potential projects.
Policy Framework Evolves
Andhra Pradesh has set ambitious clean energy targets, including 78.5 GW of solar, 35 GW of wind, 22 GW of pumped storage, and 25 GWh of battery energy storage. The state is also targeting 20 GW of solar manufacturing capacity across the value chain, 5,000 MWh of battery manufacturing capacity, and 3,000 MW of electrolyzer manufacturing capacity.
Renewables already account for more than half of Andhra Pradesh&#8217;s installed power capacity. At the end of the second quarter (Q2) of 2026, the state had 31.7 GW of installed power capacity, with renewables accounting for 54.7%.
The Andhra Pradesh Electricity Regulatory Commission (<a href="https://aperc.gov.in/" target="_blank" rel="noopener">APERC</a>) has also been updating the regulatory framework governing green energy open access (GEOA). The second amendment to the GEOA regulations clarifies the treatment of hybrid projects, including non-co-located renewable projects, along with scheduling, metering, and settlement provisions.
APERC has also released its Resource Adequacy Regulations, 2026. The framework is expected to shift procurement toward longer-term planning and increase the role of storage, hybrid projects, and firm renewable energy as DISCOMs plan for rising demand and peak power requirements.
For the C&amp;I consumers, these changes expand procurement options while making project evaluation more nuanced.
ToD tariffs are also changing the economics of conventional rooftop solar, as savings during solar-generation hours must increasingly be weighed against higher peak-period electricity costs.
As procurement becomes more complex, businesses will increasingly need solutions tailored to their load profiles, operating requirements, and cost objectives rather than standardized renewable energy offerings. This creates opportunities for developers, technology providers, and financiers that can structure the right mix of rooftop solar, open access, hybrid, storage, and financing.
For C&amp;I consumers, navigating these choices requires answers across policy, technology, financing, project economics, and execution. The <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-vizag/agenda" target="_blank" rel="noopener">Vizag C&amp;I Clean Energy Meet</a> brings these conversations together in one focused forum, allowing businesses to raise their specific concerns and evaluate potential solutions within a few hours.
For solution providers, the opportunity goes beyond presenting their offerings. Hearing directly from multiple consumers about their energy costs, load requirements, procurement constraints, financing concerns, and implementation challenges can help identify genuine project opportunities and the solutions needed to address them.
Open Access Economics Remain Critical
For C&amp;I consumers, the economic case for switching from grid supply to renewable open access depends heavily on network charges.
While retail electricity tariffs for C&amp;I consumers remained unchanged for FY 2026-27, wheeling charges increased substantially.
At 11 kV, wheeling charges for both APSPDCL and APEPDCL <a href="https://www.mercomindia.com/andhra-pradesh-retains-existing-power-tariffs-for-fy-2027" target="_blank" rel="noopener">increased</a> by 26.6%. At 33 kV, they increased by 23.7%. Transmission charges increased by 3.9%.
Cross-subsidy surcharges also vary by consumer category, voltage level, and distribution company, adding another variable to project economics.
Savings can therefore vary considerably based on the procurement structure. Banking provisions, cross-subsidy surcharges, transmission and wheeling charges, ToD tariffs, and a consumer&#8217;s load profile all need to be evaluated alongside the renewable energy tariff.
For businesses considering renewable energy procurement, the decision is therefore increasingly about choosing the right procurement structure and matching generation with consumption, rather than simply securing the lowest renewable tariff.
Hybrid and Storage Capacity Expands
Andhra Pradesh has approximately 12.6 GW <img loading="lazy" decoding="async" class="alignnone wp-image-96679 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2026/06/icon-3-2-e1781760279241.png" alt="market-tracker-icon" width="20" height="16" /> of solar and associated renewable projects under development and in the pre-construction stage, according to the<a href="https://www.mercomindia.com/product/india-solar-project-tracker" target="_blank" rel="noopener"> Mercom India Renewable Energy Project Tracker</a> dashboard.
The pipeline includes standalone solar, solar-wind hybrid projects, solar-plus-battery storage, and solar-wind projects paired with battery storage.
The growing presence of hybrid and storage-linked capacity signals a broader move toward renewable power that can better match consumption beyond solar-generation hours.
Visakhapatnam’s Power Demand Opportunity
Visakhapatnam is emerging as a hub for data centers and hyperscalers, potentially adding another source of large, round-the-clock electricity demand.
As the region attracts more high-load consumers, demand for firm renewable power could rise, strengthening the case for solar-wind hybrids, storage, and other structured clean-energy procurement solutions.
And with Andhra Pradesh’s renewable market evolving rapidly, the opportunity for both C&amp;I consumers and solution providers is not simply to understand where the market is headed, but to identify what can be done today and who they can work with to make it happen.
The next C&amp;I Clean Energy Meet will be <a href="https://www.mercomindia.com/event/c-and-i-clean-energy-meet-2026-vizag" target="_blank" rel="noopener">held</a> in Vizag on September 24, 2026.

Andhra Pradesh’s C&I Market Opens Up to New Renewable Energy Opportunities

Rashtriya Ispat Nigam (RINL), the corporate entity of Visakhapatnam Steel Plant, has commissioned projects aggregating 5 MW of grid-connected solar at the Vishakhapatnam Steel Plant premises in Vizag. The projects were developed on a Build Own Operate (BOO) basis at a cost of about Rs.330 million (~$4.86 million).
Many government-owned entities, like ports and airports, have harnessed solar energy to cut down carbon emissions; the Vishakhapatnam Steel Plant is now one among them, said an RINL official.
The solar projects are expected to achieve a net minimum guaranteed power generation of 8,000 MWh at the end of first year. The RINL had <a href="https://www.vizagsteel.com/code/tenders/tenderfiles/18689VSP-23%20of%202015-16%20.pdf" target="_blank" rel="noopener noreferrer">issued a tender</a> for this project in 2015. Jakson Engineers had won the EPC contract to set up the project, stated the RINL official.

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