Telangana's 2026-27 Budget: Energy Sector Allocation Unchanged

The Telangana government has revealed its budget for the 2026-27 fiscal year, keeping the allocation for the energy sector almost unchanged from the previous year. The allocation stands at Rs 21,285 crore compared to Rs 21,221 crore for the 2025-26 fiscal.

Deputy Chief Minister M. Bhatti Vikramarka presented the budget estimates to the Legislative Assembly, emphasising that the allocation for the upcoming fiscal year includes Rs14,000 crore dedicated to subsidies. A substantial portion of this subsidy fund is allocated to provide free power supply to agricultural pump-sets. Additionally, a smaller amount is earmarked for various other categories, including small-scale industries and handloom sectors. In the previous fiscal year, the subsidy allocation was Rs 11,500 crore.

For households eligible for free electricity, an allocation of ₹2,080 crore has been set aside, aimed at covering the first 200 units of power consumed each month.

The Deputy Chief Minister also detailed how the state's power utilities successfully managed a peak load capacity of 18,228 megawatts. On March 13, the transmission and distribution system catered to an energy demand of 344.4 million units, without any interruptions, demonstrating a strong installed capacity of 23,187 megawatts linked to the grid.

The new budget includes allocations of Rs 1,000 crore each for Telangana Generation Corporation Limited (Genco) and Telangana Transmission Corporation Limited (Transco). Another Rs 1,000 crore is designated for promoting green energy policies, and similar funds are allocated for the solarisation of villages.

In a significant push towards renewable energy initiatives, Mr. Vikramarka stated that the government is planning to develop a capacity of 11,460 megawatts of pumped storage hydropower and other renewable generation units apart from solar.

To enhance the sustainability of energy supply, the government plans to establish battery energy storage systems with a capacity of 1,500 megawatt-hours, targeting locations at Maheshwaram and Chotuppal as initial sites.

Additionally, a third distribution company (Discom) is set to be established, specifically to manage agriculture and lift irrigation connections, with operations starting in April.

Under the Indira Soura Giri Jala Vikasam initiative, plans are in place to distribute solar pump-sets with full subsidies to 2.1 lakh tribal farmers. An allocation of Rs 600 crore has been made available for this purpose. The scheme aims to assist tribal farmers in cultivating plantation crops across approximately 6 lakh acres of ‘podu’ lands, and a pilot project is underway in Achampet, with plans for statewide replication based on its outcomes.