The newly incorporated special purpose vehicle will facilitate the development of transmission infrastructure for the Kadapa-II Renewable Energy Zone, supporting grid connectivity and renewable energy integration.
New Delhi, October 15, 2026: Power Finance Corporation Limited (PFC), a Maharatna public sector undertaking under the Ministry of Power, has announced the incorporation of Kadapa II REZ Transmission Limited, a new special purpose vehicle (SPV) established to facilitate the development of critical electricity transmission infrastructure in Andhra Pradesh.
The company is a wholly owned subsidiary of PFC Consulting Limited (PFCCL), which is itself a wholly owned subsidiary of PFC.
The SPV has been created for the project titled Transmission System for Integration of Kadapa-II Renewable Energy Zone (Phase-I), aimed at strengthening the power transmission network required to integrate renewable energy generation into the national electricity grid.
PFC Consulting to Coordinate Competitive Bidding
PFC Consulting Limited has been designated as the Bid Process Coordinator (BPC) for the project under the Ministry of Power’s tariff-based competitive bidding (TBCB) framework.
In this capacity, PFCCL will oversee preparatory activities necessary to select a transmission service provider, including project documentation, technical surveys, feasibility assessments, and the initiation of land acquisition and forest clearance procedures, where required.
The newly established SPV will serve as the project-specific entity through which these activities are undertaken.
After the bidding process is complete, the SPV is expected to be transferred to the successful developer in accordance with the Ministry of Power’s prescribed competitive bidding guidelines.
Kadapa-II Project to Strengthen Inter-State Transmission Network
The proposed transmission system will support integrating renewable energy from the Kadapa-II Renewable Energy Zone in Andhra Pradesh.
The project includes developing a 765/400 kV and 400/220 kV pooling station at Kadapa-II, along with a 765 kV double-circuit transmission line connecting Kadapa-II in Andhra Pradesh to Thiruvalam in Tamil Nadu.
The planned infrastructure also incorporates ±300 MVAr Static Synchronous Compensators (STATCOMs), designed to support voltage regulation and improve grid stability.
The transmission system is scheduled to be commercially operational within 36 months of the effective date of the project agreement.
National Committee on Transmission Endorses Project
The nomination of PFC Consulting as the Bid Process Coordinator was confirmed by the Central Electricity Authority (CEA) and the Ministry of Power.
The project also received endorsement from the National Committee on Transmission during its 42nd meeting held on July 7, 2026.
The transmission scheme will be developed through the Build, Own, Operate and Transfer (BOOT) model, under which the selected transmission service provider will develop and operate the infrastructure during the concession period.
The arrangement provides for a 35-year transmission service period, after which the assets will be transferred to the designated government agency in accordance with the project agreement.
Supporting India’s Renewable Energy Expansion
The incorporation of Kadapa II REZ Transmission Limited reflects PFC’s continuing involvement in facilitating transmission infrastructure development across India’s renewable energy corridors.
As the country’s solar and wind generation capacity expands, strengthening inter-state transmission connectivity remains essential for efficiently transferring electricity from renewable energy-rich regions to major consumption centres.
Projects such as Kadapa-II are expected to support renewable energy evacuation, improve network reliability and facilitate the integration of cleaner electricity into the national grid.
The initiative also highlights the role of public sector enterprises in enabling private-sector participation in large-scale energy infrastructure through transparent competitive bidding mechanisms.
By establishing the project-specific SPV, PFC Consulting has taken another step toward implementing the Kadapa-II transmission scheme, supporting India’s broader objectives of grid modernisation, energy security, and sustainable power sector development.
