In the quiet corridors of Andhra Pradesh’s government offices, a deal struck in late 2021 has now drawn sharp scrutiny, raising questions about how decisions of monumental financial and environmental significance are made. The agreement, a $490 million annual contract to procure solar power, was approved at lightning speed despite warnings from key officials—and now sits at the center of international allegations of bribery and fraud.
A Rapid Greenlight for an Unnecessary Deal
In September 2021, the Solar Energy Corporation of India (SECI) reached out to the Andhra Pradesh government with a proposal: sign India’s largest renewable energy procurement contract. This was surprising, as the state’s own energy regulator had recently declared no short-term need for solar energy, recommending a focus on renewables capable of providing consistent, 24-hour power.
Yet, within 24 hours of SECI’s outreach, Andhra Pradesh’s state cabinet granted preliminary approval for the project, moving swiftly to finalize a procurement agreement just weeks later. The primary beneficiary? Adani Green Energy, the renewables arm of billionaire Gautam Adani’s conglomerate.
Allegations of Bribery
U.S. prosecutors have since indicted Adani and several associates, alleging that $228 million in bribes were funneled to Andhra Pradesh officials to secure the state’s buy-in. These allegations, combined with the speed of the deal’s approval, have cast a long shadow over the proceedings.
Overruling Warnings
Documents reveal a trail of objections ignored in favor of fast-tracking the deal. Treasury and energy officials warned the cabinet that the contract wasn’t financially prudent, citing falling solar prices and the state’s strong bargaining position as the buyer. They also raised concerns over the 25-year duration of the agreement, which would lock the state into a potentially overpriced contract.
Despite these red flags, the cabinet overruled the objections, locking in a price of 2.49 rupees per kilowatt-hour for solar energy. An analysis by the new state administration suggests the actual costs could soar by 23% due to overlooked taxes and duties.
A Strain on State Resources
If the deal proceeds, annual payments to Adani Green Energy could rival Andhra Pradesh’s spending on critical social programs, such as nutrition and social security. This has fueled public debate about the contract’s long-term impact on state finances and governance.
Uncertain Future
The new administration in Andhra Pradesh, led by Chief Minister N. Chandrababu Naidu, is now exploring options to suspend the agreement. A final decision is expected by year’s end, but the controversy has already underscored the risks of opaque decision-making and potential corporate influence over public policy.
As scrutiny deepens, the Adani solar deal has become a flashpoint in the broader debate over balancing renewable energy ambitions with ethical governance—a cautionary tale for states navigating the complex intersection of energy policy and corporate power.
