The Human Rights Forum (HRF) expresses deep concern over G.O. Ms. No. 32, Energy Department, dated 22 April 2026 through which the Andhra Pradesh government has approved a policy framework enabling the grant of ‘Deemed Distribution Licences’ (DDLs) to Strategic Data Centers.
After examining the Electricity Act, 2003, the Andhra Pradesh Electricity Regulatory Commission (APERC) Distribution Licence Regulations, 2013 and several binding Supreme Court judgments, HRF is of the view that G.O. 32 is legally unsustainable and should be withdrawn.
To clarify, a distribution licence exists to supply electricity to consumers and distribution necessarily involves a licensee and consumers who are distinct from the licensee. Electricity used exclusively for self-consumption does not constitute distribution.
Both the Electricity Act and APERC Regulations define a distribution licensee as an entity authorised to operate and maintain a distribution system for supplying electricity to consumers. G.O, 32, however, seeks DDL status for data centers primarily to enable dedicated power procurement and management for their own consumption. Clearly, this conflicts with the statutory scheme.
We recall that the Supreme Court has in Sesa Sterlite Ltd. v. Orissa Electricity Regulatory Commission, held that infrastructure developed solely for self-consumption cannot claim the benefits available to a deemed distribution licensee. The same principle was reaffirmed in Indian Railways v. West Bengal State Electricity Distribution Company Ltd., where the Court held that merely operating a distribution system is insufficient; electricity must ultimately be supplied to consumers.
HRF is of the opinion that G.O. 32’s reliance on Special Economic Zone (SEZ) precedents is misplaced. Deemed distribution licence status for SEZ developers arises from a specific statutory framework under the SEZ Act, 2005 and a notification of the Central government. Even there, electricity is supplied to multiple units that are consumers under the Electricity Act. No comparable legal framework exists for data centers.
The G.O. also assumes that the State government can determine eligibility for deemed distribution licence status. Under the Electricity Act, licensing authority rests with the APERC, an independent statutory regulator. While the government may formulate policy, it cannot create a new category of deemed licensee, unsupported by law or contrary to binding judicial precedent.
We are of the view that G.O. Ms. No. 32 is incompatible with the Electricity Act, inconsistent with APERC regulations and contrary to Supreme Court jurisprudence. It seeks to confer distribution-related benefits on entities whose stated purpose is self-consumption of electricity, without any statutory basis.
Apart from the legal infirmities, G.O. 32 effectively confers an unwarranted benefit on Google, one of the principal beneficiaries of this policy. By enabling such data centers to secure electricity through a DDL arrangement, the G.O. deprives theState power utility, Andhra Pradesh Eastern Power Distribution Company Ltd (APEPDCL), of the opportunity to supply electricity to large industrial consumers at the tariff ordinarily applicable to them. The consequent loss of revenue weakens the public utility’s ability to cross-subsidise low-income households and consumers in rural and remote areas.
It is ironic that while in the USA and several other countries, energy-intensive data centers are often charged higher electricity tariffs to reflect the costs they impose on the grid and the wider power system, in Visakhapatnam, Google’s data centers will receive concessional treatment. In our view, this G.O. represents a backdoor attempt to privatise an important component of electricity distribution, a public service that has long played a vital role in cross-subsidising large sections of the population, including farmers and other disadvantaged sections. In effect, the G.O. socialises the costs of private corporate projects while privatising their benefits!
HRF believes that executive policy must operate within the limits prescribed by statute and judicial authority. G.O. Ms. No. 32 fails that test. We call upon the State government to withdraw the Order forthwith.
Y Rajesh – HRF State general secretary
G Rohith – HRF State secretary
VS Krishna – HRF AP & TG Coordination Committee member
22-6-2026,
Vijayawada.