Amaravati, May 20 : Adani Hydro Energy Eleven Ltd. (AHE11L), part of the diversified Adani Green Energy, will develop the 2,250 MW Gandikota-2 Pumped Storage Project (PSP) in YSR Kadapa district of Andhra Pradesh.

The state government approved the allocation of the project to AHE11L, which is expected to further strengthen the stateâ??s position as Indiaâ??s emerging clean energy and energy storage hub, said an official release on Wednesday.

The project, to be developed by the Adani Group under the Andhra Pradesh Integrated Clean Energy Policy 2024, is expected to become one of the largest pumped storage projects in the country and a key pillar of Andhra Pradeshâ??s next-generation power infrastructure strategy.

The approval was accorded following clearance by the State Investment Promotion Board (SIPB), chaired by Chief Minister N. Chandrababu Naidu.

The Gandikota-2 PSP will be developed at the Lord Balaji Donthi Kona PSP Park in YSR Kadapa district. The project is expected to significantly strengthen Andhra Pradeshâ??s renewable energy balancing and storage capabilities while supporting the stateâ??s rapidly growing ecosystem of green hydrogen, advanced manufacturing, electric mobility, and AI-driven data centres.

Globally, pumped storage projects are increasingly viewed as the backbone of renewable-heavy power systems, enabling stable, round-the-clock clean energy by storing surplus solar and wind power during off-peak hours and releasing it during peak demand periods, said the release.

India is witnessing rapid expansion in pumped storage capacity as the country accelerates its transition towards large-scale renewable energy integration. According to Government of India data, Andhra Pradesh has emerged as one of the leading destinations for pumped storage development with a significant pipeline of projects under implementation.

The Adani Group has also been expanding its national pumped storage portfolio as part of its broader renewable energy and energy transition strategy, with projects across multiple states, including Andhra Pradesh, Maharashtra, and Uttar Pradesh.

Andhra Pradesh has already emerged as a major destination for Adani Groupâ??s clean energy investments, including pumped storage and renewable energy infrastructure projects. Industry experts view large-scale storage assets such as Gandikota-2 as critical enablers for Indiaâ??s future energy economy and for supporting energy-intensive digital infrastructure such as hyperscale data centres.

As part of the approvals, the government has sanctioned allocation of 29.20 MCM of water for one-time initial filling and 2.20 MCM annually towards evaporation losses from the existing Gandikota reservoir, subject to prevailing guidelines.

The project will also be eligible for incentives under the Andhra Pradesh Integrated Clean Energy Policy 2024, which targets investments worth nearly Rs 10 lakh crore and aims to generate employment for approximately 7.5 lakh people across the clean energy value chain.

The government reiterated that Andhra Pradesh continues to attract some of Indiaâ??s largest energy and infrastructure investments due to its policy stability, fast-track approvals, strong transmission planning, and integrated approach towards industrial and clean energy development.

The Gandikota-2 PSP is scheduled to be completed within 72 months.

/IANS