Andhra Pradesh will adopt smart grid and Internet of Things (IoT) based solutions of AutoGrid to improve energy utilities’ financial health and customer experiences, officials said on Sunday.

The state government on Sunday signed a Memorandum of Understanding (MoU) with AutoGrid, a US-based leading provider of flexibility management software for the energy sector, at the CII Partnership Summit here.

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The initiative, which is expected to bring transformational change in the electricity sector, involves demand-side management (DSM) programmes covering key segments, including agricultural pump-sets, residential/commercial ACs and industrial units.

The Andhra Pradesh Southern Power Distribution Company (APSPDCL) will use the programmes to evaluate its benefits to the utility as well as to the consumers in the state.

Chief Minister N Chandrababu Naidu had told the delegates at the Summit on Saturday that he is embarking on second generation power sector reforms, which will bring down the cost of energy.

APSPDCL provides over 28 TWh of electricity annually to its nearly 11 million consumers. In spite of being one of the best run utilities in India, APSPDCL’s latest statement shows a net deficit of Rs 3,400 crores per year on annual revenues of nearly Rs 14,900 crore.

The DSM solutions in the project will enable benefits of over Rs 1,000 crore per year when deployed at scale, said a release from AutoGrid.

This savings will be achieved via peak shaving for capex avoidance, time of use implementation to leverage cheaper power at off-peak hours, soil-moisture-based pump-set operation to intelligently reduce power used for agricultural purposes, AC cycling to drive both energy efficiency and peak load shaving, and renewable integration to incorporate cheaper solar and wind power supply without impacting reliability or quality of service.

“We are excited to be partnering with APSPDCL and the Government of Andhra Pradesh to bring a proven solution deployed at some of the leading global utilities around the world for the first time to India,” said Amit Narayan, Chief Executive Officer of AutoGrid Systems.

“This solution not only provides significant savings to the utility, but also delivers strong benefits to consumers, thereby aiding in improved governance,” he added.