Gujarat is all set to emerge as one of the greenest states in the country! The government has chalked out a massive plan to add about 7,000 Mw of renewable energy in the next three to four years, attracting investments to the tune of about Rs 80,000 crore (Rs 800 billion).

Gujarat is already among the top four states using renewable energy, having an installed capacity of about 1,400 Mw.

"Global warming is a cause of concern. And to address this problem, we will increase our focus on renewable energy, especially solar," chief minister Narendra Modi told Business Standard in a recent interview.

The state government has recently come out with a separate solar power policy under which it proposes to purchase 500 Mw of solar power every year at an agreed cost.

"The chief minister had set a target of 10 per cent renewable energy for 2014.

However, looking at the liberal policies in wind and solar power, and favourable investment and business climate, we would be able to accomplish it in 2-3 years, going by the response we are getting," said a senior government official.

In the solar energy segment, the state will see investments to the tune of Rs 45,000 crore (Rs 450 billion).

AES Corporation, a US-based Fortune 500 company, has firmed its plans to invest about Rs 6,000 crore (Rs 60 billion) for setting up 'world's largest solar project in the state by 2010' after going through the new policy, sources said.

The size of the plant would be about 1,000 Mw.

Clinton Foundation, headed by former US president Bill Clinton, which has initiated trials in Kutch with the Tata Energy Research Institute, is mulling a 5,000 Mw solar project in the state at an investment of over Rs 70,000 crore (Rs 700 billion).

The companies that have confirmed their intention to sign MoUs at the ongoing Vibrant Gujarat Summit include Moser Baer [Get Quote] for setting up a 650 Mw project, Swiss Park (100 Mw), OPG Energy (100 Mw), Par Solar 300 (Mw), Acme group (110 Mw), Welspun group (100 Mw), US-based Next Gen Syndicate (310 Mw) and Essar Abengoa Solar (40 Mw).

The state government offers tariffs of Rs 11 and Rs 13 per unit for solar thermal and PV cells, respectively. This tariff is given for a period of 12 years, after which a tariff of Rs 3 per unit is offered for another period of 13 years.

In wind power, the state currently ranks third but is aiming to overtake Maharasthra and Tamil Nadu in the next two to three years by generating over 5,000 Mw of wind power.

"Tamil Nadu has touched 4,000 Mw, but has reached a saturation point. It can install only about 5,000 Mw. Currently, Gujarat has an installed capacity of 1,500 Mw," a senior official said.

The state is expected to draw investment to the tune of Rs 40,000 crore (Rs 400 billion) in the wind energy sector.

The players that are likely to sign MoUs include Sydney-based Abellon Bioenergy for a 1,000 Mw wind farm project with an investment of Rs 5,500 crore (Rs 55 billion), Suzlon's [Get Quote] Rs 9,000 crore (Rs 90-billion) investment for producing 1500 MW, NTPC's Rs 3,000 crore (Rs 30-billion) investment for 500 MW and Enercon's Rs 3,500-crore (Rs 35-billion) project for producing 600 MW of wind power.