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Green Investing in India – Favorable government policies make Gujarat a top Renewable Energy destination

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India’s Western state of Gujarat is one of the most developed regions in the country and has shown tremendous economic growth over the past decade.The state has been growing at a scorching pace under stable and supportive governments for the past several years.This state is home to Reliance Industries massive petrochemical complex and Tatas have also shifted their prestigious “Nano” car production to the state.Now Gujarat is making aggressive policy moves to become a Green Powerhouse as well with substantial subsidies towards the growth of wind,biomass and solar energy generation.Note the state is already one of the top producers of Renewable Energy with 1400 MW of installed power capacity.The state is now targeting a 5 fold increased in renewable energy over the next 5 years.

Solar Energy gets a Big Push

Gujarat has signed MOUs to buy power from approximately 500 MW of Solar Energy Capacity in the next 2-3 years.It is giving a Feed in Tariff of Rs 13 for the first 12 years and Rs  3 for the next 13 years besides tax and other incentives.The government has signed agreements with a number of local and international players for setting up this capacity.Note Gujarat is a very good geographical location because of the high amount of solar radiation that it gets.

Gujarat pushes green energy – Business Standard

In the solar energy segment, the state will see investments to the tune of Rs 45,000 crore.AES Corporation, a US-based Fortune 500 company, has firmed its plans to invest about Rs 6,000 crore 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 (Teri), is mulling a 5,000 Mw solar project in the state at an investment of over Rs 70,000 crore.The companies that have confirmed their intention to sign MoUs at the ongoing Vibrant Gujarat Summit include Moser Baer 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).

Wind Energy gets a Massive Boost as Well

Gujarat is also having ambitious plans in setting up over 5 GW of Wind Energy capacity to become the biggest wind power state in India.It is looking for investments of around $9 billion in Wind Energy signing investment pacts with Indian companies like Suzlon,NTPC and foreing companies like Enercon and Abellon Energy.

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 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.

Gujarat is already matching its word with actions as Solar and Wind Power plants are already being constructed.It is also looking to give a boost to manufacturing by setting up the first dedicated Renewable Energy Special Economic Zone (SEZ) .With large power capacities being setup,it would make sense for manufacturers to produce locally and a tax free SEZ would help in this endeavour.Note no other state in India has come with such a clear and supportive Green Energy Policy till now.States like Tamil Nadu and Karnataka which has large wind energy installations need to up their game to attract Green investments.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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