Bengaluru: The State government on Tuesday signed a memorandum of understanding (MoU) with American firm, SunEdison, to generate 5,000 megawatts of power (renewable energy) in Karnataka over the next five years.

Energy Minister D K Shivakumar speaking to the media after the signing of the MoU, said the government had given SunEdison a free hand to directly purchase land from farmers to set up solar power installations, or take land on lease from the Karnataka Renewable Energy Development Limited (KREDL).

“We have opened the scheme under our solar policy for farmers to put together their small portions of land and lease it out to KREDL, which in turn will lease it to the company for installation of the solar power system for a period of 25 years,” he said.

As per the present agreement, SunEdison will build a mix of solar photovoltaic (PV) and wind energy power plants across Karnataka. The power plants will supply electricity to be sold under power purchase agreements within and outside Karnataka. SunEdison, along with the government, will identify suitable government land to construct the projects and build the infrastructure to connect the projects to the grid. The agreement includes details of an immediate plan to implement between 1,000 MW and 1,500 MW before Dec 31, 2016.

Chief Minister Siddaramaiah asked Sun-Edison to open a solar PV panel manufacturing unit in the State.

Shivakumar said he had cancelled several power purchase agreements with renewable energy companies that bagged tenders for wind and solar power between 2006 and 2008, as they had not taken off. He said power purchase agreements for as much as 4,000 MW had been cancelled after spot inspections by the Energy department officials.

“The power purchase agreement, with land provided by the government, was being used for real estate deals rather than for generating power,” he said.