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COVER
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Rural Electrification using Biomass
Husk Power Systems (HPS)
Power to Empower
Mario FerroKolkata CUTS seminar25 June 2011
My Village and 24,999 other Villages at Night
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More than 125,000 villages in India after sunset
Conventional Solutions Can’t Deliver
+ =Over 550,000,000 rural Indians without reliable
power 3
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The Main Challenges
Which technology?
How to attract and retain customers?
Where to find funds?
The Solution?
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We explored the options …
The Solution Requires
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Technology
Supply Chain
Operations
Revenue & Funding
Creativity
Innovation
Partnership
The Solution - Technology and Supply Chain
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Distributed Generation
Non-conventional Technology
Renewable Resource
The Solution - Technology and Supply Chain
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• ~132MT rice produced
• ~ 40MT husk• ~27,000,000 MW
Rice Production
Rice Belt
Plenty of rice husk to serve 125K un-electrified villages in India
Source: World Energy Outlook 2006, World Resources Institute
• 125,000 villages starving for power• 18,000 “not reachable”
• $102B rural power mkt.• Replacing diesel and
kerosene
Rural Power Market
Yellow – low per capita electricity
The Solution - Technology and Supply Chain
The Solution - Supply Chain and Operations
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The Solution - Operations and Revenues
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BOOM – Build Own Operate Maintain Company’s ownership, operation, maintenance
BOM – Build Own Maintain (only for individuals willing to either to be operators or tariff collectors)
Operations by local entrepreneur Entrepreneur’s share of capital cost – Rs 2.0 lakh – Rs 2.5 lakh HPS share of the capital - rest
HPS owns the plant machinery and cables
BM – Build Maintain Agencies own and operate the plant (for large orders i.e > 50)
Cost per 40 kVA plant (including training and knowledge transfer) ~ Rs 15 lakh
MNRE Subsidy Rs 15k / kW + Rs 3.0 lakh for more than 3 km of distribution
3-4 month’s gap between inception of project and release of subsidy
Fee to cover plant repair and non-regular maintenance HPS to aid monetization of additional streams
Special Incentive Scheme from UP NEDA for HPS Projects
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Revenue
RHCElectricity Gen.
CER Sales
Product Fulfilment
50% 4% 25% 21%
20142010
95% 0% 0%5%
RHC – Rice Husk Char can be used as base material for a variety of products such as – Incense Sticks, Fire Bricks, Briquettes for home cooking, Silica etc
The Solution - RevenuesPlant level
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Access to finance – HPS has launched a model for partnership with rural
unemployed youth/diesel gen set operatorsIn this model, the Entrepreneur invests ~Rs 2.5 lakh upfront
and a fixed monthly fee for the operating rights of the plant
A major roadblock is the funding arrangements for these entrepreneurs
Some linkages with financial institutions and extension of rural credit schemes
HPS has also launched a franchise model where interested individuals may own and operate a plantGovernment of India provides a subsidy of ~Rs 7.5 lakh per
plant which is realized after 6-7 monthsA facility for bridge financing would be great step forward
The Solution - Funding
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The Solution - Funding
Ministry of New & Renewable Energy, Govt. of India
Summary
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• Find the most appropriate technology for your specific context
• Innovate• Build your own capacity (training)
Which technology?
Challenge Our
experience
How to attract and retain customers?
• Let the customer chose• Affordability• Quality of service
• Partner with local entrepreneurs
Where to find funds?
• Check all the available public schemes
• Generate positive cash flow with different complementary revenue streams
• Look for committed private investors
Husk Power Systems
Inception in Aug’ 2007 ( first in the world to successfully operate 100% Rice Husk based electricity generation using gasifiers)
More than ~75 operational plants Catering over 400 villages /hamlets
Capex ~$1 / Watt for Generation and distribution Cheaper than the conventional thermal
World class team (IITs, ISB, Oxford, UT Austin, Darden, RPI) Over 40 months of operational experience A comprehensive training program
HPS university curriculum to train operators, mechanics, managers and entrepreneurs
A series of Technical Innovations Pre-paid meters, smart monitoring / smart grid, dry exhaust gasifier, absorption chiller, Incense Stick maker
A motivated team of more than 250 on-ground employees Excellent Investing partners
IFC, Acumen Fund, Oasis Funds, LGT VP, DFJ, CISCO, Shell Foundation, MNRE
Very strong commitment to HSSE16
World Leader in decentralized generation and distribution
2007 Dec 2008 Dec 2012
3 Power plants
Master RamBalak Ji, 15th Aug.2007
19 Power Plants
50 Power Plants
500 Power Plants
Raj Kundra, Acumen Fund
No. of Plants
Employ 700 operators, 35 cluster level managers, 10 mid-level managers and 5 senior managers
Dec 2009 Aug 2010
India got independence from England 60 years ago, but this village got its independence today.
My colleagues at Acumen and I have watched this team progress from a prototype of a new business model to bring electricity to rural villages in India, to now a full scale company that has now deployed over 24 individual systems serving over 50 individual villages in rural Bihar.
Won $100K in prize money in business plan competitions in US. HPS set up with 4 Co-Founders
Won Global Business Plan Competition and received a $250K investment from DFJ and Cisco
Installed over 30 new plants and launched 3 Business models for future growth
2014 Power Plants
Dec 2014
Create 10,000 Jobs in rural India, save 72,000 tons of CO2 per year and lighten 1 million Households
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First 40KVAplant
Husk Power Systems - Growth
Over 5 yrs of perseverance pays off. Rice Husk gasification proves to be a solution to the problem of rural electrification
Husk Power Systems – Value for Money
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Reliable electricity Cheaper and quality products of general consumption at door-steps Livelihood generation for 100’s of households
Operators Electricians Rent Collectors Managers Husk loaders Incense Stick Makers Hassle-free sale of Rice Husk for Rice Millers
Dignity and Pride
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Phone No. +91-612-2283333
for partnerships: [email protected]
for general query: [email protected]
Husk Power Systems – Contacts
HPS Sends over 250 kids to school
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Back Up Slides
• Back Up Slides
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Capex ~15 lakh + taxes for 30 kVA ~16 lakh + taxes for 40 kVA
Opex ~50 kg / hr of Rice Husk (or other biomass) 1 Operator + 1 electrician / collector + 1 husk-man Maintenance/repair of wear and tear ~8,000 – 10,000 per
annum Total of less than Rs 30,000 per month
Revenue Upto 20 kW of electricity to sell More than 2 tons of RHC per month Consumable –fulfillment More than Rs 60,000 pm if all the above streams realized Bonus of CDM
The Solution - Financials
Husk Power Systems
In pursuit of bringing Power to Empower millions of rural population, We provide reliable, renewablereliable, renewable and affordableaffordable
electricity that wows the world
It involves changing paradigms It involves inventing machines and gadgetsIt involves finding different ways to think
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