If all your growing up years your world would plunge into darkness every evening, it is not a memory you easily forget. For Gyanesh Pandey and Ratnesh Yadav every meeting would at some point converge on their childhood days in the early 1990s spent without electricity in the rural areas of India’s eastern State of Bihar.
Now university qualified, they vowed to bring light at the flick of a switch to the areas that were still not connected to the grid. To come up with an environment friendly and a viable venture, they roped in Manoj Sinha who had studied business management. This was in 2007, when still a third of the country’s population had no access to electricity.
After an unsuccessful attempt to use Jatropha seeds to create biodiesel fuel, the friends zeroed in on rice husk, a waste product generated when rice, a staple food, is processed in the mill to remove the chaff from the grain. They found that in paddy growing Bihar alone an estimated 1.8 billion kilograms of husk was generated every year but put to no productive use.
Launching their start-up company Husk Power Systems (HPS) in 2008 and beginning their operations in West Champaran district, the entrepreneurs focused on developing a circuitry that turned the biomass into power. With subsidy from the Central government’s Ministry of New and Renewable Energy, they designed a rice husk based power plant with a capacity of 30-35 kW that would provide electricity for 5-7 hours every evening to 400 homes in a 3-km radius.
Customers had to pay Rs 150-160 per month for two CFL bulbs and a mobile charging unit. Smart pre-paid meters enabled them to pay more if they used TVs, refrigerators or ran commercial operations. “Earlier, as night came on we had to use kerosene lanterns or candles. Now, our children can study after dark and I can also keep my shop open,” says Ranjit, a butcher in Dahwa village.
HPS soon spread its wings to eight districts including West and East Champaran, Samastipur, Motihari, Siwan, Muzaffarpur and Gopalganj. By 2011, there were around 70 mini biomass plants providing power to over one lakh people. The investment was small and in three months each plant would generate Rs 50,000 as revenue.
They also trained local youth who would operate and maintain the plant and look into distribution and collections. “I was picked up for training and now earn Rs 6,500 per month,” says Ajit Kumar.
Happily for HPS, funding came in several forms. Prize money from the Darden’s Annual Business Plan Competition at University of Virginia, Social Innovation Competition at University of Texas and the Ignite Clean Energy Competition at the Massachusetts Institute of Technology was ploughed into the business. The 1,20,000 pound International Ashden Award in 2011 proved to be the icing on the cake.
UNFCCC also certified that the company’s 40 kVA biomass plant reduces 215 tonnes CO2 annually when it runs 5-6 hours a day, making it eligible for carbon credit transactions. It also received grants from the Shell Foundation and equity investments from social venture capital firms like Bamboo Finance, Acumen Fund and LGT Venture Philanthropy.
On the ground, however, the company had its own complaints. It found it had left out several hamlets from its energy map as they were too far or sparsely populated. “We addressed the essential needs of this last rung through solar PV based DC micro-grids,” explains CEO Manoj Sinha.
By 2014, the scenario changed once again. HPS found its customers no longer satisfied with eight hours of electricity. They wanted on-demand power (24X7). So, the start-up began looking for a partner to bundle biomass and solar in one hybrid synchronising unit for customers, so that solar-based electricity would serve them during the day and husk-based power after dusk.
For its proprietary technology it found a partner in American photovoltaic manufacturer First Solar. “As a strategic investor First Solar picked up equity and is providing solar panels at preferential pricing,” says Sinha, not revealing the exact equity ratio.
In September, HPS set up its first hybrid unit at Manjhariya, Motihari, where along with the mini biomass plant 25-50 kW of solar panels provide seamless electricity 24X7. By December, three more such units will be put up.
Preeti Mehra
