Husk power systemsa clean energy company that has been at the forefront of rural electrification supply since 2008, plans to roll out 500 solar mini-grids in Nigeria over the next five years.
The renewable energy company unveiled the plans today when it announced the signing of a voluntary commitment with the United Nations to grow its energy market in Sub-Saharan Africa and South Asia. The commitment is contained in the 24/7 Carbon-free Energy Compact from leading energy buyers, suppliers, equipment manufacturers and governments. The compact represents a global effort to accelerate the absorption of carbon-free electricity as a way to avoid the dangerous effects of climate change.
The startup currently has operations in Nigeria, Tanzania and India (Uttar Pradesh and Bihar), where it has the ambitious goal of installing at least 5,000 mini-grids by 2030 and in the process making 1 million connections – half of which will be micro, small and medium-sized companies. Husk launched its first six mini-grids in Nigeria in November last year and expects to have 100 operational mini-grids in the country within two years.
“Husk is committed to providing energy to families, but our focus is primarily on micro, small and medium-sized enterprises (MSMEs) and public institutions such as health clinics and schools. MSMEs are the engine of economies in Africa, and boosting existing small businesses and encouraging the formation of new MSMEs helps create the kind of economic growth and social benefit that transfers to families, creating more opportunities and more jobs,” he said. the CEO and co-founder of the company. -founder Manoj Sinha, told Ploonge.
The company is now exploring growth opportunities in West, South and East Africa, prioritizing countries that have a “favorable regulatory environment” as their current markets. In Nigeria, for example, mini-grid operators are “largely exempt from license requirements for standalone off-grid mini-grids or interconnected mini-grids”.
The Electricity Regulatory Commission of Nigeria Mini-Grid Regulation (2016) stipulates asset transfer and financial compensation to mini-grid operators in cases where the national grid finally connects regions where private mini-grids are operational. .
Husk is one of the companies participating in the Nigeria Electrification Project, which provides performance-based subsidies, a kind of capital subsidy, to mini-grid developers – part of the national effort to solve the problem. the country’s chronic power supply problems.
“In terms of policy and regulatory frameworks, the states where Husk works in India (Uttar Pradesh and Bihar) have supportive policies. And the Nigerian mini-grid policy is actually based on these policies with additional improvements. As a result, Nigeria is seen as having the most favorable policy in Sub-Saharan Africa at the moment, which also includes the Nigeria Electrification Project (NEP), a program administered by the Rural Electrification Agency and funded by the World Bank to provide a subsidy of capital for mini-grid developers and accelerate market development,” said Sinha.
Nigeria and India are the company’s biggest markets at the moment. A supportive environment encourages investment from private companies like Husk and serves the energy needs of homes and small businesses, especially in rural areas.
Potential markets for Husk include Kenya, which earlier this month recognized mini-grid power systems, granting them 50% tax breaks and other tax breaks enjoyed by large-scale generators.
“We welcome the Energy Compact commitments made by Husk Power and appreciate its leadership. It shows the business opportunity presented by the global energy transition and how private companies can drive accelerated action to end energy poverty, expand renewable energy solutions for consumption and production load, and improve the adoption of energy efficiency solutions by end consumers. ” said the UN. Energy Program Manager Kanika Chawla.
According world Bank, mini-grids have the potential to provide clean energy to half a billion people by the end of this decade (including those using overloaded grids) with the right policies in place. They also provide cleaner, cheaper energy alternatives that can transform the lives of millions of people living in darkness.
Sub-Saharan Africa is responsible for 75% of the world’s population without access to renewable energy and electricity solutions. Countries like South Sudan, Burundi, Chad, Malawi, Burkina Faso, Madagascar, Tanzania are among some of the least electrified countries in the world and can benefit from clean solar or wind energy.
“For off-grid communities where diesel generation is the standard source of electricity, the savings for our customers are significant. Companies can expect about a 30% reduction in their monthly energy costs by switching from diesel electricity to solar mini-grid,” Sinha said.
To date, Husk has raised $40 million from investors, including energy company Shell and Dutch development bank FMO. The startup, which also finances home appliances and home appliances, was recognized last year by the 2021 Renewables Global Status Report as the only mini-network developer with over 100 community sites in operation.