According to reports, numerous solar energy startups are delivering cheap and accessible power to rural India. These ventures have come up with solutions – ranging from solar off-grids to solar-powered home systems – that are not just cost-effective but also less toxic than traditional fuels like kerosene.
“In a country, where large swathes of population have little or unreliable access to basic power, off grids is the solution,” said Shyam Patra, 36, founder of Naturetech Infrastructure. The four-year-old, Lucknow-based startup provides electricity to more than 25 villages across Uttar Pradesh and Bihar by offering power directly to homes and micro and small enterprises.
“UP alone has 20 million rural households that have no access to electricity. Even if we choose to work only here, we will not be able cover more than 10% of the market,” said Patra, who was formerly with infrastructure companies Lanco and GMR.
Naturetech’s off-grid is installed underground, with cables attached to households. Customers pay through a tamper-proof prepaid meter. Consumers pay up to 150 a month for 24-hour electricity, almost half of what they spend on kerosene and diesel.
“The aim is to provide the last mile connectivity,” Patra said, adding that he expects to install at 10 more off-grids by the end of the year and earn revenue of Rs 10 lakh by the end of the current fiscal.
Solar has for long been viewed as the energy source with the most potential to offer low-cost power, with policy support and plummeting prices of solar panels used to store power boosting entrepreneurial activity in the sector.
“That has had a big impact, because project capital expenditure is now much lower. In 2007, we sold power at 16 to 17 a unit in Punjab. Now they can look to sell it at 7 and 8,” said Sanjeev Aggarwal, managing partner at Helion Venture Partners, an early investor in solar power company Azure Power. The launch of the Jawaharlal Nehru National Solar Mission has also spurred startup activity. The target of 20,000 mw of grid-connected solar power by 2022 has led to increased domestic production of critical raw materials and components.
“It has been a big boon, we are seeing a lot of entrepreneurs enter the space, and who are bringing in the changes,” said Karan Gupta, an investment manager at social venture capital fund Insitor Management.
“Economies of scale will bring down costs and thereafter tariffs. We are very bullish on this space,” said Gupta whose fund has invested in Lucknow-based startup, Mera Gao Power.
“Power is so scarce in India that the situation provides us with massive opportunities,” said Nikhil Jaisinghani, founder of Mera Gao Power.
Born and raised in the US, Jaisinghani and his cofounder, Brian Shaad, both 38, quit their jobs with development agency USAID and Shell, respectively, to start Mera Gao Power in 2010. The company currently serves the Sitapur district in UP, providing electricity to more than 600 villages that account for about 65,000 people.
“Our target is to reach 1,000 villages by end-2013,” said Jaisinghani.
Mera Gao Power’s micro-grid system, which costs about Rs 50,000, can be built and set up in a single day, and the system can generate, store and distribute power, turning itself on and off automatically.
“We finance it for the consumer, offering them at seven hours of light and phone charging capacity. It is much more energy and cost efficient,” Jaisinghani said.
He, however, did not disclose Mera Gao Power’s topline projections for the financial year ended 2014, but said monthly revenue is expected to be about Rs 13 lakh for September.
In Kolkata, Onergy operates eight renewable energy centres and provides a range of products, from solar lanterns and solar home systems, to solar power installations, in the process, reaching about 700 villages.