Renewable energy firm, Husk Power Systems, is planning to launch 500 solar mini-grids in Nigeria over the next five years and is looking to expand into other countries in Africa.
This was revealed today when the startup 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 under the 24/7 Carbon-free Energy Compact — a global effort to accelerate the uptake of carbon-free electricity as a way of averting the perilous effects of climate change — by leading energy buyers, suppliers, equipment manufacturers, and governments.
Husk has been at the forefront of fueling rural electrification since 2008 and currently has operations in Nigeria, Tanzania, and India. It seeks to install at least 5,000 mini-grids by 2030 while making 1 million connections — half of which will be micro, small, and medium-sized enterprises.
It launched its first six mini-grids in Nigeria in November last year with the hope of having 100 mini-grids operational in the country within two years.
The renewable energy firm is now exploring growth opportunities in the western, southern, and eastern regions of Africa while giving huge focus on countries with a “supportive regulatory environment” like its current markets.
Speaking on the firm’s mission, Manoj Sinha, CEO and Co-founder, Husk Power Systems, said, “Husk is committed to powering households, but our focus is first and foremost on micro, small and medium enterprises (MSMEs), and public institutions like health clinics and schools. MSMEs are the engine of economies in Africa, and powering existing small businesses and encouraging the formation of new MSMEs helps create the type of economic growth and social benefit that carries over to households by creating more opportunity and more jobs.”
Husk is one of the companies participating in the Nigeria Electrification Project, which provides performance-based grants, a sort of capital subsidy, to mini-grid developers — part of the national effort to solve the country’s chronic power supply issues.
“In terms of policy frameworks and regulation, the states where Husk works in India (Uttar Pradesh and Bihar) have supportive policies. And the Nigerian mini-grid policy is actually based on those policies, with additional improvements. As a result, Nigeria is seen to have the most conducive policy in sub-Saharan Africa at the moment, which also includes their Nigeria Electrification Project (NEP), a program administered by the Rural Electrification Agency and funded by the World Bank to provide a capital subsidy to mini-grid developers and accelerate market development,” said Sinha.
Husk plans to have additional technological and business model innovations, and use AI and IoT to remotely manage its fleet.
Currently, Nigeria and India are its biggest markets while potential markets include Kenya, which recognized mini-grid power systems at the start of this month, granting them 50% tax allowance and other tax incentives enjoyed by large-scale generators.
“We welcome the Energy Compact commitments made by Husk Power and appreciate their leadership. It showcases the business opportunity presented by the global energy transition, and how private enterprises can drive accelerated action on ending energy poverty, expand renewable energy solutions for consumptive and productive load, and improve the adoption of energy efficiency solutions by end consumers,” said Kanika Chawla, UN Energy program manager.
To date, Husk has raised $40 million from investors, including the Shell energy company and the Dutch Development bank FMO. It was recognized last year by the 2021 Renewables Global Status Report as the only mini-grid developer with over 100 community sites in operation.