Husk Power Systems: Lightening up the Indian Rural Lives
| Case Code: LDEN085
Case Length: 19 Pages
Pub Date: 2013
Teaching Note: Not Available
| Price: Rs.500
Organization : Husk Power System
Industry: Power, Off-grid Industry
Countries : India
Themes: Social Entrepreneurship, Sustainable Business Model
Abstract Case Intro 1 Case Intro 2 Excerpts
Idea Behind Husk Power Systems
Pandey and Yadav, childhood friends, had faced the problem of non-availability of electricity as both hailed from rural Bihar. Even after they moved to different cities– Pandey was in Los Angeles, US, and Yadav was in New Delhi, India – the electricity problem that they faced during their growing up years in Bihar, remained a point of discussion between them. They wanted to supply electricity to the rural areas at a low price as conventional electricity system was unable to deliver power to everybody especially in remote, and undeveloped areas, and to people in the Bottom of the Pyramid segment who earned less than US$ 2 per day...
Operating Husk Power Systems
A husk power plant required around 5000-6000 sq ft of land to be set up. According to Pandey, "Each plant takes about 3 months to get started. This can go up to 5 months depending on how many houses need to be connected. We have hired local people and trained them to run these plants. We have also set up an HPS University curriculum to train these workers".
The main part of the power plant was the biomass gasifier which was around 10 to 12 feet high. A husk loader fed the rice husk into the biomass gasifier from the top. The biomass gasifier generated producer gas. The producer gas was then transferred to coolers which cooled the gas down and sent it to the filters to be cleaned. The producer gas passed through a total of four filters which cleaned the tar and dust from the gas...
Developing Sustainable Business Model
The objective of HPS was to provide a comparatively cheaper, eco friendly, reliable power system for the poor living in the rural and remote areas of Bihar (initially), while making sufficient profit to ensure that the business model could function smoothly in the long run. Pandey said, “Our goal is to have our model help to deliver rural electrification to India's villages and eventually to rural areas around the world."
To achieve its objectives, HPS carried out a detailed study before setting up the husk power plant. It first tried to understand the types of electricity uses, current source of energy, and the per kWh (kilowatt hour) cost to the target customers. After understanding the target customers and their energy needs, HPS did a feasibility study of the potential for using a husk power plant in the target area...
Social and Environmental Impact
Each HPS plant served around 400 households and helped save on approximately 42,000 liters of kerosene and 18,000 liters of diesel per year which was used to generate electricity. This contributed to, reduced home pollution, and improved the lives as well as health of the villagers, especially the women and children who used to huddle around the kerosene lamps after sunset to work and study. According to a company source, it had already saved 9,244,800 liters of kerosene by August 2012. With HPS plants, the villages had a far better lighting system in the form of CFL lamps which gave out bright white light which helped the children to study and helped women to do their household work better without having to face the problems associated with using kerosene lamps and diesel generators...
Challenges in the Way
Social entrepreneurs are responsible not only to their shareholders but also to the government (which provides a subsidy) as well as to society (which is impacted positively or negatively by the act of the social entrepreneur). Commenting on the challenges faced by this project, Pandey said, "The biggest challenge always is to get the right people for the right job. Besides, convincing villagers about the need to bring about a change in their lives was tough. We need a continuous supply of machines and manpower to effectively implant our plans."...
The Road Ahead
HPS was looking forward to massive expansion based on its award winning business model and the huge demand for off-grid electricity in its home country as well as in different parts of the world. The company planned to expand its business into other states in India like Maharashtra, West Bengal, Uttar Pradesh, and Tamil Nadu. Outside India, it planned to expand into Bangladesh, Cambodia, Ethiopia, Indonesia Nepal, Tanzania, and Uganda. Pandey said, "We plan to have 2,014 plants by 2014. Besides, electrifying other villages across India, we also plan to make a foray into countries like Nepal, Indonesia, Cambodia, and Ethiopia in the near future."...
Exhibit I: Award and Recognition to Husk Power System
Exhibit II: Time Line of Husk Power Systems Growth
Exhibit III: Management at Husk Power Systems
Exhibit IV: Questions to Assess the Feasibility of HPS Power Plants to Serve the Villages
Exhibit V: Approximate Monthly Revenue and Cost for 35kW Husk Power Plant
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