See through our eyes, not your ears.

Husk Power gets more VC funding

BETTIAH — Bihar’s Husk Power Systems (HPS), a award winning rural electrification company, has got second round of financial support from Shell Foundation to further scale up operations of their unique biomass gasification technology which converts rice husks into electricity.

HPS, currently owns and operates 35-100 kW “mini power-plants” that deliver electricity as a pay-for-use service to villages of 2,000 to 4,000 inhabitants in West Champaran district of Bihar. Each plant becomes operationally profitable in the first six months of operations.

HPS has successfully implemented projects in 50 villages in Bihar and will expand its footprint to 100 villages in 2009, 400 in 2010, and 2000 in 2012.

The funding will help deliver more power plants, increase the operational and technical capacity of the company and develop the Husk Power Systems brand in India and the US. Shell Foundation got associated with HPS in November 2008, providing ongoing business development assistance and technical support.

Rice husks (the casing on the outside of rice grains) have traditionally been discarded. However, upon heating, rice husk releases gas and which HPS uses to run modified diesel engines to generate electricity. The waste product of the process is high in silica and can be sold to concrete manufacturers.

The business has also been awarded the first prize in the 2009 Global Business Plan Competition by leading global venture capital firm Draper Fisher Jurvetson (DFJ) and Cisco.

Simon Desjardins, Analyst, Shell Foundation, said: “Today, more than 40% of the Indian population, or approximately 1,25,000 villages, have no access to reliable electricity. Existing energy options in rural communities such as diesel generator sets and kerosene lanterns are polluting, prohibitively expensive, and logistically difficult to disseminate. Those villages which do have access to electricity are often subject to frequent power cuts and shortages in power supply. This directly impedes the economic development of the affected communities and indeed India as a whole.”

“HPS is using unique technology and processes to tackle the rural energy deficit in an environmentally and commercially sustainable way. They are proving that rural Indian communities are willing and able to pay for reliable electricity and that Bihar represents a viable market in which to deliver modern energy services,” he further added.

The company which has set up 10 plants is creating new job opportunities locally in Bihar. Chip Ransler, Chief Strategy Officer, Husk Power Systems said the company will hire hundreds of employees – most of them coming from Bihar, as they scale up the operation.