Clean energy company, Husk Power System has signed a voluntary commitment with the United Nations to grow its energy market in sub-Saharan Africa and South Asia, a deal that would see the solar company launch 500 solar mini-grids in Nigeria over the next five years.
The commitment represents 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.
The development is expected to bridge the energy needs of households and small businesses, especially in rural areas leveraging Nigeria and India as its company’s biggest markets currently.
What they are saying
Manoj Sinha, CEO and co-founder, Husk said the company is committed to powering households, adding that the focus is first and foremost on micro, small and medium enterprises (MSMEs), and public institutions like health clinics and schools.
According to her, 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.
Speaking on why the company is exploring growth opportunities in the western, southern and eastern regions of Africa, prioritizing a country like Nigeria, he explained that the country has a supportive regulatory environment that allows mini-grid operators free of permit requirements for either standalone off-grid mini-grids or interconnected mini-grids.
He said, “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.”
“For off-grid communities, where diesel generation is the default source of electricity, the savings to our customers are significant. Businesses can expect about a 30% reduction in their monthly energy costs by switching from diesel to solar mini-grid electricity,” added Sinha.
Notably, the Nigerian Electricity Regulatory Commission Mini-Grid Regulation (2016) stipulates the transfer of assets and financial compensation for mini-grid operators in cases where the national grid finally connects the regions where private mini-grids are operational.
Kanika Chawla, UN Energy programme manager said while speaking on the deal, “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.”
What you should know
- While the startup currently has operations in currently with operations in Nigeria (Uttar) Tanzania (Pradesh) and India (Bihar), it says its ambition is to install at least 5,000 mini-grids by 2030 and also make 1 million connections; half of which will be micro, small and medium-sized enterprises.
- Husk launched its first six mini-grids in Nigeria, in November last year and is looking to have 100 operational within two years.