Husk becomes first profitable minigrid company in Africa and Asia

Since Husk Power Systems pioneered the first renewable energy minigrid in 2008, the industry has worked tirelessly to find a sustainable business model that can serve the more than 3 billion people still living without access to reliable electricity in rural South Asia and Sub-Saharan Africa. Today, that search is over.

Husk,   owner   of  the  largest  fleet  of  community  solar  minigrids  with  150  in  operation, announced that it has cracked the code and become the industry’s first profitable company on both continents.

The  company  became  EBITDA  positive  in  Q4  2022  in its two primary markets, Nigeria and India.  EBITDA,  or  earnings  before  interest,  taxes, depreciation, and amortization, is a widely used measure of corporate profitability.

The  milestone  was  achieved  because  of  two  factors:  1)  Husk’s  unique  platform  approach, which addresses the entire rural energy ecosystem (besides electricity and appliance sales, it also installs rooftop solar for businesses,  and offers energy-as-a-service for drinking water,   agro-processing,   etc.);  and  2)  its  relentless  focus  on  technology  and  business innovation, which has allowed Husk to boast the lowest cost of delivered energy and highest average revenue per user in the industry.

Husk pioneered the rural minigrid 15 years ago using waste biomass gasification, and in 2017 followed  up  with  the  industry’s  first  solar  hybrid  minigrid.  Since  then,  the  World  Bank  and International Energy Agency have both recognized the central role of solar minigrids in ending  energy  poverty  by  2030.  It  is  estimated  that  between  100,000  and  200,000 minigrids need to be built before the end of the decade.

“When  I  took  over  the  reins  of  Husk  in  2014,  we  underestimated  the  amount  of  time  and effort it would take to discover the right business model, right team and right technology platform  to  build  a  commercially  viable  minigrid  company  on  two  continents,”  said Manoj Sinha, Co-Founder and CEO. “It took grit and innovation to arrive here – at a profitable and scalable minigrid company.”

By achieving profitability, Husk has sent a clear signal to the market that rural minigrids are a bankable asset class, as well as an important contributor to net-zero growth for hundreds of millions of unserved and under-served people in Africa and Asia.

“Husk has proven that the rural minigrid business model works, in Asia and in Africa, and in off-grid,  under-the-grid,  and  grid-interconnected  communities.  It  works  and  it  is  robust,” said  Board  Chairman,  Brad  Mattson.  “We  have  already  scaled  10X,  and are poised to scale another  10X.  We  urge  the  industry  to  embrace  the  roadmap  Husk  followed. If funders and governments embrace the minigrid sector and this roadmap for success, together we can not only end energy poverty, but also lay the foundation for a rural industrial revolution.”

In 2022, Husk signaled its ambitions to do its part in fueling that revolution by signing a UN Energy Compact. It committed to build at least 5,000 minigrids by 2030 that would impact more  than  10  million  people  and  avoid  7  megatons  of  carbon  emissions  from  diesel generators.

Corporate profitability in India and Nigeria was achieved against a backdrop of severe market   disruption   caused   by   Covid-19,   global   inflation   and   rising   costs   of   capital, demonstrating the resilience of Husk’s business model.

huskpowersystems.com