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.