CASE STUDY
investment and sales revenue. HPS loses only about 4% of revenue through default on payment or electricity theft, considerably lower than most power suppliers in India, who often lose 30%.
Environmental benefits Surveys show that households stop using kerosene lamps when they get HPS electricity, and save 6 - 7 litres/month of kerosene on average. The total kerosene saving for the 32,500 households supplied at the end of March 2011 is therefore about 2.7 million litres per year. Kerosene savings cut greenhouse gas emissions by an estimated 125 tonnes/year CO2 equivalent per plant (assessed as part of CDM certification). Thus the total saving for the 65 plants in operation at the end of March 2011 is about 8,100 tonnes/year of CO2e. Further CO2 savings come from the reduced use of diesel generators to supply small businesses: these savings vary from plant to plant because they depend on the type of customers served. Note that some CO2 is produced from the fossil fuels used in the transport of rice husk, but the amount is small (less than 1 tonne/year CO2 per plant) since HPS plants are sited within 10 km of the rice mill, and some transport is done by bullock cart.
Social benefits Having a reliable electricity supply makes families feel more settled and connected to the wider world. Even in villages with grid power, households and businesses choose to connect to the HPS supply because of its greater reliability and lower cost. HPS makes sure that customers understand how to use electricity safely, and that every member of the household agrees to abide by safety rules. Good-quality lighting throughout the evening is a huge benefit to households. Children can study properly, housework is easier, and families can relax and socialise. Better lighting deters petty crime, and reduces the frequency of snake-bites and dog-bites, a common reason for emergency hospital admission in Bihar. Removing kerosene lamps reduces exposure to smoke and fumes, and the risk of fire: many village homes are built from woven bamboo, and house fires are common in rural Bihar. Mobile phones are important for keeping in touch with the many family members who work elsewhere in India or abroad. In one village mobile phone ownership increased from 10% to 80% of households after the HPS supply was installed, because previously people had to go out of the village to have their phones charged.
Economic and employment benefits Households with HPS power save typically INR 200 per month on kerosene, so their net monthly saving (after paying for their CFLs) is about INR 100 (US$2.2). With household earnings of typically US$75 to 100 per month, this frees up a significant amount of cash. Businesses
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benefit from better quality light and electric fans, and some new businesses have started because of the HPS supply, including photocopying shops and mini cinemas. Rice mills are paid about US$25 per tonne of rice husk, so earn an extra US$3,000 per year by supplying an HPS plant, as well as solving a disposal problem. Some mills have shared this benefit with their customers by cutting the charges that they make for milling. HPS provides good employment at a local level. Plant assembly provides temporary employment for about 10 local labourers. Each plant then employs four people (plant operator, electrician, fuel handler and fee collector) who have training, income and safe working conditions. The collector is encouraged to earn extra as ‘travelling salesman’, selling goods that are not usually available in the village at the same time as collecting fees. Further skilled and professional employment is provided in the cluster-level, regional and central operations. HPS provides full medical benefits and retirement contributions for its full time employees, who number about 270. Rice husk char is produced as a by-product of the gasification process. HPS is investigating ways of using this that will add value and create employment. At five plants, groups of about 15 women work part-time making incense sticks from char, and can earn about INR 80 (US$1.8) per day.
Future plans HPS has a target of over 2,000 plants in operation by the end of 2014.
Husk Power Systems is a for-profit company, registered in 2008. It has a mission to provide renewable and affordable electricity to rural people in a financially sustainable way. Most of its income comes from electricity sales.
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