A Few Questions; A Few Answers (1) – About Aspiration Energy

We started our blog a year back during July 2014. When we look back, the year had moments of jubilations, we became a WWF climate solver, won couple of projects that differed from the usual industries we worked on. Great learning curve. We are now 40 posts richer, sharing our thoughts, our views, current trends, setbacks.

This is our 40th blog post, with a promise that there will be more blog posts that will strive to create the awareness within the industries to use Solar as their fuel, we present to you our few questions, few answers series.

What we might feel as a simple question can have wealth of meaning. The simplest questions fetch answers that in turn pave way for research and growth.

Few questions; few answers:

Who are we?

Aspiration Energy Private Ltd (AEPL) provides roof top, Solar Thermal Systems on pay-per-unit (KWH) model, for Industrial Heating Applications in the temperature range of 60 to 120 Degree Celsius. By innovative systemic enhancements to proven technologies, AEPL has achieved a cost per MW which is 30-40% cheaper than Solar PV and Solar CSP, making it economical and viable without government subsidy. The monthly bill is based on the heat energy delivered to the process through a heat exchanger. AEPL takes all the risks and converts the CAPEX investment in to an OPEX expense similar to fuel purchase / utility bill.

What is our vision?

According to a KPMG report in 2012, there is a potential to replace 4.8 Million Tons of Oil per year in Low Temperature Industrial heating applications (< 250 Deg cel) in India alone, valued at USD 3.5 Billion per year, requiring 70 Million SQM of thermal collectors. This translates in to 20,000 MW of Solar thermal capacity in manufacturing sector alone. Our vision is to achieve 10,000 MW within the next 5 years. At an average of 2 MW per factory, the no. of possible projects over the next 5 years in India is 5000+ executed through 50+ partners. What are the obstacles that mar our vision? Inspite of solar thermal being 30-40% cheaper than Solar PV and Solar CSP, due to the dependence on commercial financing, we are finding it difficult to provide PPU rates like Rs.3.0 per KWH. 90% project finance with a longer tenure say 15 years can speed up the voluntary adoption. Voluntary adoption and decision making is very slow. If the Government mandates the use of Solar thermal for all industrial heating below 120 Deg Celsius, we can execute 10,000 MW for industrial heating in India alone. Million of Tons of Oil could be saved per year. The resultant foreign exchange saving and energy security advantages for India will be huge. What are our innovations and how they benefit? Innovations in Systems Design: Through our constant enhancements on existing globally proven ETC solar thermal collectors, we achieve higher temperatures required in the industry (60 -120C). The design and engineering innovations allows us : To install large scale systems on factory roof tops (500 KW to 5 MW) Efficiently extract the heat from the ETC modules Transport it through 1000-2000 meters of pressurized piping circuits Transfer it to the manufacturing process of the customer through a heat exchanger. The energy delivery is measured and totalized at the customer’s process end for monthly billing purpose, if only the guaranteed process temperature is achieved. Energy generated below the guaranteed process temperature is not billed.’ Pumps, Solenoid Valves, Temperature Sensors and PLC based Automation are used to manage energy delivery and billing. We have achieved INR 45 Million per MW (USD 700,000) for projects executed in India which is 40% cheaper than Solar PV and 30% cheaper than Solar CSP. The energy delivered is 4 times more than Solar PV per SQ MTR. Innovations in Business Model: By linking the monthly payments to the thermal energy delivered, we completely de-risk the project for the customer and make it in to an opex expense like fuel purchase or utility bill. (5, 10 or 20 year contracts with pre-agreed rate per KWH). The asset is owned by AEPL or a leasing company or a third party investor. For customers who have accelerated depreciation benefits, we offer a very unique “Customer Owned but Pay-per-unit monthly billing model”. The customer owns the asset in his balance sheet and claims income tax benefits. The monthly billing (PPU price X Energy Delivered) realized from customer is posted in AEPL books in two parts : a) interest free EMI for the balance asset value and b) performance linked fee for AEPL. Comprehensive O&M and AMC are also offered as an option. How unique are our innovations? Burning of fossil fuels in boilers, is the most common approach for industrial heating applications even for temperatures in the range of 60-120 Deg Cel. Grid electricity is also used in some places. The cost per unit of thermal energy derived from these sources is on par or higher than the prices offered by AEPL for Solar Thermal Energy. Solar CSP systems (Concentrator Dish type) cannot be mounted on factory roof tops and ground space availability is a major constraint in manufacturing industry. They are also 30-40% more expensive than AEPL thermal systems and hence require government subsidy to make it viable. While these are justified for high temperature applications (>250 Deg Cel), these are not economically viable for 60-120 Deg Cel.
Traditional Solar Water Heaters used in Domestic and Commercial sectors cannot be used for Industrial heating applications.
~to be continued