Winds of change

Winds of change

The business of clean technology is still in a nascent stage but entrepreneurs like C. Raghuraman see a great potential in the sector in the years to come. As supplier of micro wind turbines, his company E-Hands Energy (India) Pvt. Ltd. (E-Hands) supplies individuals and institutions with turbines ranging from 600W to 3.5 KW that reduce dependence on traditional sources of energy. “There is great scope for many players in this space but sadly only about six serious ones exist,” says the president and founder of the Chennai-based company. E-Hands was initiated in late 2008 and has so far, successfully installed 36 such turbines. According to Raghuraman, the biggest challenge he comes across is in making sense of clean technology as a business strategy to people. “Though a 3.5 KW turbine delivers about 17 to 20 KWh (units) of energy/day where the annual average wind speed is about 5m/s, it is still high risk since we depend on nature,” he adds.

“I want to position E-Hands as a total energy efficiency solutions provider. We want to approach corporate companies by placing E-Hands as an outsourced energy sustainability partner, for which I am currently developing the ecosystem.”

E-Hands is tied up with South Africa-based Kestrel, a subsidiary of Eveready Pty. Ltd., which manufactures these turbines. It has five different types of hybrid (that includes solar panels) turbines. Of the 22 wind-mapped regions in India, it has a presence in 14 areas. About a quarter of E-Hands’ installations have been for schools in various backward areas, three that power railways crossings, and the remaining for individual users and institutions. Almost every installation at these schools are highly subsidised by E-Hands. “We will continue to do so for another 200+ installations as part of our commitment to help children learn and grow with renewable energy.”

It has also installed for the army in Kashmir and the Bannerghatta National Park, Karnataka. “The total implementation cost for the turbine would be about Rs. 1.5 lakh. In the U.S., where the cost in much more, the demand can go up to 30,000 systems whereas in India, it is a couple of hundreds,” says Raghuraman. With a life span of over 20 years, the cost of producing power from these turbines, if the capital cost is amortised over a long period, is about Rs. 10 – 12/KWh from a hybrid system. In such areas where power is intermittent, the cost of producing power from diesel generators (DG) vary between Rs. 20 – 35/KWh, depending on the size and efficiency of the DG and at the prevailing retail price of diesel (Rs. 40 – 44/litre in different parts of the country). “We have demonstrated that the payback on the turbine is over three years in many of our installations. Hence, that is almost free energy for the next 16 + years.”

Snap Shot

E-Hands Energy
Founder: C. Raghuraman
Year: Late 2008
City: Chennai

He plans to cross at least 100 installations in the coming financial year. To do this, he is hoping to secure funding by mid-2012. “The target is to raise about US $ 15 – 20 million and definitely approach those investors, who are experienced in green funding and understand the return on investment in this space,” he says.

A gust of faith

An IIT-Roorkee and an Indian Statistical Institute graduate, Raghuraman worked in many domains such as electronics, automobiles (for Eicher Motors) and information technology. In 1996, he joined Polaris (then Nucleus Software) and went onto head its North American division. By the time he decided to return to India in 2001, the company’s strength in the U.S. grew from four to 400 people constituting a major share of its revenue. The same year, Raghuraman was bit by the entrepreneurial bug and started a company providing wireless data infrastructure in Uttarakhand. But bogged down by bureaucracy, he exited it by mid-2003 and consulted for Reliance Communication. In late 2003, he joined Dr. Reddy’s Laboratories as its senior vice-president, business process excellence and chief investment officer. After two years of frantic travel, Raghuraman decided to quit Dr. Reddy’s and worked for a software company. It was during this time that he was exposed to micro wind turbines and was fascinated by it.

With an investment of Rs. 40 lakh over the last three years including a paid up capital of Rs. 10 lakh, the team has slowly grown to 16 engineers who are present in Vijayawada, Pune, New Delhi, Nainital etc. “Everyone had to go through training to handle these turbines and in the initial two years, Kestrel was present during every installation to guide us,” says Raghuraman. E-Hands’ did its first installation for a resort in Uttarakhand in June 2009. Now, 25 per cent of its installations are based in that state, which Raghuraman considers it to hold a bigger potential.

The company has a basic assembling unit in Chennai from where the turbines are assembled and sent. It has a sales head in Bengaluru while Raghuraman handles the marketing. E-Hands has generated revenues of Rs. 80 lakh in the past three years. Though it is yet to break even, he is positive that will happen in 2012. “We need to achieve about 60 – 70 installations per year to break even, which we will easily cross in the coming year. We have to focus on reducing the installation period, which currently takes about eight days and thus bring in more efficiency,” he adds.

Intensifying operations

E-Hands has renewed its contract with Kestrel for another five years as it hopes to bring in turbines with bigger capacity. It is also currently in talks with a U.S-based portable wind turbine manufacturer that can be leased to army personnel and eco-friendly tour operators. “We’ve also approached telecom companies to power their transmitting towers. But they want us to operate under the operating expense model that requires E-Hands to invest in the capital and recover the investment plus the operating expense by setting off the expenses on diesel consumption, which we need to consider,” says Raghuraman.

It is also in talks with a soft drink company to power its refrigeration. Another revenue model that he hopes to find momentum is advertising on the turbine towers. “People have shown interest in this and we are targeting 20 per cent of our revenues from this in 2012.” E-Hands’ channel/national partners at specific locations deal with the local government agencies in obtaining advertisement permits.

In the coming years, Raghuraman hopes to focus on other areas that do not rely on wind energy solely. “I want to position E-Hands as a total energy efficiency solutions provider. We want to approach corporate companies by placing E-Hands as an outsourced energy sustainability partner, for which I am currently developing the ecosystem,” he states. He is also looking at expanding the team and innovating at marketing with a better online presence. He hopes to bring in newer technologies in this area and slowly expand his sights to other countries in the region. At the moment, he is targeting the U.S. market to work as an engineering products contractor for the bigger boys by helping them execute the projects faster with E-Hands’ skills/knowledge.


Concept in Brief

As supplier of micro wind turbines, E-Hands Energy supplies individuals and institutions with turbines ranging from 600W to 3.5 KW that reduce dependence on traditional sources of energy. It is tied up with South Africa-based Kestrel, a subsidiary of Eveready Pty. Ltd., which manufactures these turbines. E-Hands has five different types of hybrid (that includes solar panels) turbines. Of the 22 wind-mapped regions in India, it has a presence in 14 areas. About a quarter of E-Hands’ installations have been for schools in various backward areas, three that power railways crossings, and the remaining for individual users and institutions.

Raguraman plans to cross at least 100 installations in the coming financial year. To do this, he is hoping to secure funding by mid-2012. The target is to raise about US $ 15 – 20 million and approach those investors, who are experienced in green funding and understand the return on investment in this space. E-Hands has renewed its contract with Kestrel for another five years as it hopes to bring in turbines with bigger capacity. It is also currently in talks with a U.S-based portable turbine manufacturer. In the coming years, he wants to position E-Hands as a total energy efficiency solutions provider.