Arjun P. Gupta, a Massachusetts Institute of Technology and UC Berkeley graduate, returned to India after learning about efficiency technologies in the US for nine years and joined the Jaypee Group, where he acquired on-ground experience in viable models of energy efficiency.
Gupta spent a lot of time at industrial and commercial sites, working with engineering and maintenance teams to identify opportunities to incorporate cost-effective clean technologies in their regular operations.
As a buyer of energy services, he found that the solutions offered by most technology and service providers didn't adequately match what the market needed. That is when he decided to launch Smart Joules in 2014.
New York-based Echoing Green, which is among the world’s leading social entrepreneurship accelerators, provided Smart Joules (SJ) early support in the way of a Climate Fellowship. “Then we started approaching Delhi hospitals as our first customers, Sant Parmanand Hospital, being our first client,” recalls Gupta. Three other hospitals followed suit.
Smart Joules invests in existing building structures in terms of both hardware and software to reduce electricity consumption by 15 per cent to 20 per cent and sometimes by as much as 35 per cent. The company facilitates more than 15 per cent savings by optimising central air-conditioning plants in tune with changing outdoor weather and indoor occupation patterns, while maintaining desired comfort levels. A state-of-the-art building energy management system (DeJoule) is installed to leverage the latest developments in IoT hardware, cloud computing and data analytics in a building.
"We saw that the India market didn’t know what was possible in terms of the value that energy efficiency can generate. Demand for energy services was mostly driven by compliance requirements, and not by profit. On the supply side, companies were selling energy saving products or services, but no one was truly selling energy savings," says Gupta. So, what did Smart Joules disrupt?
“We are poised to disrupt the 150 odd energy saving companies listed under the Bureau of Energy Efficiency (BEE), and Building Management Systems (BMS),” says Gupta, adding, “No Indian company now makes commercial grade BMS, only multinationals like Schneider, Honeywell and Siemens make BMS for commercial buildings, which are expensive and unaffordable for most companies.” Gupta claims to have created a unique business model, putting customer profitability first, in which the customers have no investment.
The hardware is provided by Smart Joules and customers share a portion of the bill per unit as a fee structure. Gupta claims that no other company makes saving energy as easy and profitable. Even the best managed buildings can reduce their consumption by 15 per cent to 20 per cent, he says. A single building wastes enough energy in a year to power 400 houses, but the expertise or financial resources to build and operate highly energy efficient buildings, are still not available in India, says Gupta. His company invests in building energy efficiency retrofits and provides operator training. It then takes a 70-75 per cent cut from the actual savings on the historic bills.
The company has invested over Rs 1 crore and raised Rs 2 crore from multiple financial backers, like Tata Cleantech Capital and Echoing Green that support social entrepreneurship and innovative climate change solutions. Gupta is now scouting for an investor to fund itechnology development.
“Our first challenge was to convince the customer with our product and enter into a long-term partnership,” says Gupta. Retaining talent was the next challenge, as the company invests considerable time in recruitment, training and building a talent pool.
The biggest turning point, Gupta says, was when he successfully field tested virtual control of major energy consuming equipment, using his own technology. “We knew we were on to something big,” he recalls. Gupta plans to scale up the model from hospitals to hotels and commercial projects. “Our revenue is Rs 1 crore and we are targeting annual revenues of Rs 250 crore by 2020,” Gupta.
monica@businessworld.in
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