n spite of the fact that India receives more than 300 days of sun every year, solar energy only makes up 2 percent of India’s energy power. And for a country that faces daily power outages, a renewable source of energy ought to be in high demand.
A face to the solution for India’s problem? Meet Sujith S. Thannikkatt, cofounder of Longman Suntech Energy. Thannikkatt and his team sensed a need for renewable energy solutions in 2012 and have been working since to make solar energy a practical reality.
Thannikkatt competed at the Challenge Cup in New Delhi and won the energy category. He will travel to Washington, D.C. at 1776 in May to compete in the Challenge Cup festival against 15 others in his category. Following the competition, 1776 talked to him about Longman Suntech’s future and what the company hopes to contribute to a country in the emerging world withstanding a big energy shortage.
What is the story behind Longman Suntech?
I was working the U.K. in London as a strategy consultant. I had four or five friends and we stayed in contact, one, Sameer, was already in India and we constantly kept in touch. We’re wing-mates and old classmates back in college. In the middle of summer I was contacted by a solar energy manufacturer in the U.K. who wanted to come to India and expand there.
About two to three months after starting the company, I took control of the project completely. I had collected a lot of data for this product as far as how great of prospect solar energy is in India. We knew all this solar energy talk was something very much new to us and the fact that it has such a huge prospects was definitely new information. When the project got shelved originally, it shocked me. As Sameer said, “You know there isa prospect, there is a market.”
We come to this industry as a startup and definitely won’t have liquidity problems; we’ll be doing it at a much cheaper cost than what other companies are doing.
Where did the idea and passion for the energy project come from?
It was this very thing—energy—and working with my previous company where I got the hang of it. You could have said, a year back, that I would never start a company, but solar energy was a big prospect. It could be a great game changer in five to 10 years. That’s how the energy prospective came in. One of the biggest problems India is facing is the power outages. India is also relying on a lot of form of energy that we have to import, such as coal.
How do you provide solar energy to costumers?
We started off by doing regular projects and we contracted. We really wanted to know why, in spite of great prospects and growth potential, things are not working fine for solar power in India.
We went to the market, to the well-established hospitals, and asked of solar power works really great for them. Then we started doing projects—understanding the power requirements, taking into account the rooftops they have, and the quality of the grid supply from which they’re getting energy. Based on that we designed a solar power plant. Based on that we proceeded to get, all the components that are required to install the system and enter into a commitment with them. We’ll upkeep the maintenance with a 20-year plan.
While developing the product, what challenges have you faced?
There are several reasons why people aren’t taking up solar. One is that there is a huge capital cost. So, say it takes $10 million for a big hospital to go solar, and you can recover that money in five to six years since the power plant would be there for the next 25 years. Over the next 20 years they’d get free power. They say that’s fine, but who is going to cover the $10 million right now?
Secondly, it’s fairly new technology so people are a bit skeptical. If you want to go for a general electricity set up, people will say, “Okay, that’s fine.” But this solar energy is a new technology so they’re a bit skeptical if it’s going to work or not.
Finally, there are tax incentives, which somewhere are not properly planned by the government. We found that many of our prospective clients were not able to understand the financial benefits of solar power. They subsidize other forms of power in tax credits so they can write off the tax.
Why did decide to compete in Challenge Cup? What was the experience like?
The experience was really cool. To be fair, I would say this is the first time we were having a one-on-one interaction with a lot of people. We have been interacting with a lot of other startups, but this was different. It was a great experience because of all the startups coming in, 50 or 70 entrepreneurs that decided, “We have a great idea— let’s try to put that in practice.” It was a great experience to meet a ton of startups in one place.