After working in energy management, renewables and private equity for almost 22 years Ghoshal saw that far too much capital had been invested in building solar wind and renewable power plants compared to what was invested in managing them.
“The management and the operations part was neglected in a sense, it was still very manual, power driven, very analogue. The right processes didn’t exist and they used siloed setups and then you have all these old legacy systems that you use to manage them. In a nutshell, it doesn’t work very efficiently.
“We also saw a transition that was happening as large investors came in and they were investing and their capital was at risk; the operational expenses were going through the roof because you’re always dependent on manpower, it’s an analogue system and unpredictable.
Every year, the world installs close to 300 gigawatts of renewable power and 60% of it is solar, as we approach 2030 this figure will triple, says Ghoshal.
The solar asset market had reached a tipping point where initial markets have been developed and institutional investors have been buying out local domestic solar assets, but without the right tools to efficiently monitor and manage solar power plants to protect their investment, Ghoshal says there was a risk of capital flowing back out of the solar space.
“Because you have all the large institutional investors like Blackrock, Blackstone, and they’re not really only motivated by wanting to invest in renewables.
“They’re investing in airports, in roadways and hotels and if those assets give them better returns, they will just vary their investment,” he says.
Together with co-founders, CTO Aslan Shamsutdin, Executive Director Murshid M. Ali, and Executive Director Petter S. Berge, Ghoshal set about developing technology which could streamline, automate and put a layer of quality on solar asset operations to make solar capital investment sustainable.
“We wanted to make solar plant management more systemized, we wanted to modernise it with automation and we started with solar power plants but we have a very generic technology, quite an agnostic technology, which can be used in wind and energy storage,” says Ghoshal.
“If we had not done it, we probably would see the capital drain out of renewable energy investments.”
Skyfri’s propriety technology targets and transforms three key underperformance areas:
1. We identify energy losses in real-time
Why is that important? I have been an Asset and Portfolio Manager and I’ve worked in private equity. I know that when reporting happens on the asset management, you get a report after a month or a quarter and you suddenly realise that some of your plans didn’t work. Something burnt out and needed replacement and by the time you know you already lost revenue and need to spend more to fix the issues.
So we wanted to know exactly when things fail, or even futuristically predict when they might finish or start showing signs of underperformance. That’s real-time management.
2. We break the silos
We wanted to fundamentally change the system of operations, accounting and monitoring as siloed systems to have this be a single source of truth in a single integrated platform.
3.We do all of this autonomously
We don’t need a lot of people to manage the system, everything happens automatically.
The algorithm runs on machine learning, deep learning setup, and it does things automatically that previously needed a 20–30 member team depending on portfolio size. So the final value proposition to the investor goes back in the form of increased rate of return.
“Our system monitors the solar plants and creates alerts and incidents which are automatically integrated into a ticket.
“From acquiring data to analysing data to understanding data, to taking action on data, the entire value chain is automated with our system.
“Then there’s the other side – asset management, which is where we look at the financial and operational performance: How has the power plant performed? Have I paid all my bills? Am I compliant? Are my warranties in place? Is my insurance up to date? How are my inventories?
“Right now, this is all siloed.
“What we realised is that we have a perfect opportunity to create one single monitoring system. So we monitor, we manage, and then we asset manage and create reports.”
Immediate savings of operating heads by 20-30% for a solar power plant that was previously manually managed.
Skyfri’s technology targeted a genuine market pain point and quickly struck a chord in the solar industry; within just a few months of launching company growth soared to 500%.
Today, Skyfri is one of the fastest-growing cleantech firms globally. Backed by climate investors SpeedInvest, Singularity and Link Venture, it manages about 185 sites worldwide and is dramatically accelerating growth through targeted acquisitions.
Skyfri’s immediate impact translates into reduced costs across the solar industry through transparent, efficient solar asset management that enables the continued influx of funds into renewables.
20 years ago, Ghoshal says, it cost 5 million Euros to build one megawatt of solar power – now that figure is now just 0.5 million Euros per megawatt: “because of the immense drop in capital expenditure, it has already become a mainstream class asset but what would have derailed its potential is the lack of management of the solar power plants – and that’s where we come in.
“We are seeing an increased amount of investment.
“Germany just declared that they want to be a 200 gigawatt solar market in the coming years.
“The Blackrocks and Blackstones of the world have already invested and all the corporates, the Googles, Amazons, Facebooks, they’re buying solar power all over the world. So the money is coming in and we want to not only sustain that money, we want more to come in to reduce global warming.
“We say, ok, now that you’ve invested, leave it to us, your assets are protected. We’ve made solar assets very transparent and modernised so you’re no longer dependent on the blackbox system,” says Ghoshal.
“You can report accurately and see your money growing so investors are happy. And please bring us the next billion dollars so that we can build more solar.”
This article is written by Marianne Lehnis for Forbes, May 2 2022.