EnergyPro Assets Ltd (EPAL), the joint venture between EnergyPro Asset Management Limited (EPAM) and the Indian Government’s energy service company, Energy Efficiency Services Ltd (EESL), has been named the fastest-growing Indian owned company in the UK.
This is according to research by Grant Thornton, in conjunction with the Confederation of Indian Industry.
EPAM provides EPAL with advisory services ranging from the identification of opportunities to execution of transactions and post-transaction management.
EPAL has executed over £60m of investments including the first overseas acquisition by an entity under the Indian Ministry of Power. EPAM’s relationship with EESL has facilitated several other opportunities for EPAM in India, and provides the Company with unparalleled insight into key policy decisions and future technology requirements.
EPAM is dedicated to commercialising and deploying energy efficiency technologies in India and the UK in support of the UN’s Sustainable Development Goals, particularly the requirements to double the global rate of improvement in energy efficiency by 2030, promote access to research, technology and investment into clean energy, and expand and upgrade energy services for developing countries.
There is a significant opportunity for the Company to leverage its strength in deploying new clean technologies to support the high growth of the Indian market and other territories. In fact, EPAM management believes the Company can facilitate up to £500m of investment over the next five years, generating a range of revenue opportunities, including advisory services, management fees and co-investment.
While virtually all Indian households now have access to the electricity grid, the needs of economic development coupled with a policy goal of meeting (or even exceeding) its Paris Accord commitments on Climate Change, mean considerable further investment is required in the Indian energy sector.
The key drivers of the market are:
- Meeting the energy demands of an economy expected to be the world’s second largest by 2050;
- Increasing the share of non-fossil fuels to 40 per cent of the total electricity generation capacity;
- Reducing the emission intensity of the economy by between 33 per cent and 35 per cent by 2030 from the 2005 level.
The Indian government is firmly committed to improving energy efficiency and EESL (backed by the Indian Ministry of Power and four state energy companies) has implemented a number of world leading programmes including UJALA, which has delivered over 360 million LED lamps on a commercial model. The World Bank estimates energy efficiency in India to be a $12bn opportunity.
EPAM has a current pipeline of about 20 live opportunities, five of which are well progressed. Further, the Company has signed a MoU with two clients including a UK provider of highly efficient process heat technology wishing to enter the Indian market, a market opportunity EPAM estimates to be worth some $50m annually.
To capitalise on these opportunities, EPAM is seeking funding of £2m to build out the EPAM team and associated infrastructure to enable execution of the pipeline it has generated, and build further links within the Indian market. EPAM will also continue to hold the existing investment in the joint venture until a contracted liquidity event occurs in March 2023, offering the opportunity for investors to see a strong return within the near term, driven by existing asset value.
The joint venture with EESL demonstrates the power of UK-India collaboration in the energy transition. EPAM has a unique proposition to support this and, in its joint venture, has demonstrated the ability to successfully combine UK and Indian expertise.
Dr. Steven Fawkes, Chair of EPAM, said: “We have been inspired by India’s commitment to scaling-up energy efficiency, and the work of EESL which as well as contributing to solving India’s energy challenges has a global impact.
“Our joint venture achieving the number one spot in the India meets Britain tracker of fastest-growing companies, is a testament to the progress we’ve achieved together with EESL, but it’s a step along the way of a much bigger journey.
“India’s fast-growing economy is rich in human initiative, with strong historic links to the UK. We have witnessed first-hand the commitment, throughout government and industry, to de-carbonising the economy and building a sustainable future for India’s 1.4 billion people.
“We have also identified a major opportunity for UK companies to participate in the growth of the Indian low-carbon sector.”
EPAM is also focusing on several further companies developing technologies with applications in the Indian energy market, including a developer of EV charging infrastructure, a developer of grid-scale energy storage systems, and a provider of AI based building control systems that enable grid integration.