It is estimated that more than 60 per cent of the energy demand in India is utilized for space cooling and heating. Going forward, the demand will increase dramatically with an expected eleven-fold rise towards 2038.
Smart Joules, an Indian company established in 2014, provides cooling solutions for commercial and industrial buildings reducing energy consumption by more than 20 per cent. New financing from IFU will ensure Smart Joules the opportunity to expand their business.
In India, the energy efficiency sector is still at a very early stage. Consequently, long term debt is not available at scale. The loan financing from IFU is thus additional to the current market.
“We are very pleased to support Smart Joules that have proven solutions, which significantly reduce energy consumption and greenhouse gas emissions from cooling of commercial buildings that are rapidly growing in numbers.”
Nitish Chawla, Senior Investment Manager at IFU.
First investment under India Climate Finance Initiative
Denmark and India have entered a green strategic partnership, and the Danish state has allocated funding to IFU for an India Climate Finance Initiative. The investment in Smart Joules is the first investment made based on this initiative.
The Indian government wants to increase energy efficiency
In 2019, the Indian government launched the India Cooling Action Plan (ICAP), which aims to reduce the need for cooling of buildings. This is aligned with Smart Joules’ business strategy opening good market prospect, going forward.
Speaking about the development, Mr. Arjun Gupta, Founder and CEO said, “We are thrilled to be the first recipients of this investment, and this couldn’t have come at a better moment in our journey. As we are gearing up for the next phase of growth, this investment would help us enhance our circle of influence and impact helping us introduce JouleCOOL across newer building formats and brands, helping them achieve their sustainability goals. I look at this investment as a recognition of our commitment towards helping India achieve its sustainability goals and an appreciation of the impact we have been able to make so far.”
Smart Joules is mainly supplying cooling solutions to large hospitals. But in coming years the company wants to expand servicing commercial office buildings, data centres and industrial facilities as well.
Pay-as-you-save
Smart Joules has introduced a “pay-as-you-save” model. Thereby customers are not required to make upfront payments, since they pay with the savings gained from Smart Joules’ solution. If Smart Joules does not meet their guarantee, the company will pay the shortfall, which means “zero risk” for customers wanting to implement energy efficiency solutions.
Danish content is part of the solution
A portion of Smart Joules’ equipment originates from Danish companies like Danfoss, Grundfos and Novenco that for many years have been leading the way in climate solutions and energy efficiency.
About India Climate Finance Initiative
In 2020, Denmark and India formalized the Green Strategic Partnership Agreement. The purpose is to support India’s green transition and strengthen Denmark’s engagement in India. Under this agreement the Danish Minister for Development Cooperation has approved the India Climate Finance Initiative, an earmarked capital contribution of DKK 200 million to IFU.
About Smart Joules
Smart Joules is India’s leading energy efficiency company. Instituted in 2014, Smart Joules has been pioneering the energy efficiency through its industry-first Cooling-as-a-Service solution, that has been designed keeping energy efficiency at the core of it. Over the past 9 years, Smart Joules has been able to save 23 crore kWh of energy translating to INR 181 crore in energy costs and 1.6 lakh tonnes in carbon emissions. Smart Joules at the moment has been catering to the marquee names within the Indian healthcare sector such as Apollo Hospitals, KIMS and Aster to name a few and will soon foray into the Indian hospitality sector with Le Meridien being their first customer from the sector.