India is embracing renewable power solutions at an unprecedented pace, harnessing solar, wind, and hydroelectric energy to meet growing electricity demands while reducing its carbon footprint.
BrightNight Power specializes in global, renewable and independent power that is built to deliver industry-leading, large-scale solutions. Naveen Khandelwal, CFO and COO of BrightNight Power spoke exclusively to India Business and Trade and shared his insights on the company’s innovative projects as well as global challenges and opportunities in adapting renewable energy solutions.
IBT: BrightNight aims to deliver dispatchable renewable power capacity. Can you explain the technical aspects and innovations involved in achieving this goal?
Naveen Khandelwal: Dispatchable energy essentially necessitates planning for the potential unavailability of specific technological resources we initially rely on. To illustrate, when someone is planning a renewable energy project, the absence of these resources could lead to interruptions. Therefore, when we talk about adding dispatchability, we mean incorporating multiple technologies or combining various technologies to enhance the reliability of renewable energy generation.
In India, the approach to solving this issue varies from country to country, depending on multiple factors, including policy and regulation, commercial market evaluation, which I will explain shortly, and the affordability of off-takers. In India, we aim to provide dispatchable renewables by integrating wind, which is crucial, with solar, and then incorporating one form or another of energy storage. Energy storage options can include battery storage or pump hydro storage, and in the future, potentially other commercially viable and deployable technologies. As of today, the solution for the Indian market involves a combination of wind, solar, and either batteries or pump hydro.
IBT: How does BrightNight’s project optimization software contribute to overcoming the intermittency challenges associated with renewable energy sources?
Naveen Khandelwal: The proprietary software developed by BrightNight, called Power Alpha, functions as an optimization algorithm. It utilizes multiple technologies and algorithms to determine the most cost-effective solution that aligns with each customer’s specific requirements. These customer-specific requirements may vary depending on the off-taker or client. Some prioritize peak-hour generation availability, while others insist on round-the-clock, 24-hour generation. Accordingly, the software takes into account various technologies for ten-minute generation, including wind, solar, and theoretically, any other generation resource. Additionally, it incorporates storage technologies as the second component and includes market dynamics as the third component. These three components together encompass energy-generating assets, which can comprise wind, solar, or any other technology.
The second component is energy storage, serving as a bridge. The third component is the wholesale market, where you can either purchase or sell excess power. You can acquire power in times of deficit or supply excess power when available. These three components are combined to model the lowest-cost solution for the client using this tool.
This tool enables us to conduct numerous scenarios or simulations in a very short period of time. We can run, for example, thousands of scenarios in just a couple of hours. Out of these thousands of simulations, one can select the specific technical configuration involving various technologies that provide the most optimal solution for a particular client. That’s the beauty of the software—it allows real-time optimization, integrating multiple complex technologies while prioritizing the client’s requirements and achieving the least costly solution.
IBT: What specific steps does BrightNight take to ensure that its renewable energy projects meet and exceed customer power requirements, particularly for utilities and industrial clients?
Naveen Khandelwal: When you ask about the specific steps, it’s important to note that we are planning to integrate multiple technologies, each with distinct generating technologies, development processes, development cycles, and sensitivities to cost and generation parameters. So, let’s break down the steps we take into account:
First and foremost, we begin with early-stage development. Since we are integrating various technologies, we aim to control as many parameters as possible. This involves defining project boundaries, securing the necessary land well in advance of the project execution timeline, and identifying a specific evacuation route. These are the initial physical on-ground development efforts.
Next, during resource optimization and generation assessment, our team focuses on gathering high-quality data inputs to ensure more accurate and precise output from our generation assessment tools.
The third critical component is the optimization tool mentioned earlier. This tool utilizes inputs from early-stage development and high-quality resource assessments to determine the most suitable configuration for a particular client, whether they are a utility or a CNI (Commercial and Industrial) customer, based on their specific load patterns. This software provides the most optimal solution.
Afterwards, the execution team takes over to implement the best solution for the client. This phase involves typical project management aspects, including high-quality and efficient project execution, followed by asset management, or as we refer to it, project operations and maintenance.
All of this is underpinned by high-quality and efficient financing solutions. It requires the synchronization of all these aspects to deliver a reliable, dependable, and affordable customized energy solution to every client who engages with BrightNight.
IBT: Reliability is a critical factor for utilities and industrial customers. How does BrightNight ensure that its renewable power solutions offer consistent and reliable energy generation?
Naveen Khandelwal: I believe this is a combination of three key factors. First is site selection, which is of utmost importance, and site selection goes hand in hand with early-stage development. When we begin designing solutions for clients, our goal is to identify sites that make the most sense, if not the absolute best sense. Ideally, we aim for the best sense, but at the very least, we strive for sites that offer better suitability to our clients.
This process may involve finding complementary resources such as wind and solar at a particular site or even a combination of multiple sites. This is where it all begins. The benefit of this approach, in terms of site identification and early-stage development, is that it allows us to leverage the complementarity of resources. This, in turn, helps minimize the need for energy storage technologies, whether it be pumped hydro or batteries.
We aim to optimize and minimize non-generating asset blocks because our primary focus is on optimizing generating asset blocks, primarily wind and solar initially. Later on, we may incorporate hydro generation and possibly other sources. So, it all begins with site selection.
The second step is optimizing storage. Storage options, as we know, vary across technologies, each with its own set of pros and cons. The second task for our team is to select the right storage technology that aligns best with the client’s needs and preferences.
The third component involves maintaining flexibility to engage with the green market. This allows us to use market energy to achieve balance. By this, I mean that in the event of energy deficits, we should be able to procure from the market to meet the client’s needs. Conversely, when there is excess generation, we should be able to sell to the wholesale market to rebalance the equation. This is how our team operates.
The three key components include selecting the right site, choosing the appropriate storage technology, and establishing a suitable interface with the market structure. These three elements work together to enhance the reliability and dependability of the energy solutions we offer to our clients.
IBT: BrightNight operates globally. What challenges and opportunities does this present in terms of adapting renewable energy solutions to different regions and markets?
Naveen Khandelwal: It’s a ‘glocal’ business, as we like to call it. This means it has both global and local aspects. When we say it’s global, we mean it involves various global dimensions, but it’s equally, if not more, local in many aspects. This is because, in industrial development, you rely on local resources like land, the grid network, and local policies and regulations. Everything from this perspective is inherently local.
The global aspect comes into play with our supply chain, which is truly global, except for pumped hydro. In today’s age, the supply chain for wind, solar, and batteries is global.
What we aim to do, the third aspect is to leverage the capabilities, competencies, and knowledge base of our team. Additionally, we consider financing and financing-related solutions as crucial factors.
Our approach to operating this platform as a global entity involves collecting country-specific requirements and offering them as global solutions. This mainly revolves around three aspects:
These three aspects remain global, while the development and execution phases are kept local. We also tailor our understanding of policies and regulations to each local context. In essence, development and execution are local, while design, engineering, technology, and procurement are managed on a global scale. This is how we aim to strike a fine balance between being a global business and executing our projects efficiently and effectively on a local level.
IBT: In what ways does BrightNight stay at the forefront of technological advancements in the renewable energy sector, and how does this drive innovation in project development and execution?
Naveen Khandelwal: So, this goes back to my previous point: being a developer in this new era of renewable energy, whether it’s 2.0 or 3.0, the first thing the team needs to do is keep track of all the technologies and technological developments or evolutions across the globe. That’s one of the keys if not the only key. The second key is to focus on the right project sites and complementary locations that can offer valuable solutions to our clients. So, when you ask how we stay at the forefront of technology, there is a global technology team that tracks developments across all generations of technology, whether it’s in solar, wind, batteries, or potentially other technologies in the future.
So, there is a global team, but this team interacts with local engineering talent pools which, let’s say, add an execution perspective from the local market. That’s how we approach technology. It’s a ‘glocal’ function, if I may use that term. It involves tracking global trends while adapting to local requirements and suitability. That’s our approach.
Now, as I mentioned, this is the technology piece. The second piece involves on-ground development. We integrate these two aspects: local development and the use of cutting-edge or the latest technology, technological solutions, combinations, or configurations. We combine these two and then add an efficient financing layer or an efficient capital structure. These three elements, when combined, more often than not result in the best possible outcome. This outcome is valuable for the client and allows both parties to capture value. The client is satisfied because they receive a good solution, and we are content because by offering such solutions, we aim to capture more value than any other typical developer.
IBT: Could you share any upcoming projects or initiatives that highlight BrightNight’s commitment to delivering large-scale, sustainable energy solutions to its diverse customer base?
Naveen Khandelwal: I think I can discuss the Indian market because BrightNight is otherwise a global platform. The US team is focused on the US market, developing it, and providing the best solutions to clients. Similarly, other BrightNight teams are dedicated to their respective markets, such as Australia, the Philippines, and others. But let me delve into the Indian market.
In India, we are striving to create a large pipeline of around-the-clock dispatchable multi-tech renewable projects. These projects, as I mentioned, will involve a combination of at least four elements: wind, solar, storage in various forms, and interaction with the wholesale market. We are developing this extensive portfolio across multiple states in the country, leveraging these four components. Our goal is to create optimized solutions for both utility clients on a wholesale basis and for corporate clients, or what we refer to as CNI (Commercial and Industrial) clients, tailored to their specific customized requirements based on the nature of their industries.
There are process industries with unique load patterns, commercial customers, data centers, technology companies, pharma, textile, and cement companies, each with its own distinct needs.
So, we endeavour to develop and provide these customized solutions to these corporate clients, in addition to supplying bulk power to distribution companies (discoms) or utilities. In India, the good news is that the renewable energy market is already shifting toward solutions that cater to peak power needs and round-the-clock power supply, among other things. We are actively engaged in this market segment, and you will find us participating in a variety of complex projects serving diverse off-taker segments, including both utilities and corporations. That’s our plan for the next three to five years.
Moreover, we foresee ourselves transitioning into the green fuels and green fuel business or providing solutions beyond green electricity or electrons. In a couple of years, we aim to enter the green molecules or green fuels business as well because we believe that efficient and effective green energy project generation is fundamental to the green fuels and green molecules industry.
IBT: As the COO, what are the key operational challenges you face in ensuring the successful implementation of BrightNight’s renewable energy projects, and how do you address them?
Naveen Khandelwal: I believe challenges are a natural part of life, an integral part of the journey, which is perfectly fine because we are here to address and overcome those challenges. If I were to categorize these challenges into different groups, I would begin with challenges on the development side. This includes issues such as land acquisition and securing strategic grid access, which fall into one category of problems—development challenges.
The second set of challenges pertains to supply chain stability and supply security. As we all know, India has been particularly dependent on solar and battery technologies. The Government of India has made tremendous strides in the past three to four years, with significant domestic manufacturing capacity being established, both with and without the support of Production-Linked Incentives (PLI). We are optimistic that conditions will improve in the near future. Nevertheless, we must acknowledge the challenges on the supply chain and equipment supply security fronts, as this market is highly volatile and dynamic. So, that’s the second aspect.
The third aspect, which is not the most significant challenge for India but is generally a challenge, pertains to the availability of capital, both in terms of debt and equity. Fortunately, as I mentioned earlier, this is not currently our foremost concern.
The fourth, or second-to-last, challenge is the consistency of policies and regulations. Despite operating only in India, there are state-specific regulations and policies that vary. One state may have one set of rules, while another has something different. Therefore, it’s essential to closely monitor state-specific developments, execution, and operational regulations.
The last, which effectively oversees all of these four challenges, is talent. Human resources management or talent management is an equally important aspect of business growth. We are actively seeking to recruit the best-in-class individuals who are aligned, motivated, and passionate about the energy transition and decarbonization journey that we will be embarking on for the next couple of decades.
Naveen Khandelwal has been a leader in Indian energy markets for more than 18 years. He was a founding member of two large and reputed Indian renewable energy IPPs with GW-size wind and solar portfolios. He has worked extensively in the areas of corporate development, corporate finance, techno-commercials, growth strategy, capital allocation and general management. Naveen has also led capital raises for more than US$2B USD over the last 10 years, across equity and debt, for renewable energy platforms.
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