Building a Sustainable Market for Biodigesters in Vietnam – SNV World/EnDev

Since 2003, SNVWorld, with funding from the Netherlands Ministry of Foreign Affairs (DGIS), have been working to develop the biogas and biodigester sector in Vietnam. SNV to date have been providing technical assistance and developing financial capacity in conjunction with the country’s Ministry of Agriculture and Rural Development, with the Department of Livestock Production under the MARD acting as the implementing partner for the project. Vietnam is particularly suitable for the development of biodigester technology, given the high prevalence of livestock farming and the large heads of animals present in the country. In 2016, over 26 million pigs were raised in the country, and utilising the waste products from this livestock farming can provide significant benefits to the economy, as well as sustainability objectives. As of March 2017, the project has installed over 150,000 biodigesters in the country, with a further 80,000 having been installed under spin-off projects implemented by the MARD.

The project has not only focused on installations, but has sought to develop the capacity for a functional, self-sustaining market for biodigester technology in the country. To that end, as of March 2017 the project has created over 2,500 new jobs in rural areas of the country, and trained over 1,700 masons in the construction of biodigesters. The consumer-side has also been targeted by the project, with over 160,000 households receiving both pre-installation training on the use of biodigesters, and post-installation training on the maintenance of the digester chamber and the use of bio-slurry in agricultural applications.

Dome-type biodigester in rural Vietnam. Image: SNVWorld

One of the innovative measures used to assist in developing a sustainable biogas sector in the country was implemented by the NGO EnDev in partnership with SNVWorld and the MARD. The NGO has recently implemented a Results-Based Financing (RBF) scheme in the country to promote the acceleration of biodigester construction, through empowering the supply-side of the biogas market to keep up with demand through subsidy. A financial incentive is provided for the construction and verification of each new biodigester, starting at US$50 for each new digester and falling over time. The intention is that the suppliers who receive this incentive can then reinvest the extra income in attracting more staff and scaling their businesses. The verification system is implemented through a novel online application developed in partnership with SNVWorld and AVKO, combining input data, photos and GPS locations translated to maps that are automatically updated with new information from the field. This system has replaced the traditional hard-copy form submission system for verification of new installations, streamlining the process for both EnDev and installers. The system is currently in use by 146 active installers in 18 provinces in Vietnam, and to date has verified over 35,000 biodigester installations.

In terms of capacity-building, SNV are currently partnering with MARD to continue the training of government installation and verification partners to build capacity in the biodigester sector, in an effort to better support a viable, private-sector supply and distribution market. Government technicians are also being trained in communicating about benefits of biogas technology, supporting enterprises in identifying suitable households and providing them with extension services on the use of bio-slurry.

– Daniel Kerr, UCL

References

SNVWorld (2018) Vietnam Biodigester Programme. Available at: http://www.snv.org/project/vietnam-biogas-programme [Accessed 11^th March 2018]

Teune (2017) Igniting a Self-Sustaining Biogas Market in Vietnam. Available at: http://www.snv.org/update/igniting-self-sustaining-biogas-market-vietnam [Accessed 11^th March 2018]

Supporting Thermal Energy Services in Afghanistan

Binu Parthan from Sustainable Energy Associates writes on the growing support for thermal energy service considerations in Afghanistan.

Afghanistan is often in the news for the wrong reasons such as large swathes of migrants on European shores, armed conflicts, loss of life etc. However it is possible that the country might actually be implementing one of the most innovative energy services projects which has just started implementation with support from the STEPs team.

Decades of political instability and conflict has resulted in low levels of infrastructure access levels in Afghanistan. Over 57% of the Afghan population does not have access to electricity and 81% of the population does not have access to non-solid fuels (World Bank/IEA, 2015). The situation is dire in rural Afghanistan where only 4% of the population have access to non-solid fuels. Many such locations in Afghanistan are located in colder regions with more than 6000 HDDs/Year.

Afghan households use a Tandoor, a traditional cylindrical clay or metal oven for cooking and baking an efficient version of which is shown in the Fig. It is reported that 90% of cooking revolves around making bread called Naan, followed by potatoes. Houses also use a Bukhari, a traditional space heater for heating the living spaces in winter. Some of the traditional houses also have a Tawa Khana which circulates the hot combustion gases from the tandoor under the floor of the living room and releases to the outside through the opposite wall.

Households in Afghanistan use firewood, animal dung cakes, charcoal and shrubs for heating and cooking. Traditionally firewood and charcoal were purchased in rural Afghanistan but increasingly shrubs and animal dung cakes also have to be purchased. The thermal energy use of solid fuels also have their serious health effects, the annual number of pre-mature deaths from indoor-air pollution is estimated to be 54,000/Year (WHO, 2009). In comparison the civilian casualties in 2015 from the armed conflict in Afghanistan was 11,002 (UNAMA, 2016). The use of solid fuels are also a financial strain on the Afghan households as the average rural Afghan household spends over $ 90 on fuels of which only 12% is on kerosene/lighting with 88% on thermal energy. The prices of the solid fuels also increase by 15-25% during winter months as well.

An efficient Tandoor in Afghanistan. Image: COAM/Amy Jennings

Since late 2013, since the inception of the STEPs project, till late 2015, Sustainable Energy Associates (SEA), one of the partners have been working with the Ministry for Rural Reconstruction and Development (MRRD) in Afghanistan and UNDP to develop a project to address these rural energy and thermal energy challenges. These efforts have led to development of a new programme – Afghanistan Sustainable Energy for Rural Development (ASERD) which has business model and financial innovation at the core of the programme design and was finalised by SEA in late 2015. The project agreement was signed by MRRD and UNDP in late December 2015 and will be financed by the governments of South Korea and Sweden. The project will have a financial outlay of over US$ 50 million and will be implemented over 4 years during the period 2016-2019.

The ASERD programme plans to establish sustainable rural energy services in 194 rural communities in 4 years, providing both electrical and thermal energy services. The efforts will bring sustainable energy to over 19,500 households providing health, economic and social benefits. However the major contribution the programme will make to rural energy in Afghanistan would be to establish delivery models that are technology neutral, leverage additional local and international resources, mobilise communities, engage the private sector and financiers to establish a self-sustaining delivery model. The thermal energy service model which will be used by ASERD is shown in Fig.1.

Thermal Energy Service Model of ASERD. Image: Sustainable Energy Associates

Past rural energy programmes in Afghanistan have mainly relied on technology driven approaches which have focused on commissioning electricity generating equipment and transferring ownership, operation and utility management responsibilities to the communities. These efforts have also largely ignored the cooking and heating needs of rural population in a country which has cold winters. The opportunities to go beyond household energy to commercial, enterprise and public service use of energy have not been exploited or capitalised effectively. Similarly private sector and financial institutions have only played a limited role in the programme so far and the aspects of policy, regulation, standards and incentive frameworks have also not received considerable attention.

Against this backdrop, the ASERD programme seeks to graduate from the current approach to establish a technology-neutral, sustainable service delivery arrangement to provide thermal and electrical energy in rural areas of Afghanistan for household, social and productive needs. The programme will also provide energy in rural areas to seek agriculture productivity gains, rural enterprise development, income generation, community social empowerment and cohesion as well as to expand public service to improve access to better health, education and security in rural areas. To deliver these services in rural areas in a sustainable manner the programme will seek to engage the national utility and the private sector in addition to community mobilisation.

The programme will also develop capacities of the government agencies, civil society and the, private sector including the financial sector. ASERD will also create frameworks for policy and regulation, testing and quality assurance as well as will also pilot seven innovative energy service delivery models which will leverage skillsets and resources from communities, private sector and financial institutions some of which are linked to global financing mechanisms for climate change and energy. These models will also result in benefits to women and the marginalised nomadic Kuchi communities.

The design of ASERD has benefited from the learnings on thermal energy services offerings, key challenges and solutions gained by the STEPs project team which will now be used to support about 20,000 families in Afghanistan. SEA will be involved during the implementation of ASERD to support MRRD and UNDP.

– Binu Parthan, SEA

References

Conservation Organisation of Afghan Mountain Areas (COAM), 2012, Shah Foladi Village energy Use Survey

International Energy Agency (IEA) and the World Bank. 2015. “Sustainable Energy for All 2015—Progress Toward Sustainable Energy” (June), World Bank, Washington, DC. Doi: 10.1596/978-1-4648 -0690-2 License: Creative Commons Attribution CC BY 3.0 IGO

United Nations Assistance Mission in Afghanistan (UNAMA), 2016, ‘Civilian Casualties Hit a New High in 2015’ available at  https://unama.unmissions.org/civilian-casualties-hit-new-high-2015

United Nations Development Programme (UNDP), 2015, Project Document: Afghanistan – Sustainable Energy for Rural Development (ASERD)

World Health Organisation, 2009, Country profile of Environmental Burden of Disease: Afghanistan

Maintenance of biodigesters and issues surrounding maintenance/service arrangements

Even in the presence of mandated service agreements maintenance for biodigesters can still be an issue. For example, time constraints on private contractors [1] from central government to install and maintain digesters, lead to a slipping in maintenance standards. In a village in Assam interviewed in the paper, no follow up visits from the contractors were had for four years, and a 20% digester failure rate was recorded. Communications issues were a key contributor to this: the fact that a provision of a half of the installation subsidy for maintenance of plants over 5 years old was not communicated to households or the contractors.

A broken biodigester in Assam, India, having not been repaired for 6 months. Source: Raha, Mahanta & Clarke (2014) The implementation of decentralised biogas plants in Assam, NE India: The impact and effectiveness of the National Biogas and Manure Management Programme. http://dx.doi.org/ 10.1016/j.enpol.2013.12.048

One of the more overlooked aspects of biogas digester services and operation is the maintenance requirements of digesters. Older digester designs (for example dome-type biodigesters constructed from brick or earth) require a regular maintenance schedule (monthly to quarterly is common) [2] in order to maintain best performance, including maintaining the chemical balance of the digesting chamber and its structural integrity, repairing cracks in the chamber if necessary. More modern household and collective-scale designs are based off a plastic digesting chamber, usually fibreglass-reinforced plastic (FRP), and as such require less intensive maintenance (annual maintenance visits are sufficient), but still have a maintenance burden to address for peak performance (for example, maintaining the chemical balance of the digester through appropriate feedstock insertion).

However, even in the presence of mandated service agreements for biodigesters, for example delivered through a fee-for-service energy service company (ESCO), maintenance can be overlooked. A useful case study illustrating this can be obtained from India’s National Biogas and Manure Management Program (NBMMP) [1]. The NBMMP relied on local governments in India contracting the private construction sector to construct biogas digesters for rural communities. Time constraints on these contractors on installation, stemming from the prevailing climatic conditions limiting the working period of the year due to monsoons, meant that maintenance standards, for which the contractors under the tender from local government were also responsible, and the overall quality of installation of digesters, slipped drastically. Some contractors reported having to fill an annual allocation of 6,000 digester installations in just three months, at a rate of over 60 digesters per day, often for small companies of just 5-10 technicians. Hence, some digesters were not being maintained for four years or more, and there was a 20% overall digester failure rate. Communication between the public bodies and private contractors was also an issue: the NBMMP made provision of half the subsidy granted to households for purchasing digesters as a maintenance grant over a five-year period, which was barely taken advantage of due to a lack of awareness on the part of households and contractors.

This case study makes clear the necessity of accounting for maintenance arrangements in the design of any biodigester business plan or program. Ensuring the maintenance schedule is followed will extend the life of the biodigester and improve its performance, resulting in greater satisfaction with the system from the point-of-view of end-users. This fact makes biodigesters particularly suited to a fee-for-service business model: regular maintenance can easily be combined with regular payment collection visits, reducing the cost burden on the company/organisation and improving service.

The final post in this series will focus on the recent evolution of the Chinese National Biogas Program, and the lessons to be learned for cross-application in other regions globally.

– Xavier Lemaire and Daniel Kerr, UCL Energy Institute

[1] Raha, Mahanta & Clarke (2014): http://dx.doi.org/10.1016/j.enpol.2013.12.048

[2] Surendra et al (2014): http://dx.doi.org/10.1016/j.rser.2013.12.015

The ‘Real 5P Model’ in Cinta Mekar

Binu Parthan from SEA writes on the implementation of a pro-poor public-private partnership (5P) model for micro-hydropower in Indonesia.

I first heard about the 5P model or the Pro-Poor-Public-Private-Partnership in 2012 when I was in the mountain kingdom of Lesotho. The UN’s Economic Commission for Africa were scoping for an energy centre to be run by a cooperative as a 5P model.  I found the idea of PPPs in rural energy that focused on poverty alleviation quite compelling in the context of the rural energy work I was doing at the time. This approach was reflected in the Lesotho Energy Alternatives Programme (LEAP) that I developed for UNDP and the Sustainable Thermal Energy Partnerships (STEPs) project that Xavier Lemaire of UCL Energy Institute and I developed with during 2012-2013. Fast forward 2 years and the STEPs project is generously funded by UK Aid and on its way, and while responding to the baseline study on the STEPs project, I hear from Hongpeng Liu and Deanna Morris at the Energy Division of UN’s Economic and Social Commission for Asia-Pacific (UN-ESCAP) about the original 5P model which has been working for over 10 years in Cinta Mekar, Indonesia.

With kind support from Tri Mumpuni of People Centred Business and Economic Institute (IBEKA) (who incidentally is a recipient of Magsaysay award for her work on hydro power for rural electrification), weeks later I find my way to Cinta Mekar, a relatively remote hilly village about 3 hours drive from Jakarta. The Cooperative at Cinta Mekar – Makar Sari is headed by a diminutive Yuyun Yunegsih, a grandmother of three who was elected a few years ago by the 450 members of the cooperative. The cooperative manages the 120 kW hydro power plant which was commissioned in 2003. The investment in the hydro-mechanical and electro-mechanical equipment and the building materials were financed 50:50 by UN-ESCAP and a private company Hidropiranti. The facilitation was by IBEKA and the members of the community and cooperatives contributed labour and local materials for civil construction in a normal PPP mode. Today after 12 years the hydro power system is still working well and generating and selling electricity to the local utility – PLN at slightly over US cents 4/kWh. 40% of the $650-$1100 monthly revenues go to Hydropiranti and 40% to Mekar Sari cooperative while 20% is set aside for maintenance, repairs and replacement.

The Mekar Sari cooperative has done a number of impressive ‘pro-poor’ initiatives over the years with its share of the revenues. It has provided financial assistance to households which could not afford to obtain an electricity connection. The cooperative also provides scholarships to 360 kids from the community, provides a land fund for members who do not have land holdings, provides an allowance for women in the community to cover childbirth related expenses and also pays an allowance to older members in the community. It has plans to construct public toilets, drinking water fountains etc. all of which seems very impressive. This is an impressive ‘pro-poor’ element that I have not seen in energy projects in general. I have seen impressive pro-poor energy initiatives driven by visionary and charismatic individuals but not by organisations for such a long duration and consistent track-record.

While the social development and pro-poor schemes have been very impressive, the business side has been slightly less impressive. The cooperative has not been successful in renegotiating in higher off-take tariffs in the power purchase agreement with PLN which pays almost a three times higher tariff for similar community hydro plants. A major investment in a manufacturing facility to make gluten-free banana flour which would have employed 10 people have not been successful and lies largely unutilised as the supply chain and market prospects were not investigated properly. It’s possible that the cooperative may have benefitted from some hard-nosed business advice. However the initiative can be considered a notable success in establishing a technical and management solution at an institutional level which has worked for over 12 years and has continued to be profitable and having driven social development in the community.

From the STEPs project perspective it was interesting to see that almost all the electrified community was using LP Gas or gathering wood from the forests for cooking, thus affirming our view that the thermal energy aspect is often overlooked and left to individual households to solve. What was interesting was also that many households which could afford were using electric rice cookers for cooking the main staple food, and efficient electric cooking is something STEPs hasn’t paid much attention. For the STEPs project plans, 5P model which combines private sector quality, efficiency and investments with public and community investment and participation, with community organisations managing social benefits and which combines both electricity and gas supply could indeed be a better model economically and socially. The question whether the institutionalised community leadership in Cinta Mekar can be replicated elsewhere remains. After my visit I asked Yuyun what the cooperatives biggest challenge was and contrary to what I expected it turned out to be the efforts by the local government to take over the cooperative. So while technical, economic and social challenges can be overcome in rural energy services, political challenges often pose a greater risk to sustainability.

– Binu Parthan, SEA

Yuyun Yunegsih at the Cinta Mekar 5P Hydro Power Plant. Image: Sustainable Energy Associates