Biogas Projects Show Promise for Power in the Developing World

Cambodia

SME Renewable Energy Ltd. (SME-RE) is a joint venture partnership of SME Cambodia, a Cambodian NGO promoting rural private sector development, and E+Co. Inc., a U.S. based non-profit, renewable-energy investment company. These systems produce a gas that replaces 75% - 100% of imported diesel and other fossil fuels on which most rural Cambodian enterprises still depend. The gasifiers use renewable, agricultural waste products such as rice husks, corn cobs, sugar cane “bagasse” or wood from local tree farms.

Small and medium sized enterprises, including rice mills, brick factories, ice plants, rural electricity enterprises and small grid electricity systems for remote villages, are prime targets for SME-RE’s systems.

“It has been a tough, sometimes frustrating and slow process to introduce this new concept and method of energy production and convince very conservative Cambodian entrepreneurs such as rice millers,” said Rin Seyha the Managing Director of SME-RE.

From 2004 to 2005 SME Cambodia supported visits by Cambodian rural entrepreneurs to India and Sri Lanka to see biomass gasification equipment at work in power plants and rice mills.

"Seeing the equipment actually operating is very important to Cambodian business owners who find this more convincing  than listening to workshop presentations and taking the word of foreign experts. Seeing gasifiers in operation is necessary for Cambodians to accept that the technology really works. It helps them visualize how the equipment could be used in their own operations and appreciate the potential benefits of the technology in terms of reducing their energy costs and their dependence on expensive diesel fuel,” Seyha said.

According to Mr. Song Hong, owner of the Seng Hong Rice Mill Ltd. in Battambang and President of the Battambang Rice Millers Association, “Most Cambodian family business men are not used to making investment decisions based strictly on numerical calculations, internal rates of return or long term returns on investment. They are used to working season by season and making do with whatever funds are available from their family networks. They just hope they can finish the season making a profit. Rice millers mostly strive just to obtain sufficient working capital to buy paddy rice to process in their mills.”

Led by the example of Hong who was the first to buy a gasifier, and with the support of E+Co Inc. Cambodian millers have begun purchasing gasification systems. Installations and loans have steadily grown from one in 2006 to seven in 2007. SME-RE Ltd. has already received five more orders so far in 2008.

The accumulated value of these turn-key projects is now more than US $800,000. The loans financing these investments total more than US $500,000. Plans are being made to  begin manufacturing system components within Cambodia. The market potential for the next three years is estimated to be 100 units.

In Camboia, a typical 2 ton/hour rice mill operating 10 hours per day for 25 days a month will save more than 60,000 liters of diesel worth about US $54,000 per year. For ice plants that operate 22 hours per day the benefits can be even greater.

“The economic benefit of using low cost biomass (e.g. rice husks already owned by the millers) or other locally grown agricultural waste that can substitute for 70% -75% of the diesel fuel bill, offers tremendous opportunity to reduce energy costs. Fuel is the largest single expense facing a mill next to the rice paddy itself. More than 70% of mill direct operating expenses are for fuel. The pay back period on these investments is typically between 1.5 to 3 years” said Tony Knowles, Director of SME-RE.

Costa Rica

In Costa Rica, residents of Santa Fe are using biogas on a more personal level, for everyday cooking. The Santa Fe Biogas project, in its initial stages, was simply a long list of concerns in the community communicated at the Women's Group meetings.

"How can we avoid buying expensive tanks of gas or the inhalation of smoke in the kitchen?" the women asked themselves. Several women in the group had heard of farmers who use biogas as a solution to both problems. Biogas made from biodigesters that process manure are also able to convert manure into fertilizer. The Women's Group took advantage of a UN Women's Group Grant that would cover most of the expenses of a project that would supply a biodigester to the people in the community who were in need of one.

A biodigester being used in Santa Fe, Costa Rica
Credit: RuralCostaRica.com

The women quickly organized themselves to start learning about biodigester construction and maintenance with the help of the local Agriculture Ministry. Once they felt comfortable with the design they chose they started building their first prototype so that their grant proposal had a proven concept to show.

After submitting their proposal they were informed that out of the nine finalists, that their proposal was the one chosen for the grant. They organized the purchase and delivery of all the materials necessary to build the biodigesters. Each of the families that received materials built their own biodigesters with the expertise gained from the sessions with the Agriculture Ministry that the Women's Group organized. At the project's completion, all 16 biodigesters were built, offering energy independence to the rural families.