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Using the E-P-T triangle (a program approach) To analyze The Biogas Support Programme

Using the E-P-T triangle (a program approach) To analyze The Biogas Support Programme Nepal, (1992-present) & The E-C interaction (a micro-economic analysis) To analyze Toyola Energy, Ltd. Ghana, (2006-present). The E-P-T triangle & The Biogas Support Programme. Policy.

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Using the E-P-T triangle (a program approach) To analyze The Biogas Support Programme

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  1. Using the E-P-T triangle (a program approach) To analyze The Biogas Support Programme Nepal, (1992-present) & The E-C interaction (a micro-economic analysis) To analyze Toyola Energy, Ltd. Ghana, (2006-present)

  2. The E-P-T triangle & The Biogas Support Programme Policy Technology Enterprise

  3. The Biogas Support ProgrammeOverview • Began – 1992, Nepal • What – A government program that promotes biogas technology • Now (2008) – In its 4th phase (’03-’09); registered as a CDM project • Outcomes/Impacts - More than 190,000 homes have digesters; the price has fallen significantly. P T E

  4. The Biogas Support Programme http://www.youtube.com/watch?v=b_lZTSJ47rI

  5. The Biogas Support ProgrammeHistorical Development • It all began with a technology push. • Early experimentation with biogas c. 1955 • Research continues in 60s and 70s • Government established Gobar Gas Co. (GGC) in 1977. P T E

  6. The Biogas Support ProgrammeHistorical Development • The technology was quickly aided by policy. • 1st official government promotion of biogas, 1974 • Gobar Gas Co. (GCC) established, 1977 • Biogas targets incorporated into 7th national 5-year plan, 1984-1989 • Biogas Support Programme (BSP) launched in 1992 P T E

  7. The Biogas Support ProgrammeHistorical Development • Inclusion of the private sector at the beginning of the BSP • From the start of the BSP, private companies were included as part of the strategy to extend biogas technology to rural households. • There are now 72 enterprises operating in conjunction with the BSP P T E

  8. The Biogas Support ProgrammeBalanced Implementation • The BSP includes a wide range of partners who have provided consistent and long-term support. • Gov’t stakeholders • International donor organizations • Financial institutions • Local biogas companies P T E

  9. The Biogas Support ProgrammeBalanced Implementation Source: Bajgain, Sundar & Indira Shakya. “The Biogas Support Program: A successful model of public-private partnership for rural household energy supply.” The Ministry of Foreign Affairs, The Netherlands; SNV; Biogas Sector Partnership, Nepal; 2005.

  10. The Biogas Support ProgrammeBalanced Implementation • More about the policy: • (1992-97) 8th 5-year plan: the BSP arose hand in hand with an institutional framework for promoting decentralized energy resources. • Alternative Energy Promotion Center (AEPC) founded, becomes major implementing agency. • Capital subsidies (25%) and interest subsidies provided. • (1998-2003) 9th 5-year plan sets target of 90,000 biogas installations • Additional support provided by providing tax exemptions on all biogas supplies • (2003-2009) 10th 5-year plan targets an additional 135,000 systems P T E

  11. The Biogas Support ProgrammeBalanced Implementation • Significant parts of the BSP, originating at the policy level, related to technology. • Development of a uniform and rigorous set of production, installation and maintenance standards (eventually ISO). • Helped establish consumer confidence • Reduced lending risk (now 167 MFIs engaged) • Facilitated registration of project with the CDM P T E

  12. The Biogas Support ProgrammeBalanced Implementation • Much technical support was provided by international donor partners • SNV/N work with the GGC began in 1989, sought to improve technical performance of digesters and reduce their overall cost. • Technical capacity building support extended at all levels of the program. P T E

  13. The Biogas Support ProgrammeBalanced Implementation • Significant parts of the BSP, originating at the policy level, related to enterprise • Engagement of 72 biogas construction companies in 2008 vs only one at the start of the program in 1992 (the government-owned GGC). • Entry of private sector companies in at every stage of the value chain (installation, parts manufacture, appliances, etc.). • 167 MFIs actively lending for biogas thanks to availability of special funds, guarantees and awareness raising. P T E

  14. The Biogas Support ProgrammeOther Reasons for Success • Long term (multi-decadal) support facilitates growth, learning by doing and program continuity. • Excellent M&E… • …allowed shortcomings and gaps to be quickly addressed. • …demonstrated program success and helped justify new and continued resources. • …aided CDM registration. • Inclusion of financing options… • …increased depth of outreach. • …reduced the level of subsidy required to achieve same results. P T E

  15. E (Enterprise)‏ C (Customer)‏ The E-C Connection & Toyola Energy Ltd.

  16. Toyola Energy, Ltd.Overview • Began: Legally registered in 2006 in Ghana • What: A company manufacturing and distributing improved charcoal cookstoves • Now (2008): Toyola has opened a 3rd production site and is beginning to export stoves to Togo and Benin. Toyola is also beginning to retail solar lanterns. There are a total of 127 employees plus 47 additional artisans and 238 sales agents. • Outcomes/Impacts: 35,000 stoves were manufactured and sold in the first two years of operations. Each stove reduces charcoal demand by 30-40% and avoids ~1 ton of CO2 annually.

  17. Toyola Energy, Ltd.The E-C Connection Entrepreneur (e)‏ Demand (d)‏ Technology (t)‏ Knowledge (k)‏ E (Enterprise)‏ C (Customer)‏ Services (Es)‏ Services (Cs)‏ Finance (Ef)‏ Finance (Cf)‏ This is what is required for a successful E-C interaction.

  18. Toyola Energy, Ltd.The E-C Connection • Suraj Wahab and Ernest Kyei have technical and business experience along with a strong desire to extend social and environmental benefits to their customers Entrepreneur (e)‏ E (Enterprise)‏ C (Customer)‏

  19. Toyola Energy, Ltd.The E-C Connection • Ghanaian Gyapa stoves based on Kenyan Jiko model. • Relatively simple to manufacture using locally available materials. • 30-40% charcoal savings translate to short payback periods and better indoor air quality Technology (t)‏ E (Enterprise)‏ C (Customer)‏

  20. Toyola Energy, Ltd.The E-C Connection • Initial technical training provided to many artisans by Enterprise Works. • Business plan development assistance and carbon monetization services provided by E+Co. E (Enterprise)‏ C (Customer)‏ Services (Es)‏

  21. Toyola Energy, Ltd.The E-C Connection • (2006) $70,000 loan • (2008) $100,000 loan • (2008) $40,000 carbon advance • (2009) $100,000 loan possible E (Enterprise)‏ C (Customer)‏ Finance (Ef)‏

  22. Toyola Energy, Ltd.The E-C Connection • Stoves can save a household ~$35/year in fuel costs after initial investment of ~$8. • Fits a variety of pot sizes and types used. • Less indoor air pollution. Demand (d)‏ E (Enterprise)‏ C (Customer)‏

  23. Toyola Energy, Ltd.The E-C Connection • Enterprise Works embarked on a large marketing campaign. • Sales promoted by word-of-mouth, Gyapa “evangelists” and commissioned sales agents. • Risk-free trial allowed. Knowledge (k)‏ E (Enterprise)‏ C (Customer)‏

  24. Toyola Energy, Ltd.The E-C Connection • Delivery services available, especially for larger commercial stoves. • Stoves can be refurbished (ceramic liners replaced) for less than the cost of a new stove. E (Enterprise)‏ C (Customer)‏ Services (Cs)‏

  25. Toyola Energy, Ltd.The E-C Connection • Larger stoves sometimes sold with vendor credit. • Informal microfinance options through Susu collectors and sales agents. • Many sales possible on a cash basis. E (Enterprise)‏ C (Customer)‏ Finance (Cf)‏

  26. Very little country-level policy directly affects the market for stoves. However, policy does play a role through the creation of carbon markets. These have a huge potential to affect the operations of Toyola. Policy & Enabling Environments Entrepreneur (e)‏ Demand (d)‏ Technology (t)‏ Knowledge (k)‏ E (Enterprise)‏ C (Customer)‏ Services (Es)‏ Services (Cs)‏ Finance (Ef)‏ Finance (Cf)‏

  27. Policy & Enabling Environments Entrepreneur (e)‏ Demand (d)‏ Technology (t)‏ Knowledge (k)‏ E (Enterprise)‏ C (Customer)‏ Services (Es)‏ Services (Cs)‏ Finance (Ef)‏ Finance (Cf)‏ Financial Social Environmental

  28. Toyola Energy, Ltd.Triple Bottom Line Returns • Toyola is a very healthy and financially sustainable enterprise. • It has created significant employment opportunities. • Cooking practices are being made cleaner. • The pressure on forests is being reduced and GHG emissions are avoided. Financial Social Environmental

  29. Thank You! Questions?

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