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Water for a food-secure world

Research on Resource Recovery and Reuse (RRR) Business Cases and Models

Miriam Otoo

2014 World Water Week, Stockholm2nd September 2014

Waste management in cities in most developing countries cannot keep pace with

urbanization

Photo: George Fox

Insufficient collection systems for wastewater, MSW, faecal sludge;

Majority of treatment plants do not operate effectively;

Absence of resources for operation and management is a common cause of failure-

• Inadequate billing systems• Low household ability and willingness to pay

knowledge.allianz.com knowledge.allianz.com

Safe Use of Wastewater, Greywater and excreta | April 13, 20234 |

Unsafe waste disposal is a source of health hazard and environmental pollution.

• Investments in infrastructure are required;• Level of maintenance and related costs set most

treatment plants on a trajectory for failure;• Suggested solutions additional revenue streams

to ensure sustainability.

Agro-industrial waste - Energy

Wastewater – Water (irrigation, aquaculture)

MSW, Faecal sludge - Nutrients (ag. production)

• Innovative RRR initiatives can help sustain cost recovery via additional revenue streams and close the water, nutrient and energy loops.

http://www.waste-enterprisers.com

www.new-ag.info

Why do we not see more of this and at scale?

• Most initiatives aimed at RRR have been characterized in low-income countries by:- High dependence on subsidies; - Limited up-scaling potential.

• Fundamental gaps in:- Business planning and management

strategies, market knowledge;- Economic aspects and institutional linkages;

• Resulting in more failures than successes.

What is needed?• Business thinking and market-driven

mechanisms in a business-phobic sanitation sector; – This involves the analysis, development

and promotion of innovative cost-recovery and other business models that represent: sources of revenue generation or social

benefits for all relevant actors; incentives for private sector

participation.

Business Thinking: Why?

Most donors and governments envision investment plans which do not require their continuous support for impact.

Donor Support

$  Intervention Sustainable impact

$ $ $ 

Donor Support

Market-driven

Mechanisms

$  Intervention $ $ $ 

x

IWMI & WLE’s RRR Strategy + Partners

Capacity Building

Implementa-tion

Research

Water for a food-secure world

The Science – Research Approach

Water for a food-secure world

Capacity Building

Implementation

Research

Water for a food-secure world

Research Phase

Analysis of empirical RRR Business cases from a Multi-Disciplinary perspective

The Science – Research Approach

Water for a food-secure world

Feasibility studies

Business case identification and analysis

Business model

description

Implemen-tation

Implem

entation Phase

Testing feasibility of business models in local context

Business modeling

Case 2

Case 1

Business model

Case 3

Investment in most promising RRR businesses in diff. locations [implementation research]

RRR business casesNumber Business case name Country Location

Scale (pilot, community,

city,…)

Type of waste used

Waste product (biogas, fertilizer,

water, ..)

Process of waste

treatment

Could be a business case

because..

Financial data

available?

1 WASTE CONCERN BANGLADESHDhaka Large-scale business operationSolid waste Fertilizer Composting, co-compostingYes. Replication of Business model in 10 African citiesNot sure

2 BIOGAS SECTOR PARTNERSHIP NEPAL Kathmandu Large-scale??? Replicable?Human excreta, cattle dung and waterBiogas and compost/fertilizerMethanogenic bacteria on biodegradable waste in anaerobic conditionsMaybe but specific to rural settings and may not be practical for urbal sanitation crisisPossible upon request

3 PUNJAB ENERGY DEVELOPMENT AGENCYINDIA Punjab Large-scale Cattle dung Biogas and manure Biologically induced mixing arrangement (BIMA) technology used for anaerobic digestion

4 USAID INDIA Uttar Pradesh Pilot Cattle dung Biogas (thermal and electrical energy) and compostAnaerobic digestionPotential

5 TAMIL NADU ENERGY DEVELOPMENT AGENCYINDIA Tamil Nadu City Wastewater Biogas, Electrical energyHybrid Upward Flow Sludge Media Anaerobic ReactorPotential for replication and given growing demand for sago and starch, wastewater from tapioca processing expected to increase exponentially; sustainable; economic benefits to several sectors

6 KOYAMBEDU WHOLESALE MARKET COMPLEXINDIA Chennai, Tamil NaduCity Organic waste (market waste)Electricity; Biogas (used as fuel in gas engine and excess power generated is exported to the TNEB grid), Manure (dewatered cake is sold)Biologically induced mixing arrangement (BIMA) technology used for anaerobic digestionRepresents a way for the public sector to finance other divisions of the sanitation sector;Potential for replicationPossible

7 M/s HIND AGRO INDUSTRIES, LTD INDIA Aligarh, Uttar PradeshLow-medium scale (individual entrepreneur)Abattoir soild waste (droppings, rumen, fat, agro-wastes, fodder residues and hay)Biogas, biofertilizer Biomethanation (Low Speed Agitator tank Reactor) Replicability and sustainability potential; diverse source of income streams; Implementation agency that keeps them up to date on technical know-how, etc.Maybe

8 M/s AL-KABEER EXPORTS PVT, LTD INDIA Andhra Pradesh Medium scale Feed waste, animal wasteBiogas, Manure Biogas Induced Mixing Arrangement (BIMA) technologyReplicability and potential for up-scalingMaybe

9 SuSanA GHANA Kumasi Pilot Faecal sludge, Solid wasteCompost FS Dewatering with unplanted drying beds and Aerobic Windrows co-composting of organic SW and dewatered sludgePPP which addressses land tenure constraints, third party implementing agencyYes (IWMI was partner)

10 ECoH Holdings Ltd KENYA Nairobi City Organic waste (green waste, market waste, hotels, schools, hospitals, kitchen waste, farmyard manure, crop residues and yard trimmings, slaughterhouse remains)Compost Windrow composting Possible to get financial data

11 Lilongwe City Council MALAWI Lilongwe Community Organic waste (sugarcanes, mangoes, nsima from hospitals, kitchen and animal manure)Compost Open-air, static-pile compostingAspects of PPP/ CBO model address business constraints (financial); Low-level technology; Easily replicated Annual turnover: 40,000Kwacha; Price of product: 100-160 Kwacha

12 NAWACOM KENYA Nakuru Community/City Household organic wasteCompost ? Replicability - success factor/ cooperative model1,500Ksh per bag; 336 members; Access to micro-credit loan facility

13 Waste Enterprisers GHANA Kumasi City Faecal sludge Wastewater 1. Water Stabilization Pond?Sustainable model but may be limited in terms of replicability Available

14 Water for People BOLIVIA Cuchumuela, CochabambaCity Urine and fecesDecomposed urine and fecesUDDTs Sustainability Sale of mushrooms; Pine

15 ROSA KENYA Nakuru City Organic waste, feces, urineCo-compost (organic waste with faecal matter collected from UDDTs)? Replicable; sustainable model without external financial support

16 Karnkata Compost Development LimitedINDIA Bangalore City Organic wasteCompost Windrow composting/ Aerobic decomposition

17 Santiago Composting Project CHILE Santiago Project/ City Biodegradable waste and nontoxic wastewater sludgeCompost/ Sale of emissions reductions? Replicable, self-sustainingProcesses 43000mT of waste/year; Sale of 326,000 of CO2 equivalent

18 Ministry of Agriculture and Rural Development (MARD)& SNVVIETNAM ? Pilot/City Human excreta, cattle dung and waterBiogas, Bio-slurry/organic fertilizer? Can be widely replicated, however success highly dependent on geographical context (peri-urban/ urban)Costs per household: $550

19 Chinese Academy of Science CHINA ? Pilot project Waste straw "Bread grass", biogas Bacteria infested (anaerobic/aerobic)Self-sustaining, however initial financial obstacles N/A

20 Unilever/Triple R Project SOUTH AFRICA? City Food grade wasteCompost * Replicable but may not be cost-effective for factoriesnone

21 Kigali - Biogas RWANDA Kigali City Human feces, urineBiogas Biogas digester Replicated with other institutions (hospitals, academic institutions)Possibly accessible

22 Waste Busters PAKISTAN Lahore City Household/ market waste (organic and inorganic)Compost Windrow composting methodPotential for up-scalingAvailable

23 VermiGOLD INDIA Mumbai City Wet garbage, organic wasteVermicompost Vermiculture Low-level technology, replicability

24 Anamol Krishi Udyog INDIA Nagpur, MaharashtraCity Vegetable market waste, organic household wasteCompost Biologically induced mixing arrangement (BIMA) technology Replicability, has potential to be up-scaled; Profitable and sustainable modelCosts of production available

25 TERRA FIRMA BIOTECHNOLOGY LTD INDIA Bangalore City - large-scale Household and market wasteOrganic compost Vermiculture Historical financial growth; large-scale; Successful producer of organic fertilizer using vercompostingAvailabel in document: http://www.sswm.info/sites/default/files/reference_attachments/SHAH%20et%20al%201997%20Composting%20in%20Bangalore.pdf (pages51-66)

26 Lakshmi Energy and Foods Limited INDIA Punjab City Rice husk Electricity, Bricks (ash from burning husks)* Large-scale; sustainable business model*27 Cape Flats Treatment Works SOUTH AFRICACape Town City Faecal sludge Biogas, pellets Anaerobic digestion for biogas production; Drying with Swiss Combi Drying system - Stabilised sludge from anaerobic digesters are sintered into pellets at a temp. of 500C using biogas from anaerobic digesters as fuelLarge-scale; sustainable business model400m3/h of biogas; wastre volume?

28 Sulabh International Social Service OrganizationINDIA 25 states Country-wide Human excreta, WastewaterCompost, Manure, Pisciculture?Human excreta - biogas digesters; Duckweed-based wastewater treatment; Compost from solid waste - thermophilic aerobic composterCommercially viable business model - portfolio diversification, significant development impact, highly profitable2005 profits - $5m; 6,000 public toi; lets in 25 states; 15 million users daily; 160 biogas plants connected to public toilet complexes

29 East Kolkata Wetlands INDIA West Bengal City,maybe on a larger scale?Wastewater, solid wasteFish Waste stabilization pondsLarge-scale; self-sustaining/commercially viable system; replicable*

30 Ondo State Integrated Wastes Recycling and Treatment ProjectNIGERIA Ondo State Solid waste Compost Semi-mechanical windrow, curing and milling operationsLarge-scale; successful public entity*

31 PRISM BANGLADESHKuhlna City Faecal sludge, wastewaterDuckweed, Fish Waste stabilization pondsSelf-sustaining/ successful?Available in document

32 Cows to Kilowatts Project NIGERIA Ibadan? City Abattoir wasteBiogas Anaerobic digestion of abattoir waseSelf-sustaining *

33 UN-ESCAP/ Waste Concern SRI LANKA/ VIETNAMMatale/ Quy NhonCommunity Solid waste Compost Aerated box methodSelf-sustaining, profit-making enterpriseSince 2007, model plants operating successfully on a self-financed basis under a public-private partnership.

34 Nyongara Biogas Project/ Kenya Industrial Research and Development InstituteKENYA Dagoretti/ Outskirts of NairobiCity Abattoir wasteBiogas High Performance Temperature Controlled (HPTC) biogas digester modelReplicable in developing countries (East Africa) where waste from slaughterhouses represent significant source of environmental challengesPossibly available upon request

35 IFAD Supported Biogas Projects ASIA / PACIFICChina/ Vietnam Mainly Rural setting? Human and animal wasteBiogas (thermal and electrical energy) and compostBiogas digester This case was included because it has the potential to be replicated in the urban context and produce a value-added product that potentially has an all year-round market and addresses environmental issues*

36 KORAT WASTE TO ENERGY THAILAND Muang District City Industrial - wastewater from starch industry/ Sanguan Wongse industriesBiogas - (biofuel and electricity)Anaerobic baffled reactorFinancial viability?*

37 Boeung Cheung Ek Lake CAMBODIA Phnom Penh City? Wastewater Water spinach productionWastewater used as a growth medium for water spinachAgricultural production; Financial viability100-300kg/household; $350-700/yr for 5-10tons

38 Supporting the Informal Wastewater Farming Business in GhanaGHANA Accra - Several citiesCountry-wide Wastewater Direct reuse of wastewaterAgricultural use of wastewaterHigh cost-recovery potential and model is already flourishingAvailable in Cofie and Murray paper

• Existing database of 150+ business cases across Asia, Africa and Latin America

• 50+ cases selected for detailed analysis, more under screening;

• Development of 25+ business models tailored to different waste sources, processes and products, for different entities is target.

Research Phase

Feasibility studies

Business case identification and analysis

Business model

description

Implemen-tation

Implem

entation Phase

Research Phase

Feasibility studies

Business case identification and analysis

Business model

description

Implemen-tation

Implem

entation Phase

Water for a food-secure world

Research Phase

Development of Business Models

Water for a food-secure world

Business model

description

Feasibility studies

Implemen-tation

Implem

entation Phase

Analysis of empirical RRR Business cases from a Multi-Disciplinary perspective

Business modeling

Case 2

Case 1

Business model

Case 3

• Learning from 100 compost plants in Sri Lanka;

• Cost recovery ranges: 3 to over 100%

• Similar cases from Africa and South Asia;

• Detailed analyses – development of most successful model for replication.

Subsidized composting at district level

Key research questions are….

•What are the characteristics and success factors of viable, scalable business models for the safe recovery and reuse of water, nutrients and energy in a low-income country?

•How much public funding is needed to stimulate business development?

•What programs are helpful in reducing the sanitation sector’s reliance on financial aid, and what roles do resource recovery businesses play in financing and managing parts of the sanitation value chain?

•What is the implementation potential and scale in low-income countries of such business models that provide marketable water, fertilizer and energy products?

Catalogue of RRR cases and models

Testing the feasibility of the business models

The methodology builds on a multi-disciplinary approach:

1. Waste supply and availability2. Market analysis – WTP, market size3. Technology 4. Financial analysis 5. Institutions, social and legal settings and

acceptability6. Health and environmental risks and

mitigation measures7. Economic analysis incl. valuation of positive

and negative externalities

Research Phase

Business case identification and analysis

Feasibility studies

Implem

entation Phase Implem

en-tation

Testing the feasibility of models – 10 locations (4 funded by SDC)

Peru

Vietnam

India

Uganda

Ghana

Sri Lanka

Bangladesh

Implementation of business models

Capacity Building

Implementation

Research

Implementation of business models

• Commercialization of fortified excreta pellets• Wastewater-fed aquaculture• Dry fuel manufacturing from MSW

Market waste

Faecal sludgeFortified excreta

pellets

wearewhatwedo.org

blog.ecoagriculture.org

Research continues!

Implementation offers significant learnings on the up- and out-scaling of potential BMs:

1. How are multi-party PPP contracts formulated which feed funds back into the sanitation chain?

2. How do we get products, e.g. faecal sludge pellets registered, certified and labeled for safe reuse?

3. How do we address the capacity gaps of partners/actors (public and private) to implement resource recovery and reuse (e.g. agricultural market knowledge)?Implemen-

tation

Implem

entation Phase

Capacity building

Capacity Building

Implementation

Research

• Training workshops for existing and new entrepreneurs, e.g. from cash flow to business modeling;

• Larger lessons will feed into business school curricula;

• Business Modeling Workshop, e.g. 2015 FSM3 conference for practitioners and academia.

Capacity building

No reuse without safety!