[Stoves] FW: New York Times: Toxic Smoke Is Africa’s Quiet Killer. An Entrepreneur Says His Fix Can Make a Fortune

Fri Dec 14 22:16:35 CST 2018

Dear all,
this is the first time I intervene on this mailing list. I have been
following for years with very much interest the technical discussions on
stoves, where I am not an expert, but I have a pretty good experience and
knowledge about fuel production and distribution, through my
char-briquettes company in Cambodia - SGFE. We are so successful in
Cambodia that now we have decided to "franchise" our model in other
countries and we are doing that through a new company called OTAGO
www.otago-global.com

Regarding Inyenyeri's business model, I have to say that I have more than a
doubt:

1. If inyenyeri has 5,000 customers, that means that they are producing at
least 5 tons of pellets per day (1 kg/stove/day). Judging from the pictures
of the production facility, I would hardly say it produces even just 1
ton/day. Where is the raw material? Where are the safety stocks? Where is
the equipment? Are they moving 5 tons of material around the factory every
day with a wheelbarrow as it can be seen in one of the pictures? My factory
has an average output of 3-4 tons/day and it has a main building of 1,200
sqm, 30 production workers and a raw material stock of 200 tons and a
finished product stock of 70-80 tons (not considering the buffers of
material which is being processed).
Why are the production workers in Inyeyeri wearing helmets? The building is
not really high, there don't seem to be any overhead stored material or
overhead movement of material (like with cranes). In my experience with
processing biomass fuel, you keep everything on the floor, since there is
lots of material and it is really heavy. Unless there is the risk that the
roof falls on their head, the helmets seem completely useless and worn just
as a statement of (useless) safety measures being implemented.

2. According to Inyenyeri's business model, they receive the biomass from
the people that collect it and bring it to the factory. To produce 5
tons/day you need at least 5 tons of wood per day (more if you consider the
moisture content). If everybody brought 50kg (I imagine these people are
low income, might not have a car or even a motorbike and therefore bring
everything on foot, as shown in a picture) that would mean 100 people line
up every day in front of the factory. How much time does it take to weigh
the wood one by one and pay them? Do they weigh 5 tons of wood every day
with that small hanging scale that can be seen in one of the pictures? At
SGFE we have trucks delivering the raw material at the factory and just the
unloading of the trucks is already a really hard job.

3. How does Inyenyeri distribute the pellets? With bicycles, as it can be
seen in the picture and in the video? They distribute 5 tons of pellets in
a HILLY COUNTRY with bicycles? How many bicycles do they have/need? The
riders have probably a training ready  to participate to the Tour the
France.... In Cambodia we use 2-3 Tuk Tuks driving around the city 10 hours
a day (from 8am to 6 pm), fully loaded to deliver 3-4 tons/day. And Phnom
Penh is completely flat!

4. According to Inyenyeri's business model they distribute Mimimotos stoves
for free and they earn the money by selling the fuel. If Inyenyeri makes
30% profit margin on the fuel (which is massive, because fuel businesses
are usually "low margins high volumes" business models), selling the
pellets at 0.24 USD/kg, it would take 2 years and 3 months only to pay back
the 60 USD stove. How are they making any money? What if some of the
customers decide they don't want to buy the pellets anymore, which would
add effective losses?

5. Inyenyeri's business model is already pretty hard to believe with the
alleged 5,000 customers, how do they intend to scale up to serve 100,000
households? Do they have any idea of what it means to produce 100 tons of
pellets per day? (Size of the building and land, necessary raw material
storage, equipment, trucks, etc...). How many hundreds/thousands of people
will line up in front of the factory every day to supply the wood/raw
material? Is it even manageable and is it actually feasible to secure the
required feedstock with such a business model? Are they going to deliver
100 tons per month on bicycles?

6. Inyenyeri has risen 12 million USD in funding (private investments and
grants). On what basis was that amount of money granted to Inyenyeri? For
their business model or their technology or their market penetration? Is
the business plan or any other data publicly available? What have they
demonstrated in the past? And what have they done with that money so far?

I am an engineer and have been working in the fuel business for 8 years. I
find it really hard to believe Inyenyeri's story and am wondering if
anybody else has the same doubts or if anyone can eventually give me some
answers.

Best regards,
Carlo
*_________________________*
*Carlo Figà Talamanca - CEO*
*Sustainable Green Fuel Enterprise (**SGFE**)*
Phlove Lom, Phoum Russey, Sangkat Stueng Meanchey, Khan Meanchey,
Phnom Penh, CAMBODIA
T: +855-(0)97-8159256
E: carlo at sgfe-cambodia.com <carloft at gmail.com>
W: www.sgfe-cambodia.com

On Fri, Dec 14, 2018 at 9:47 PM Anderson, Paul <psanders at ilstu.edu> wrote:

> Crispin,
>
>
>
> Tom Price and others at Inyenyeri can answer better than I can.   Tom does
> read this Listserv (I think.).
>
>
>
> Cooking with good TLUD stoves (Mimi Moto and others) saves fuel (fuel
> savings mean less cutting of wood, even if it is farm-grown or in the
> wild).
>
>
>
> Additionality is that the households would not be doing this savings if
> they could not get the stoves, and the stoves are supplied by the project.
>
>
>
> I see no objections to how this project functions.  My reservations are
> about the financing for reaching the many millions needing good stoves.
> But we know that getting stove projects started takes much money.
> Examples include some that are starting and others that have shifted into
> more stabilized production costs:
>
>
>
> Burn in Kenya ---- Many millions at the start.  Now seems to be stabilized
> for production and business.  (not counting much money for the design and
> testing)
>
>
>
> Inyenyeri -----   $12 million and now has 5000 TLUD stoves   (not counting
> the substantial investment to get the Mimi Moto stove designed, tested, and
> into production)
>
>
>
> Rocket stoves -----  Years and much money at Aprovecho and the business
> efforts, including by SSM in china.
>
>
>
> Champion TLUD  -----  Development work by Anderson and Servals, but with
> some millions by atmosfair to establish the carbon credit program
> (somewhere around 35,000 stoves).
>
>
>
> Prime and Prof. M. Nurhuda  ---  Substantial, but I do not know the numbers
>
>
>
> SNV in SE Asia  -----   LOTS of expenditures.
>
>
>
> Solar cookers, alcohol stoves, and even LPG stoves are backed by
> substantial time and money.
>
>
>
> Anyone can add to this list (or disagree with me).
>
>
>
> But the BIG issue is financial sustainability with quality stoves.   And
> how much are the improved stoves actually helping the people is substantial
> ways (substantial is not defined here).  I will have more on this by the
> time of ETHOS in late January.
>
>
>
> Paul
>
>
>
> Doc / Dr TLUD / Paul S. Anderson, PhD
>
> Exec. Dir. of Juntos Energy Solutions NFP
>
> Email:  psanders at ilstu.edu       Skype:   paultlud
>
> Phone:  Office: 309-452-7072    Mobile: 309-531-4434
>
> Website:   www.drtlud.com
>
>
>
> *From:* Stoves <stoves-bounces at lists.bioenergylists.org> *On Behalf Of *Crispin
> Pemberton-Pigott
> *Sent:* Thursday, December 13, 2018 2:36 PM
> *To:* Discussion of biomass cooking stoves <
> stoves at lists.bioenergylists.org>
> *Subject:* Re: [Stoves] FW: New York Times: Toxic Smoke Is Africa’s Quiet
> Killer. An Entrepreneur Says His Fix Can Make a Fortune
>
>
>
> Dear Paul
>
>
>
> I was discussing this with someone off list and they made the following
> observation, which seems relevant. They asked:
>
>
>
> Is Inyenyeri solving a non existent problem?
>
>
>
> The question is relevant because there are not forests left in Rwanda. The
> cutting of the remaining national forest has been stopped (securing the
> habitat of the mountain gorillas, mainly).  All wood comes from farmers
> that grow trees as a crop. This applies as well to the charcoal trade which
> is legal and sustainable.
>
>
>
> Where is the wood coming from? As I understand the project when I reviewed
> it, the wood is brought to the pelleting house by people who trade it on a
> discounted mass basis for pellets. The rural community is therefore doing
> the foraging. They have to get wood somehow to cook, but when they do, they
> can take it to the processing centre and get bags of pellets in return – no
> money involved.
>
>
>
> In town, the pellets are sold. The town pellets come from the discounted
> exchange in the rural area.
>
>
>
> So…does the project still work this way?  If so, how is a carbon credit
> being calculated? There are no forests to “save” so the collection of wood
> is sustainable.  Isn’t some unsustainable fraction required for CDM credits
> to apply? Plus additionality (look it up).
>
>
>
> I think it would be helpful if the project financing model were explained
> in a way that helped us to know how to replicate it.
>
>
>
> Much appreciated.
>
> Crispin
>
>
>
>
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