"We Need More People Playing That High-Risk Angel Investor Role To Crack Development Problems"

At the core of the Shell Foundation’s enterprise solutions to poverty lies the belief that if you treat the poor as consumers and deliver the goods that the consumer wants, you are more likely to deliver sustainable and scalable solutions. After all, for any set of solutions to development issues, the alternative is to have an inexhaustible source of funds that will support it.

This basic philosophy was outlined in an interview of Chris West, Director, Shell Foundation to Sukalp Sharma of the Financial Express during his recent visit to India. According to Chris, Shell Foundation acts like an angel investor at a very early stage for social entrepreneurs. However, he believes that is more than money that counts in this stage of development of the enterprises.

According to Chris West, 

           “What we are trying to do with this enterprise approach is to show that working  like a business in tackling development issues is a more scalable and sustainable approach to solve problems of energy access. The conventional model has been one of ease on both sides. It's easy for people to write a cheque and it's easy for people to ask for only money.We need more people playing that high-risk angel investor role to crack these problems.”

Chris also believes that Shell Foundation stays close to Shell’s core activities by tackling global development challenges related to industry as it can leverage resources of Shell in the areas of its domain expertise.

Read the full interview in the Financial Express.

Shell Foundation’s Enterprise Based Solutions: A New Approach To Indian Development Challenges

Shell Foundation’s recent elucidation of its approach to development challenges by building scalable and sustainable enterprises argued that that such enterprises could be built only after investing in core capacity and systems. Equally, such enterprises required more than grant finance to become sustainable: They needed business advice, market access and governance support.

While this basic approach has been tested out in many parts of the world, as outlined in the “Enterprise Solutions to Scale Report”, the touchstone for Shell Foundation could well be its activities in India where new business models were tried out, a slew of programs underwent gestation and where the Foundation had both a fertile entrepreneurial context and a complex matrix of economic challenges.

On the occasion of a Round Table on “Maximizing Impact through Enterprise Development Solutions”, Shell Foundation released the Country study on the Scale Report, titled “Shell Foundation in India: From Traditional Philanthropy to  ‘enterprise-based' solutions".

India has been the single largest country recipient of Shell Foundation investment to date. Says the report, “The country presents a sea of opportunities fueled by the same size and dynamism that make its development journey complex. What has been referred to as ‘India’s urban awakening’ and the growth of India’s rural consumer market are just two examples: recent figures suggest that there will be 700 million new residents in Indian cities by 2050. Such trends present both challenges and opportunities to our own partners in India.”

The country report makes the point that the success that Shell Foundation has had in building scalable partnerships has resulted in creating new business models and a new approach to the Indian development challenges.

One such partner profiled in the report is Envirofit India which is addressing the greatest energy poverty issue that challenges India: inefficient stoves in poorly ventilated homes that lead to premature deaths of over 500,000 women and children in India. Shell Foundation has worked with Envirofit to develop a viable business model and establish distribution and sales networks for a durable clean cookstove.

In 2011, Envirofit will complete the registration of its Voluntary Carbon Programme developed in conjunction with Eco-Securities, making it the first stoves carbon programme of its kind in India. This development will enable Envirofit to reduce the consumer price or reinvest funds in addressing some of the key market barriers by building local assembly and manufacturing capacity.

Waste Not, Want Not: Biogas Saves Lives And Cuts Greenhouse Gases Says New Research

A new study from rural china says that biogas, a clean-burning fuel produced from animal waste, can significantly reduce both the harmful effects of IAP and greenhouse gas emissions.

According to the World Health Organisation, some 700 million people in rural China are affected by IAP, leading to approximately 420,000 premature deaths each year. In response, the Chinese government has subsidised the installation of more than 10 million bio-generators (also called anaerobic digesters) that use microbes to convert animal or human waste into clean-burning biogas, and systems to pipe this directly into rural homes.

Using biogas instead of traditional fuel sources such as coal, wood and crop waste has the potential to cut IAP and greenhouse gas emissions. Biogas, however, is predominantly methane – a potent greenhouse gas – leading scientists to worry that any leakages may mean such biogas systems are net contributors to global warming.

But new research into biogas in rural China, undertaken by an international team at the Department of Environmental Health at Emory University in Atlanta has found that using biogas fuel (even allowing for 10% with leaky systems) can cut contributions to global warming by up to 54% when compared against traditional fuels over the course of 20 years.

“The study is the first to demonstrate that in addition to improving public health, using anaerobic digesters could benefit the climate” says Kirk Smith, a professor of global environmental health at the University of California, Berkeley. “That's a significant contribution”.

Justin Remais, an assistant professor of environmental health at Emory University and his team researched six villages in Sichuan Province, covering 67 households. Thirty-five of the families burned traditional fuels for household needs while the remaining 32 households used biogas from anaerobic digesters.

The researchers concluded that if Chinese people living in rural areas switched to biogas, it would not only make a serious dent on the 420,000 premature deaths each in year, it would dramatically impact greenhouse gas emissions.

Read the full study here.

Read more about the process of generating biogas from waste in this excellent article on the Chemical and Engineering News website.

Latest Research From Denmark Adds Fuel To The Fire Around The Health Impacts Of IAP

Scientists from the University of Copenhagen have released new research on air pollution from wood stoves, furthering the world’s understanding about the health impacts of IAP. Their findings are the subject of Cheryl Katz’s latest feature for Environmental Health News.

“Recent research raises new concerns over the toxic substances borne aloft in wood smoke. Scientists say the tiny airborne specks of pollution carry carcinogenic chemicals deep into the lungs that trigger DNA damage and gene changes comparable to the hazards of cigarette smoke and car exhaust fumes” writes Katz.

As the world focuses more attention on Indoor Air Pollution as a global problem, new research is establishing a far wider spectrum of IAP-related diseases than at first thought. In addition to the well established correlation between heart and lung diseases and IAP,  new studies are claiming linkages between wood smoke and further illnesses, diseases and genetic changes.

“We found that wood smoke PM [particulate matter] has similar levels of toxicity and effects on DNA as that of vehicle exhaust particles,” said University of Copenhagen researcher Steffen Loft, whose team sampled the air from a Danish village where most homes were heated by wood-burning stoves, and compared it to air outside the smoke area.

Whilst the concept that harmful toxins are released when wood is burned are comparable to tobacco smoke or fumes from motor engines has been widely acknowledged for some time, the study by the University of Copenhagen is the first to characterize the minute particles and droplets of pollution released by wood fires.

It describes in detail the extremely small particles (PM 2.5 or 0.0001 inches) found in wood smoke that lodge deep in the lungs. These have the capacity to injure cells and damage DNA (causing potential carcinogenic changes), to interfere with the body’s ability to fight infection, and to cause oxidative stress linked to asthma and other lung diseases.

To support this, Katz cites a recent study by the University of British Columbia which determined that infants and toddlers living in areas with a lot of wood stoves and fireplaces are significantly more likely to get ear infections. The  study analyzed visits to the doctor for 45,000 children aged two and under in Vancouver and surrounding areas, comparing it to data on wood smoke pollution levels during the same period. The study is the first to show a connection between ear infections and neighborhood wood stoves and fireplaces. 

The correlation between ear infections and wood smoke exposure was as strong as the link with tobacco smoke. The study proposes that substances in the smoke suppress children’s ability to fight off common upper-respiratory tract viruses and bacteria which then migrate to the ear causing infections.

Read Cheryl Katz’s full article here.

Changing The TIDE In Karnataka

Technology Informatics Design Endeavour (TIDE), an organization in Karnataka, India, came up with a solution to the problem of reaching out to women who cook on stoves: It turned the women of the village into entrepreneurs.

TIDE figured that it would be better to work directly with the users and adapted their cookers and stoves to the requirements of the women, says Radio Netherlands Worldwide.

TIDE also decided to train women to build and sell the stoves, priced at about US$ 5 or 6.  Women who built these stoves installed them as well for a small fee. This took care of the apprehension faced by women to ask for outside male help.

TIDE not only taught women how to build stoves, the women trainers of TIDE themselves were instilled with confidence in their own ability.

TIDE’s Director Svati Bhogle tells the story of Lalita Bai, a worker in the fields who signed up to be a stove builder because she wanted to earn money to send her daughter to Teachers Training School.  She went from village to village and built up such a successful business that not only did she get her daughter educated but now manages her own stove installation business. 

Lalita Bai has been awarded the CII Woman Exemplar Award-2007 in Micro-Finance and Enterprise in recognition of her spirit to move from labour to stove building. She has setup an enterprise for construction of household stoves and has built over one thousand stoves over three years.

Photo Courtesy: TIDE

Read the full story on: Indian women fight poverty with cooking stoves

Darfur Stoves Project And Plan Canada Partner Stoves Program

Darfur Stoves Project and the international development organization, Plan Canada announced the launch of a new partnership to provide fuel-efficient cookstoves to women in Sudan’s war-torn region of Darfur.

The partnership seeks to protect Darfuri women by providing them with specially developed stoves which are more energy efficient, decreasing women’s exposure to violence while collecting firewood and their need to trade food rations for fuel.

According to Andrée Sosler, Darfur Stoves Project’s Executive Director, “The partnership with Plan Canada will help extend our reach, enabling us to reach 1,500 additional families in the next three months. We are delighted to enlist Plan as our newest field partner, and hope this will mark the beginning of a long-term collaboration between our organizations.”

In Darfur, conflict has claimed the lives of at least 300,000 people and created almost three million internally displaced persons (IDPs), most of whom have taken refuge in camps. Families in IDP camps receive food aid and cooking oil from humanitarian aid organizations; however, families are still responsible for gathering firewood for cooking. Because of the desert-like terrain and the large populations in the IDP camps, wood is scarce.

Traditionally, women and girls are responsible for obtaining cooking fuel, venturing for hours on foot to collect wood, risking assault during these treks. Because of increasing pressure on Darfur’s environment there is almost no wood available within walking distance of the camps, and today most women must sell a portion of their food aid for cash to purchase firewood.

These fuel-efficient stoves dramatically decrease the amount of fuel women need each day. For women still collecting wood, the stoves reduce the frequency of their treks outside the camps and their exposure to violence. For the majority who are now trading food aid for cash to purchase wood, the fuel-efficient stove enables them to save money and provide more food to their families.

Photo Courtesy: Darfur Stoves
Read the Press Release: Aid organizations launch partnership to provide clean cookstoves to women in Darfur

Rural Pollution From Farm Practices And Biomass Fuel: Indian Government

The Indian Minister of State for Environment and Forests, Mr Jairam Ramesh, has said that pollution in ambient air in rural areas, particularly in terms of PM10 (particulate matter having size less than 10 micron), is due to agricultural practices, burning of post-harvest residual stalks, use of wood, coal and dung-cake based hearth and baking of earthen pots.

In a written reply to a question by Shri Om Prakash Yadav in the lower house of Indian Parliament on March 7, the minister said that NEERI, Nagpur has undertaken a study, namely, Control of Indoor Air Pollution in Rural Areas under RSWNET (Rural Development, SC/ST, Women, North-East and Tribal Sector) project during 2009-10. NEERI has reported an increase in concentration of Carbon Monoxide, PM10 and Volatile Organic Compounds in indoor air in the rural household due to burning of wood, coal and dung-cake in kitchen.

According to the Minister, the Ministry of New and Renewable Energy (MNRE) has launched a National Biomass Cook-stoves Initiative in December, 2009 with the primary aim of enhancing the availability of clean and efficient energy for energy deficient and poorer sections of the society. MNRE is also implementing a National Biogas and Manure Management Programme and a total of 4.32 million family type biogas plants have been installed under the programme since inception to create a smoke free environment for women in rural kitchens, the reply said.

Biomass Users To Increase By 2030

The number of people who use traditional biomass as wood and manure, is projected to rise from 2.7 billion today, to 2.8 billion in 2030, announced the International Energy Agency (IEA) bringing attention to the fact that the vast usage of biomass for cooking is a key component of energy poverty as  reported in InDepthNews. This statement was made as a part of IEA's call to secure adequate funds to turn universal energy access into a reality.

It is been projected by WHO and IEA that the number of IAP deaths owing to the use of traditional biomass in stoves with inadequate ventilation will lead to over 1.5 million premature deaths per year in 2030, while the number of premature deaths from malaria, tuberculosis and HIV/AIDS will reduce.

IEA says that to combat IAP related deaths and to provide clean cooking facilities to 2.8 billion people, a sum of USD 2.6 billion is required every year. The total investment projected between now and 2030 is USD 756 billion to achieve universal access to electricity and clean energy.

Dr. Fatih Birol, IEA's chief economist on approaching 2012, says, “As we build up to the 'International Year of Sustainable Energy for All', the global community must rally together to make sure that access to energy becomes a right that is not only enjoyed by the majority, but by each and every citizen of the world."

Meanwhile, the IEA is also catering to issues of energy security, economic development, fostering economic growth, environmental awareness and eliminating energy poverty. 

Read full story on: ‘Make Access to Energy a Right of All Citizens’

Bharat Laxmi Stoves Saving Lives In Nandal

Smokeless cookstoves have been installed in all 500 households of Nandal Village in Satara district by Samuchit Enviro Tech. The Bharatlaxmi stoves have slashed fuel consumption and smoke emissions by 30% and 80% respectively as compared to traditional stoves says Samuchit Enviro Tech.

In Nandal Village, Cummins Diesel Foundation provided financial assistance while technical know how was provided by Appropriate Rural Technology Institute (ARTI). The stoves have been supplied by Samuchit Enviro Tech Pvt Ltd.

Each family has contributed just about Rs 100 (approx USD 2.5) worth of materials for stove installation. The total cost for installing each Bharatlaxmi Stove was not more than INR 700 (approx USD 15). The project, says Samuchit, will go on to create more smoke free homes in the vicinity, with installation of 500 more stoves in nearby villages.

Women folk of the village say there is no smoke in the house after the installation of the chulha. In the words of one of the ladies using the stove - ‘Since I got this chulha, there is no smoke in the house. With my previous traditional chulha, I can’t even describe how much my eyes used to water. Now I need only a handful of fuel sticks and the cooking is finished so fast! Earlier even if I cleaned the house every other day, in a short while again it looked dirty. Now I don’t have to clean for 4-5 days, still it is fine.’

Mr R D Hanbar Deshmukh, Vice President, ARTI feels , “A cookstove touches the life of the rural woman, and an improved cook stove that eases some of her hardships is greatly appreciated.” Therefore, the fact that the stove donors ensured provision of stoves in the rural kitchen has touched the hearts of the villagers. 

The stove has passed rigorous testing carried out by Cummins India team using six sigma principles, said Dr. Priyadarshini Karve, Project Co-ordinator, ARTI & Director, Samuchit Enviro Tech Pvt Ltd.

Photo Courtesy: Samuchit Enviro Tech Pvt Ltd 

Read the full story on: Bharatlaxmi Stoves Save Lives in Village Nandal

Cross-Sector Partnership To Tackle IAP In Nigeria

Envirofit International and Shell Foundation have joined forces with the US-based carbon finance business, C-Quest Capital, to kickstart propagation of clean cookstoves in Nigeria. The partners aim to deliver two million improved cook-stoves to Nigerian households over the next seven years.

“Carbon finance can be a key enabler to reach families that are suffering the most from IAP” said Pradeep Pursnani, the Business Director in charge of Shell Foundation’s IAP programme. “This unique partnership could be a genuine game-changer. We will help C-Quest develop a viable clean cookstoves business in Nigeria and to create new routes to market. This will be no easy feat, but success will de-risk the market and attract more investment into the sector, which will encourage further innovation and deliver better more affordable products to the people who need them. It is a good example of the role business can play in sustainable development.”

The IAP problem is particularly rife in Nigeria – a country that has the largest household wood-burning population in Africa. However the high costs associated with developing affordable “cleaner” stoves that cut these emissions, and getting these to market in a country of Nigeria’s size, has meant that for centuries people have had no large scale solution to the problem.

The partnership between Envirofit, Shell Foundation and C-Quest seeks to solve this problem by using cutting-edge stove technology and carbon financing to distribute stoves throughout Nigeria at prices that consumers can afford. The work will begin in villages in Kano State in the north of the country in March 2011 and is then planned to extend to other parts of the country based on market demand. Importantly the solution has already been validated in India, Kenya, Tanzania and Zambia.

“The availability of carbon revenues allows a lower price which brings high quality, durable clean cookstoves into line with inefficient alternatives and makes it an easy choice for consumers,” said Ron Bills, CEO, Envirofit. “The success of this project will significantly impact the social, economic and environmental consequences of Indoor Air Pollution in Nigeria.”

Envirofit and Shell Foundation have created a global business to develop affordable clean cookstoves that significantly reduce fuel usage, emissions and cooking times. The stoves are specifically designed to meet user’s unique cooking styles and choice of fuel (predominantly wood or charcoal). C-Quest will purchase stoves from Envirofit and market them to households across Nigeria. They will then monetize the reductions in carbon emissions that the stoves deliver. With each wood cookstove estimated to save over one tonne of carbon per year, this will help bring down the price of clean cookstoves making them accessible to millions more people across Nigeria.

The new model builds on recent developments in UN-regulated carbon offset markets. The partners hope that this will encourage new entrants into the clean cookstove sector by ensuring long-term financial-viability, dramatically scaling social and environmental impacts. It follows the launch of the Global Alliance for Clean Cookstoves in September 2010 - a $250million public-private partnership that aims to remove barriers in the global market for clean cookstoves, such as challenges linked to accessing carbon finance, which currently prevent the sale of clean cookstoves at scale.

In three years Envirofit has become the global leader in this new market. Shell Foundation have pioneered new ways to raise consumer awareness of IAP and to explain the need to change their cooking practices. Together the partners have developed innovative distribution mechanisms in India and Africa (in Zambia, Kenya and Tanzania) – working with NGOs, governments and microfinance institutions to reach the rural and urban poor. Having sold over 200,000 stoves since 2007, benefitting over one million people, Envirofit and Shell Foundation will now bring this expertise to Nigeria.

Ken Newcombe, CEO, C-Quest Capital said: “We are thrilled to join this partnership. We know that recent developments in carbon finance make it possible to offer superior returns on capital into energy services to the poor – activities that were once solely the domain of development finance. The carbon credits that we will sell on the market will also carry a high social impact which should affect the demand for them. This is the ideal partnership to prove that this concept can work”.