Development Alternatives

ENTERPRISE MODEL FOR BIOMASS SUPPLY

A PROJECT PROPOSAL ON

“Community based enterprise model for biomass supply” A sustainable approach to enhance rural economy

Project location: Datia, (M.P)

Submitted to – Punjab National Bank (PNB), Datia, (M.P)

Submitted by-

Development Alternatives,Orchha, (M.P)

xvi

PARTICULARS Executive summery Introduction Problem statement Project background. PAGE NO. 3.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY INDEX SR NO. 6. 5. 4. 9. 2. climate and soil Project implementation activities Expected benefits Financials Roles of stakeholders Annexure 1. goal and objectives Project location. 8. iii iv-v vi vii-viii ix-x xi-xii xiii xiv xv xvi Executive summery xvi . 7.

At the same time. which is abundantly available in the surrounding area of the site. being a tropical country. high quality stable power is required to attain the higher growth rate projected for this sector. The industrial sector today consumes approximately 35% of total electricity generated in the country. Project introduction xvi . has tremendous potential for energy generation through biomass and its residues. Majority of industries in India require both electrical and thermal energy.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY India faces severe problems in the power sector resulting in energy shortages. Promotion of micro and small enterprise will boost the rural economy. having calorific value of 3800 kcal per kg and bulk density of 160 kg per cubic meter is a costeffective way to generate electricity. or generate their own power largely through diesel generators and meet their thermal energy requirements through captive means mostly utilizing fossil fuels such as coal. Today. and have adverse environmental impact. The project involves supply of biomass to the biomass-based power generation plants with a total capacity of 40 kW for uninterrupted electricity supply to the micro and small enterprise hub. 1. India. it would be appropriate to use non-conventional energy sources including biomass resources such as crop residues and agro-industrial wastes for generation of energy in the industries mainly through biomass gasification technology for meeting their total / partial requirements for both electrical and thermal energy. Development Alternatives has taken initiatives to generate electricity through biomass which will further be a source of electricity generation for micro and small enterprise hub. they either buy power from the State Electricity Boards. Ipomea. run by community people. As fossil fuels are limited. In 2001 this was 8% and peak demand exceeding supply by about 13%. The fuel used is primarily Ipomea weed. oil or natural gas.

which grows in marshy areas. local (land degradation). Biomass Potential India is a tropical country blessed with abundant sunshine and rains. 500 MW 19. regional (air. biomass from animal waste. ultimately leading to less development and environmental degradation.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY Access to quality. Among all the renewable energy sources. thus offering an ideal environment for Biomass production. Of these weeds. reliable and affordable energy is critical for promoting economic and social development in rural areas. Major features of ipomea are given below- xvi . unreliable supply and shortage of power in most parts of rural India. Ipomea is found in abundance in the Datia region. lantana camera etc which grow on waste lands and have no or very little use. Further. residual biomass is capable of mitigation of GHG emissions to the extent of 300 million tonnes / annum. biomass is the largest. 500 MW Biomass for electricity generation can be available in various forms like agricultural residues. The energy situation in rural India is characterized by low quality of fuel. Other sources of biomass are weeds like Ipomea. 000 MW 3. MNES estimated the biomass power potential in the entire country as 19. Dependence on coal-based electric power plants (accounting for 70% of power generation) is leading to environmental degradation. the vast agricultural produce also makes available large quantities of agro-residues which can be used to meet energy needs. Government of India strongly encourages the utilization of biomass energy. forest biomass and municipal wastes. cholla. The estimated potential of Biomass based renewable energy options in India are as follows: Biomass Energy Bagasse Co-Generation Total 16. un/semi reliability electricity supply and limited access leading to lower productivity of land. water and soil pollution) and global (greenhouse gas build-up leading to climate change). There is a realization on the need to search for decentralized and renewable energy-based options to meet the rural energy needs in a sustainable way. prosopis julifora. most diverse and readily exploitable resource. water and human effort.500 MW. Dependence on centralized grid electricity supply to low-load rural situations is characterized by fluctuating voltage. With an estimated production of about 350 million tonnes of agricultural waste every year. low efficiency of use.

The inherent advantages in utilization of biomass are that employment opportunities are created even for cultivation. before it can be fed in to the gasifier. Problem statement xvi . • It further needs to be chopped in to small pieces of about 2 inches. which is equivalent to 64 tonnes of useful feed stock for gasifier.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY On direct combustion. collection. transportation and storage of biomass. this gives a very pungent odor and hence is not generally used as fuel wood for cooking purpose. The chopping is done in the green condition. Biomass power is an important alternative for providing energy in the rural sector. It is then sun-dried from an original moisture content of about 85% to 34-38%. • • For the purpose of gasification. 2. ipomea needs to be harvested from the marshy areas and near water body. • The calorific value of ipomoea is 3800 kcal per kg and bulk density is 160 kg per cubic metre. • One hectare yields approximately 160 tonnes of green biomass.

700kg/day ipomea is needed as feedstock to the biomass gasifier to run it for at least 10 hrs.242 GAP/SHORTAGE (41. there are certain issues which may reduce the profit of entrepreneur a) Efficiency of labor to cut biomass due to which quantity of biomass sourced /day is reduced b) The cost of transportation of biomass from field to the chopping place and from the chopping place to the endpoint is 32 % of the total cost. Micro-concrete roofing.Fly-ash bricks and Pre-cast door/window frames). c) Use of motorized gini-cutter will increase the pace of operation. goals and objectives xvi . ENERGY SOURCE Electricity(Jan 2006) (In million KWh) DEMAND 5. lack of quality power and poor voltage conditions compel rural enterprises to look for alternative sources (captive diesel generator sets) which is very costly. Paving blocks. To make biomass sourcing a convenient and quick process. In this way biomass sourcing can be treated as an opportunity to create an alternative source of income generation. Although it seems to be a remarkable idea. but in this process of supplying dry biomass. Development Alternatives.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY India’s energy development programme has been put to severe pressure with the ever increasing demand supply gap (8 to 10%) and mismatch of resources coupled with non-uniform growth curve. 3.630) Though. To fill this gap. Energy demand for these industries is 3735.78 units (kWh) per month. Consequently. This huge demand of biomass will give rise to another line of business which will be a biomass based enterprise. SMEs are not a priority sector for State Electricity Boards. group of entrepreneurs involved in it require proper equipments to meet the demand –supply gap of biomass. has demonstrated new Renewable Energy technology (Desi Power) at TARA gram Datia that can be a source of assured power supply for clusters of new industries manufacturing building materials based products(bricks.21. Project background. To provide assured and uninterrupted power supply to these industries. Hence the volume of the business can be increased. Development Alternatives has set-up gasifier of 32 kW (biomass based renewable energy generation and distribution system) and currently supplying electricity to these industries.80.872 SUPPLY 4.

small and medium enterprises run by utilizing local resources./Panchayat’s permission to harvest NRM • DA’s hand holding to stream line Biomass enterprises SHG Or Individ ual Memb er of SHG Processed Biomass Biomas s Electricity Money Gasifie r (40 KW) at REZ Farmers/s mall supplier of Biomass s ma Bio s Raw/Processed Biomass ney Mo 3. Development Alternatives proposes to demonstrate the sustainable enterprise model of dry biomass supply to ensure sustainable income generation of community by utilizing the natural resources and agro wastes for renewable energy based electricity generation. Project Goal xvi Enterprise or Biomass Money Usin g elec tricit y .1. 3. fund (Grant/Subsidy) to purchase tools • Govt.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY In order to address the prevailing problem.2. These have been visualized as an alternative source of employment for the community (especially women) development programme through efficient utilization of local resources by regular and sustainable supply of biomass by the community clusters. In this project the main focus is to supply biomass which grows on the waste or barren lands and have no other use. which can further leads to ensure the regular supply of electricity to micro. Business process Market Inputs • Govt.

3. Biomass Supply chain and Transportation of wet biomass Biomass harvesting Cost of transportation=Rs 200/- Chopping of wet biomass Drying up to 50% of moisture content 4 labors (@ 4 quintals/day) =400/- Labor cost = 100/Transportation of dry biomass Labor cost = 100 Cost of transportation=Rs 350/- xvi .and rural economy development. • To create an alternative source of livelihood for the rural women of Datia region by preserving and harvesting natural resources and agro waste • To ensure sustainable supply of biomass to run the power plant as well as SMEs so as to ensuring sustainability proposed first REZ in India 3.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY To develop community based enterprise for supplying dry biomass to the biomass gasification plant to ensure regular electricity supply of SMEs . 3.4. • Project Objective To establish biomass supply chain mechanism and demonstrate its socio-commercial and institutional (SHG run) viability.

47 IST (UTC+5:30) 302 m (991 ft) 627. The district has 445 villages and 3 towns. State: District: Coordinates: Time zone Area Elevation Population Madhya Pradesh Datia 25°40′N 78°28′E / 25. The population of Datia District increased by 26% from 1981 to 1991. and Bhander. 4.038 km².The state suffered from famine in 1896-97.3. The district is part of Gwalior Division. is only about 25 km away. Lantana Camera in geographic regions of District Datia especially. Soil Type xvi . India. 78.1 Background Datia had formerly been a state in the Bundelkhand region. Cholla. Gwalior to the west. The project area covers barren and degraded lands and lands such as roadside. the town of Jhansi in U. Datia is bounded by the Madhya Pradesh districts of Bhind to the north.818 (2001) The district has an area of 2. and Shivpuri to the south. Seondha.P). canal side and railway lines. The project proposes to harvest weeds like Ipomea for green energy supply. Project location.67. and by 22% from 1991 to 2001. and again to a lesser extent in 1899-1900. The state was administered as part of the Bundelkhand agency of Central India. climate and soil 4.818 (2001 census).P.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY 4.2. Datia. Project Location Datia district in the state of Madhya Pradesh. and by Jhansi District of Uttar Pradesh state to the east. is situated near Gwalior and on the border with Uttar Pradesh (U. and a population 627. covered with weeds like Ipomea. These weeds can be called as green energy plants. 4.

1 2 3 4 5 6 7 8 9 8 TOTAL Species Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Ipomea Village Shyamlal ka Dera Jhakhoria Sitapur Samroli Gari Borgaon Uprai Agora Durgapur Guliapura Cherula Rena xvi . 15% of the population is under 6 years of age.4. higher than the national average of 59. Datia had a population of 82. Socio Economic Profile As of 2001 India census.742.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY The soil erosion and unsustainable land use practices contribute to severe degradation and loss of soil and soil organic carbon each year and is a major factor contributing to about 50% loss of soil productivity. Males constitute 53% of the population and females 47%. female literacy is 60%. The project intends to initiate project implementation activities in the following villages of Datia district – Estimation of available biomassBio-Mass ( in Tractor Loads) 15 10 5 4 4 10 5 3 5 10 20 5 Biomass(dry) in (Quintal/s) 240 160 80 64 64 160 80 48 80 160 320 80 1536 Sr. Datia has an average literacy rate of 68%. 4.5%: male literacy is 75% and. In Datia. no.

Activity 6.Assuring supply of biomass at pre-determined time and rate to the location with a guarantee of substantial profit to biomass supply group. For this ipomea needs to be brought at chopping place as early as possible. villagers or potential supplier groups need government grants and subsidy.MoU with the supplier group for the supply of demanded quantity and quality of biomass.Identification of potential supplier group.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY 5.Community Mobilization Activity 2-Ensuring govt grants and subsidy To purchase certain equipments for making biomass sourcing a lucrative process. Potential supplier groups for biomass (ipomea) should be identified according to their willingness to accept this business model. Activity5 –Purchasing equipments like biomass cutter and Gini-cutter. Weed like ipomea. After biomass chopping/slicing. it is being dried for two to three days. To clear the roles and responsibility between demand and supplier group. Project implementation activities Activity 1. Activity 3. when used as biomass for electricity generation needs to be chopped up at green stage. MoU will be signed between them. Thus certain equipments like wood cutter and gini cutter are required to make this process faster . Activity 4. DA will fix the rate of dried biomass and disburse the amount within two days to the supplier group. xvi . biomass will be supplied to DA center. Datia. As soon as drying process completes.

Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY GANT CHART Activities Community Mobilization Ensuring govt grants and subsidy Identification of potential supplier group MoU with the supplier group for the supply of demanded quantity and quality of biomass Purchasing equipments like biomass cutter and Gini-cutter. Assuring supply of biomass at predetermined time and rate to the location with a guarantee of substantial profit to biomass supply group W1 W2 W3 W4 W5 xvi .

Demand-supply gap: . if the whole system operates in a mechanized way.Total demand of biomass (ipomea) /year is 96000 kg (per hour biomass consumption= 40 kg.Utilization of weeds like weeds like ipomea and Cholla. Assured power supply:-This project will ensure continuous biomass supply for electricity generation through gasifier which will assure regular electricity supply to micro and small enterprise run by community people. Hence it can be inferred from the given figures that biomass demand – supply gap can be fulfilled easily. Utilization of waste resources: . as biomass for electricity generation will increase their economic value. Expected benefits The aforesaid proposed enterprise model will lead to the following benefits to the suppliers Local employment:-This will create an alternative source of employment for the community people (especially women) as well as fill the demand-supply gap of electricity generation to run micro and small enterprises which will boost up the rural economy. xvi . working hours= 8 hrs. working days=300) in TARAgram. Available biomass (ipomea) in the vicinity is 1536 quintals. Here community plays dual role both as supplier (biomass supply for electricity generation) and consumer (purchase of electricity to run enterprises). which are grown in marshy places.Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY 6.

Projected profitability per supply (within 4 days in a week):AMOUN T Weak1 2000 200 600 200 350 525 3875 4500 625 AMOUN AMOUN T T Week Week 2 3 2000 2000 200 200 600 600 200 200 350 350 525 3875 4500 625 525 3875 4500 625 PARTICULARS WORKING CAPITAL Labors @ 3 qtls/day Loading of biomass (1 labor) Transport from field to farm Cutting Transport from farm to firm Depreciation @ 5% per annum Total cost (B) Revenue generated Revenue realized xvi . only).Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY 7. FINANCIALS Project cost:ECONOMICS OF DRY BIOMASS RAT E 300 900 0 AMOUN T 1500 9000 10.500 PARTICULARS Capital Expenditure Hand cutter Chopping machine Total cost (A) WORKING CAPITAL(for one week) labors @ 3 qtls/day Loading of biomass (1 labor) Transport from field to farm Cutting Transport from farm to firm Depreciation @ 5% per annum Total cost (B) TOTAL PROJECT COST(A+B) QTY 5 1 100 100 300 100 350 20 2 2 2 1 2000 200 600 200 350 525 3875 14.375 (Fourteen thousand three hundred seventy five.375 The total project cost is Rs. 14.

Roles of stakeholders Role of supplier group • Supplier group will have a key role in this business as they have to cut. xvi .Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY 8. Role of Panchayat/ Other Govt players• To provide fund to the biomass suppliers. This support will assist suppliers in establishing their business. Role of DA• • DA will act as a consumer in this business. • Full Payment to the supplier group will be made on time. • Supplier group will ensure for the quality supply of biomass(At 50% or less moisture content). dry and supply ipomeas according to the consumer (DA) demand. DA will have the responsibility to measure the dried ipomea (Should not be more than 50%).

8 144 0 1152 192 144 0 2 PARTICULARS Capital Expenditure Hand cutter Chopping machine Total cost (A) WORKING CAPITAL labors @ 3 qtls/day Loading of biomass (1 labor) transport from field to farm cutting transport from farm to firm depriciation @ 5% per annum Total cost (B) Revenue generated Revenue realized by the suppliers QTY 5 1 AMOUNT 1500 9000 10500 2000 200 600 200 350 525 3875 PARTICULARS Capital Expenditure Hand cutter Total cost (A) WORKING CAPITAL labors @ 4 qtls/day Loading of biomass (1 labor) transport from farm to firm depreciation @ 5% per annum Total cost (B) Revenue generated QTY 4 100 100 300 100 350 20 2 2 2 1 Revenue realized by the suppliers COST TO THE END USER Amount paid to the supplier Cutting cost(1 labor for 2 days) Loss (5 % of the cost paid to supplier) Storing TOTAL COST/KG COST/KG After drying 0.6 100 1 720 100 1509.05 2.6 COST TO THE END USER Amount paid to the 300 supplier 1.0966 67 (1500 kg/day)* 4day =60 qtl will be cut in 4 days by 5 labor xvi .Development Alternatives ENTERPRISE MODEL FOR BIOMASS SUPPLY Annexure-1 Comparison of the revenue realized by the supplier and the COST TO THE END USER ECONOMICS OF DRY BIOMASS RAT E 300 900 0 ECONOMICS OF WET BIOMASS RAT E 300 AMOUN T 1200 1200 100 100 400 4 1 1 400 100 400 60 960 0.5 0 Storing 100 2 TOTAL COST/KG 4500 200 4700 1.8 100 1.5 300 0 4500 625 1152 200 57.6 1.

Sign up to vote on this title
UsefulNot useful