Scaling-Up of Charcoal Briquette Production in Tanzania

In 2013-2014 ARTI implemented the “Scaling-Up of Charcoal Briquette Production in Tanzania”.  The project, which has been funded by the Governments of Finland, Austria, United Kingdom and Hosted by KPMG South Africa, through the Energy and Environment Partnership Southern and East Africa Programme, had the overall objective to enable a fuel switch from unsustainable charcoal to sustainable non-wood charcoal in households in Tanzania. The objective is being achieved by scaling-up the overall production capacity of Community Based Enterprises dealing in the production of sustainable agri-waste charcoal briquettes. The project is the continuation of a successful pilot conducted in 2011-2012 “Waste to Wealth” through the Biomass Energy Initiative Awards (World Bank). The project took place in Bagamoyo and Kibaha Districts, Coast Region and Dar-es-Salaam.

Background Information:

Traditional charcoal production has led to severe deforestation around the biggest cities in Tanzania causing environmental stress and degradation, diminishing watershed management and rising vulnerability towards climate change. Tanzania has lost approximately 15% of its forest cover and more than 37% of its forest and woodland habitat. About 70% of the deforestation is due to fuel wood harvests caused mainly by urban households. Dar es Salaam alone uses approximately 500,000 tons of charcoal annually (World Bank, 2009), and the amount of charcoal consumed is expected to further rise in the coming years. Over 90% of Tanzanian households use wood based fuel (charcoal or firewood) as their primary source of fuel.  In context of the current project the target markets are urban households, commercial kitchens (hotels. lodges, clubs, restaurants etc) and small/medium industries. The production capacity of the CBEs at the end of the project is 2,000 tons of Mkaa Mkombozi sustainable agri-waste charcoal briquettes annually.

Rationale:

By replacing wood-based charcoal with sustainable fuels it is possible to improve the livelihoods of millions of people, increase natural carbon sequestration and support the communities’ ability to respond to the challenges caused by climate change. As cultural traditions and household equipments rely on charcoal utilization, the most efficient way to respond to the challenges raised by non-sustainable wood charcoal is to produce similar fuels from renewable sources such as agricultural waste.

 The practical objectives of the project are:

  1. To make available, on a commercial scale, sustainable charcoal briquettes to replace the unsustainably produced wood charcoal which is responsible for uncontrolled deforestation.
  2. To demonstrate that investment in sustainable charcoal briquette production is a profitable social business.
  3. Create an up-scalable, replicable and sustainable business solution working towards low-carbon development

 The project assists two Community Based Enterprises (CBEs) producing non-wood charcoal briquettes from agricultural waste and other dry biomass to enhance their production and commercialization capacities.

 The project consists of following components:

  1. Non-wood charcoal briquette quality and quantity has been improved through the procurement and installation of new and improved production methods and equipment
  2. 18 Additional charcoal producer training were carried out in order to increase the availability of char powder for the CBEs. 720 char producers have thus been trained.
  3. Customer sensitization and awareness creation through the development of a unique brand of sustainable charcoal briquettes, Mkaa Mkombozi and promotional material. Live demos and roadshows have also been carried out to promote sustainable charcoal briquettes.
  4. Technical advisory on further technology development and assessment of financial mechanisms to further scaling up the production and use of sustainable charcoal.Assessment of the sustainability of the charcoal briquette production model as well as the calculation of the potential Greenhouse gas emissions reduction has proven that charcoal briquette business is sustainable, is socially inclusive, has a good governance, is profitable and mitigates climate change impacts.

Upon completion the project will have supported CBE members and customers to avoid deforestation, and to mitigate and adapt to climate change through fuel switching, created hundreds of “green” jobs and enabled proof of the business concept.

Proven business concept demonstrates profitable manufacturing of quality briquettes, sales of branded product and creation of market demand. On the other hand, the project establishes the required legal and business partnerships that ensure a credible and sustainable business structure for attracting further investments in up-scaling and further development of the business. Thereby the project facilitates the CBEs and its partners to present the proven business case and a credible business expansion plan with realistic and improved understanding of the market to potential financiers.

With additional investments, new CBEs can be established and the CBEs and their partners will increase their capacities at all stages of the value chain – from charring to production to marketing and selling. Also new CBEs are expected to be set up by other communities once they have seen the success of the CBEs supported by the EEP funding. People and companies already working in the charcoal sector are also seen as potential stakeholders in the new sustainable charcoal industry it being easy for them to switch their products from wood charcoal to charcoal briquettes. Also other entrepreneurs and business organizations will be encouraged to enter the business.

The project builds on the earlier project implemented by ARTI. The project “Promotion of Charcoal Briquettes in Tanzania” was awarded funding under the “Biomass Energy Initiative For Africa” program of the World Bank. The grant enabled ARTI to train and equip 720 rural Tanzanians (50% women) from 24 villages in Bagamoyo and Kibaha districts to become non-wood charcoal briquette producers. The trained groups were assisted and financed to form “Community Based Enterprises  (CBEs). The CBE are producing small quantity of non-wood charcoal briquettes which are being sold at local markets.

Based on this success, this project aimed to expand the supply of non-wood charcoal and thereby make it a real market alternative to non-sustainable charcoal.

The project project partners have worked with the CBEs to improve the quality and quantity of the briquettes through improved working methods and use of higher efficiency equipments. Customer sensitization, marketing and commercialization strategies have been and continue to be major focus areas.

 Funding:

ARTI recieved funding for the project through the Energy and Environment Partnership Programme Southern and East Africa.  The Programme is funded by the Governments of Finland, Austria, United Kingdom and Hosted by the KPMG South Africa.

 Partners:

ARTI has partnered with Gaia Consulting Oy, Helsinki, Finland to provide the project with experience and understanding in sustainable business development and international charcoal markets. The project model relies on ARTI’s previous experience in training and equipping 720 charcoal briquette producers and supporting villages to set up CBEs as well as Gaia’s experience on innovative and practical sustainability and distributed energy solutions in developing and developed countries.