Exclusive interview with Sanga Moses, CEO of the groundbreaking and award-winning company ECO-FUEL AFRICA and speaker at the upcoming African Utility Week.
1) What inspired you to start the ECO-FUEL AFRICA (EFA) company?
In January, 2009, I travelled from Kampala, the capital city of my native country, Uganda where I worked as an accountant in a top bank to go and visit my mother in my home village in Western Uganda. On my way home, I met my 12 year old sister carrying a huge bundle of firewood on her head.
She had missed school that day and walked for 10 kilometers to gather firewood for my family. When my sister saw me, she started crying and told me that she was tired of missing school to gather wood. This troubled me so much because I was paying school fees for my sister and wanted her to get an education.
I immediately decided to quit my secure job with just $500 in savings to totally focus on finding a solution to overdependence on fuel-wood in Uganda. Everyone thought I was crazy! I spent a full year researching possible solutions until I realized that I could turn agricultural waste which is abundant and just wasted in Uganda into clean burning fuel briquettes.
I sold all my personal belongings including my bed to build the first kiln and make the first briquetting machine and in April, 2010, we launched Eco-fuel Africa and in November, 2010, Eco-fuel Africa brought its first product to market.
2) How does the product work?
EFA works by training marginalized farmers to turn locally sourced biomass waste into a product called char using simple, locally made kilns. These farmers are trained for five days and after the training, they take home a kiln on a lease-to-own basis, and begin to make char out of waste sourced locally from their communities.
About 80% of this char is sold directly to EFA or to its micro-franchisees and each farmer earns at least $30/month from selling char to EFA. This is augmenting incomes of marginalized farmers by over 50%.
The char that farmers do not sell to EFA which is about 20% of the char they make, is retained by the farmers and EFA trains them to mix it with local organic nutrients to make biochar which they then put in their gardens to increase their agricultural productivity. This has helped over 3,500 marginalized farmers in Uganda to increase their food harvests by over 50%. This has reduced malnutrition, increased food security and increased incomes of farmers.
EFA then presses the char bought from farmers into green charcoal, a carbon neutral cooking fuel which functions the same as traditional fuel-wood but costs 20% less, is not smoky and burns longer than fuel-wood.
EFA then sells its green charcoal back to communities through a network of women retailers. EFA selects these women retailers through partnerships with local women groups. Selected women are trained for 3 days and at the end of the training, EFA builds a kiosk for each of the women which they use as a retail shop to sell EFA’s green charcoal in their local communities. Already, EFA has created a network of 2,300 women retailers in Uganda. Each of these women retailers earns at least $152/month. This is augmenting incomes of marginalized women by over 100%.
In areas where EFA cannot operate directly, it empowers local people to replicate its model in those areas through a program called micro-franchising. Through this program, Eco-fuel Africa works with community based organizations and NGOs to identify local marginalized people particularly women and youths who are then trained and given the initial machinery needed to launch a briquetting micro-factory in their village on a lease basis. These village factories are owned and managed by the micro-franchisee, EFA only plays an advisory role and makes money from the micro-franchisee through leasing the technology and training fees. Already 200 micro-franchisees have been created. Micro-franchising overcomes the need to transport our fuel briquettes over very long distances, keeps the cost of fuel briquettes down and creates a revolutionary growth opportunity for viallage level micro-scale bioenergy entrepreneurs.
Below is a summary of our business model:
3) How difficult was it as a start-up?
Firstly, I did not know how to build technology and I also did not have enough money to invest in research but like an old Chinese proverb says: “when a student is ready, a teacher shows up” I talked to many people and asked everyone I could find for help and finally I was able to get help from university engineering students in Uganda who I worked with to build the first pieces of technology (briquetting machine and kiln) but even with this technology, it took us close to 6 months before we could make a product that was accepted by the market.
Raising Capital: raising capital has been a challenge. Banks charge very high interest rates and ask for a lot of collateral security that organizations like ours do not have while other forms of capital are simply no-existent. This limits our ability to rapidly expand.
As related to the above, our biggest challenge now is that demand exceeds our supply by far and the biggest constraint has been lack of the finances needed to rapidly expand our production capacity.
Lack of Infrastructure: The under developed infrastructure in Uganda also makes our operating costs very high. For example, the road network is very bad which makes transporting our product very expensive. Electricity supply is not available in most areas and where it is available, it very expensive and unreliable. This makes expanding our production capacity difficult.
4) What funding were you able to obtain?
We have been able to raise some grant capital from organizations like EEP, USAID, SIDA to mention but a few. We also raised a convertible note from impact assets.
5) How many people are you employing at the moment?
• We keep 40 on our pay roll
• We also work with a network of 2,300 women micro-retailers and 3,500 farmers who use our kilns.
6) What are your plans to grow the company? Are you planning to branch out into other countries?
Our goal is to take our clean cooking fuel to every energy poor household in Uganda by 2020 and to every country in Sub-Saharan Africa by 2030.
7) You have won some awards so far, what is it like to make such a huge impact on your community?
It is true we have won some awards and this makes us more determined to make this successful.
8) Do you have any other projects in the pipeline?
Our focus is on growing Eco-Fuel Africa and enabling more people to access our product.
9) What is your vision for the energy industry in Africa?
My vision for the energy industry in Africa is to enable every person rich or poor in Africa to have access to sustainable energy. I am a strong believer in energy justice and I want to use my life to create energy solutions that even people at the base of the pyramid can benefit from.
10) You are speaking at African Utility Week in May this year, what will be your message?
My message will be to encourage my fellow Africans to look for look solutions in their local areas. If all of us do our best to make our local communities more sustainable and better, together, we can build a better Africa and a better world that is sustainable and works for all.
11) What advice do you have for other entrepreneurs who have good ideas that could change the energy landscape?
Go for it. Your idea may just be what changes the world and you will never know how far you can go unless you go out and try