World's first plug-and-play PAYGO biodigester

In Bangladesh, 98% of the 24 million rural households use biomass fuels as main cooking fuel (200 hours collecting per year), causing health and environmental hazards (70,000 deaths attributable to household air pollution in Bangladesh, forest declining 1.1% p.a.). Moreover, the overuse of chemical fertilizer in Bangladesh has led to a critical situation for food security with 62% of soils classified as degraded.

ATEC* designed the first patented plug-and-play biodigester, combined with the world’s first patented PAYGo biogas technology, which provides a turnkey solution that give farmers up to 1,500L of biogas per day and 40 tons of organic fertilizer per year. 

ATEC* aims to reach 1 million people in Bangladesh by 2030, achieving significant impacts on the SDGs, with results across clean cooking, improved farming, environment, health, equity and livelihoods. 

In Bangladesh, 98% of the 24 million rural households use biomass fuels (wood and cow dung) as main cooking fuel (BBS 2015).

• Cooking with biomass causes significant health hazards with 70,000 deaths attributable to household air pollution in Bangladesh (GACC 2017).
• Biomass fuel gathering and inefficient cooking is a huge time loss for rural households: 200h spend on collecting wood per household per year, 150h for women only (BIDS 2004).
• Fuelwood collecting puts a lot of pressure on natural ressources, with forests declining at a rate of 1.1% p.a. (BBS 2015).

Vulnerable farmers in Bangladesh are being sold on heavy chemical fertiliser use to achieve short term results –at the cost of long term soil health. Not only is this causing risks to the country's food supply, the yearly declining ROI of heavy chemical use is leading farmers to financial hardship. FAO estimates that 62% of the soil are classified as chemically deteriorated and 30% are subject to water erosion (2015).

High groundwater, earthquake and floods affect an estimated 75% of Bangladesh. It is expected to increase with climate change

• Target market is 4 million rural households (IDCOL) who own livestock which makes them viable customers for biogas. 2.68 cows per household, each cow produces 8-40kg manure per day.
• Average daily household income is US$1.64 per day
• 89% of households own a mobile phone with smartphone use growing 50% YOY
• 90% of households use harmfull biomass fuel as main cooking fuel with forest declining 1.1% per year
• Energy expenditures represent 6% of the rural Households’ budget but 90% of daily energy needs.
• Rural household spend 200 hours per year collecting biomass.

• ATEC's biodigester produces up to 1,500L of biogas per day and 20t of organic fertilizer per year, and can withstand cyclones and seasonal flooding conditions (affects 75% of the target market)
• Customers will receive a subsidy through the existing IDCOL program
• Remaining balance will be facilitated through low-interest debt provided by IDCOL over 2 years combined with ATEC’s patented paygo technology.  This will be paid for through savings on cooking and fertilizer combined with up to 30% increase in crop yield.
• Distribution partnership through 45 IDCOL's Partner Organisations, including the largest one Grameen Shakti.

Since 2006, Bangladesh government (IDCOL) has run a program of household subsidy for biodigesters but has had limited success.  The main issues identified by IDCOL are:

• The designs promoted by national program has mostly been brick and mortar biodigesters, that are not easily scalable and lack effective quality control.
• The 250 fiberglass system are expensive and lack effective quality control (30% to 50% gas leakage).
• The installation cannot be done during rainy season or in high groundwater/flooded areas
• Lack of appropriate financial controls for customer instalment repayments 

ATEC* biodigester is a simple system that collects and treats manure, human, kitchen and green waste and effectively converts this into the valuable resources of 500-2500L of biogas per day and 20 tons of organic fertiliser per year

• The high quality of the base material (UV-treated LLDPE), the standardized production process ensuring the best quality, and its unique design made to be installed in flood areas, make it the highest quality biodigester produced globally. Expected lifespan of 25 years.
• Prefabricated model and Quality Assurance procedures removes any design failure issues. Patented design is also the first that can work in any challenging environment (e.g. seasonal flooding, high groundwater, earthquakes, hurricanes).
• The biodigester is sold with highly energy-efficient cooking appliances: a rice cooker and a Biogas twin stove.
• ATEC's world's first PAYGo biogas technology increases the financial availability of the system

ATEC* is now a certified partner of IDCOL's National Domestic Biodigester and Manure Program (NDBMP).

Manufacturing:

• The tank manufacturing is outsourced to Gazi Tanks, the national leading rotor-mold manufacturer with ISO 9001 certified manufacturing processes. ATEC* patent for M4 biodigester unit.
• Cooking appliances are imported from China from sourced supplier Wusi, providing highly energy efficient products.
• ATEC* patented PAYGO technology imported from China.

Distribution:

• 45 IDCOL Partner Organizations collect the product ex-factory, distribute to their own warehouse, then deliver to the customer.

After Sales-Service:

• Unique app-based performance management system Commcare combined with market-leading 5-step after sales service program (98% customer satisfaction rate, SNV 2017)

Financing:

• Customers will pay for the system either to distributor staff or on PAYGo biogas, using mobile money provider bKash which will integrate to ATEC paygo software provider Angaza. 
• IDCOL provides a customer subsidy and low interest debt-facility.

If biodigesters are an established technology across the developing world, with over 45 million units installed globally with China and India leading the way, it is hardly developed in Bangladesh. The 12-year old national program for the development of biodigesters has however shown mitigated success and identified the 3 key barriers:

• The designs promoted by national programs are mostly brick and mortar biodigesters, that lack effective quality control and aren’t easily scalable.   
• The installation cannot be done during rainy season or in high groundwater/flooded areas, which affect 75% of the target market in a country particularly prone to climate disasters
• Lack of appropriate financial controls for customer instalment repayments

ATEC* designed the first plug-and-play biodigester, combined with the world’s first patented PAYGo biogas technology, which provides a turnkey solution that give farmers up to 1500L of biogas per day and 40 tons of organic fertilizer per year. 

• The high quality of the base material (UV-treated LLDPE), the standardized production process ensuring the best quality, and its unique design made to be installed in flood areas, make it the highest quality biodigester produced globally. Expected lifespan of 25 years.
• Prefabricated model and Quality Assurance procedures removes any design failure issues. Patented design is also the first that can work in any challenging environment (e.g. seasonal flooding, high groundwater, earthquakes, hurricanes).
• The biodigester is sold with highly energy-efficient cooking appliances: a rice cooker and a Biogas twin stove.
• ATEC's world's first PAYGo biogas technology increases the financial availability of the system

To date, ATEC* has sold more than 1,400 systems in 7 countries, with operations in Cambodia since 2016, current expansion in Bangladesh and export to Myanmar, Indonesia, Thailand, PNG & Fiji.

In Bangladesh, IDCOL has set up an efficient structure to spread biodigesters in Bangladesh and only need the right technology to scale up its program. ATEC* is now registered as an official Manufacturing Partner of the National Domestic Biodigester and Manure Program (NDBMP),led by IDCOL. Therefore, ATEC* access a network of 45 companies distributing biodigesters in the whole country, including Grameen Shakti, which is by far the greatest contributor to the NDBMP, with 70% of the installed biodigesters.

Through this partnership, ATEC* will distribute 1,800 biodigester systems in 2020 and cumulated 32,000 by 2024, provinding access to clean and affordable cooking solution to 160,000 people. The objective by 2030 is to reach 1 million people with clean cooking (5% of the total market potential, estimated at 4 million biodigester systems - IDCOL).

ATEC’s market entry will be a game changer for the sector and the 45 distributors under the IDCOL program by meeting the above. We believe we can turn the curve around on market development. However, both our assessment and investors have flagged concerns that the right technology is not enough to create rapid change within the sector and generate large-scale impact by 2030.  During interviews with IDCOL PO distributors, they state that they are happy to hear a better product is coming but see biodigesters as a low priority product due to the poor historical performance.  Incentivising POs to reinvest into biodigesters with ATEC* national marketing and market systems development, forms the basis of our proposal that will change this paradigm quickly and at scale.

The goals for the next five years are the following:

• Conduct a nationwide marketing campaign to build brand awareness, trust and lead generation for POs
• Work on Market Systems Development (MSD) activities to build existing PO capacity plus bring minimum 5 POs into the ATEC/iDCOL Partnership
• As market condition will improve, it will incentivise IDCOL POs to invest in the development of the market and wide-scale distribution

1. Distributors don’t engage in ACE Bangladesh.  Mitigation – Market facilitation with local partners and country-wide marketing by ATEC.  IDCOL endorsement and support. Gazi as production partner.
2. High cost of operation to reach last mile customers. Mitigation - build a data driven supply chain with efficient and smart stock management processes.
3. Production can’t keep up with demand. Mitigation – Work with Gazi tanks who have production capacity 4x market projections and can invest in further oven-rotor moulding facilities as required.
4. Spread of disease from waste handling. Mitigation – user training that is overseen by ATEC and consumer behaviour campaign.
5. Challenges in finding quality staff to start the business. Mitigation – ATEC* has several channels for recruitment and local support (SNV, iDE, others).

While ATEC* biogister systems will have national potential, activities will be first targeted to the 4 divisions that have the highest concentration of cattle (Dhaka, Khulna, Rajshahi, Rangpur).  These high potential locations will be the focus of market systems development with ATEC* local partners who have existing networks and market development programs across the regions and also are the closest to Dhaka for monitoring and delivery.

• ATEC marketing strategy:
  • National social media, search, TV, radio, youtube and Adword campaigns to reach 20 million potential customers
  • Generate 300,000 leads across 5 years for POs
  • Establish online customer support group, the ‘smart farmer’ community, which builds trust, brand and ongoing customer referrals
  • After-sales support call centre
  • Run multi-channel content strategies that position ATEC as the thought leader in clean cooking and sustainable farming

• ATEC technology strategy
  • Scale-up biogas Paygo technology
  • Train, manage and support Quality Assurance (QA) on manufacturing and installation. Follow-up operation with Business Intelligence softawares (Commcare/Salesforce and Angaza) 

• ATEC operational and market facilitation strategy:
  • Facilitate coordination between manufacturer and POs
  • Provide sales and distribution skills training to POs
  • Identify new POs with existing capability within ag or energy
  • Enhance demand creation strategy
  • Facilitate local business models for after sales
  • Implement behavior change campaigns for proper handling of waste
  • Assess pathways toward systemic expansion

• IDCOL POs:
  • Sell, distribute and install 32,000 systems
  • Provide local after-sales as required
  • Can sell the organic fertilizer through the Bangladesh Fertilizer Association
  • Provide paygo consumer financing from IDCOL debt fund

Non-for profit, Social Enterprise

The CEO, the Lead Engineer and the Strategic Marketing Manager are based in Australia, where ATEC* Biodigester Int. is registered. They manage the strategy and development of the group in the various countries:

 ATEC* has its first subsidiary in Cambodia with a team of 40 employee. They are structured in 5 departments listed hereby and managed by Socheat Cheng (General Manager) and Pech Pat (Finance and Operations Manager).

 Bangladesh Country Director is to be recruited in Q4 2019. 

Grameen Shakti: Largest of the Partner Organisations (POs) of the NBDMP who will be driving market sales, distribution and installation for ACE Bangladesh.  MOU signed with ATEC*. Grameen Shakti (GS) is one of the leading social enterprises in the world, founded by Nobel laureate Prof. Mohammad Yunus, with an aim of improving “Access to Energy” for the rural people of Bangladesh. Through its 23 years of journey of accomplishments, Grameen Shakti has installed over 1.8 million units of Solar Home System, 35,000 Biodigesters and disbursed 1 million units of Improved Cook Stoves. Revenue $20m per year and over 100 staff in Bangladesh.

ATEC*’s cooperation with Whitten Roy Partnerships (WRP), the consultancy behind iDE’s sales strategic development to 50,000 unit sales per year, has shown good results in Cambodia. The designed sales training model will be replicated in Bangladesh to support the sale team efficiently.

• Cost effective, quality-controlled production:
  • Provide highly energy-efficient cooking appliances that symbolize modernity and convenience.
  • world’s first plug-and-play biodigester: high quality base material, standardized production process.
  • The tank manufacturing is outsourced to Gazi Tanks, the national leading rotor-mold manufacturer with ISO 9001 certified manufacturing processes. 

• Market-wide consumer financing partnerships
  • Customers will pay for the system either to distributor staff or using mobile money provider bKash which will integrate to ATEC Paygo software provider Angaza. ATEC’s patented Paygo biogas system enables appropriate financial controls for customer instalment repayments.
  • Customer will benefit from IDCOL subsidy to increase the affordability of the technology

• Market-wide distribution partnerships
  • Distribution through the 45 IDCOL's PO is key to the scalability of ATEC*. POs collect the product ex-factory, distribute to their own warehouse, then deliver to the customer. 
  • Through this model ATEC* reduces operational complexity and risk by passing distribution requirements to its partners.

• Technology driven processes, training and performance
  • Distribution and training take 3-4 hours per install, 2-4x faster than a fiberglass biodigester and 20x faster than brick biodigesters
  • The use of Business Intelligence (Commcare/Salesforce and Angaza) to access and track customer data at any time improves the performance and the level of service to ensure the best customer satisfaction.

• World-class After Sales Service
  • On-site training for users
  • 2-year warranty, 25-year life expectancy on tank
  • 30-day follow-up call to check system outputs
  • Ongoing annual maintenance calls to check use and advise if any changes required
  • Customer support hotline

• With the support of the Tiger Foundation and the expertize of local partners to set the right market conditions to incentive NDBMP distributors to bring new technology to rural markets, break-even will be met in 2022, after 3 years of operations. The gap is currently being funded by ATEC* historical impact investors. 
• Implementing ATEC’s marketing and communication strategy with the objective to reach 20 million potential customers will generate enough leads to bring the biodigester technology from early adopter phase to early majority. 
• After 5 years of operations and 32,669 customers reached, ATEC would address 0,8% of the market (rural households having 3 or more cattle).

Tiger Foundation support would help ATEC* to overcome the following challenges:

• Develop smart supply chain processes to optimize the costs of stock management and last mile delivery to small-scale farmers
• Bringing its IT expertise: Analyze and assess current Business Intelligence tools and processes and recommend optimization when needed.
• Financially support the take off of ATEC* Biogas Paygo technology in Bangladesh
• Help in the sourcing and the recruitment of a Country Manager