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*****
The Regional Cassava Processing and Marketing Initiative 
                         (RCPMI) 
                             *****



                                      
        The use of cassava wastes to produce energy: 
              outcomes of a feasibility study  
                    implemented in Ghana. 

                                 
                                 
                                 
                              ****
          In collaboration with the IFAD‐funded

“Root & Tuber Improvement and Marketing Programme/RTIMP” of Ghana
                              ****




                         October 2010 
 
                                         
                                         
                                         
                                         
                                         
                                         
                                         
                                         
                                         
                                         
                                         
                                 Prepared by: 
                                        
                                         

Mr. Andrea Serpagli         IFAD‐RCPMI/Coordinator     a.serpagli@ifad.org 

                            IFAD/Consultant, Biogas 
Mr. Govind Prasad Nagori                               gpnagori@ankurscientific.com 
                            Specialist 

                            IFAD/Consultant Food 
Mr. Giuseppe Amoriggi                                  giuseppe.amoriggi@libero.it 
                            Technologist 

                            IFAD/Consultant, 
Mrs. Chiara Calvosa                                    c.calvosa@ifad.org 
                            Economist 

                                         
Table of Contents



Executive Summary .......................................................................................................... 1
Part A: Objective of the study and methodology used .................................................. 3
1. Objective ......................................................................................................................... 3
2. Methodology used........................................................................................................... 3
Part B: Technical aspects about the production of bio-energy from cassava wastes
          and other biomasses............................................................................................ 5
3. Suitability of wastes from cassava and wood to produce bio-energy: outcomes of
   laboratory analysis .......................................................................................................... 5
      3.1. Outcomes of laboratory analyses ......................................................................... 5
      3.2. Cassava peels and barks....................................................................................... 5
      3.3. Wood Shavings and Saw Dust............................................................................. 5
      3.4. Wastewaters resulting from cassava processing .................................................. 6
4. Technological aspects related to the generation of bio-energy from cassava and other
   suitable wastes ................................................................................................................ 7
      4.1. Technological aspects: generalities...................................................................... 7
      4.1.1.     Gasification technology .............................................................................. 7
      4.1.2.     Bio-methanation technology (biogas)....................................................... 10
5. Environmental aspects related to the generation of bio-energy from cassava and other
   suitable wastes .............................................................................................................. 11
      5.1. Current state of affairs in Africa (including Ghana).......................................... 11
      5.2. Environmental aspects linked to the use of the gasification technology ........... 12
Part C: Potential of producing bio-energy from cassava wastes and other biomasses
          in Ghana............................................................................................................. 13
6. Availability and requirements of cassava wastes.......................................................... 13
      6.1. Cassava roots production in Africa and Ghana: some basic statistics ............... 13
      6.2. Ghana: availability of cassava wastes and other target biomasses to produce bio-
      energy........................................................................................................................ 14
      6.3. Ghana: Cassava waste requirements to implement the two target pilots........... 15
      6.3.1.     Gasification ............................................................................................... 15
      6.3.2.     Bio-gas ...................................................................................................... 17
Part D. IFAD interventions in the cassava sector in Ghana ....................................... 18
7. IFAD current and proposed interventions..................................................................... 18
      7.1. Current interventions ......................................................................................... 18
      7.2. IFAD proposals for setting up energy producing units from cassava processing
      wastes (biomasses and wastewaters) ........................................................................ 19
      7.2.1.     Introduction............................................................................................... 19
      7.2.2.     The General Case...................................................................................... 20
      7.2.3.     The proposed pilot plant in the Asueyi community (application) ............ 20
PART E. Profitability of producing bio-energy in Ghana .......................................... 23
E.1. General case: Outcomes of a Technical and Financial Analyses .............................. 23
      E. 1.1. Technical Analyses ................................................................................... 23
8. Heat requirements and utilization ................................................................................. 23
E. 1.2. Financial Analyses .................................................................................... 25
9. Profitability of the proposed investments ..................................................................... 25
     9.1. Generalities ........................................................................................................ 25
     9.2. Total energy expected to be produced ............................................................... 25
     9.3. Key information and main assumptions for implementing financial analyses for
     both the gasifier and the bio-gas plant ...................................................................... 26
     9.4. Outcomes of the financial analysis .................................................................... 27
     9.4.1.      Gasifier...................................................................................................... 27
     9.4.2.      Biogas plant .............................................................................................. 28
E.2. Pilot Plant (Application): Outcomes of a Technical and Financial Analyses ........... 29
     E. 2.1. Technical Analyses........................................................................................ 29
10. Electricity and heat total requirements and expected uses.......................................... 29
     E. 2.2. Financial Analyses......................................................................................... 32
11. Overall outcomes of the proposed investments .......................................................... 32
     11.1. Generalities ...................................................................................................... 32
     11.2. Key information and main assumptions for implementing financial analyses
     for the gasifier ........................................................................................................... 32
     11.3. Outcomes of the financial analysis in the case of the gasifier ......................... 33


Annexes
Annex 1 - Results of the laboratory analyses on cassava peels and barks.......................... 1
Annex 2 - Results of the laboratory analyses on wood shavings and sawdust ................... 2
Annex 3 - Financial analysis: Gasifier – General level ...................................................... 3
Annex 4 - Financial analysis Biogas Plant ......................................................................... 8
Annex 5 - Financial analysis: Gasifier– Case study in the Asueyi community................ 10
List of Acronyms and Abbreviations



CAADP: Comprehensive Africa Agriculture Development Programme (Ghana)
CPCB: Central Pollution Control Board
FAO: Food and Agriculture Organization
GHS: Ghanaian Cedi
GPC: Good Practices Centre
IFAD: International Fund for Agricultural Development
IRR: Internal Rate of Return
NHS: National Health Service
NEPAD: New Partnership for Africa’s Development
RCPMI: Regional Cassava Processing and Marketing Initiative
R&T: Roots and Tubers
RTIMP: Roots and Tubers Improvement Marketing Programme
USD: United States Dollar
VAT: Value Added Tax
WCA: Western and Central Africa




                   Exchange rate: 1 USD=1,4 GHC (August, 2010)
Executive Summary
The study has assessed the technical and financial feasibility to put in place in Ghana a
gasifier and a biogas plant which use cassava wastes (peels, barks and wastewaters),
along with maize wastes (stalks and leaves) and Shea nuts husks as feedstock to generate
bio-energy (electricity and hot/cold air).

The study results from observations made during field visits implemented by a team of
RCPMI and RTIMP specialists in the Ashanti and Brong-Ahafo regions of Ghana in
August and September 2010 and build s up on a similar study that the RCPMI carried out
in Nigeria during the first quarter of 2010.

Although the technical and financial analyses included in this study refer to Ghana,
similar results can be expected when the same investments are implemented in other
countries of the WCA region, as the previous study in Nigeria clearly showed. Adaptation
of financial parameters would however be required.

The technical feasibility has been based on laboratory analyses carried out in India and
Nigeria to assess both ignition and flow performances of the biomasses (cassava peels,
blends of sawdust/wood shavings, wastewaters) to be used as feedstock.

Based also on the outcomes of these analyses, investments in equipments and materials
for the production of bio-energy (electricity and bio-gas) through a gasifier and a biogas
plant have been worked out, including for a practical application (pilot plant) in the
Asueyi community –Techiman Municipality, which is one of the major cassava
producing areas of Ghana.

Total investment costs for a “turn-key” investment were estimated at USD 340,000 in the
case of the gasifier and USD 31,000 for the bio-gas plant. Working capital to pay off
short-term liabilities during Y1were estimated at USD 10,000/year for the gasifier and
USD 800/year for the bio-gas plant. All the money required to meet both fixed and
variable costs (including financial ones) has been supposed to be borrowed from local
banks at a 22% interest rate; as it could be expected, this fact is significantly increasing
the overall cost of for the proposed investments.

In the light of the relatively low investment cost for the bio-gas plant, it would be quite
easy to replicate the proposed investment at a local (village) level. However, this would
not be recommended for the gasifier for which, given the high investment cost, a central
plant serving several villages at the same time would be more recommendable.

Both plants are assumed to work a total of 22 hours/day during 330 working days/year;
however, sensitivity analysis shows positive results also when the gasifier plant works
just 18 hours/day (during 330 days/year).




                                           1
Revenues for both plants have been derived by: (i) first converting their expected outputs
(either electricity or heat) into liters of diesel or kilograms of firewood –which, in rural
areas of Ghana, are the feedstock most widely used to currently produce energy
(electricity) and heat, and (ii) then multiplying the resulting values (lts or kgs) for the
respective market prices prevailing in the region targeted with this study.

Annual cash-flows (both current and discounted at 22% discount rate) for the gasifier
remain positive throughout the entire investment’s life (10 years); net profits (after
payment of corporate taxes) are positive starting from Y1 (USD 6,000) till Y10 (114,000).
Much less favorable outcomes are obtained from the financial analysis for the bio-gas
plant, for which annual cash-flows (current and discounted) and net profits become
positive as from Y8.

The resulting IRR for the gasifier ranges between 21% and 17% (depending on which of
the two investment opportunities covered with the study is considered) and is
significantly higher than the average interest rate (10%) paid on bank accounts/deposits
in Ghana. IRR continues to remain very appealing even when, with the sensitivity
analyses, major changes are made in the assumptions. Pay-back period is 5 or 6 years,
depending on the option considered.

IRR and pay-back period for the bio-gas plant do not show to be very appealing, mostly
because the high incidence of financial costs over overall cost structure.

Given the high positive effects on both the environment and workers’ health that the use
of cassava solid and liquid wastes have when they are used to produce energy the
implementation of a detailed environmental impact analysis –not undertaken with this
study, though recommended- would show even higher overall impact than the one this
study could estimate. Current practices for disposing off these cassava by-products in
WCA are, in fact, extremely risky for soils’ fertility, purity of table waters and for the
health of industry operators and the general population, especially in rural areas where
cassava is processed.




                                           2
Part A: Objective of the study and methodology used

1. Objective

Objective of this technical and financial study is to assess the feasibility of setting up a
pilot plant to produce bio-energy from cassava processing wastes and other suitable
biomasses -such as: sawdust and wood shavings, maize stalks and leaves, Shea nuts husks
etc. All information presented in this study is real and based on data and figures collected
in Ghana in the course of August and September 2010.

The feasibility includes also a concrete application for a pilot plant proposed to be set up
in the Brong-Ahafo region -more precisely, in the municipality of Techiman. However, it
is worth highlighting that what presented in the following pages could be easily adapted
to other geographic contexts, both within the West and Central Africa region and
elsewhere in Africa.

This study assesses the technical/financial feasibility for the two following plants:

• A gasification plant to produce bio-energy from a blend of wastes from cassava (peels,
    barks and small roots), sawmill (sawdust, shavings and small pieces of wood) and
    other suitable bio-masses (resulting from maize and nuts processing);
• A methanization plant (biogas) to produce bio-energy from wastewaters resulting
    from cassava processing and by means of an anaerobic bio-digestion.

For each of the two plants above, a separate technical/financial feasibility has been
implemented for the two following options:

•   Option 1): General case: Production of bio-energy to be sold on the local market to
    any potential interested buyer;
•   Option 2): Pilot plant (application): Production of bio-energy to be utilized in the
    context of a specific pilot plant proposed for implementation (jointly with RTIMP) in
    the Brong-Ahafo region -more precisely, in the community of Asueyi.

2. Methodology used

This feasibility study further develops the outcomes of the following research work that
the RCPMI carried out, and published, in March 2010: “Squaring the circle: how food
and fuel can be produced in a complementary and not competitive manner - The use of
cassava wastes to produce energy: outcomes of a feasibility study implemented in
Nigeria 1 ”. As in the case of the Nigerian study 2 , also the technical and financial
feasibility proposed for Ghana foresees the setting up of pilot plants which make use of

1
 The study is available on internet at: www.fidafrique.net.
2
 The pool of RCPMI consultants involved in the preparation of the study in Nigeria included: Dr. Govind
Prasad Nagori, Ankur biogas specialist; Mr. Giuseppe Amoriggi, RCPMI/Technologist; Mrs. Chiara
Calvosa, IFAD/Economist and local specialists from the IFAD-supported: “Roots and Tubers Expansion
Project (RTEP)” in Nigeria.


                                                3
cassava wastes and other biomasses available locally as feedstock for bio-energy
production (both as electricity and cold/hot air).

The methodology adopted to carry out this study includes the implementation of: (i) field
visits in Ghana for collecting primary and secondary data3, (ii) laboratory analyses4, (iii)
face-to-face meetings with local cassava producers and processors, (iv) visits to a sample
of small-medium wood processing factories and (v) working sessions with the IFAD
specialists 5 attached to the IFAD-funded: “Roots and Tubers Improvement Marketing
Programme (RTIMP)” of Ghana.

The activities carried out in Ghana during the field visits can be summarized as it follows:
Visits to cassava producers and processing centers of different size and making use of
different technologies;
Visits to local small and medium-size wood processing factories;
Visits to a local nut processing factory (“Ghana Nuts Ltd”);
Visits to several cassava Good Practice Centers (GPCs) which are currently being set up
by RTIMP and benefiting from its assistance countrywide;
Working sessions with RTIMP staff and local experts, including from the GRATIS
Foundation and the Food Research Institute.

During the visits mentioned above, data on solid and liquid wastes and on the power
required by each processing unit visited, along with present practices to reuse/dispose off
wastes, were documented with reference to: (i) cassava peels (particularly when obtained
trough manual peeling); (ii) waters resulting from cassava washing and processing;
(iii) wood shavings; (iv) sawdust; (vi) maize stalks and leaves; and (v) Shea-nuts husks.
The field visits allowed RCPMI specialists to ascertain the availability of wastes, besides
those from cassava processing and which could be used for gasification and
bio-methanation purposes.




3
  From national and international research centers such as the: Food Research Institute/Ghana, International
Institute for Tropical Agriculture/Nigeria, Bank of Ghana, GRATIS Foundation/Ghana.
4
  Laboratory analysis on the cassava samples were carried out by the Ankur Scientific Energy Technologies
Pvt. Ltd., Vadodara, India.
5
  Mr. Vincent Cyril Akoto, Processing & Post Harvest Specialist, RTIMP/Kumasi.


                                                  4
Part B: Technical aspects about the production of bio-energy
from cassava wastes and other biomasses

3. Suitability of wastes from cassava and wood to produce bio-energy:
outcomes of laboratory analysis

3.1. Outcomes of laboratory analyses
The lack of data on the suitability of cassava wastes (peels, barks, wastewaters) and wood
wastes to generate bio-energy made necessary to work them out through targeted
proximate laboratory analysis. Laboratory analyses were then carried out at Polytechnics
Laboratory, Ibadan, Nigeria and Ankur Laboratory, Vadovara, India. Extensive details on
outcomes of these analyses are provided in Annex I for cassava peels and barks and in
Annex II for wood shavings and sawdust mixture. However, a short summary of the main
results is given in the following paragraphs to easy the reading of this report.

3.2. Cassava peels and barks
Cassava peels/barks have low ash content (<5%) and an ash fusion temperature above
1200°C. Their bulk density remains above 250 even after drying; this makes them to flow
easily and burn well. The peels have a high moisture content (~66%), which makes their
drying a necessity to bring the moisture content down to 20% and make them suitable for
gasification (generation of producer gas).

         Fig. 1: Dried peels/barks                    Fig. 2: Raw peels/barks




3.3. Wood Shavings and Saw Dust
In order to be used for gasification purposes, wood shavings and saw dust needs to be
blended in a 7:3 proportion and have an overall moisture content lower than 20%. When
burned, the blend of wood shavings and saw dust (mixed in a 7:3 proportion) shows a low
ash content (<5%) and an ash fusion temperature above 1200°C. Its bulk density is low
(which makes the blend not very suitable for gasification) and it does not flow easily;
however, it burns well. However, after being mixed with dried cassava peels (in a 1:1
proportion), ability to flow smoothly inside the gasifier increases significantly.




                                          5
Fig 3: Dried wood shaving/sawdust blend




3.4. Wastewaters resulting from cassava processing
The analysis of cassava washing/processing wastewaters conducted at the Polytechnics
Laboratory in Ibadan (Nigeria) resulted in the following:

•   Total solids                 : 4,500 mg/L
•   Total suspended solids               : 1,450 mg/L
•   Total volatile solids        : 2,000 mg/L
•   pH                           : 5.14

The results above indicate that the wastewater is acidic in nature and has good amount of
volatiles, i.e. biodegradable matters. This is also evident from the review of the existing
literature on this issue, which for this kind of wastewaters provides the following data:

•   BOD                                  : 3,400 – 6,018 mg/L
•   COD                                  : 3,870 – 6,680 mg/L
•   Free Sugars                  : 640 – 2,075 mg/L
•   Total Solids                 : 4,000 – 6,600 mg/L
•   Nitrogen                     : 65 – 74 mg/L

Based on the value of the organic load reported above, one liter of cassava wastewater
has a potential to generate from 2 to 3.5 liters of biogas.




                                              6
4. Technological aspects related to the generation of bio-energy from
cassava and other suitable wastes

4.1. Technological aspects: generalities
While energy can be derived from bio-masses using the gasification technology –through
which “producer gas” is generated, in the case of wastewaters biogas is obtained using a
bio-methanation technology.

While the gasification plants are easily available on the international market with an
installed capacity ranging from 5 KW/h up to 2200 KW/h, this is not the case for bio-
methanation technology. Plants to utilize this technology have, in fact, to be designed on
a case to case basis, according to specific customers’ needs.

  4.1.1.       Gasification technology
Gasification consists in the conversion of solid renewable biomasses into a mixture of
combustible gases, called “producer gas” (CO + H2 + CH4) 6 , from which energy is
generated.

Gasification can refer to the use of various biomasses and concerns their partial
combustion. A partial combustion process occurs because not enough oxygen (O2) is
available to allow a full combustion of biomasses to take place.

The gasifier is essentially a chemical reactor where various physical and chemical
processes take place. The reactor is fed with biomasses that, in order to be digested, may
need to be previously cut into pieces and need to have a moisture content below 20%.

The gasifier generates “producer gas” which, once it is produced, cannot be stored and
has therefore either to be burnt inside an appropriate burner or fed to diesel engines thus
replacing diesel oil, furnace oil, other petroleum derivatives or firewood.

The “producer gas” can, therefore, be used to generate both power (electricity) and
thermal applications (hot or cold air), as shown respectively in flow diagram number 1
and 2 here after.




6
 The chemical components of a producer gas, when derived from wood, are the following: CO 15÷20%;
H2 15÷20%; CH4 up to 3%; N2 45÷50%; CO2 8÷12%.



                                             7
Flow Diagram n. 1 - Gasifier to produce electricity as main output


                                                                                Exhaust Gas

                           Chillers and filters
                                                                  Engine        120 kWe


                                                                             Electrical
120 KW                                                                         Panel
Gasifier
                                           Electricity




                         100 kWe


                                                                                          Hot air
                                                                  Hot Air Generator
                                                                       (HAG)
                                                  Burner




                                           Electricity
                                                                                                         Biomass Dryer
                                                                                                    (Hot air + exhaust gas
                                                                                                    mixture to dry 200 kg/h
                                                                                                    of biomasses in 22 hrs)

                                                         Equipments +
                                                      lightening system
                                                   (for a consumption up
                                                    to: 90 kWe in 22 hrs)




                                                         8
Flow Diagram n. 2 - Gasifier to produce electricity and hot air



                                                                                        Exhaust Gas
                           Chillers and filters


                                                                        Engine        120 kWe


                                                                                     Electrical
120 KW Gasifier                                                                        Panel
                                             Electricity




                          100 kWe


                                                                                                   Hot air
                                                                             Hot Air
                                                                         Generator (HAG)
                                                       Burner




                                                                                                                  Biomass Dryer
                                         E        Electricity
                                                                                                             (Hot air + exhaust gas
                                                                                  Hot air                    mixture to dry 200 kg/h
                                                                                                               of biomasses in 22
                             60 kWe                                                                                    hrs)
                    (To operate the flash drier                   90 kWe              Hot air from HAG
                        during 10-12 hrs )                    (To operate the          to flash dryer
                                                            flash dryer + other      (7000 kg/22 hrs or
                                                           equipments during 10    320 kg/hr to decrease
                                                                  hours)           moisture content from
                                                                                        40% to 10%)




                                                            9
4.1.2.       Bio-methanation technology (biogas)
Bio-methanation (biogas production) consists in the generation of a mixture of
combustible gases (methane/carbon, dioxide/hydrogen sulphide and ammonia) through
anaerobic fermentation (bio-digestion or bio-methanation) of organic wastes (both liquid
and solid). Combustible gases are then stored and turned into energy by means of an
electrical generator.

Three fermentation process can be used to digest different bio-wastes: wet, dry and
biphasic ones, with a digestion time ranging from 10 to 40 days. In the case of
wastewaters, the liquid fermentation process is used and the digestion period ranges
between 16 to 120hs.

The mixture of biogases generated through bio-methanation comprises, in volume terms:
methane (CH4) 55÷80%; carbon dioxide (CO2) 20÷45%; hydrogen sulphide (H2S)
0÷1.5% and ammonia (NH3) 0÷0.05.

A flow diagram showing the several steps (and facilities) required to process cassava
effluents through anaerobic digestion is presented in the box here below.



                   Gas Storage
                      Unit                                     Electricity
                                                      Generator

                                     Biogas

Raw                                          Treated Effluent
Effluent                                     for aeration/disposal


           Collection       High Rate Anaerobic
           Sump             Treatment System


As mentioned in Part A, bio-methanization technology will be proposed in this study both
in the case of an investment to produce electricity to be sold on the open market
(“General Case”) and of a specific pilot proposed in the Asueyi community (“Pilot Plant”
or “Application of the General Case”).




                                        10
5. Environmental aspects related to the generation of bio-energy from
 cassava and other suitable wastes

 5.1. Current state of affairs in Africa (including Ghana)
 Cassava wastes, due to the nature of their contents, are highly polluting bio-materials
 which can affect the environment in different ways:
 • As solid waste, given that peels and barks are rich in organic residues (fibers and
    starch) and cyanides;
 • As gas (hydrogen cyanide); and
 • As liquid effluents, in view of their high content of cyanides, organic matters and
    suspended solids.
 The impact of cassava processing waste waters is particularly noxious on table-waters
 and surface waters. The financial costs to the environment and to the health of workers of
 the cassava industry and related to a poor disposal/management of cassava wastes have
 not been assessed yet. Nowadays, in Ghana, as in the other countries of the WCA region,
 the vast majority of cassava peels resulting from the processing of this root is either
 abandoned nearby processing sites, used as land fill or burnt. A fraction, difficult to
 estimate, is sun dried 7 (after having being washed, to remove dirtiness, and drained) and
 fed to pigs and goats.




Fig. 3: Disposal of cassava peels/barks &                   Figure 4: Animals eating cassava peels
wastewaters


 As mentioned above, improperly managed disposal of cassava peels and of cassava
 effluents resulting from produce processing poses serious threats to the environment and,
 therefore, to human health. National government and local municipalities in Ghana and
 elsewhere in the WCA region are facing increasing difficulties in the treatment and
 disposal of cassava wastes. As for the other biological wastes targeted by this study, they
 include primarily wood sawdust and shavings, which in Ghana are mostly burnt or
 abandoned nearby wood processing sites. However, also biomasses different from those
 resulting from wood processing (such as maize leaves and stalks) could be considered to
 produce bio-energy in case wood wastes couldn’t be procured in the needed amounts.
 7
  As of today, the production of sun-dried cassava peels in WCA is limited to the dry season (November to
 March), when solar radiation is at its peak.


                                                 11
Figure 6: Wood wastes burnt near a
    Figure 5: Maize leaves and stalks                                     processing factory



5.2. Environmental aspects linked to the use of the gasification technology
Emissions from the gasification of cassava have been recorded and compared to the
maximum limits internationally set for these specific gases by the Central Pollution
Control Board (CPCB) 8 . As shown in Table 1 below, emissions resulting from the
gasification of cassava bio-wastes are far below the permissible limits set by current
international norms.

                                  Table 1: Analysis of gasification emissions
                                                 PERMISSIBLE LIMITS              EMISSIONS OBSERVED
                            GAS                  AS PER CPCB NORMS                   ON CASSAVA

       CO                                              1.2 g/MJ                      0.4 – 0.6 g/MJ

       NO                                             2.2 g/ MJ                        0.7 g/MJ
            X


       Hydro carbons                                   0.3 g/MJ                       0.005 g/MJ

       Particulate matter                              0.2 g/MJ                       0.005 g/MJ
Source: Central Pollution Control Board (CPCB).

Additional positive aspects of this technology are the fact that the latter allows: (i) to
properly dispose off/re-use very polluting bio-wastes and (ii) to burn them with a quite
limited side-production of sulphurs –thus contributing to fight acid rains occurrence. In
addition, the charcoal obtained as a result of the combustion of target biomasses can be
reused to feed the gasifier or sold as a combustible material. In quantity terms, the
charcoal obtained corresponds to about 4% of the biomass fed to the gasifier and has a
calorific value below 5.5 Kcal/kg. Also ashes resulting from the combustion are not
polluting and can then be disposed off in the soil (as fertiliser) without risks for the
environment -about 1 g of ashes is obtained for each 1KWh produced. Furthermore, use
of bio-electricity from cassava wastes decreases potential damages to forests as it reduces
the overall amount of firewood employed to produce heat (for cooking or other purposes).

8
For further details please visit: www.cpcb.nic.in/.


                                                    12
Part C: Potential of producing bio-energy from cassava wastes
and other biomasses in Ghana

6. Availability and requirements of cassava wastes

6.1. Cassava roots production in Africa and Ghana: some basic statistics
According to FAO estimates (2006), world production of cassava roots stands at
approximately 226 million MT, out of which 54% (122 million MT) are produced in
Africa. In this specific context, West African countries produce the majority of cassava
roots: 63 million MT, equal to 52% of the total African cassava production, followed by
Eastern Africa countries with a production of approximately 31 million MT (or 25% of
Africa’s total).

As shown in the table below, with a yearly production of approximately 9.6 million MT,
equal to 8% of the total cassava produced in Africa, Ghana is the third African largest
producer.

         Table 2: Key figures on Cassava Production in Africa (FAO, 2006)


                           Key Figures on Cassava Production in Africa
                                                                 (FAOStat, 2006)


                                                                     Cassava production in Africa
                                                      Geographic area                  MT                 %
          Cassava production in the world
                                                           Africa                        122 088 128      100
          Geographic        MT         %
             area                               Western Africa                             63 261 251     52

                                                Eastern Africa                             30 757 886     25
            World       226 337 396   100
                                                Middle Africa                              28 057 653     23

                                                                                                 11 338    0
          Africa        122 088 128    54       Northern Africa

                                                      Major cassava production countries in WCA
          Asia           67 011 365    27                 Country                     MT                  %
                                                          Africa                   122 088 128            100

          Latin          37 041 521    16       Nigeria                                    45 721 000     37
          America &                             DRC                                        14 974 470     12
          Caribbean
                                                Ghana                                       9 638 000     8
          Others            196 382     1       Benin                                       2 524 234     2
                                                Ivory Coast                                 2 200 000     2
                                                Congo                                       1 000 000     1

                       Cassava processing and marketing




                                                                13
6.2. Ghana: availability of cassava wastes and other target biomasses to
produce bio-energy
In Ghana, out of a total projected production of 9,638,000 MT of cassava roots (2006),
almost 2,000,000 MT are estimated to be wastes, of which ~1,300,000 MT (13%) peels
and ~700,000 MT (7%) discarded roots and barks; residues that remain available for
further utilization.

In Ghana, cassava is traditionally cultivated by smallholder farmers; in the same way, its
processing is usually done by small-scale processing units, scattered all over cassava
production areas. This makes that cassava wastes in this country are available, with rare
exceptions, in limited volumes, at traditional processing plants.

The same stands true for other bio-masses potentially suitable for bio-energy production
after they are mixed with cassava peels/barks, with the exception of wood
shavings/sawdust which can be found in large volumes at wood processing sites,
everywhere in the country. Also volumes of waste-waters resulting from the processing
of cassava roots are usually negligible as availability of water at processing sites is still
very limited.




                   Fig 7: Ghana - Cassava peeling in the open area


In Ghana, as elsewhere in Africa, small farmers (mainly males) are mainly responsible
for growing cassava, which is a year-round crop. Cassava roots are highly perishable and
bulky, which makes their transport very expensive and their processing urgent.
Processing is usually the responsibility of women who derive from the cassava paste
several food products -such as, in the case of Western and Central Africa (WCA): gari,
fufu, agbelima, starch and flour. Potential uses of cassava include also the production of:
chips, pellets and alcohol. As of today, cassava derivatives are used by a wide range of
industries such as those dealing with animal feed, textiles, bakery, confectionary,
plywood and soft drinks. In terms of cassava by-products, the ones mostly available are:
peels, foliage, starch bagasse, discarded roots, barks and wastewaters.


                                           14
6.3. Ghana: Cassava waste requirements to implement the two target pilots

   6.3.1.       Gasification
As previously highlighted, the gasifier will produce both electricity and hot air. The
quantity of electricity to be produced will depend on the amount of hot air to be utilized
either for just drying biomasses or for drying biomasses along with cassava derivatives
(such as: flour, agbelima, starch etc). When just bio-masses to feed the gasifier are to be
dried, the amount of electricity produced by the gasifier will be higher; the opposite will
happen when also final cassava derivatives will have to be dried, as more heat will be
required.

Taking into consideration: (i) the limited amounts of cassava wastes (peels/barks)
available at any given place in Ghana and (ii) the energy required to decrease from 66%
to 20% the moisture content of the bio-masses to be gasified, a gasifier with an installed
capacity of 120 KWh has been considered to be adequate to the needs addressed with this
study.

It has been, in fact, estimated that an installed capacity lower than 120 KWh would not
allow a sustainable production of electricity, as most of the energy produced by the
gasifier would not be used to produce electricity though rather to dry bio-masses for
feeding the gasifier.

A gasifier with an installed capacity of 120 KWh produces 500 m3/h of “producer gas”,
equivalent to 550,000 Kcal/h; this requires a quantity of 200 Kg/h of dried biomasses.
Box 1 here after shows the equivalence between raw and dried biomasses.

                            Equivalence between raw and dried biomasses

  A total of 200 kg/h of a biomass at 20% moisture is required to operate a gasifier with an installed
  capacity of 120 KW/h. The 200 kg/h of biomasses should include, in equal proportions, dried
  cassava peels/barks and dried wood shavings and saw dust to assure the maximum performance of
  the gasifier. To obtain 100 Kg of cassava peels/barks, with 20% moisture content, a quantity of 235
  Kg (Kg 100*0.8/0.34) of raw biomass (with 66% moisture content) is required.

  In the same way, to obtain 100 Kg of wood shavings and saw dust duly mixed (with 20% moisture
  content), a total of 115 Kg (100*0.8/0.7) of raw biomasses with 30% moisture content are required.
  Thus, the quantity of water which needs to be evaporated is: (235+115) – 200 = 150 kg/h. As a result,
  the total amount of energy required for drying target biomasses is: 150 x {536 kcal (Latent Heat) +
  80 kcal (sensible heat 100 - 20°C)} = 92,400 kcal/h.

  In case the dryer used shows a 60% efficiency in its operations, the heat required would be (92,400
  kcal/h ÷ 0.6) = 154,000 kcal/h, corresponding to 3,388,000 Kcal/day.



Based on the above, Table 3 here below estimates the amount of raw biomasses needed to
feed the 120 KWe gasifier during, respectively: 1 hour; 1 one day (of 22 working hours);
and 1 year (of 330 working days), along with the equivalent amount in roots (expressed
in tons) in the case of cassava.



                                                15
Table 3: Biomasses intake required to feed a 120 KW Gasifier
     Installed 
     Capacity                                               Biomasses intake to feed a 120 KWe gasifier (Kg and/or MT) 
       KW/h 
       Gross          Kg/120 KW‐h                                      tons/120 KW‐h/day                                                        tons/120 KW‐h/330 days a year 
                                                                                                                         
                  Peels &      Other  Bio‐         Cassava Peels & Barks*                  Other Bio‐masses  **                 Cassava Peels & Barks*                 Other Bio‐masses  ** 
                  Barks*       masses  ** 
                    1 h           1 h        10h/d       16h/ d      22h/d        10h/d         16h/d        22 h/d          10h         16h           22h         10h           16h       22h 
                             A) Total intake of raw biomasses (moisture content: cassava peels/barks 66% and sawdust/shavings 30%) 
       120        Kg 235         Kg115        T 2.35       T 3.76      T 5.17      T 1.15         T 1.84      T 2.53        T 776      T 1,241       T 1,706      T 380          T 607    T 835 

                                               B) Total intake of raw materials expressed as: cassava roots and wood wastes  
       120        Kg 1175        Kg 115       T 11.75      T 18.8      T 25.09     T 1.15         T 1.84      T 2.53        T 3,878    T 6,204       T 8,280      T 380          T 607     T 835 

                                             C) Total intake of raw biomasses once they are dried at a  20% moisture content 
       120        Kg 100         Kg 100        T 1.0       T 1.6        T 2.2       T 1.0         T 1.6        T 2.2        T 330       T 528         T 726       T 330          T 528     T 726 
16
6.3.2.       Bio-gas
To digest wastewaters resulting from the cassava processing, a high rate anaerobic
digester is proposed to be used (capable to convert about 80% of the wastewaters’
organic load –or BOD- into biogas in a lapse of time ranging from 24 to 72 hours).

On average, the amount of wastewaters that can be expected from the production of the
cassava derivatives targeted with this study is of 1 liter for each kilogram of cassava roots
processed. In total, about 18,000 liters/day of wastewaters -with an organic load (BOD)
of 3,400 – 6,000 mg/L, can be expected every day at the pilot plant hereby proposed; this
corresponds to a generation of about 37-56 m3/h of biogas -depending upon wastewaters’
original organic load.

Biogas from effluents is made up for a 65-70% by methane, which calorific value is
between 5,800-7,200 Kcal/m3.

As most of the waste is liquid and most of the biodegradable materials are in soluble form,
a high rate anaerobic digestion can assure that:
• The populations of those bacteria responsible for the anaerobic digestion remain high
    and are retained inside the digester, which reduces the length of the digestion process
    to just few hours (see above);
• Energy is recovered from the cassava processing wastewaters up to a total amount of
    334,425 Kcal/day.

The gas produced through anaerobic digestion can then be used to generate electricity for
the unit or hot air for drying target biomasses and/or final food cassava derivatives.




                                           17
Part D. IFAD interventions in the cassava sector in Ghana

7. IFAD current and proposed
interventions

7.1. Current interventions
Through loans and grants, the International
Fund for Agricultural Development (IFAD) has
invested since 1980 a total of USD193.4 million
into initiatives to reduce rural poverty in Ghana,
thus making this country the second largest
receiver of IFAD resources in WCA.
Programmes and projects funded by IFAD cover
a wide geographical area of this country and are
designed to alleviate poverty and foster
economic development. The overarching goal of
IFAD's investments in Ghana is in fact “to
enable poor rural people to improve and
diversify their livelihoods in a sustainable
manner”. IFAD aligns its assistance with the
country's main policies and strategies for the
agriculture and rural sector. Through its
operations, IFAD targets specific development objectives within rural areas, including
economic growth, gender equality, employment, service provision for human
development, and governance for empowerment. In 2007, together with a group of 16
development partners, IFAD signed the Ghana-Joint Assistance Strategy (G-JAS), aiming
at improving the alignment of development assistance with the core business of
Government and with the Government’s political and partnership cycle. Since October
2009, IFAD has also been among the 15 signatories of the “Ghana’s Comprehensive
Africa Agriculture Development Programme” (CAADP) Compact. This document
renews the commitment of development partners to harmonize and align their assistance
with the programmes and components of the Agriculture Sector Plan (2009-2015).

In 2007, IFAD launched the “Regional Cassava Processing and Marketing Initiative”
(RCPMI) for WCA, as a response to the call from African leaders, through the New
Partnership for Africa’s Development (NEPAD), to accord priority to cassava in the
regional agricultural development strategies. The RCPMI, which is currently funded
through Italian and, to a much lower extent, Swiss and Finnish Government contributions,
is being implemented in the context of the four national “Roots & Tubers (R&T)”
development projects that IFAD is funding throughout the WCA region –specifically, in:
Benin, Cameroon, Ghana and Nigeria.

Since it started, the RCPMI has been providing IFAD-funded R&T projects in the WCA
region with technical and financial assistance on issues related to cassava processing and



                                         18
marketing 9 . More specifically, in Ghana, the RCPMI has been collaborating with the
“Roots and Tubers Improvement Marketing Programme/RTIMP”, an IFAD-funded
project that has started its operation in 2007 and has its headquarter offices in Kumasi.
RTIMP has among its main stakeholders and beneficiaries: the Ministry of Food and
Agriculture, the National Food Research Institute, the GRATIS Foundation along with
local small cassava producers, processors, traders and different kinds of providers of
service to operators active within the cassava value chain.

Among its activities, RTIMP (with also some ad-hoc support from the RCPMI) is also
establishing several Good Practice Centres (GPCs) countrywide aimed at producing
cassava derivates fully compliant with the standards set by domestic authorities
responsible for food quality and safety. The GPCs are expected to gradually become
demonstration centers for those local small entrepreneurs/processors who cannot be
directly supported by RTIMP during the lifetime fixed for this project.

Supply of water and energy at existing GPCs, located in the main cassava production/
processing areas, is very seldom catered for by public networks/grids. Water is, in fact,
usually derived from rivers, collected in tanks from rain drains and, only in a few cases,
pumped from dug-wells. Also supply of electricity from the available national grid is
erratic. Diesel powered engines are therefore the most common way to (expensively)
operate all equipments used in the cassava processing. Wood is also a major source of
energy, although its use comes at a very high cost for the environment.

Availability of a consistent and not too expensive supply of drinkable water and of
energy constitute therefore a basic requirement for scaling up cassava processing
operations in Ghana and the starting point for the research work covered under this paper.


7.2. IFAD proposals for setting up energy producing units from cassava
processing wastes (biomasses and wastewaters)

  7.2.1.         Introduction
As highlighted at Part A/Chapter 1, this study intends to assess the technical/financial
feasibility of two plants:
• A gasification plant to produce bio-energy through a gasifier with an installed
    capacity of 120 kWe; and
• A methanization plant (biogas) to produce bio-energy by means of an anaerobic bio-
    digestor with an installed capacity of 18 000 lt/day.

9
  The areas tackled varied considerably from one R&T project to the other and included issues such as:
(i) stock taking, documenting and circulating good practices on cassava processing and marketing;
(ii) setting up a regional (WCA) database on cassava equipment makers and their prototypes;
(iii) introduction of new technologies; (iv) elaborating new approaches to the development of the cassava
chain (including processing units prototypes for the production of several final derivatives and alternative
ways for the different chain actors to increase their current degree of integration); (v) implementation of
market information systems; (vi) elaboration of feasibility and market studies and trade strategies to support
production and marketing of both traditional or new cassava derivates.



                                                   19
For both the gasifier and the bio-gas plant, a separate technical/financial feasibility has
been therefore carried out in the following pages.

However, each of the two feasibilities comes as part of two options:

•   Option 1): General case: Production of bio-energy (electricity and heat) to be sold on
    the local market to any potential interested buyer;
•   Option 2): Pilot plant (application): Production of bio-energy (electricity plus heat)
    to be utilized in the context of a specific pilot recommended for implementation in the
    Brong-Ahafo region -more precisely, in the community of Asueyi.

Therefore, while point 7.2.2 below provides technical details on an intervention (general
case) to produce electricity and heat to be sold on the domestic market, point 7.2.3
(specific pilot) describes a pilot suggested for implementation in the Asueyi community
and meant to produce bio-energy (electricity plus heat) to be used by five cassava
processing facilities operating inside this community. The pilot covered with option 2 is,
therefore, a concrete application of the concepts presented in the general case (option 1)
and is based on the information and data collected on site by the IFAD (RTIMP and
RCPMI) mission.

The financial analyses assessing the sustainability and profitability of both options are
covered and presented separately at Chapter E here after.

    7.2.2.     The General Case
As already specified at Part A/Chapter 1, the general case described in this study covers
an investment into a gasification plant (“gasifier”) and a biogas plant to produce energy
(and, to a very limited extent, also heat) to be sold on the domestic market to any
interested potential (institutional or private) buyer.

A brief description of the gasification and bio-gas technology and related flow diagrams
have already been made in Part B/Chapter 4 (sub-chapters: 4.1.1 and 4.1.2). The reader is
therefore asked to refer to these two sub-chapters for details on the technology and flow-
charts proposed for the “General Case”.

However, it is worth highlighting once more that, in the general case covered with this
study, the technology described in Part B is used mostly for the production of electricity
and, to a much lesser extent, for the production of heat (hot air) to dry target biomasses to
be used as feedstock for the gasifier.

   7.2.3.     The proposed pilot plant in the Asueyi community (application)
As previously highlighted, this paper proposes also the implementation, through an
RTIMP and RCPMI joint effort, of a pilot in the community of Asueyi (municipality of
Techiman, Brong-Ahafo region) to put into practice the general concepts presented with
the study. The proposed pilot would concern five cassava processing groups (out of
which one has already received technical and financial support from RTIMP) operating in
this Asueyi community, which is one of the main cassava producing areas of Ghana.


                                           20
According to data collected during field missions, each of the existing five (5) processing
    groups has a capacity to process between 10 to 20 tons/day of raw cassava roots –or 50 to
    100 tons/day for the five groups. Cassava peels and barks resulting from the processing of
    these amounts of roots can be then estimated between 10 to 20 tons/day.

    The five selected groups in the Asueyi community are located very close one another, to
    the point that sometimes they share processing equipments. Gari and starch are currently
    the main outputs of their operations. However, the groups are in the process of
    negotiating a deal with an import-export company based in Accra for the production of
    dried agbelima (fermented cassava paste) to be transported bulk to Accra and then
    exported after having been packaged into 1 Kg retail pouches.

    As no electricity is available from the public grid, all equipments are operated manually,
    with the exception of the grater operated with energy generated through a diesel engine.

    Water currently available for cassava processing is limited and totally derived from rains
    which are collected from roofs into plastic tanks; this makes water available at processing
    sites not fit for drinking purposes. However, table water is reported to be located at a
    reasonable depth.

    These constraints in the availability of basic inputs (energy and water) make it very
    difficult to either improve the quality of the traditional cassava derivatives or engage in
    the production of new derivates (such as the dried agbelima mentioned above).

    Roasting operations to produce gari expose workers (mostly women) to toxic fumes as
    women are forced to lean on the roasting pans to turn around gari, thus inhaling them.

    Through the proposed pilot, the energy to be generated from biomasses is expected to be
    used to operate:
•   Pumps to extract water from table-water and to fill reservoirs, from where it will be
    spilled to wash peeled cassava roots and clean fermentation vats, pressing areas, floors
    and equipments. Use could also include the provision of drinkable water to nearby
    villages;
•   Processing equipments (such as: graters, presses, centrifuges, sifters, ventilators of flash
    driers, milling facilities, air conditioners and office equipment). Motorized gari frying
    pans may be introduced to avoid workers exposure to hydrogen cyanide fumes. As
    motorized gari frying pans are much larger than traditional pans, their use should allow a
    decrease in gari production cost as outputs’ volumes would increase. The same
    wastewaters resulting from the operation of centrifuges would be dried with the flash
    driers to produce a starch of improved quality.

    In order to increase both the quantities of raw materials currently processed and the
    present quality of cassava derivatives, it will be necessary that the following extra-
    equipments and facilities integrate the proposed pilot in Asueyi community:




                                              21
•   A flash drier, with a capacity of producing 5 tons/24 hours of dried product (starch,
    agbelima or flour) (~208 Kg/h of dried product with 8 to 10% of moisture content,
    equivalent to 310Kg/h of wet product/paste with 40 to 45% of moisture content);
•   One electrical roaster, equipped with rotating paddles, s.s. pan (ø 2.5 m), fireplace and
    chimney, to test the new technology and show new practices for producing gari;
•   A borehole, with a 6 m high overhead tank of 40,000 liters from which water would
    be distributed by gravity. The borehole would have to be sited in a way that all five
    processing groups can be easily served. Consistent availability of water, as much as
    electricity, would be essential to assure produce consistency of final products’ quality
    and sustainability of overall processing operations;
•   A 4 m high shed (dimension 10m x 25 m) for the peeling, washing and fermenting
    operations. Each group would have access to 40 m², including washing basins;
•   A 6 m high shed (dimension 10m x 20 m) where the following equipments would be
    installed: one flash drier (5,000 Kg of dried product/day); two centrifuges to reduce
    the moisture content of the cassava paste produced by the five processing groups, a
    milling device and a sifting machine. Storage space for packaging material and
    finished products would be also provided.

The main thrust for the proposed pilot is that larger volumes (from the current 1 MT/day
to a planned 5 MT/day) and better quality of final cassava derivatives are going to be
produced. A decrease in unitary production costs (thanks to both an increase in overall
output and a lower energy input) is, in fact, the primary condition to be met to assure that
the proposed investment can be financially sustainable in the long term –especially
considering that prices of the target final cassava products are quite rigid on local markets
and therefore difficult to significantly modify.




                                           22
PART E. Profitability of producing bio-energy in Ghana

E.1. General case: Outcomes of a Technical and Financial Analyses

   E. 1.1.      Technical Analyses

8. Heat requirements and utilization

The objective of the proposed investments is to produce 120 KWh of electricity from
cassava wastes blended with wood wastes.

Gasifier: Considering the energy required for producing electricity and hot air to dry
target biomasses and to keep the system going, a gasifier with an installed capacity of 120
KW/h has been estimated to be required. However, out of the installed capacity, no more
than 100 KW/h of net output can be expected, enough to produce 500 m3/h (or 11,000
m3/day) of “producer gas” equivalent.

Out of these 100 KW/h of net output, a total of 15-20 kW/h will be used as captive power
to run the equipments. In the same way, of the total hot air to be produced from the
gasifier, a share will be employed for drying final cassava derivatives while the
remaining share, together with the heat derived from the exhaust engine, will be used for
drying target feedstock biomasses.

More in particular, the total production of 11,000 m3/day of producer gas is expected to
be utilized in the following way:
• 6,600 m3/day to generate a gross power of 2,200 KWh/day (22 hours), corresponding
    to 7,260,000 Kcal/day. Considering a captive power of 265 KWh/day, a net quantity
    of electricity equals to 1,935 KWh/day (or 88 KW/h) will remain available (on
    average) for sale on the local market, corresponding to 5,938 m3/day and 6,385,600
    Kcal/day;
• 4,400 m3/day to generate heat, corresponding to a total of 4,840,000 Kcal/day.
    Considering the exhaust gas from the system equal to 806,819 Kcal/day, a total
    amount of heat corresponding to 5,846,810 Kcal/day will then be available from the
    gasifier. Out of this quantity, 3,388,000 Kcal/day will be used for drying feedstock
    biomasses and 2,258,810 Kcal/day as heat production surplus (available for sale).

The proposed gasifier system will be composed of a down draft gasifier, along with a gas
cleaning and cooling system -to produce ultra clean gas for electricity and heat
generation, a gas engine and an air generator. The full list of the equipments and
materials, required to run the system is provided in the Annex 4 (along with a list of the
civil works needed to put in place the gasifier), while the corresponding gasifier flow
diagram is shown at Chapter 4 (Part B).

Biogas plant: The plant taken into consideration with this study generates about 52.5
m³/day of biogas (equal to 334,425 Kcal/day). Considering that 12,912 Kcal/day will be
absorbed by the system, a net volume of 301,513 Kcal/day (or 71 KWh/day and 23,430


                                          23
KWh/year), would remain available for use. The flow diagram of the proposed biogas
plant for treating cassava effluents through anaerobic digestion is also shown at Chapter 4
(Part B).

Table 4, here below, provides a summary of the heat generated and used by both the
gasifier and the bio-gas plant and, at the same time, estimates the heat that would remain
available for sale on the domestic market.

                                     Table 4: Heat balance and equivalence
      System                            Generation/Production/Consumption                          Corresponding volume
       Unit                                          22 h/day                                            Year/330d
      Gasifier            m³/day            Kcal/day               Kwh/d             Diesel   Kwh/y    LDiesel/y       Tons
                                        Gross        Net       Gross    Net           L/d                           Firewood/y
Producer gas              11,000*
                                                         Electricity generation
Energy production            6,600     7,260,000                   2,200                      726,000
Captive power                  795       874,500                      265                      87,450
Net production               5,938                   6,385,500     1,935
Net power                                                                    1,935     637    638,368    210,210
Total                                                                                                    210,210
                                                     Heat Generation
Gross production          4,400        4,840,000
Exhaust gas                              806,810
Total production                       5,646,810
Drying biomass                                       3,388,000
Net production
Drying product
Balance to be sold                                   2,258,810                        (225)               74,250         1,485
Total                                                                                   225               74,250         1,485

Unit                                                   22 h/day                                  Year/330d
Biogas                    m³/da                       Kcal/day             Kwh/d     Diesel    Kwh/y    Diesel/L
                              y            Gross           Net     Gross     Net       L/d

Biogas
Biogas/methane            52,50
                             **
Heat production                           334,425                  78.75
System absorption                          32,912                   7.75
Net production                                         301,513              71.00              23,430
Equivalence                                                                             23                 7,710
Total                                                                                                      7,710
 * Calorific value of producer gas: 1,100 Kcal/m³.
** Calorific value of biogas/methane = 70% of methane = 6,370 Kcal/m³.




                                                           24
E. 1.2.      Financial Analyses

9. Profitability of the proposed investments

9.1. Generalities
This section provides for a detailed analysis of the profitability of the investments
required to produce bio-energy from all bio-wastes previously described. As mentioned
earlier on, a separate analysis has been undertaken in the case of the gasifier and of the
biogas, so as to provide a detailed and separate description of the profitability for each of
two proposed investments.

In order to estimate revenues, it has been necessary to convert the total energy (electricity
plus heat) generated by the gasifier and the biogas plants -and expressed into Kwh and
Kcal- into liters of diesel and tons of firewood. The reason why diesel and firewood have
been chosen (as shadow prices) to estimate the revenues is that on the Ghanaian market
diesel is, at the moment, the fossil fuel mostly used for energy generation, as firewood is
for heat production (especially in rural areas). Therefore, the domestic market price for
diesel has been retained as the referential price for estimating the value of the electricity
generated by target investments, while the one for firewood has been retained for
estimating the value of the heat produced.

9.2. Total energy expected to be produced
The total energy expected to be produced by the proposed gasifier is 7,260,000 Kcal/day,
of which 874,500 Kcal/day (or 12%) are assumed to be consumed by the system as
“captive power”. Therefore, the resulting quantity of energy produced by the gasifier and
available for sale corresponds to 6,385,000 Kcal/day (88%), equal to 638,368 Kwh/y
(equivalent to 210,210 liter of diesel/year).

With reference to the heat generated, a total production of 5,646,810 Kcal/day (including
gross production and exhaust gas) is expected, assuming that the plant will be working 22
hours/day for a total of 330 days/year.

The amount of heat remaining available for sale (once the heat required to dry biomasses
is deducted), stands at 2,258,810 Kcal/day, equivalent to 1,485 tons of firewood/year.

The biogas plant proposed with the pilot is expected to produce a total of 334,425
Kcal/day, out of which 32,912 kcal/day will be reused by the same plant. Therefore, a
total of 301,513 Kcal/day -equal to 23,430 Kwh/year or 7,710 liter of diesel/year- would
be available for sale on local market.




                                           25
9.3. Key information and main assumptions for implementing financial
analyses for both the gasifier and the bio-gas plant

       Key information

Gasifier
Total investment costs: 340 000 USD, to be entirely borrowed from local banks at a 22%
interest rate and to be paid back through equal installments (capital) plus interests on the
remained debt over a period of 7 years10;
Civil works, including assistance to installation and commissioning, have been also
considered as part of fixed costs and estimated at 40 000 USD;
Depreciation: 10 years for equipments and 15 years for civil works;
Working capital: about USD 10 000. Expected to be needed during the first four months
of Y1 to pay off short-term liabilities;
Timeframe for the analysis: 10 years.

Bio-gas plant
Total investment costs: 28 880 USD, out of which about USD 21 000 for purchasing the
equipments and USD 7 500 for civil works. The entire amount is expected to be
borrowed from local banks at a 22% interest rate and to be paid back through equal
installments (capital) plus interests on the remaining debt over a period of 7 years;
Civil works, including assistance to installation and commissioning, have been also
considered as part of fixed costs and estimated at USD 7 500;
Depreciation: 10 years for equipments and 15 years for civil works;
Working capital: about USD 800. Expected to be needed during the first four months of
Y1 to pay off short-term liabilities;
Timeframe for the analysis: 10 years.

       Main assumptions (for both gasifier and bio-gas plant)

i)         Cost of diesel: 1,18 GHS /liter equivalent to 0,8 USD/liter;
ii)        Price of electricity available from the public grid: GHS 0,47/Kwh, equals to USD
           0,335 Kwh – including VAT and NHS;
iii)       Processing plants working hours: 22 hours/day for 330 days/year. Start up costs,
           in terms of fuel requirements and annual operation and maintenance costs have
           been included;
iv)        Revenues: derived based on the following sales’ projections:
       •   Gasifier: a total of 638,368 Kwh/year, equivalent to 210,210 liters of diesel/year,
           are sold at 0.8 USD/lt (which is the current market price for diesel). As for the
           heat, a total of 2,258,810 kcal/day, equal to 1,485 tons of firewood/year, are sold
           at 15 USD/t;
       •   Biogas: a net production of 23,430 Kwh/year, equal to 7,710 lt diesel/year, is sold
           at 0.8 USD/lt -which is the current market price in Ghana for diesel, that is
           normally used to produce electricity;

10
     This assumption is built on the lending terms currently enforced in Ghana.


                                                    26
v) Interest rates applied:
     • Passive: the average passive interest rate applied in Ghana is equal to 23%
       (including administrative fees11) for industrial investments. As for the agricultural
       investments12 it decreases to 22%;
     • Active (on deposits): 10%13 on average;
vi)    Discount rate (to discount expected annual cash flows at Y1): 22% (equal to
       passive interest rate applied to agribusiness investments);
vii)   Price of fresh cassava roots: 50 GHS/t (equal to approximately 35 USD/t), which
       is an average price estimated to well reflect market price variations occurring
       during the rainy and the dry seasons;
viii) Transport costs of bio-masses (i.e. cassava peels and barks, maize stalks and
       leaves and Shea nuts) from production sites to the plant site: 15 GHS/t, equivalent
       to approximately 10 USD/t including both fuel and remuneration of the workforce
       (one driver and one unskilled worker) required to transport target biomasses;
ix)    Transport costs of equipments and materials –from India to Accra, along with
       assembling and start-up/training costs: included as part of the fixed costs;
x)     Social security costs calculated as 13.5% of the employees’ monthly gross salary;
xi)    Taxes on incomes: although in Ghana they stand at 25%14 in the case of private
       enterprises, a rate of 10% was used in this study being this the rate reported to be
       applied in the region (Brong-Ahafo) targeted with this paper;
xii)   National taxes on Value Added in Ghana stand at 12.5%, while the National
       Health Service tax is at 2.5%.

9.4. Outcomes of the financial analysis

       9.4.1. Gasifier
The technical and financial analyses refer to an investment timeframe of 10 years and are
included in Annex 3. Main elements considered in the analyses, along with the obtained
outcomes, are summarized here below:
    Total costs (including investment costs for about 340 000 USD, along with capital
    and operating costs) show a steady decrease over the 10 years period, from
    approximately USD 184 000 in Y1 to approximately USD 60 000 in Y10;
    Estimated yearly repayments of capital for implementing the investment (purchase of
    equipments and construction of facilities) and on working capital, along with related
    interests, range then from USD 123 000 in Y1 to USD 60 000 in Y7;
    Net profits after corporate taxes are positive already starting from Y1 at
    approximately 6 000 USD. They increase up to approximately USD 114 000 in Y10;
    Annual cash flows remain positive over the entire life of the investment. More
    specifically, the annual cash flow is approximately USD 38 000 in Y1 and
    approximately USD 146 000 in Y10. Also the analysis of discounted annual cash
    flows confirms satisfactory results throughout the entire life of the investment;

11
   As of August, 2010, Ghana Commercial Bank.
12
   As per information provided by the Agricultural Development Bank, which specifically finances
investments in the rural areas of Ghana.
13
   Source: Bank of Ghana Notice No. BG/GOV/SEC/2010/11.
14
   As of August, 2010.


                                            27
The internal rate of return (IRR) of this investment results to be 17%, while the pay
     back period is slightly less than 6 years. These two values clearly show the positive
     returns to be expected from this investment -as previously highlighted, interests
     accrued on bank accounts in Ghana are at around 10%;
     A sensitivity analysis has been carried out using two different scenarios: (i) a ±15%
     variation of the investment costs15 and (ii) a 20% decrease in the market price of
     energy. Under the first scenario, when total investment costs increase +15% to equal
     391 000 USD, net profit after taxes results to be positive as from Y3 (equal to
     approximately 7 000 USD), while annual cash flow become positive already from Y2
     (approximately 30 000 USD). IRR results to be equal to 11% and the investment can
     be paid back in approximately 7 years (slightly more than in the previous case).
     Under the hypothesis of total investment costs equal to 289 000 USD (-15%
     variation), net profit after taxes results to be positive already from Y1 (equal to
     approximately 27 000 USD) and increases up to approximately 118 000 USD in Y10.
     Also annual cash flows results to be positive from Y1 (approximately 53 000 USD).
     IRR results to be 24% and the investment pay back period less then 5 years. Under
     the second scenario, a 20% reduction of the diesel market price has been considered
     (market price equal to 0.64 USD/lt), while the market price of a ton of firewood has
     been assumed to remain stable. Net profit after taxes results to be positive from Y4
     (equal to 4 600 USD), while annual cash flow becomes positive as from Y1
     (approximately 4 700 USD). IRR results to be equal to 7% and the investment pay
     back period becomes less than 8 years.

      9.4.2. Biogas plant
The technical and financial analyses refer to an investment timeframe of 10 years and are
included in Annex 4. Main elements considered in the analyses and outcomes obtained
are summarized here below16:
    • Investments costs for equipments and materials: approximately USD 28 800,
       including about USD 21 000 for the equipments and USD 7 500 for civil works;
    • Depreciation timeframe: 10 years for equipments (approximately 2 000 USD/
       year) and 15 years for civil works (300 USD/year);
    • Estimated yearly repayments (over a seven year period) of capital borrowed for
       implementing the investment (purchase of equipments and construction of
       facilities and on working capital), along with related interests (22%/year), range
       then from approximately USD 10 400 in Y1 to USD 5 000 in Y7;
    • Production costs, including fixed and variable costs, for generating a total of
       23 430 kwh/year -equivalent to 7 710 liters of diesel: USD 4 745;
    • The flow of net profits (after payment of corporate taxes equal to 12.5% of total
       profits) becomes positive as from Y8 at about USD 1 200, which remains stable
       till Y10.


15
  Capital costs have been derived accordingly.
16
  Given the technical specification of the biogas plant, the outcomes of these analyses can (and will) be
used also for the concrete application relating to the pilot proposed for the Asueyi community. However,
this is not the case of the specific economic/financial feasibility analysis for the gasifier, for which a
separate analysis is required (and implemented in Part E.2: “Case study”).


                                                 28
E.2. Pilot Plant (Application): Outcomes of a Technical and Financial
       Analyses

       E. 2.1. Technical Analyses

10. Electricity and heat total requirements and expected uses

       Electricity total requirements and expected uses

The underlying assumption of the Asueyi pilot plant is that it will process 25 tons/day of
raw cassava roots into 7 tons/day of cassava paste (with a 40 to 45% moisture content),
to be then flash-dried into about 4-5 tons/day of high quality dried cassava products. All
the electricity needed to run equipments and the hot air needed to dry the biomasses to be
burnt in the gasifier along with the finished cassava food derivatives to be marketed, is
expected to be derived from target biomasses. Table 5, here below, summarizes the total
quantity of heat required to process 25 tons/day of cassava roots. As per the amounts of
cassava roots, raw biomass and dried biomasses required to feed the gasifier proposed to
be set up in the context of this pilot (always with an installed capacity of 120 KW), they
would be the same as those calculated for the “General Case” in Table 3 (Part C/sub-
chapter 6.3.1).

In the context of the pilot planned in the Asueyi community, electricity is required for
operating electric motors of the processing plants making up the pilot unit (graters, sifters
and centrifuges), ventilators of the flash dryer, motorized roasters, the water pump and
the lighting of offices, working areas etc.

The maximum quantity of electricity absorbed by the pilot plant has been estimated at
about 100 kW/h. However, data on consumption have been estimated considering a
consumption of up to 90 KW/h during 10 hours and up to 60KW/h during 10-12 hours,
when only one centrifuge, the ventilators (of the flash drier), the miller and the plant’s
lightening grid would be operated –the centrifuge and the miller are, in fact, not expected
to run continuously). Electricity consumption of single equipments has been estimated, at
their peak, equals to: 28 KW/h for the flash drier; 11 KW/h for the centrifuge; 20 KW/h
for the grater and/or the sifter; 5 KW/h both for both the roasting pan and water pump.

Electricity for running the flash drier, set up to produce 4-5 MT/day of dried final food
products, will be needed for a maximum of 22 hours/day, while electricity for operating
graters and sifters will be required for few (2-3) hours/day only. All other equipments
will be operated according to needs and the energy required correspondingly. The net
consumption of electricity for a working day of 22 hours is expected to be about 65
KW/h (or 1,425 KWh/day), which correspond to 4,275m³/day of producer gas or
4,702,500 Kcal/day.

The features of the product to be dried in the context of the pilot plant in Asueyi
community are as it follows:
   • Initial moisture level of the wet paste after centrifugation (40% to 45%)



                                           29
•   Final moisture content of dried cassava derivatives: 8% to 10%
     •   Total quantity of wet products to be dried: 7 tons/day (or 16 hours)
     •   Total quantity of final (dried) output: 4.5 tons/day (or 22 hours)
     •   Hot air required for drying (180°C) wet material: 3585 m³/h

The energy required to decrease by 30% the moisture content of the 7000 kg/day of wet
cassava paste is calculated at: 2,156,000 kcal/day (or 98,000 kcal/h), as per the
following calculations:
    • Total quantity of water to be evaporated from the 7000 kg/day of wet cassava
       paste = 7000 X 0.3 = 2100 kg/day
    • Energy required to evaporate the quantity of water above: 2100 kg/day x {536
       kcal (Latent Heat) + 80 kcal (sensible heat 100-20°C)} = 1,293,600 kcal/day. This
       amount increases to 2,156,000 kcal/day (1,293,600 kcal ÷ 0.6) or 98,000 kcal/h
       assuming that the dryer operates at a maximum efficiency of 60% and during 22
       hours/day respectively

         Heat total requirements and expected uses

A 120 KW/h gasifier, to be used to both generate electricity and hot air- has been
considered for this investment. However, out of this installed capacity, no more than 100
KW/h of net output can be expected (of which about 15-20 kW/h are to be used as
captive power), enough to produce 500 m3/h of producer gas equivalent (equal to 550,000
Kcal/h). In a day of 22 working hours, 11,000 m3/day of producer gas will be produced,
corresponding to 12,100,000 Kcal/day. As the heat generated from the engine exhaust
gas 17 in a day of 22 hours will be 1,125,868 Kcal/day, the total daily amount of
kilocalories generated by the gasifier will be 13,225,686 Kcal/day.

The 11,000 m3/day of producer gas are expected to be utilized as it follows:

•    4,860 m3/day to generate electricity, equivalent to a total amount of gross power of
     1,620 KWh/day (22 hours), corresponding to 5,346,000 Kcal/day. Considering a
     captive power of 195 KWh/day, a net balance of 1,425 KWh/day will remain
     available to meet the electricity needs of the pilot, corresponding to 4,275 m3/day (or
     4,702,500 Kcal/day);
•    6,140 m3/day to generate heat for drying biomasses and final products, corresponding
     to a total of 6,754,000 Kcal/day. To this amount it should be added an additional
     quantity of 1,125,868 Kcal/day as exhaust gas produced by the gasifier. The total
     available heat generated by gasifier would then be 7,879,868 Kcal/day, of which
     2,156,000 Kcal/day (corresponding to 1,973 m3/day) would be used for drying
     finished food derivatives (agbelima, flour, starch, etc.) and 3,388,000 Kcal/day (or
     3,080 m3/day) for drying biomasses. A total amount of 2,335,868 Kcal/day (or
     2,123 m3/day) would remain available for sale as heat surplus.

17
  If an 120 KWe engine is used for generating power, the heat contents (at full load) of the exhaust gas can
be so calculated: (a) Gas + air required for the 120 kW engine = 120 x 7.8 kg = 936 kg; (b) Total flue gas
quantity of 120 kW engine: 2035 m3/h (936 kg/h) @ 450°C; (c) Heat required for drying purposes -from
450°C to 120°C (∆T 330°C)- corresponds to m cp ∆T = 936 x 0.27 x 330 = 83,397 kcal/h.


                                                  30
Table 5: Heat balance and equivalence
     System                        Generation/Production/Consumption                          Corresponding volume
       Unit                                      22 h/day                                         Year/330days
Gasifier            m³/day                Kcal/day             Kwh/d           Diesel   Kwh        LtDiesel       Tons
                                     Gross         Net     Gross     Net       L/day    /year       /year      Firewood/y
Producer gas           11,000*    12,100,000
Electricity generation
Total production         4,860      5,346,000                 1,620                     534,600
Captive power              585        643,500                   195
Net Product.             4,275                  4,702,500
Net Power                                                             1,425      469    470,250     154,770
Heat Generation
Gross production       6,140        6,754,000
Exhaust gas                         1,125,868
Total production                    7,879,868
Drying biomass                      3,388,000
Net production                                  4,491,868                       (448)
Drying product                                  2,156,000                         215                70,960
Balance to be sold                              2,335,868                       (233)                               1,485
              Total                                                               684               225,730         1,485

      Unit                                         22 h/day                                        Year/330d
Biogas              m³/day              Kcal/day                  Kwh/d        Diesel   Kwh/y     Diesel/L
                                    Gross           Net       Gross    Net      L/d
Biogas
Biogas/methane         52,50**
Heat production                        334,425                 78.75
System absorption                       32,912                  7.75
Net production                                     301,513             71.00             23,430
Equivalence                                                                        23                 7,710
             Total                                                                                    7,710
* Calorific value of producer gas: 1,100 Kcal/m³;
** Calorific value of biogas/methane = 70% of methane = 6,370 Kcal/m³.


It is recommended that both gasification and biogas plants be located in a central position as far as
the five target processing groups in Asueyi community are concerned, so as to easily distribute
produced energy to the same groups and collect from them, by gravity, waste waters to be fermented
inside the bio-gas plant.




                                                      31
E. 2.2. Financial Analyses

11. Overall outcomes of the proposed investments

11.1. Generalities
The outcomes of the financial analysis concerning the application in the Asueyi
community are provided in the following paragraphs. The analysis focuses on the specific
profitability of the gasifier only as the profitability of the biogas plant does not differ
from the one estimated at chapter E.1 (under the: “General Case”).

The financial analysis has been worked out using the data and information (including
availability of bio-masses) collected during field works in the geographic area proposed
for the investment covered with this study.

Also some of the assumptions outlined in Part E, Chapter 9 and used to assess the
profitability of the general case have been adapted to circumstances encountered in the
Techiman Municipality18.

11.2. Key information and main assumptions for implementing financial
analyses for the gasifier

           Key aspects (Gasifier only)

       Total investment costs: 340 000 USD, to be entirely borrowed from local banks at a
       22% interest rate and to be returned through equal installments (capital) plus interests
       on the remaining debt over a period of 7 years19;
       Working capital: about USD 10 000, expected to be needed during the first four
       months of Y1 to pay off short-term liabilities;
       Timeframe for the investment: 10 years;
       Depreciation: 10 years for equipments and 15 years for civil works;
       Revenues expected to be generated from the gasifier in the Asueyi community have
       been so estimated:
       • The entire amount (470,250 Kwh/y) of electricity produced, corresponding to
           154,770 lt/year of diesel, to which has been added an additional amount of 70,960
           lt diesel/year derived as heat generated by the plant and used to dry products, are
           sold at 0.8 USD/lt (which is the current market price in Ghana for diesel); and
       • The remaining 2,335,868 kcal/d deriving from the heat generated (and equal to
           1,485 t firewood/y) are sold at 15 t/USD (which is the market price for firewood
           that is usually used in Asueyi to produce heat).




18
     If not specified, the assumptions described in the previous sections do not change.
19
     This assumption is built on the current practices in Ghana


                                                     32
11.3. Outcomes of the financial analysis in the case of the gasifier
The outcomes of the technical and financial analyses detailed in Annex 5 here after and
implemented over a timeframe of 10 years, show that:
• Total costs20 show a steady decrease over the 10 years period, from approximately
   USD 184 000 in Y1 to approximately USD 60 000 in Y10. By far and large, capital
   costs are the main item (60%) of the total cost structure;
• Working capital, expected to be needed during the first four months of Y1 to pay off
   short-term liabilities, has been included at approximately USD 10 000;
• Estimated yearly repayments of capital for implementing the investment (purchase of
   equipments and construction of facilities) and on working capital, along with related
   interests, range then from USD 123 000 in Y1 to USD 60 000 in Y7;
• Net profits after corporate taxes are constantly positive, ranging from approximately
   USD 17 000 in Y1 up to approximately USD 125 000 in Y10;
• Annual cash flows remain positive over the entire life of the investment. More
   specifically, the annual cash flow stands at approximately USD 48 000 in Y1 and it
   increases up to approximately USD 156 000 in Y10. Also the analysis of discounted
   annual cash flows confirms satisfactory results throughout the entire life of the
   investment as from Y1;
• The internal rate of return (IRR) of this investment results to be 21%; the pay back
   period is slightly less than 5 years. These two indicators clearly show the high returns
   to be expected from this investment;
• A sensitivity analysis has been carried out taking into consideration: (i) the possibility
   to sell the total amount of heat generated, equal to 2 970 liter of diesel/year, at the
   prevailing market price for firewood (15 USD/t) and (ii) a 20% decrease in the total
   working hours of the gasification plant (from 22h/day to 18 h/day) during a total
   period of 330 working days/year. Under the first scenario, net profit after taxes result
   to be positive as from Y3 (equal to about 5 000 USD), while annual cash flow starts
   being positive as from Y1 (approximately 16 000 USD). IRR is 11%; the pay back
   period approximately 7 years. Under the second scenario, the plant works a total of
   18h/d only, which causes a 20% decrease in the quantity of electricity generated
   (from 154,700 lt diesel/year to 128 816 lt/diesel/year), as well as of the heat generated
   and required to dry products (from 70 960 to 56 768 lt/diesel/year and from 1 485 to
   1188 tons of firewood/year) and therefore a reduction in the level of total revenues.
   Given this reduction in total working hours, the overall amount of high quality (dried)
   cassava derivatives decreases from almost 4.5 tons/day to approximately 3.5 tons/day.
   Total revenues are equal to 162 287 USD/year, so derived: 99 053 USD/year from the
   sale of electricity and 62 234 USD/year from the sale of the heat generated. Net
   profits after taxes become slightly positive in Y3 and increase to approximately
   90 000 USD in Y10, while annual cash flow remains always positive throughout the
   10-year timeframe (from approximately 10 250 USD in Y1 to approximately 120 000
   USD in Y10). IRR decreases to 10% and the paid back period results to be less than 8
   years. Therefore, also under the hypothesis of a 20% decrease of total revenues, the
   sensitivity analysis confirms the good profitability for the proposed investment.


20
     These include: capital costs, operating costs and fixed costs and are equal to USD 340 000.


                                                     33
Annexes
Annex 1 - Results of the laboratory analyses on cassava peels
                            and barks

              Table 1: Proximate analysis and basic properties on cassava peels

                                           Ankur Lab                    Polytechnics Lab
     Parameters
                                          Dried sample                     Wet sample

     Moisture, %                             2.16                           66.20

     Ash, % of dry wt.                       3.41                            4.94

     Volatile, % of dry wt.                 78.28
                                                                }          95.06
     Fixed carbon, % of dry wt.             18.31

     Bulk density, kg/m3                        286                          340

     Ash fusion test                No ash Fusion at 1200°C         No ash Fusion at 1200°C

     Shape & Size, %                      Irregular shape                 Irregular shape

     Ignition test                         Burns easily                        NM

     Flow ability test                     Flows easily                        NM


Cassava peels have low ash content (<5%) and an ash fusion temperature above 1200°C.
Their bulk density remains above 250 kg/m3 even after drying and hence flow easily and
burn well. Peels have a high moisture content that has to be decreased to 20% to make
them suitable for gasification purposes.




                                            1
Annex 2 - Results of the laboratory analyses on wood shavings
                           and sawdust

The table here below shows the results of the analyses conducted in two different
laboratories on a blend of wood shavings and saw dust.

  Table 1: Proximate analysis and basic properties of wood shavings & saw dust mixture

                                      Ankur Laboratories             Polytechnics Lab.
      Parameters
                                    Naturally dried sample              Wet sample

      Moisture, %                          19.83                         30.60

      Ash, % of dry wt.                     1.29                          2.33

      Volatile, % of dry wt.               78.59

      Fixed carbon, % of dry wt.           20.12
                                                                }         97.66

      Bulk density, kg/m3                      68                          95

      Ash fusion test              No ash Fusion at 1200°C      No ash Fusion at 1200°C
      Shape & Size, %                    Irregular shape               Irregular shape

      Ignition test                       Burns easily                      NM

      Flow ability test               Does not flow easily                  NM


The mixture of wood shavings and saw dust has a low ash content (<5%) and an ash
fusion temperature above 1200°C. Its bulk density is low and it does not flow easily;
however, it burns well. The high moisture content and the low bulk density of this blend
makes it unsuitable for gasification; however, after having dried the mixture to 20%
moisture level and having mixed this latter with dried cassava peels, it can be proficiently
used for gasification purposes.




                                           2
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana
The Use of Cassava Wastes to Produce Energy in Ghana

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The Use of Cassava Wastes to Produce Energy in Ghana

  • 1. ***** The Regional Cassava Processing and Marketing Initiative  (RCPMI)  *****   The use of cassava wastes to produce energy:  outcomes of a feasibility study   implemented in Ghana.        **** In collaboration with the IFAD‐funded “Root & Tuber Improvement and Marketing Programme/RTIMP” of Ghana **** October 2010 
  • 2.                         Prepared by:      Mr. Andrea Serpagli  IFAD‐RCPMI/Coordinator   a.serpagli@ifad.org  IFAD/Consultant, Biogas  Mr. Govind Prasad Nagori  gpnagori@ankurscientific.com  Specialist  IFAD/Consultant Food  Mr. Giuseppe Amoriggi  giuseppe.amoriggi@libero.it  Technologist  IFAD/Consultant,  Mrs. Chiara Calvosa  c.calvosa@ifad.org  Economist   
  • 3. Table of Contents Executive Summary .......................................................................................................... 1 Part A: Objective of the study and methodology used .................................................. 3 1. Objective ......................................................................................................................... 3 2. Methodology used........................................................................................................... 3 Part B: Technical aspects about the production of bio-energy from cassava wastes and other biomasses............................................................................................ 5 3. Suitability of wastes from cassava and wood to produce bio-energy: outcomes of laboratory analysis .......................................................................................................... 5 3.1. Outcomes of laboratory analyses ......................................................................... 5 3.2. Cassava peels and barks....................................................................................... 5 3.3. Wood Shavings and Saw Dust............................................................................. 5 3.4. Wastewaters resulting from cassava processing .................................................. 6 4. Technological aspects related to the generation of bio-energy from cassava and other suitable wastes ................................................................................................................ 7 4.1. Technological aspects: generalities...................................................................... 7 4.1.1. Gasification technology .............................................................................. 7 4.1.2. Bio-methanation technology (biogas)....................................................... 10 5. Environmental aspects related to the generation of bio-energy from cassava and other suitable wastes .............................................................................................................. 11 5.1. Current state of affairs in Africa (including Ghana).......................................... 11 5.2. Environmental aspects linked to the use of the gasification technology ........... 12 Part C: Potential of producing bio-energy from cassava wastes and other biomasses in Ghana............................................................................................................. 13 6. Availability and requirements of cassava wastes.......................................................... 13 6.1. Cassava roots production in Africa and Ghana: some basic statistics ............... 13 6.2. Ghana: availability of cassava wastes and other target biomasses to produce bio- energy........................................................................................................................ 14 6.3. Ghana: Cassava waste requirements to implement the two target pilots........... 15 6.3.1. Gasification ............................................................................................... 15 6.3.2. Bio-gas ...................................................................................................... 17 Part D. IFAD interventions in the cassava sector in Ghana ....................................... 18 7. IFAD current and proposed interventions..................................................................... 18 7.1. Current interventions ......................................................................................... 18 7.2. IFAD proposals for setting up energy producing units from cassava processing wastes (biomasses and wastewaters) ........................................................................ 19 7.2.1. Introduction............................................................................................... 19 7.2.2. The General Case...................................................................................... 20 7.2.3. The proposed pilot plant in the Asueyi community (application) ............ 20 PART E. Profitability of producing bio-energy in Ghana .......................................... 23 E.1. General case: Outcomes of a Technical and Financial Analyses .............................. 23 E. 1.1. Technical Analyses ................................................................................... 23 8. Heat requirements and utilization ................................................................................. 23
  • 4. E. 1.2. Financial Analyses .................................................................................... 25 9. Profitability of the proposed investments ..................................................................... 25 9.1. Generalities ........................................................................................................ 25 9.2. Total energy expected to be produced ............................................................... 25 9.3. Key information and main assumptions for implementing financial analyses for both the gasifier and the bio-gas plant ...................................................................... 26 9.4. Outcomes of the financial analysis .................................................................... 27 9.4.1. Gasifier...................................................................................................... 27 9.4.2. Biogas plant .............................................................................................. 28 E.2. Pilot Plant (Application): Outcomes of a Technical and Financial Analyses ........... 29 E. 2.1. Technical Analyses........................................................................................ 29 10. Electricity and heat total requirements and expected uses.......................................... 29 E. 2.2. Financial Analyses......................................................................................... 32 11. Overall outcomes of the proposed investments .......................................................... 32 11.1. Generalities ...................................................................................................... 32 11.2. Key information and main assumptions for implementing financial analyses for the gasifier ........................................................................................................... 32 11.3. Outcomes of the financial analysis in the case of the gasifier ......................... 33 Annexes Annex 1 - Results of the laboratory analyses on cassava peels and barks.......................... 1 Annex 2 - Results of the laboratory analyses on wood shavings and sawdust ................... 2 Annex 3 - Financial analysis: Gasifier – General level ...................................................... 3 Annex 4 - Financial analysis Biogas Plant ......................................................................... 8 Annex 5 - Financial analysis: Gasifier– Case study in the Asueyi community................ 10
  • 5. List of Acronyms and Abbreviations CAADP: Comprehensive Africa Agriculture Development Programme (Ghana) CPCB: Central Pollution Control Board FAO: Food and Agriculture Organization GHS: Ghanaian Cedi GPC: Good Practices Centre IFAD: International Fund for Agricultural Development IRR: Internal Rate of Return NHS: National Health Service NEPAD: New Partnership for Africa’s Development RCPMI: Regional Cassava Processing and Marketing Initiative R&T: Roots and Tubers RTIMP: Roots and Tubers Improvement Marketing Programme USD: United States Dollar VAT: Value Added Tax WCA: Western and Central Africa Exchange rate: 1 USD=1,4 GHC (August, 2010)
  • 6.
  • 7. Executive Summary The study has assessed the technical and financial feasibility to put in place in Ghana a gasifier and a biogas plant which use cassava wastes (peels, barks and wastewaters), along with maize wastes (stalks and leaves) and Shea nuts husks as feedstock to generate bio-energy (electricity and hot/cold air). The study results from observations made during field visits implemented by a team of RCPMI and RTIMP specialists in the Ashanti and Brong-Ahafo regions of Ghana in August and September 2010 and build s up on a similar study that the RCPMI carried out in Nigeria during the first quarter of 2010. Although the technical and financial analyses included in this study refer to Ghana, similar results can be expected when the same investments are implemented in other countries of the WCA region, as the previous study in Nigeria clearly showed. Adaptation of financial parameters would however be required. The technical feasibility has been based on laboratory analyses carried out in India and Nigeria to assess both ignition and flow performances of the biomasses (cassava peels, blends of sawdust/wood shavings, wastewaters) to be used as feedstock. Based also on the outcomes of these analyses, investments in equipments and materials for the production of bio-energy (electricity and bio-gas) through a gasifier and a biogas plant have been worked out, including for a practical application (pilot plant) in the Asueyi community –Techiman Municipality, which is one of the major cassava producing areas of Ghana. Total investment costs for a “turn-key” investment were estimated at USD 340,000 in the case of the gasifier and USD 31,000 for the bio-gas plant. Working capital to pay off short-term liabilities during Y1were estimated at USD 10,000/year for the gasifier and USD 800/year for the bio-gas plant. All the money required to meet both fixed and variable costs (including financial ones) has been supposed to be borrowed from local banks at a 22% interest rate; as it could be expected, this fact is significantly increasing the overall cost of for the proposed investments. In the light of the relatively low investment cost for the bio-gas plant, it would be quite easy to replicate the proposed investment at a local (village) level. However, this would not be recommended for the gasifier for which, given the high investment cost, a central plant serving several villages at the same time would be more recommendable. Both plants are assumed to work a total of 22 hours/day during 330 working days/year; however, sensitivity analysis shows positive results also when the gasifier plant works just 18 hours/day (during 330 days/year). 1
  • 8. Revenues for both plants have been derived by: (i) first converting their expected outputs (either electricity or heat) into liters of diesel or kilograms of firewood –which, in rural areas of Ghana, are the feedstock most widely used to currently produce energy (electricity) and heat, and (ii) then multiplying the resulting values (lts or kgs) for the respective market prices prevailing in the region targeted with this study. Annual cash-flows (both current and discounted at 22% discount rate) for the gasifier remain positive throughout the entire investment’s life (10 years); net profits (after payment of corporate taxes) are positive starting from Y1 (USD 6,000) till Y10 (114,000). Much less favorable outcomes are obtained from the financial analysis for the bio-gas plant, for which annual cash-flows (current and discounted) and net profits become positive as from Y8. The resulting IRR for the gasifier ranges between 21% and 17% (depending on which of the two investment opportunities covered with the study is considered) and is significantly higher than the average interest rate (10%) paid on bank accounts/deposits in Ghana. IRR continues to remain very appealing even when, with the sensitivity analyses, major changes are made in the assumptions. Pay-back period is 5 or 6 years, depending on the option considered. IRR and pay-back period for the bio-gas plant do not show to be very appealing, mostly because the high incidence of financial costs over overall cost structure. Given the high positive effects on both the environment and workers’ health that the use of cassava solid and liquid wastes have when they are used to produce energy the implementation of a detailed environmental impact analysis –not undertaken with this study, though recommended- would show even higher overall impact than the one this study could estimate. Current practices for disposing off these cassava by-products in WCA are, in fact, extremely risky for soils’ fertility, purity of table waters and for the health of industry operators and the general population, especially in rural areas where cassava is processed. 2
  • 9. Part A: Objective of the study and methodology used 1. Objective Objective of this technical and financial study is to assess the feasibility of setting up a pilot plant to produce bio-energy from cassava processing wastes and other suitable biomasses -such as: sawdust and wood shavings, maize stalks and leaves, Shea nuts husks etc. All information presented in this study is real and based on data and figures collected in Ghana in the course of August and September 2010. The feasibility includes also a concrete application for a pilot plant proposed to be set up in the Brong-Ahafo region -more precisely, in the municipality of Techiman. However, it is worth highlighting that what presented in the following pages could be easily adapted to other geographic contexts, both within the West and Central Africa region and elsewhere in Africa. This study assesses the technical/financial feasibility for the two following plants: • A gasification plant to produce bio-energy from a blend of wastes from cassava (peels, barks and small roots), sawmill (sawdust, shavings and small pieces of wood) and other suitable bio-masses (resulting from maize and nuts processing); • A methanization plant (biogas) to produce bio-energy from wastewaters resulting from cassava processing and by means of an anaerobic bio-digestion. For each of the two plants above, a separate technical/financial feasibility has been implemented for the two following options: • Option 1): General case: Production of bio-energy to be sold on the local market to any potential interested buyer; • Option 2): Pilot plant (application): Production of bio-energy to be utilized in the context of a specific pilot plant proposed for implementation (jointly with RTIMP) in the Brong-Ahafo region -more precisely, in the community of Asueyi. 2. Methodology used This feasibility study further develops the outcomes of the following research work that the RCPMI carried out, and published, in March 2010: “Squaring the circle: how food and fuel can be produced in a complementary and not competitive manner - The use of cassava wastes to produce energy: outcomes of a feasibility study implemented in Nigeria 1 ”. As in the case of the Nigerian study 2 , also the technical and financial feasibility proposed for Ghana foresees the setting up of pilot plants which make use of 1 The study is available on internet at: www.fidafrique.net. 2 The pool of RCPMI consultants involved in the preparation of the study in Nigeria included: Dr. Govind Prasad Nagori, Ankur biogas specialist; Mr. Giuseppe Amoriggi, RCPMI/Technologist; Mrs. Chiara Calvosa, IFAD/Economist and local specialists from the IFAD-supported: “Roots and Tubers Expansion Project (RTEP)” in Nigeria. 3
  • 10. cassava wastes and other biomasses available locally as feedstock for bio-energy production (both as electricity and cold/hot air). The methodology adopted to carry out this study includes the implementation of: (i) field visits in Ghana for collecting primary and secondary data3, (ii) laboratory analyses4, (iii) face-to-face meetings with local cassava producers and processors, (iv) visits to a sample of small-medium wood processing factories and (v) working sessions with the IFAD specialists 5 attached to the IFAD-funded: “Roots and Tubers Improvement Marketing Programme (RTIMP)” of Ghana. The activities carried out in Ghana during the field visits can be summarized as it follows: Visits to cassava producers and processing centers of different size and making use of different technologies; Visits to local small and medium-size wood processing factories; Visits to a local nut processing factory (“Ghana Nuts Ltd”); Visits to several cassava Good Practice Centers (GPCs) which are currently being set up by RTIMP and benefiting from its assistance countrywide; Working sessions with RTIMP staff and local experts, including from the GRATIS Foundation and the Food Research Institute. During the visits mentioned above, data on solid and liquid wastes and on the power required by each processing unit visited, along with present practices to reuse/dispose off wastes, were documented with reference to: (i) cassava peels (particularly when obtained trough manual peeling); (ii) waters resulting from cassava washing and processing; (iii) wood shavings; (iv) sawdust; (vi) maize stalks and leaves; and (v) Shea-nuts husks. The field visits allowed RCPMI specialists to ascertain the availability of wastes, besides those from cassava processing and which could be used for gasification and bio-methanation purposes. 3 From national and international research centers such as the: Food Research Institute/Ghana, International Institute for Tropical Agriculture/Nigeria, Bank of Ghana, GRATIS Foundation/Ghana. 4 Laboratory analysis on the cassava samples were carried out by the Ankur Scientific Energy Technologies Pvt. Ltd., Vadodara, India. 5 Mr. Vincent Cyril Akoto, Processing & Post Harvest Specialist, RTIMP/Kumasi. 4
  • 11. Part B: Technical aspects about the production of bio-energy from cassava wastes and other biomasses 3. Suitability of wastes from cassava and wood to produce bio-energy: outcomes of laboratory analysis 3.1. Outcomes of laboratory analyses The lack of data on the suitability of cassava wastes (peels, barks, wastewaters) and wood wastes to generate bio-energy made necessary to work them out through targeted proximate laboratory analysis. Laboratory analyses were then carried out at Polytechnics Laboratory, Ibadan, Nigeria and Ankur Laboratory, Vadovara, India. Extensive details on outcomes of these analyses are provided in Annex I for cassava peels and barks and in Annex II for wood shavings and sawdust mixture. However, a short summary of the main results is given in the following paragraphs to easy the reading of this report. 3.2. Cassava peels and barks Cassava peels/barks have low ash content (<5%) and an ash fusion temperature above 1200°C. Their bulk density remains above 250 even after drying; this makes them to flow easily and burn well. The peels have a high moisture content (~66%), which makes their drying a necessity to bring the moisture content down to 20% and make them suitable for gasification (generation of producer gas). Fig. 1: Dried peels/barks Fig. 2: Raw peels/barks 3.3. Wood Shavings and Saw Dust In order to be used for gasification purposes, wood shavings and saw dust needs to be blended in a 7:3 proportion and have an overall moisture content lower than 20%. When burned, the blend of wood shavings and saw dust (mixed in a 7:3 proportion) shows a low ash content (<5%) and an ash fusion temperature above 1200°C. Its bulk density is low (which makes the blend not very suitable for gasification) and it does not flow easily; however, it burns well. However, after being mixed with dried cassava peels (in a 1:1 proportion), ability to flow smoothly inside the gasifier increases significantly. 5
  • 12. Fig 3: Dried wood shaving/sawdust blend 3.4. Wastewaters resulting from cassava processing The analysis of cassava washing/processing wastewaters conducted at the Polytechnics Laboratory in Ibadan (Nigeria) resulted in the following: • Total solids : 4,500 mg/L • Total suspended solids : 1,450 mg/L • Total volatile solids : 2,000 mg/L • pH : 5.14 The results above indicate that the wastewater is acidic in nature and has good amount of volatiles, i.e. biodegradable matters. This is also evident from the review of the existing literature on this issue, which for this kind of wastewaters provides the following data: • BOD : 3,400 – 6,018 mg/L • COD : 3,870 – 6,680 mg/L • Free Sugars : 640 – 2,075 mg/L • Total Solids : 4,000 – 6,600 mg/L • Nitrogen : 65 – 74 mg/L Based on the value of the organic load reported above, one liter of cassava wastewater has a potential to generate from 2 to 3.5 liters of biogas. 6
  • 13. 4. Technological aspects related to the generation of bio-energy from cassava and other suitable wastes 4.1. Technological aspects: generalities While energy can be derived from bio-masses using the gasification technology –through which “producer gas” is generated, in the case of wastewaters biogas is obtained using a bio-methanation technology. While the gasification plants are easily available on the international market with an installed capacity ranging from 5 KW/h up to 2200 KW/h, this is not the case for bio- methanation technology. Plants to utilize this technology have, in fact, to be designed on a case to case basis, according to specific customers’ needs. 4.1.1. Gasification technology Gasification consists in the conversion of solid renewable biomasses into a mixture of combustible gases, called “producer gas” (CO + H2 + CH4) 6 , from which energy is generated. Gasification can refer to the use of various biomasses and concerns their partial combustion. A partial combustion process occurs because not enough oxygen (O2) is available to allow a full combustion of biomasses to take place. The gasifier is essentially a chemical reactor where various physical and chemical processes take place. The reactor is fed with biomasses that, in order to be digested, may need to be previously cut into pieces and need to have a moisture content below 20%. The gasifier generates “producer gas” which, once it is produced, cannot be stored and has therefore either to be burnt inside an appropriate burner or fed to diesel engines thus replacing diesel oil, furnace oil, other petroleum derivatives or firewood. The “producer gas” can, therefore, be used to generate both power (electricity) and thermal applications (hot or cold air), as shown respectively in flow diagram number 1 and 2 here after. 6 The chemical components of a producer gas, when derived from wood, are the following: CO 15÷20%; H2 15÷20%; CH4 up to 3%; N2 45÷50%; CO2 8÷12%. 7
  • 14. Flow Diagram n. 1 - Gasifier to produce electricity as main output Exhaust Gas Chillers and filters Engine 120 kWe Electrical 120 KW Panel Gasifier Electricity 100 kWe Hot air Hot Air Generator (HAG) Burner Electricity Biomass Dryer (Hot air + exhaust gas mixture to dry 200 kg/h of biomasses in 22 hrs) Equipments + lightening system (for a consumption up to: 90 kWe in 22 hrs) 8
  • 15. Flow Diagram n. 2 - Gasifier to produce electricity and hot air Exhaust Gas Chillers and filters Engine 120 kWe Electrical 120 KW Gasifier Panel Electricity 100 kWe Hot air Hot Air Generator (HAG) Burner Biomass Dryer E Electricity (Hot air + exhaust gas Hot air mixture to dry 200 kg/h of biomasses in 22 60 kWe hrs) (To operate the flash drier 90 kWe Hot air from HAG during 10-12 hrs ) (To operate the to flash dryer flash dryer + other (7000 kg/22 hrs or equipments during 10 320 kg/hr to decrease hours) moisture content from 40% to 10%) 9
  • 16. 4.1.2. Bio-methanation technology (biogas) Bio-methanation (biogas production) consists in the generation of a mixture of combustible gases (methane/carbon, dioxide/hydrogen sulphide and ammonia) through anaerobic fermentation (bio-digestion or bio-methanation) of organic wastes (both liquid and solid). Combustible gases are then stored and turned into energy by means of an electrical generator. Three fermentation process can be used to digest different bio-wastes: wet, dry and biphasic ones, with a digestion time ranging from 10 to 40 days. In the case of wastewaters, the liquid fermentation process is used and the digestion period ranges between 16 to 120hs. The mixture of biogases generated through bio-methanation comprises, in volume terms: methane (CH4) 55÷80%; carbon dioxide (CO2) 20÷45%; hydrogen sulphide (H2S) 0÷1.5% and ammonia (NH3) 0÷0.05. A flow diagram showing the several steps (and facilities) required to process cassava effluents through anaerobic digestion is presented in the box here below. Gas Storage Unit Electricity Generator Biogas Raw Treated Effluent Effluent for aeration/disposal Collection High Rate Anaerobic Sump Treatment System As mentioned in Part A, bio-methanization technology will be proposed in this study both in the case of an investment to produce electricity to be sold on the open market (“General Case”) and of a specific pilot proposed in the Asueyi community (“Pilot Plant” or “Application of the General Case”). 10
  • 17. 5. Environmental aspects related to the generation of bio-energy from cassava and other suitable wastes 5.1. Current state of affairs in Africa (including Ghana) Cassava wastes, due to the nature of their contents, are highly polluting bio-materials which can affect the environment in different ways: • As solid waste, given that peels and barks are rich in organic residues (fibers and starch) and cyanides; • As gas (hydrogen cyanide); and • As liquid effluents, in view of their high content of cyanides, organic matters and suspended solids. The impact of cassava processing waste waters is particularly noxious on table-waters and surface waters. The financial costs to the environment and to the health of workers of the cassava industry and related to a poor disposal/management of cassava wastes have not been assessed yet. Nowadays, in Ghana, as in the other countries of the WCA region, the vast majority of cassava peels resulting from the processing of this root is either abandoned nearby processing sites, used as land fill or burnt. A fraction, difficult to estimate, is sun dried 7 (after having being washed, to remove dirtiness, and drained) and fed to pigs and goats. Fig. 3: Disposal of cassava peels/barks & Figure 4: Animals eating cassava peels wastewaters As mentioned above, improperly managed disposal of cassava peels and of cassava effluents resulting from produce processing poses serious threats to the environment and, therefore, to human health. National government and local municipalities in Ghana and elsewhere in the WCA region are facing increasing difficulties in the treatment and disposal of cassava wastes. As for the other biological wastes targeted by this study, they include primarily wood sawdust and shavings, which in Ghana are mostly burnt or abandoned nearby wood processing sites. However, also biomasses different from those resulting from wood processing (such as maize leaves and stalks) could be considered to produce bio-energy in case wood wastes couldn’t be procured in the needed amounts. 7 As of today, the production of sun-dried cassava peels in WCA is limited to the dry season (November to March), when solar radiation is at its peak. 11
  • 18. Figure 6: Wood wastes burnt near a Figure 5: Maize leaves and stalks processing factory 5.2. Environmental aspects linked to the use of the gasification technology Emissions from the gasification of cassava have been recorded and compared to the maximum limits internationally set for these specific gases by the Central Pollution Control Board (CPCB) 8 . As shown in Table 1 below, emissions resulting from the gasification of cassava bio-wastes are far below the permissible limits set by current international norms. Table 1: Analysis of gasification emissions PERMISSIBLE LIMITS EMISSIONS OBSERVED GAS AS PER CPCB NORMS ON CASSAVA CO 1.2 g/MJ 0.4 – 0.6 g/MJ NO 2.2 g/ MJ 0.7 g/MJ X Hydro carbons 0.3 g/MJ 0.005 g/MJ Particulate matter 0.2 g/MJ 0.005 g/MJ Source: Central Pollution Control Board (CPCB). Additional positive aspects of this technology are the fact that the latter allows: (i) to properly dispose off/re-use very polluting bio-wastes and (ii) to burn them with a quite limited side-production of sulphurs –thus contributing to fight acid rains occurrence. In addition, the charcoal obtained as a result of the combustion of target biomasses can be reused to feed the gasifier or sold as a combustible material. In quantity terms, the charcoal obtained corresponds to about 4% of the biomass fed to the gasifier and has a calorific value below 5.5 Kcal/kg. Also ashes resulting from the combustion are not polluting and can then be disposed off in the soil (as fertiliser) without risks for the environment -about 1 g of ashes is obtained for each 1KWh produced. Furthermore, use of bio-electricity from cassava wastes decreases potential damages to forests as it reduces the overall amount of firewood employed to produce heat (for cooking or other purposes). 8 For further details please visit: www.cpcb.nic.in/. 12
  • 19. Part C: Potential of producing bio-energy from cassava wastes and other biomasses in Ghana 6. Availability and requirements of cassava wastes 6.1. Cassava roots production in Africa and Ghana: some basic statistics According to FAO estimates (2006), world production of cassava roots stands at approximately 226 million MT, out of which 54% (122 million MT) are produced in Africa. In this specific context, West African countries produce the majority of cassava roots: 63 million MT, equal to 52% of the total African cassava production, followed by Eastern Africa countries with a production of approximately 31 million MT (or 25% of Africa’s total). As shown in the table below, with a yearly production of approximately 9.6 million MT, equal to 8% of the total cassava produced in Africa, Ghana is the third African largest producer. Table 2: Key figures on Cassava Production in Africa (FAO, 2006) Key Figures on Cassava Production in Africa (FAOStat, 2006) Cassava production in Africa Geographic area MT % Cassava production in the world Africa 122 088 128 100 Geographic MT % area Western Africa 63 261 251 52 Eastern Africa 30 757 886 25 World 226 337 396 100 Middle Africa 28 057 653 23 11 338 0 Africa 122 088 128 54 Northern Africa Major cassava production countries in WCA Asia 67 011 365 27 Country MT % Africa 122 088 128 100 Latin 37 041 521 16 Nigeria 45 721 000 37 America & DRC 14 974 470 12 Caribbean Ghana 9 638 000 8 Others 196 382 1 Benin 2 524 234 2 Ivory Coast 2 200 000 2 Congo 1 000 000 1 Cassava processing and marketing 13
  • 20. 6.2. Ghana: availability of cassava wastes and other target biomasses to produce bio-energy In Ghana, out of a total projected production of 9,638,000 MT of cassava roots (2006), almost 2,000,000 MT are estimated to be wastes, of which ~1,300,000 MT (13%) peels and ~700,000 MT (7%) discarded roots and barks; residues that remain available for further utilization. In Ghana, cassava is traditionally cultivated by smallholder farmers; in the same way, its processing is usually done by small-scale processing units, scattered all over cassava production areas. This makes that cassava wastes in this country are available, with rare exceptions, in limited volumes, at traditional processing plants. The same stands true for other bio-masses potentially suitable for bio-energy production after they are mixed with cassava peels/barks, with the exception of wood shavings/sawdust which can be found in large volumes at wood processing sites, everywhere in the country. Also volumes of waste-waters resulting from the processing of cassava roots are usually negligible as availability of water at processing sites is still very limited. Fig 7: Ghana - Cassava peeling in the open area In Ghana, as elsewhere in Africa, small farmers (mainly males) are mainly responsible for growing cassava, which is a year-round crop. Cassava roots are highly perishable and bulky, which makes their transport very expensive and their processing urgent. Processing is usually the responsibility of women who derive from the cassava paste several food products -such as, in the case of Western and Central Africa (WCA): gari, fufu, agbelima, starch and flour. Potential uses of cassava include also the production of: chips, pellets and alcohol. As of today, cassava derivatives are used by a wide range of industries such as those dealing with animal feed, textiles, bakery, confectionary, plywood and soft drinks. In terms of cassava by-products, the ones mostly available are: peels, foliage, starch bagasse, discarded roots, barks and wastewaters. 14
  • 21. 6.3. Ghana: Cassava waste requirements to implement the two target pilots 6.3.1. Gasification As previously highlighted, the gasifier will produce both electricity and hot air. The quantity of electricity to be produced will depend on the amount of hot air to be utilized either for just drying biomasses or for drying biomasses along with cassava derivatives (such as: flour, agbelima, starch etc). When just bio-masses to feed the gasifier are to be dried, the amount of electricity produced by the gasifier will be higher; the opposite will happen when also final cassava derivatives will have to be dried, as more heat will be required. Taking into consideration: (i) the limited amounts of cassava wastes (peels/barks) available at any given place in Ghana and (ii) the energy required to decrease from 66% to 20% the moisture content of the bio-masses to be gasified, a gasifier with an installed capacity of 120 KWh has been considered to be adequate to the needs addressed with this study. It has been, in fact, estimated that an installed capacity lower than 120 KWh would not allow a sustainable production of electricity, as most of the energy produced by the gasifier would not be used to produce electricity though rather to dry bio-masses for feeding the gasifier. A gasifier with an installed capacity of 120 KWh produces 500 m3/h of “producer gas”, equivalent to 550,000 Kcal/h; this requires a quantity of 200 Kg/h of dried biomasses. Box 1 here after shows the equivalence between raw and dried biomasses. Equivalence between raw and dried biomasses A total of 200 kg/h of a biomass at 20% moisture is required to operate a gasifier with an installed capacity of 120 KW/h. The 200 kg/h of biomasses should include, in equal proportions, dried cassava peels/barks and dried wood shavings and saw dust to assure the maximum performance of the gasifier. To obtain 100 Kg of cassava peels/barks, with 20% moisture content, a quantity of 235 Kg (Kg 100*0.8/0.34) of raw biomass (with 66% moisture content) is required. In the same way, to obtain 100 Kg of wood shavings and saw dust duly mixed (with 20% moisture content), a total of 115 Kg (100*0.8/0.7) of raw biomasses with 30% moisture content are required. Thus, the quantity of water which needs to be evaporated is: (235+115) – 200 = 150 kg/h. As a result, the total amount of energy required for drying target biomasses is: 150 x {536 kcal (Latent Heat) + 80 kcal (sensible heat 100 - 20°C)} = 92,400 kcal/h. In case the dryer used shows a 60% efficiency in its operations, the heat required would be (92,400 kcal/h ÷ 0.6) = 154,000 kcal/h, corresponding to 3,388,000 Kcal/day. Based on the above, Table 3 here below estimates the amount of raw biomasses needed to feed the 120 KWe gasifier during, respectively: 1 hour; 1 one day (of 22 working hours); and 1 year (of 330 working days), along with the equivalent amount in roots (expressed in tons) in the case of cassava. 15
  • 22. Table 3: Biomasses intake required to feed a 120 KW Gasifier Installed  Capacity  Biomasses intake to feed a 120 KWe gasifier (Kg and/or MT)  KW/h  Gross  Kg/120 KW‐h  tons/120 KW‐h/day  tons/120 KW‐h/330 days a year      Peels &  Other  Bio‐ Cassava Peels & Barks*  Other Bio‐masses  **  Cassava Peels & Barks*  Other Bio‐masses  **  Barks*  masses  **  1 h  1 h  10h/d  16h/ d  22h/d  10h/d  16h/d  22 h/d  10h  16h  22h  10h  16h  22h  A) Total intake of raw biomasses (moisture content: cassava peels/barks 66% and sawdust/shavings 30%)  120  Kg 235  Kg115  T 2.35  T 3.76  T 5.17  T 1.15  T 1.84  T 2.53  T 776  T 1,241  T 1,706  T 380  T 607  T 835    B) Total intake of raw materials expressed as: cassava roots and wood wastes   120  Kg 1175  Kg 115  T 11.75  T 18.8  T 25.09  T 1.15  T 1.84  T 2.53  T 3,878  T 6,204  T 8,280  T 380  T 607  T 835    C) Total intake of raw biomasses once they are dried at a  20% moisture content  120  Kg 100  Kg 100  T 1.0  T 1.6  T 2.2  T 1.0  T 1.6  T 2.2  T 330  T 528  T 726  T 330  T 528  T 726  16
  • 23. 6.3.2. Bio-gas To digest wastewaters resulting from the cassava processing, a high rate anaerobic digester is proposed to be used (capable to convert about 80% of the wastewaters’ organic load –or BOD- into biogas in a lapse of time ranging from 24 to 72 hours). On average, the amount of wastewaters that can be expected from the production of the cassava derivatives targeted with this study is of 1 liter for each kilogram of cassava roots processed. In total, about 18,000 liters/day of wastewaters -with an organic load (BOD) of 3,400 – 6,000 mg/L, can be expected every day at the pilot plant hereby proposed; this corresponds to a generation of about 37-56 m3/h of biogas -depending upon wastewaters’ original organic load. Biogas from effluents is made up for a 65-70% by methane, which calorific value is between 5,800-7,200 Kcal/m3. As most of the waste is liquid and most of the biodegradable materials are in soluble form, a high rate anaerobic digestion can assure that: • The populations of those bacteria responsible for the anaerobic digestion remain high and are retained inside the digester, which reduces the length of the digestion process to just few hours (see above); • Energy is recovered from the cassava processing wastewaters up to a total amount of 334,425 Kcal/day. The gas produced through anaerobic digestion can then be used to generate electricity for the unit or hot air for drying target biomasses and/or final food cassava derivatives. 17
  • 24. Part D. IFAD interventions in the cassava sector in Ghana 7. IFAD current and proposed interventions 7.1. Current interventions Through loans and grants, the International Fund for Agricultural Development (IFAD) has invested since 1980 a total of USD193.4 million into initiatives to reduce rural poverty in Ghana, thus making this country the second largest receiver of IFAD resources in WCA. Programmes and projects funded by IFAD cover a wide geographical area of this country and are designed to alleviate poverty and foster economic development. The overarching goal of IFAD's investments in Ghana is in fact “to enable poor rural people to improve and diversify their livelihoods in a sustainable manner”. IFAD aligns its assistance with the country's main policies and strategies for the agriculture and rural sector. Through its operations, IFAD targets specific development objectives within rural areas, including economic growth, gender equality, employment, service provision for human development, and governance for empowerment. In 2007, together with a group of 16 development partners, IFAD signed the Ghana-Joint Assistance Strategy (G-JAS), aiming at improving the alignment of development assistance with the core business of Government and with the Government’s political and partnership cycle. Since October 2009, IFAD has also been among the 15 signatories of the “Ghana’s Comprehensive Africa Agriculture Development Programme” (CAADP) Compact. This document renews the commitment of development partners to harmonize and align their assistance with the programmes and components of the Agriculture Sector Plan (2009-2015). In 2007, IFAD launched the “Regional Cassava Processing and Marketing Initiative” (RCPMI) for WCA, as a response to the call from African leaders, through the New Partnership for Africa’s Development (NEPAD), to accord priority to cassava in the regional agricultural development strategies. The RCPMI, which is currently funded through Italian and, to a much lower extent, Swiss and Finnish Government contributions, is being implemented in the context of the four national “Roots & Tubers (R&T)” development projects that IFAD is funding throughout the WCA region –specifically, in: Benin, Cameroon, Ghana and Nigeria. Since it started, the RCPMI has been providing IFAD-funded R&T projects in the WCA region with technical and financial assistance on issues related to cassava processing and 18
  • 25. marketing 9 . More specifically, in Ghana, the RCPMI has been collaborating with the “Roots and Tubers Improvement Marketing Programme/RTIMP”, an IFAD-funded project that has started its operation in 2007 and has its headquarter offices in Kumasi. RTIMP has among its main stakeholders and beneficiaries: the Ministry of Food and Agriculture, the National Food Research Institute, the GRATIS Foundation along with local small cassava producers, processors, traders and different kinds of providers of service to operators active within the cassava value chain. Among its activities, RTIMP (with also some ad-hoc support from the RCPMI) is also establishing several Good Practice Centres (GPCs) countrywide aimed at producing cassava derivates fully compliant with the standards set by domestic authorities responsible for food quality and safety. The GPCs are expected to gradually become demonstration centers for those local small entrepreneurs/processors who cannot be directly supported by RTIMP during the lifetime fixed for this project. Supply of water and energy at existing GPCs, located in the main cassava production/ processing areas, is very seldom catered for by public networks/grids. Water is, in fact, usually derived from rivers, collected in tanks from rain drains and, only in a few cases, pumped from dug-wells. Also supply of electricity from the available national grid is erratic. Diesel powered engines are therefore the most common way to (expensively) operate all equipments used in the cassava processing. Wood is also a major source of energy, although its use comes at a very high cost for the environment. Availability of a consistent and not too expensive supply of drinkable water and of energy constitute therefore a basic requirement for scaling up cassava processing operations in Ghana and the starting point for the research work covered under this paper. 7.2. IFAD proposals for setting up energy producing units from cassava processing wastes (biomasses and wastewaters) 7.2.1. Introduction As highlighted at Part A/Chapter 1, this study intends to assess the technical/financial feasibility of two plants: • A gasification plant to produce bio-energy through a gasifier with an installed capacity of 120 kWe; and • A methanization plant (biogas) to produce bio-energy by means of an anaerobic bio- digestor with an installed capacity of 18 000 lt/day. 9 The areas tackled varied considerably from one R&T project to the other and included issues such as: (i) stock taking, documenting and circulating good practices on cassava processing and marketing; (ii) setting up a regional (WCA) database on cassava equipment makers and their prototypes; (iii) introduction of new technologies; (iv) elaborating new approaches to the development of the cassava chain (including processing units prototypes for the production of several final derivatives and alternative ways for the different chain actors to increase their current degree of integration); (v) implementation of market information systems; (vi) elaboration of feasibility and market studies and trade strategies to support production and marketing of both traditional or new cassava derivates. 19
  • 26. For both the gasifier and the bio-gas plant, a separate technical/financial feasibility has been therefore carried out in the following pages. However, each of the two feasibilities comes as part of two options: • Option 1): General case: Production of bio-energy (electricity and heat) to be sold on the local market to any potential interested buyer; • Option 2): Pilot plant (application): Production of bio-energy (electricity plus heat) to be utilized in the context of a specific pilot recommended for implementation in the Brong-Ahafo region -more precisely, in the community of Asueyi. Therefore, while point 7.2.2 below provides technical details on an intervention (general case) to produce electricity and heat to be sold on the domestic market, point 7.2.3 (specific pilot) describes a pilot suggested for implementation in the Asueyi community and meant to produce bio-energy (electricity plus heat) to be used by five cassava processing facilities operating inside this community. The pilot covered with option 2 is, therefore, a concrete application of the concepts presented in the general case (option 1) and is based on the information and data collected on site by the IFAD (RTIMP and RCPMI) mission. The financial analyses assessing the sustainability and profitability of both options are covered and presented separately at Chapter E here after. 7.2.2. The General Case As already specified at Part A/Chapter 1, the general case described in this study covers an investment into a gasification plant (“gasifier”) and a biogas plant to produce energy (and, to a very limited extent, also heat) to be sold on the domestic market to any interested potential (institutional or private) buyer. A brief description of the gasification and bio-gas technology and related flow diagrams have already been made in Part B/Chapter 4 (sub-chapters: 4.1.1 and 4.1.2). The reader is therefore asked to refer to these two sub-chapters for details on the technology and flow- charts proposed for the “General Case”. However, it is worth highlighting once more that, in the general case covered with this study, the technology described in Part B is used mostly for the production of electricity and, to a much lesser extent, for the production of heat (hot air) to dry target biomasses to be used as feedstock for the gasifier. 7.2.3. The proposed pilot plant in the Asueyi community (application) As previously highlighted, this paper proposes also the implementation, through an RTIMP and RCPMI joint effort, of a pilot in the community of Asueyi (municipality of Techiman, Brong-Ahafo region) to put into practice the general concepts presented with the study. The proposed pilot would concern five cassava processing groups (out of which one has already received technical and financial support from RTIMP) operating in this Asueyi community, which is one of the main cassava producing areas of Ghana. 20
  • 27. According to data collected during field missions, each of the existing five (5) processing groups has a capacity to process between 10 to 20 tons/day of raw cassava roots –or 50 to 100 tons/day for the five groups. Cassava peels and barks resulting from the processing of these amounts of roots can be then estimated between 10 to 20 tons/day. The five selected groups in the Asueyi community are located very close one another, to the point that sometimes they share processing equipments. Gari and starch are currently the main outputs of their operations. However, the groups are in the process of negotiating a deal with an import-export company based in Accra for the production of dried agbelima (fermented cassava paste) to be transported bulk to Accra and then exported after having been packaged into 1 Kg retail pouches. As no electricity is available from the public grid, all equipments are operated manually, with the exception of the grater operated with energy generated through a diesel engine. Water currently available for cassava processing is limited and totally derived from rains which are collected from roofs into plastic tanks; this makes water available at processing sites not fit for drinking purposes. However, table water is reported to be located at a reasonable depth. These constraints in the availability of basic inputs (energy and water) make it very difficult to either improve the quality of the traditional cassava derivatives or engage in the production of new derivates (such as the dried agbelima mentioned above). Roasting operations to produce gari expose workers (mostly women) to toxic fumes as women are forced to lean on the roasting pans to turn around gari, thus inhaling them. Through the proposed pilot, the energy to be generated from biomasses is expected to be used to operate: • Pumps to extract water from table-water and to fill reservoirs, from where it will be spilled to wash peeled cassava roots and clean fermentation vats, pressing areas, floors and equipments. Use could also include the provision of drinkable water to nearby villages; • Processing equipments (such as: graters, presses, centrifuges, sifters, ventilators of flash driers, milling facilities, air conditioners and office equipment). Motorized gari frying pans may be introduced to avoid workers exposure to hydrogen cyanide fumes. As motorized gari frying pans are much larger than traditional pans, their use should allow a decrease in gari production cost as outputs’ volumes would increase. The same wastewaters resulting from the operation of centrifuges would be dried with the flash driers to produce a starch of improved quality. In order to increase both the quantities of raw materials currently processed and the present quality of cassava derivatives, it will be necessary that the following extra- equipments and facilities integrate the proposed pilot in Asueyi community: 21
  • 28. A flash drier, with a capacity of producing 5 tons/24 hours of dried product (starch, agbelima or flour) (~208 Kg/h of dried product with 8 to 10% of moisture content, equivalent to 310Kg/h of wet product/paste with 40 to 45% of moisture content); • One electrical roaster, equipped with rotating paddles, s.s. pan (ø 2.5 m), fireplace and chimney, to test the new technology and show new practices for producing gari; • A borehole, with a 6 m high overhead tank of 40,000 liters from which water would be distributed by gravity. The borehole would have to be sited in a way that all five processing groups can be easily served. Consistent availability of water, as much as electricity, would be essential to assure produce consistency of final products’ quality and sustainability of overall processing operations; • A 4 m high shed (dimension 10m x 25 m) for the peeling, washing and fermenting operations. Each group would have access to 40 m², including washing basins; • A 6 m high shed (dimension 10m x 20 m) where the following equipments would be installed: one flash drier (5,000 Kg of dried product/day); two centrifuges to reduce the moisture content of the cassava paste produced by the five processing groups, a milling device and a sifting machine. Storage space for packaging material and finished products would be also provided. The main thrust for the proposed pilot is that larger volumes (from the current 1 MT/day to a planned 5 MT/day) and better quality of final cassava derivatives are going to be produced. A decrease in unitary production costs (thanks to both an increase in overall output and a lower energy input) is, in fact, the primary condition to be met to assure that the proposed investment can be financially sustainable in the long term –especially considering that prices of the target final cassava products are quite rigid on local markets and therefore difficult to significantly modify. 22
  • 29. PART E. Profitability of producing bio-energy in Ghana E.1. General case: Outcomes of a Technical and Financial Analyses E. 1.1. Technical Analyses 8. Heat requirements and utilization The objective of the proposed investments is to produce 120 KWh of electricity from cassava wastes blended with wood wastes. Gasifier: Considering the energy required for producing electricity and hot air to dry target biomasses and to keep the system going, a gasifier with an installed capacity of 120 KW/h has been estimated to be required. However, out of the installed capacity, no more than 100 KW/h of net output can be expected, enough to produce 500 m3/h (or 11,000 m3/day) of “producer gas” equivalent. Out of these 100 KW/h of net output, a total of 15-20 kW/h will be used as captive power to run the equipments. In the same way, of the total hot air to be produced from the gasifier, a share will be employed for drying final cassava derivatives while the remaining share, together with the heat derived from the exhaust engine, will be used for drying target feedstock biomasses. More in particular, the total production of 11,000 m3/day of producer gas is expected to be utilized in the following way: • 6,600 m3/day to generate a gross power of 2,200 KWh/day (22 hours), corresponding to 7,260,000 Kcal/day. Considering a captive power of 265 KWh/day, a net quantity of electricity equals to 1,935 KWh/day (or 88 KW/h) will remain available (on average) for sale on the local market, corresponding to 5,938 m3/day and 6,385,600 Kcal/day; • 4,400 m3/day to generate heat, corresponding to a total of 4,840,000 Kcal/day. Considering the exhaust gas from the system equal to 806,819 Kcal/day, a total amount of heat corresponding to 5,846,810 Kcal/day will then be available from the gasifier. Out of this quantity, 3,388,000 Kcal/day will be used for drying feedstock biomasses and 2,258,810 Kcal/day as heat production surplus (available for sale). The proposed gasifier system will be composed of a down draft gasifier, along with a gas cleaning and cooling system -to produce ultra clean gas for electricity and heat generation, a gas engine and an air generator. The full list of the equipments and materials, required to run the system is provided in the Annex 4 (along with a list of the civil works needed to put in place the gasifier), while the corresponding gasifier flow diagram is shown at Chapter 4 (Part B). Biogas plant: The plant taken into consideration with this study generates about 52.5 m³/day of biogas (equal to 334,425 Kcal/day). Considering that 12,912 Kcal/day will be absorbed by the system, a net volume of 301,513 Kcal/day (or 71 KWh/day and 23,430 23
  • 30. KWh/year), would remain available for use. The flow diagram of the proposed biogas plant for treating cassava effluents through anaerobic digestion is also shown at Chapter 4 (Part B). Table 4, here below, provides a summary of the heat generated and used by both the gasifier and the bio-gas plant and, at the same time, estimates the heat that would remain available for sale on the domestic market. Table 4: Heat balance and equivalence System Generation/Production/Consumption Corresponding volume Unit 22 h/day Year/330d Gasifier m³/day Kcal/day Kwh/d Diesel Kwh/y LDiesel/y Tons Gross Net Gross Net L/d Firewood/y Producer gas 11,000* Electricity generation Energy production 6,600 7,260,000 2,200 726,000 Captive power 795 874,500 265 87,450 Net production 5,938 6,385,500 1,935 Net power 1,935 637 638,368 210,210 Total 210,210 Heat Generation Gross production 4,400 4,840,000 Exhaust gas 806,810 Total production 5,646,810 Drying biomass 3,388,000 Net production Drying product Balance to be sold 2,258,810 (225) 74,250 1,485 Total 225 74,250 1,485 Unit 22 h/day Year/330d Biogas m³/da Kcal/day Kwh/d Diesel Kwh/y Diesel/L y Gross Net Gross Net L/d Biogas Biogas/methane 52,50 ** Heat production 334,425 78.75 System absorption 32,912 7.75 Net production 301,513 71.00 23,430 Equivalence 23 7,710 Total 7,710 * Calorific value of producer gas: 1,100 Kcal/m³. ** Calorific value of biogas/methane = 70% of methane = 6,370 Kcal/m³. 24
  • 31. E. 1.2. Financial Analyses 9. Profitability of the proposed investments 9.1. Generalities This section provides for a detailed analysis of the profitability of the investments required to produce bio-energy from all bio-wastes previously described. As mentioned earlier on, a separate analysis has been undertaken in the case of the gasifier and of the biogas, so as to provide a detailed and separate description of the profitability for each of two proposed investments. In order to estimate revenues, it has been necessary to convert the total energy (electricity plus heat) generated by the gasifier and the biogas plants -and expressed into Kwh and Kcal- into liters of diesel and tons of firewood. The reason why diesel and firewood have been chosen (as shadow prices) to estimate the revenues is that on the Ghanaian market diesel is, at the moment, the fossil fuel mostly used for energy generation, as firewood is for heat production (especially in rural areas). Therefore, the domestic market price for diesel has been retained as the referential price for estimating the value of the electricity generated by target investments, while the one for firewood has been retained for estimating the value of the heat produced. 9.2. Total energy expected to be produced The total energy expected to be produced by the proposed gasifier is 7,260,000 Kcal/day, of which 874,500 Kcal/day (or 12%) are assumed to be consumed by the system as “captive power”. Therefore, the resulting quantity of energy produced by the gasifier and available for sale corresponds to 6,385,000 Kcal/day (88%), equal to 638,368 Kwh/y (equivalent to 210,210 liter of diesel/year). With reference to the heat generated, a total production of 5,646,810 Kcal/day (including gross production and exhaust gas) is expected, assuming that the plant will be working 22 hours/day for a total of 330 days/year. The amount of heat remaining available for sale (once the heat required to dry biomasses is deducted), stands at 2,258,810 Kcal/day, equivalent to 1,485 tons of firewood/year. The biogas plant proposed with the pilot is expected to produce a total of 334,425 Kcal/day, out of which 32,912 kcal/day will be reused by the same plant. Therefore, a total of 301,513 Kcal/day -equal to 23,430 Kwh/year or 7,710 liter of diesel/year- would be available for sale on local market. 25
  • 32. 9.3. Key information and main assumptions for implementing financial analyses for both the gasifier and the bio-gas plant Key information Gasifier Total investment costs: 340 000 USD, to be entirely borrowed from local banks at a 22% interest rate and to be paid back through equal installments (capital) plus interests on the remained debt over a period of 7 years10; Civil works, including assistance to installation and commissioning, have been also considered as part of fixed costs and estimated at 40 000 USD; Depreciation: 10 years for equipments and 15 years for civil works; Working capital: about USD 10 000. Expected to be needed during the first four months of Y1 to pay off short-term liabilities; Timeframe for the analysis: 10 years. Bio-gas plant Total investment costs: 28 880 USD, out of which about USD 21 000 for purchasing the equipments and USD 7 500 for civil works. The entire amount is expected to be borrowed from local banks at a 22% interest rate and to be paid back through equal installments (capital) plus interests on the remaining debt over a period of 7 years; Civil works, including assistance to installation and commissioning, have been also considered as part of fixed costs and estimated at USD 7 500; Depreciation: 10 years for equipments and 15 years for civil works; Working capital: about USD 800. Expected to be needed during the first four months of Y1 to pay off short-term liabilities; Timeframe for the analysis: 10 years. Main assumptions (for both gasifier and bio-gas plant) i) Cost of diesel: 1,18 GHS /liter equivalent to 0,8 USD/liter; ii) Price of electricity available from the public grid: GHS 0,47/Kwh, equals to USD 0,335 Kwh – including VAT and NHS; iii) Processing plants working hours: 22 hours/day for 330 days/year. Start up costs, in terms of fuel requirements and annual operation and maintenance costs have been included; iv) Revenues: derived based on the following sales’ projections: • Gasifier: a total of 638,368 Kwh/year, equivalent to 210,210 liters of diesel/year, are sold at 0.8 USD/lt (which is the current market price for diesel). As for the heat, a total of 2,258,810 kcal/day, equal to 1,485 tons of firewood/year, are sold at 15 USD/t; • Biogas: a net production of 23,430 Kwh/year, equal to 7,710 lt diesel/year, is sold at 0.8 USD/lt -which is the current market price in Ghana for diesel, that is normally used to produce electricity; 10 This assumption is built on the lending terms currently enforced in Ghana. 26
  • 33. v) Interest rates applied: • Passive: the average passive interest rate applied in Ghana is equal to 23% (including administrative fees11) for industrial investments. As for the agricultural investments12 it decreases to 22%; • Active (on deposits): 10%13 on average; vi) Discount rate (to discount expected annual cash flows at Y1): 22% (equal to passive interest rate applied to agribusiness investments); vii) Price of fresh cassava roots: 50 GHS/t (equal to approximately 35 USD/t), which is an average price estimated to well reflect market price variations occurring during the rainy and the dry seasons; viii) Transport costs of bio-masses (i.e. cassava peels and barks, maize stalks and leaves and Shea nuts) from production sites to the plant site: 15 GHS/t, equivalent to approximately 10 USD/t including both fuel and remuneration of the workforce (one driver and one unskilled worker) required to transport target biomasses; ix) Transport costs of equipments and materials –from India to Accra, along with assembling and start-up/training costs: included as part of the fixed costs; x) Social security costs calculated as 13.5% of the employees’ monthly gross salary; xi) Taxes on incomes: although in Ghana they stand at 25%14 in the case of private enterprises, a rate of 10% was used in this study being this the rate reported to be applied in the region (Brong-Ahafo) targeted with this paper; xii) National taxes on Value Added in Ghana stand at 12.5%, while the National Health Service tax is at 2.5%. 9.4. Outcomes of the financial analysis 9.4.1. Gasifier The technical and financial analyses refer to an investment timeframe of 10 years and are included in Annex 3. Main elements considered in the analyses, along with the obtained outcomes, are summarized here below: Total costs (including investment costs for about 340 000 USD, along with capital and operating costs) show a steady decrease over the 10 years period, from approximately USD 184 000 in Y1 to approximately USD 60 000 in Y10; Estimated yearly repayments of capital for implementing the investment (purchase of equipments and construction of facilities) and on working capital, along with related interests, range then from USD 123 000 in Y1 to USD 60 000 in Y7; Net profits after corporate taxes are positive already starting from Y1 at approximately 6 000 USD. They increase up to approximately USD 114 000 in Y10; Annual cash flows remain positive over the entire life of the investment. More specifically, the annual cash flow is approximately USD 38 000 in Y1 and approximately USD 146 000 in Y10. Also the analysis of discounted annual cash flows confirms satisfactory results throughout the entire life of the investment; 11 As of August, 2010, Ghana Commercial Bank. 12 As per information provided by the Agricultural Development Bank, which specifically finances investments in the rural areas of Ghana. 13 Source: Bank of Ghana Notice No. BG/GOV/SEC/2010/11. 14 As of August, 2010. 27
  • 34. The internal rate of return (IRR) of this investment results to be 17%, while the pay back period is slightly less than 6 years. These two values clearly show the positive returns to be expected from this investment -as previously highlighted, interests accrued on bank accounts in Ghana are at around 10%; A sensitivity analysis has been carried out using two different scenarios: (i) a ±15% variation of the investment costs15 and (ii) a 20% decrease in the market price of energy. Under the first scenario, when total investment costs increase +15% to equal 391 000 USD, net profit after taxes results to be positive as from Y3 (equal to approximately 7 000 USD), while annual cash flow become positive already from Y2 (approximately 30 000 USD). IRR results to be equal to 11% and the investment can be paid back in approximately 7 years (slightly more than in the previous case). Under the hypothesis of total investment costs equal to 289 000 USD (-15% variation), net profit after taxes results to be positive already from Y1 (equal to approximately 27 000 USD) and increases up to approximately 118 000 USD in Y10. Also annual cash flows results to be positive from Y1 (approximately 53 000 USD). IRR results to be 24% and the investment pay back period less then 5 years. Under the second scenario, a 20% reduction of the diesel market price has been considered (market price equal to 0.64 USD/lt), while the market price of a ton of firewood has been assumed to remain stable. Net profit after taxes results to be positive from Y4 (equal to 4 600 USD), while annual cash flow becomes positive as from Y1 (approximately 4 700 USD). IRR results to be equal to 7% and the investment pay back period becomes less than 8 years. 9.4.2. Biogas plant The technical and financial analyses refer to an investment timeframe of 10 years and are included in Annex 4. Main elements considered in the analyses and outcomes obtained are summarized here below16: • Investments costs for equipments and materials: approximately USD 28 800, including about USD 21 000 for the equipments and USD 7 500 for civil works; • Depreciation timeframe: 10 years for equipments (approximately 2 000 USD/ year) and 15 years for civil works (300 USD/year); • Estimated yearly repayments (over a seven year period) of capital borrowed for implementing the investment (purchase of equipments and construction of facilities and on working capital), along with related interests (22%/year), range then from approximately USD 10 400 in Y1 to USD 5 000 in Y7; • Production costs, including fixed and variable costs, for generating a total of 23 430 kwh/year -equivalent to 7 710 liters of diesel: USD 4 745; • The flow of net profits (after payment of corporate taxes equal to 12.5% of total profits) becomes positive as from Y8 at about USD 1 200, which remains stable till Y10. 15 Capital costs have been derived accordingly. 16 Given the technical specification of the biogas plant, the outcomes of these analyses can (and will) be used also for the concrete application relating to the pilot proposed for the Asueyi community. However, this is not the case of the specific economic/financial feasibility analysis for the gasifier, for which a separate analysis is required (and implemented in Part E.2: “Case study”). 28
  • 35. E.2. Pilot Plant (Application): Outcomes of a Technical and Financial Analyses E. 2.1. Technical Analyses 10. Electricity and heat total requirements and expected uses Electricity total requirements and expected uses The underlying assumption of the Asueyi pilot plant is that it will process 25 tons/day of raw cassava roots into 7 tons/day of cassava paste (with a 40 to 45% moisture content), to be then flash-dried into about 4-5 tons/day of high quality dried cassava products. All the electricity needed to run equipments and the hot air needed to dry the biomasses to be burnt in the gasifier along with the finished cassava food derivatives to be marketed, is expected to be derived from target biomasses. Table 5, here below, summarizes the total quantity of heat required to process 25 tons/day of cassava roots. As per the amounts of cassava roots, raw biomass and dried biomasses required to feed the gasifier proposed to be set up in the context of this pilot (always with an installed capacity of 120 KW), they would be the same as those calculated for the “General Case” in Table 3 (Part C/sub- chapter 6.3.1). In the context of the pilot planned in the Asueyi community, electricity is required for operating electric motors of the processing plants making up the pilot unit (graters, sifters and centrifuges), ventilators of the flash dryer, motorized roasters, the water pump and the lighting of offices, working areas etc. The maximum quantity of electricity absorbed by the pilot plant has been estimated at about 100 kW/h. However, data on consumption have been estimated considering a consumption of up to 90 KW/h during 10 hours and up to 60KW/h during 10-12 hours, when only one centrifuge, the ventilators (of the flash drier), the miller and the plant’s lightening grid would be operated –the centrifuge and the miller are, in fact, not expected to run continuously). Electricity consumption of single equipments has been estimated, at their peak, equals to: 28 KW/h for the flash drier; 11 KW/h for the centrifuge; 20 KW/h for the grater and/or the sifter; 5 KW/h both for both the roasting pan and water pump. Electricity for running the flash drier, set up to produce 4-5 MT/day of dried final food products, will be needed for a maximum of 22 hours/day, while electricity for operating graters and sifters will be required for few (2-3) hours/day only. All other equipments will be operated according to needs and the energy required correspondingly. The net consumption of electricity for a working day of 22 hours is expected to be about 65 KW/h (or 1,425 KWh/day), which correspond to 4,275m³/day of producer gas or 4,702,500 Kcal/day. The features of the product to be dried in the context of the pilot plant in Asueyi community are as it follows: • Initial moisture level of the wet paste after centrifugation (40% to 45%) 29
  • 36. Final moisture content of dried cassava derivatives: 8% to 10% • Total quantity of wet products to be dried: 7 tons/day (or 16 hours) • Total quantity of final (dried) output: 4.5 tons/day (or 22 hours) • Hot air required for drying (180°C) wet material: 3585 m³/h The energy required to decrease by 30% the moisture content of the 7000 kg/day of wet cassava paste is calculated at: 2,156,000 kcal/day (or 98,000 kcal/h), as per the following calculations: • Total quantity of water to be evaporated from the 7000 kg/day of wet cassava paste = 7000 X 0.3 = 2100 kg/day • Energy required to evaporate the quantity of water above: 2100 kg/day x {536 kcal (Latent Heat) + 80 kcal (sensible heat 100-20°C)} = 1,293,600 kcal/day. This amount increases to 2,156,000 kcal/day (1,293,600 kcal ÷ 0.6) or 98,000 kcal/h assuming that the dryer operates at a maximum efficiency of 60% and during 22 hours/day respectively Heat total requirements and expected uses A 120 KW/h gasifier, to be used to both generate electricity and hot air- has been considered for this investment. However, out of this installed capacity, no more than 100 KW/h of net output can be expected (of which about 15-20 kW/h are to be used as captive power), enough to produce 500 m3/h of producer gas equivalent (equal to 550,000 Kcal/h). In a day of 22 working hours, 11,000 m3/day of producer gas will be produced, corresponding to 12,100,000 Kcal/day. As the heat generated from the engine exhaust gas 17 in a day of 22 hours will be 1,125,868 Kcal/day, the total daily amount of kilocalories generated by the gasifier will be 13,225,686 Kcal/day. The 11,000 m3/day of producer gas are expected to be utilized as it follows: • 4,860 m3/day to generate electricity, equivalent to a total amount of gross power of 1,620 KWh/day (22 hours), corresponding to 5,346,000 Kcal/day. Considering a captive power of 195 KWh/day, a net balance of 1,425 KWh/day will remain available to meet the electricity needs of the pilot, corresponding to 4,275 m3/day (or 4,702,500 Kcal/day); • 6,140 m3/day to generate heat for drying biomasses and final products, corresponding to a total of 6,754,000 Kcal/day. To this amount it should be added an additional quantity of 1,125,868 Kcal/day as exhaust gas produced by the gasifier. The total available heat generated by gasifier would then be 7,879,868 Kcal/day, of which 2,156,000 Kcal/day (corresponding to 1,973 m3/day) would be used for drying finished food derivatives (agbelima, flour, starch, etc.) and 3,388,000 Kcal/day (or 3,080 m3/day) for drying biomasses. A total amount of 2,335,868 Kcal/day (or 2,123 m3/day) would remain available for sale as heat surplus. 17 If an 120 KWe engine is used for generating power, the heat contents (at full load) of the exhaust gas can be so calculated: (a) Gas + air required for the 120 kW engine = 120 x 7.8 kg = 936 kg; (b) Total flue gas quantity of 120 kW engine: 2035 m3/h (936 kg/h) @ 450°C; (c) Heat required for drying purposes -from 450°C to 120°C (∆T 330°C)- corresponds to m cp ∆T = 936 x 0.27 x 330 = 83,397 kcal/h. 30
  • 37. Table 5: Heat balance and equivalence System Generation/Production/Consumption Corresponding volume Unit 22 h/day Year/330days Gasifier m³/day Kcal/day Kwh/d Diesel Kwh LtDiesel Tons Gross Net Gross Net L/day /year /year Firewood/y Producer gas 11,000* 12,100,000 Electricity generation Total production 4,860 5,346,000 1,620 534,600 Captive power 585 643,500 195 Net Product. 4,275 4,702,500 Net Power 1,425 469 470,250 154,770 Heat Generation Gross production 6,140 6,754,000 Exhaust gas 1,125,868 Total production 7,879,868 Drying biomass 3,388,000 Net production 4,491,868 (448) Drying product 2,156,000 215 70,960 Balance to be sold 2,335,868 (233) 1,485 Total 684 225,730 1,485 Unit 22 h/day Year/330d Biogas m³/day Kcal/day Kwh/d Diesel Kwh/y Diesel/L Gross Net Gross Net L/d Biogas Biogas/methane 52,50** Heat production 334,425 78.75 System absorption 32,912 7.75 Net production 301,513 71.00 23,430 Equivalence 23 7,710 Total 7,710 * Calorific value of producer gas: 1,100 Kcal/m³; ** Calorific value of biogas/methane = 70% of methane = 6,370 Kcal/m³. It is recommended that both gasification and biogas plants be located in a central position as far as the five target processing groups in Asueyi community are concerned, so as to easily distribute produced energy to the same groups and collect from them, by gravity, waste waters to be fermented inside the bio-gas plant. 31
  • 38. E. 2.2. Financial Analyses 11. Overall outcomes of the proposed investments 11.1. Generalities The outcomes of the financial analysis concerning the application in the Asueyi community are provided in the following paragraphs. The analysis focuses on the specific profitability of the gasifier only as the profitability of the biogas plant does not differ from the one estimated at chapter E.1 (under the: “General Case”). The financial analysis has been worked out using the data and information (including availability of bio-masses) collected during field works in the geographic area proposed for the investment covered with this study. Also some of the assumptions outlined in Part E, Chapter 9 and used to assess the profitability of the general case have been adapted to circumstances encountered in the Techiman Municipality18. 11.2. Key information and main assumptions for implementing financial analyses for the gasifier Key aspects (Gasifier only) Total investment costs: 340 000 USD, to be entirely borrowed from local banks at a 22% interest rate and to be returned through equal installments (capital) plus interests on the remaining debt over a period of 7 years19; Working capital: about USD 10 000, expected to be needed during the first four months of Y1 to pay off short-term liabilities; Timeframe for the investment: 10 years; Depreciation: 10 years for equipments and 15 years for civil works; Revenues expected to be generated from the gasifier in the Asueyi community have been so estimated: • The entire amount (470,250 Kwh/y) of electricity produced, corresponding to 154,770 lt/year of diesel, to which has been added an additional amount of 70,960 lt diesel/year derived as heat generated by the plant and used to dry products, are sold at 0.8 USD/lt (which is the current market price in Ghana for diesel); and • The remaining 2,335,868 kcal/d deriving from the heat generated (and equal to 1,485 t firewood/y) are sold at 15 t/USD (which is the market price for firewood that is usually used in Asueyi to produce heat). 18 If not specified, the assumptions described in the previous sections do not change. 19 This assumption is built on the current practices in Ghana 32
  • 39. 11.3. Outcomes of the financial analysis in the case of the gasifier The outcomes of the technical and financial analyses detailed in Annex 5 here after and implemented over a timeframe of 10 years, show that: • Total costs20 show a steady decrease over the 10 years period, from approximately USD 184 000 in Y1 to approximately USD 60 000 in Y10. By far and large, capital costs are the main item (60%) of the total cost structure; • Working capital, expected to be needed during the first four months of Y1 to pay off short-term liabilities, has been included at approximately USD 10 000; • Estimated yearly repayments of capital for implementing the investment (purchase of equipments and construction of facilities) and on working capital, along with related interests, range then from USD 123 000 in Y1 to USD 60 000 in Y7; • Net profits after corporate taxes are constantly positive, ranging from approximately USD 17 000 in Y1 up to approximately USD 125 000 in Y10; • Annual cash flows remain positive over the entire life of the investment. More specifically, the annual cash flow stands at approximately USD 48 000 in Y1 and it increases up to approximately USD 156 000 in Y10. Also the analysis of discounted annual cash flows confirms satisfactory results throughout the entire life of the investment as from Y1; • The internal rate of return (IRR) of this investment results to be 21%; the pay back period is slightly less than 5 years. These two indicators clearly show the high returns to be expected from this investment; • A sensitivity analysis has been carried out taking into consideration: (i) the possibility to sell the total amount of heat generated, equal to 2 970 liter of diesel/year, at the prevailing market price for firewood (15 USD/t) and (ii) a 20% decrease in the total working hours of the gasification plant (from 22h/day to 18 h/day) during a total period of 330 working days/year. Under the first scenario, net profit after taxes result to be positive as from Y3 (equal to about 5 000 USD), while annual cash flow starts being positive as from Y1 (approximately 16 000 USD). IRR is 11%; the pay back period approximately 7 years. Under the second scenario, the plant works a total of 18h/d only, which causes a 20% decrease in the quantity of electricity generated (from 154,700 lt diesel/year to 128 816 lt/diesel/year), as well as of the heat generated and required to dry products (from 70 960 to 56 768 lt/diesel/year and from 1 485 to 1188 tons of firewood/year) and therefore a reduction in the level of total revenues. Given this reduction in total working hours, the overall amount of high quality (dried) cassava derivatives decreases from almost 4.5 tons/day to approximately 3.5 tons/day. Total revenues are equal to 162 287 USD/year, so derived: 99 053 USD/year from the sale of electricity and 62 234 USD/year from the sale of the heat generated. Net profits after taxes become slightly positive in Y3 and increase to approximately 90 000 USD in Y10, while annual cash flow remains always positive throughout the 10-year timeframe (from approximately 10 250 USD in Y1 to approximately 120 000 USD in Y10). IRR decreases to 10% and the paid back period results to be less than 8 years. Therefore, also under the hypothesis of a 20% decrease of total revenues, the sensitivity analysis confirms the good profitability for the proposed investment. 20 These include: capital costs, operating costs and fixed costs and are equal to USD 340 000. 33
  • 40.
  • 42. Annex 1 - Results of the laboratory analyses on cassava peels and barks Table 1: Proximate analysis and basic properties on cassava peels Ankur Lab Polytechnics Lab Parameters Dried sample Wet sample Moisture, % 2.16 66.20 Ash, % of dry wt. 3.41 4.94 Volatile, % of dry wt. 78.28 } 95.06 Fixed carbon, % of dry wt. 18.31 Bulk density, kg/m3 286 340 Ash fusion test No ash Fusion at 1200°C No ash Fusion at 1200°C Shape & Size, % Irregular shape Irregular shape Ignition test Burns easily NM Flow ability test Flows easily NM Cassava peels have low ash content (<5%) and an ash fusion temperature above 1200°C. Their bulk density remains above 250 kg/m3 even after drying and hence flow easily and burn well. Peels have a high moisture content that has to be decreased to 20% to make them suitable for gasification purposes. 1
  • 43. Annex 2 - Results of the laboratory analyses on wood shavings and sawdust The table here below shows the results of the analyses conducted in two different laboratories on a blend of wood shavings and saw dust. Table 1: Proximate analysis and basic properties of wood shavings & saw dust mixture Ankur Laboratories Polytechnics Lab. Parameters Naturally dried sample Wet sample Moisture, % 19.83 30.60 Ash, % of dry wt. 1.29 2.33 Volatile, % of dry wt. 78.59 Fixed carbon, % of dry wt. 20.12 } 97.66 Bulk density, kg/m3 68 95 Ash fusion test No ash Fusion at 1200°C No ash Fusion at 1200°C Shape & Size, % Irregular shape Irregular shape Ignition test Burns easily NM Flow ability test Does not flow easily NM The mixture of wood shavings and saw dust has a low ash content (<5%) and an ash fusion temperature above 1200°C. Its bulk density is low and it does not flow easily; however, it burns well. The high moisture content and the low bulk density of this blend makes it unsuitable for gasification; however, after having dried the mixture to 20% moisture level and having mixed this latter with dried cassava peels, it can be proficiently used for gasification purposes. 2