Difference between revisions of "Enhancing Production of Improved Cookstoves (ICS)"

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==> [[GIZ HERA Cooking Energy Compendium|Back to Overview GIZ HERA Cooking Energy Compendium]]  
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[[File:GIZ HERA Cooking Energy Compendium small.png|left|831px|GIZ HERA Cooking Energy Compendium|alt=GIZ HERA Cooking Energy Compendium small.png|link=GIZ HERA Cooking Energy Compendium]]<br/><br/><!--
  
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== Identification of potential ICS markets  ==
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The inception study informs the planning process about many aspects:&nbsp;
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• Potential project locations<br>• Potential implementation partners<br>• Potential useful technologies<br>• Potential production and marketing concepts<br>• Political frame conditions for ICS production and marketing<br>The result of the inception study needs to be verified by important stakeholders, which is usually done in a national stakeholder workshop. As a result of this workshop, potential ICS markets can be described by aspects of:
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• Type of customer<br>• Geographical intervention area<br>• Characteristics of required technology<br>• Potential options for production and marketing<br>Sometimes it is useful to prepare such business cases already upfront and discuss and rank these scenarios at the stakeholder workshop.  
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It is important to bear in mind that a cooking systems is more than just a financial consideration. It often requires a change of behavior which is difficult to achieve.
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The core question is “Why should poor people spend their little cash for an ICS?
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• Financial issues: Investment cost, cost of usage, durability;<br>• Convenience issues: handling, intensity of attention to the fire, traditional meals, size and height, emissions of heat/light/smoke;<br>• Status issues: design, modernity, aspirational products;<br>• Access and vulnerability issues: Can we trust this new product? What does it mean to me if I buy it and than it does not work/I cannot access the fuel (e.g. supply shortage of imported parts or fuels)?<br>This question has to be answered through the perspective of the potential buyers to investigate if there is a business case. User group discussions or test sales can assist to verify the strength of an ICS market case.
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-->{{#ifeq: {{#show: {{PAGENAME}} |?Hera category}} | Extra |'''[[GIZ HERA Cooking Energy Compendium#Climate Change Related Issues|Extra]]''' | [[GIZ HERA Cooking Energy Compendium#Climate Change Related Issues|Extra]] }}
  
The potential ICS markets can be ranked in various dimensions:
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<br/>
  
• Purchase power of customer groups;<br>• Size of the market;<br>• Access of potential customers to the market / Difficulty to reach customers;<br>• Likeliness to find a product that suits the demand of the potential customers (existing product or need for product development);<br>• Competition on the market through other players;<br>• possibility to scale up existing efforts.<br>Based on these (and other) criteria, the potential ICS markets can be prioritized. However, it needs to be verified if the “best market” is also relevant from the perspective of the underlying development goals.
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== Product Development<br/> ==
  
== “How do we reach ‘the poor’ with our ICS interventions?”  ==
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Sometimes, existing improved stoves can be further promoted by investing into scaling up interventions. However, very often there is no ready-made improved cook stove model available that adheres 100% to the specific requirements of&nbsp;&nbsp;the&nbsp;local conditions.&nbsp;Adaptation or even the development of a new product is required to find the best balance between the needs of the targeted customers, the needs of the producers, and the frame conditions of the production chain. For product development the following steps are normally necessary:<br/>
  
Poverty reduction is the overarching goal of any development intervention. However, there can be huge difference between ‘directly addressing the needs of the poor’ and concepts where poverty reduction is an effect at the outer end of the result chain.
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The first step is to agree who should be considered poor in the given environment. Usually there is a strata within “the poor” which can be instrumental in the process of identifying the right target group.
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Generally, four concepts of how to address specifically very poor target groups can be distinguished:<br>1. Promotion of “non-cash” solutions<br>2. Make “special products” for the poor available<br>3. Make “special prices” for the poor available<br>4. Reaching the poor by improving social services<br>Each of these concepts has its specific rational and approaches.&nbsp;
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[[File:Evolution of production in a project.JPG|thumb|center|750px|Evolution of production in a project|alt=Evolution of production in a project.JPG]]
  
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Prototypes of new stoves are usually produced in a lab-controlled environment with close collaboration between stove designers and researchers, stove users and potential producers. Once the prototype fulfills the required standards, it has to be field tested at a larger scale to verify if the stove performs well enough and if ordinary households are using it. In reality, there might be alterations between phases of lab testing and field testing.<br/>
  
[[Image:Pro poor ICS approaches.JPG|668x501px|Pro poor ICS approaches.JPG]]
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The development of an ICS is never actually completed. Even after 10 years of promotion, new materials or design features may come up. Researchers and technicians tend to request for long product development phases, whereas project managers tend to push for early piloting. There is no golden rule for identifying when a stove is ready for the market.<br/>
  
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<br/><u>There are, however, some general requirements. These include:</u><br/>• The stove must be safe enough to be used in households without doing harm to the user;<br/>• The stove must perform well enough to satisfy both the potential user as well as the intention by a private or public supporter (e.g. donor) of the&nbsp;improved cook stove;<br/>• The stove must be convenient and appealing enough to convince the target group to buy and use it;<br/>• The cost of stove production (including material cost) must be low enough to allow a retail price which satisfies both the target group (affordability) as well as the producer (profit margin per stove and turn over).<br/>
  
At some stage there seems to be a trade-off between poverty orientation and sustainability. While “non-cash” self-help stoves and highly subsidized stoves may allow to reach fast many very poor people, the development of special products (to be sold at commercial rates) or the support through improved social services may result on the long run into more sustainable benefits for the poor.
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At some stage of the development process, there is a need to interrupt the change processes for at least a year to allow a field based learning on a constant stove model. Otherwise it is difficult to identify which variation of the stove model is related to which feedback or observation. While an early release to the public bears the risk of a public failure (image problem), a prolonged research period increases the cost of development and delays the results of dissemination.<br/>
  
== Technology selection  ==
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A wide range of improved cook stoves have been developed and disseminated in the past 30 years.<br>
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== Piloting of Improved Cookstoves (ICS) Production<br/> ==
  
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Once the field test confirms the satisfaction of the target group with the product, the ICS will be produced for the selected market. As there is still the danger of “teething problems” (see below) in the first few years, it is a common practice to start with a geographically restricted pilot project. This will allow a close follow-up for producers and users through “the project” to ensure that the stoves are properly produced and appropriately used. If problems with the design or the materials are arising, there is still the possibility to correct the faults before large segments of the targeted market are already dissatisfied with the product.
  
[[Image:Diversity of ICS.JPG|668x501px|Diversity of ICS.JPG]]&nbsp;
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<br/><u>The initial step from “prototyping” to “piloting production” is very crucial and difficult:</u>
  
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*we are not yet sure of the product (teething problems);
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*we are not yet sure of the market (new product);
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*we are not yet sure of the market case (production costs vs. sales price);
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*we are not yet sure of the marketing system.
  
They differ in many aspects:<br>
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*'''Fuel''': firewood, charcoal, other non-tree solid biomass, liquid biomass, gas from biomass, non-biomass fuels;
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Because of these uncertainties, many projects feel the need to protect the initial producers against the risks of entering this new production business. <u>This “protection” can take the form of…</u><br/>
*'''Mobility''': portable or fixed stoves
 
*'''Flames''': one flame stove or multiple flame stove
 
*'''Pots''': (a) ‘one pot only at a time’ or ‘multiple pots used at the same time’; (b) only usable for a specific pot (sunken pot concept) or usable for a variety of pot sizes and shapes;
 
*'''Material''': (a) mud, fired clay, bricks, cement/concrete, metal, isolation materials (vermiculite, ceramic wool, refractory bricks, air…)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b) one material or material mix;
 
*'''Chimney''': smoke reduction (without chimney) or smoke extraction (with chimney);
 
*'''Dimension''': Tea preparation stove (for app. 1-2l), household size stove (for app. 3-15l), restaurant size (for app. 15-50l), large institutional stove (for app. 50-300l)
 
  
All these differences impact on the perception of the “convenience of use” by potential user groups.
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*providing producers with required tools;
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*providing producers with required production materials;
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*providing producers with grants or loans;
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*giving producers large production contracts ( project buys all their stoves );
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*employ the producers ( time-based contracts);
  
An overview on ICS examples is given in chapter “[http://energypedia.info/index.php/GIZ_HERA_Cooking_Energy_Compendium#Cooking_Energy_Technologies_and_Practices cooking energy technologies and practices]”.<br>There is no standard procedure to identify which technology option might be most successful on the market. On the one hand it has often been observed that “evolution” of existing baseline technologies is more acceptable and feasible than “revolution” (e.g. bringing in a completely new stove and fuel concept). On the other hand, the establishment of a commercial supply chain might be more feasible with a “modern/strange” product (e.g. a portable metal stove) rather than with a modification of an existing self-help product (e.g. an improve mud stove), if there is already a long tradition of local non-cash stove building.
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<u>While these interventions are useful to get the production going, there are also huge risks for the long term sustainability attached to these approaches:</u>
  
&nbsp;[[Image:Range of ICS Energy saving stoves in Malawi.JPG|668x501px|Range of ICS Energy saving stoves in Malawi.JPG]]
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*The initial producers may consider themselves as “employees of the program”. Therefore, clarification of ownership is a must right from the beginning;<br/>
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*If the risk to produce for the market is buffered by&nbsp;a program, there is little motivation for the producers to develop a cost-efficient production concept. The initial price for the stove will always be high as there is no incentive to produce many stoves in short time. As a remedy, projects tend to subsidize the initial price for the customer to still find a market for the stove. Once this system of a high workshop-gate price on the side of the producers and a project-based subsidized low customer price is established, it will be highly difficult to exit this scenario without severe fractions. If the stove price increases up to the real price after the removal of the subsidy, the customers will complain that they are used to having a cheaper stove. Or if the workshop-gate price is pushed lower, than the producers may lose interest. Unless there is a clear element of economy of scale, which will result in a natural reduction of production costs over a short time, there is no easy exit from this system.<br/>
  
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<br/>In many countries, there are artisans who have already worked with former “stove projects”. New interventions often have to also combat expectations which are generated from these past experiences. It requires time, good knowledge of the local stove project history, and strong standing to establish a different system. The selection of the location and the initial producers is something which should be carried out with thorough planning.<br/>
  
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Many interventions resorted into offering a range of stoves to the target groups and let them have the choice according to their needs, capabilities and preferences. Sometimes you start with one or two products and then, after realizing additional market opportunities, additional products are taken on board.<br>In the selection of technologies, the needs and perception of both potential customers and users on the one hand and potential producers and traders on the other hand have to be taken into consideration.
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It is not possible to suggest “the best way” on how to initiate the ICS production as it is highly circumstantial. <u>However, here are some ideas which have worked in the past:</u><br/>
  
*A stove which works well and is very cheap, but which will not give the producer any profit, will not be produced for sale.  
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*At the end of the prototype-development phase, test-sales can be done to assess how much people would pay for the stove. They can also generate orders for stoves.<br/>
*A high-end efficient, durable and beautiful stove which is highly profitable for the producer will not be effective if the target group is not prepared to spend so much money for its purchase.
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*Based on this concrete demand, artisans with an already established workshop and business can be asked if they are interested to satisfy this documented demand if trained by the program. It is assumed that these producers have all tools and labor required to manufacture the stoves. The project may give a warranty that the investment into the materials for the stoves will be covered in case the stoves are actually not sold despite the orders of the customers.<br/>
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*Once these first stoves are produced and sold, the initial producers are invited to participate in awareness and marketing activities to establish their own links to potential target groups and understand how to find markets for their new product.<br/>
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*They are continuously supported through quality control and additional awareness campaigns. Feedback rounds with early customers may assist to create a better understanding of the perception of the customers.<br/>
  
Both sides should be involved in the selection process of the technology.
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New technologies often have to be adapted to the local requirements. It is important to reserve time and resources for several loops between producers and users of a new ICS to make sure that the stove model is well accepted and matured before the actual market introduction. Although this sounds trivial, in the reality there are tremendous time pressures which suggest taking some short cuts. However, this might be the wrong place to cut corners.
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<u>There are some lessons from previous interventions to be shared:</u><br/>
  
== The links between technology selection and design of the intervention  ==
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*Do not pay artisans for attending a training workshop on stove production.<br/>Some projects pay artisans for attending training courses as “they cannot afford to lose a working days income by attending a training course without pay”. But if you pay for participation, people will attend for the money (as a job) and you do not get the interested people. At least their time should be their contribution into a better future. You can buffer the “income-argument” by providing food and by designing half-day trainings close to the homes or work-places of the participants. Hence they can still work half time in their work-shops and still earn a little money.<br/>
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*Do not provide free tooling and free materials to kick-start production:<br/>Access to tools and materials for the production of the new product might be a bottleneck for the newly trained producers. Hence it is tempting to provide them with all tools necessary and the materials required for the first number of stoves with the idea that they can afford to purchase the next materials from the income of the first stoves.<br/>In some cases this works out fine. But sometimes this attracts the wrong participants who are using the provided inputs to produce any type of other product and afterwards claim that they have to be given another material for the stoves. To avoid this kind of frustration, another option is to provide tools and inputs on a cost sharing arrangement, and the part to be paid by the artisan can be pre-financed by a micro-credit organization. This goes along with the support of the project to connect the artisans with their first customers. By doing so, a strong motivation to produce stoves is generated.<br/>
  
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&nbsp;[[Image:Selling Services or Products.JPG|668x501px|Selling Services or Products.JPG]]
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== Scaling-up of Improved Cookstoves (ICS) Production Capacities<br/> ==
  
Selecting a stove technology is much more than just a technical decision. It has huge impacts on the overall design of the intervention. One of the chore questions is related to the portability of the stove. In generalizing terms, one could distinguish between the needs of the rural and urban ICS markets as below. There are, however, also a number of examples of rural areas with portable stoves. This holds particularly true in areas where cooking is done outside. Hence this is just a generalization to demonstrate the links between technology selection and the design of the intervention. It does not cover all cases.  
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Once an initial ICS production is established and the market case has been proven by an increasing demand, there is a need to scale-up the production to satisfy larger customer groups.
  
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[[Image:Diversity of Production Systems.JPG|668x501px|Diversity of Production Systems.JPG]]
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<u>It is important to consider the coordinated growth of both production and demand:</u><br/>
  
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*demand without products can frustrate the customers and<br/>
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*production without markets ruins the producers.<br/>
  
As manifold as the types of stoves available, there are also different modes of stove production to be distinguished.
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<u>Scaling-up can be done in two dimensions:</u><br/>
  
&nbsp;[[Image:Production systems of ICS.JPG|668x501px|Production systems of ICS.JPG]]
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'''1. Increasing the number of small scale supply-demand systems.'''<br/>
  
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In this case, the concept of “local production for local markets based on local resources and local skills” is maintained. It is a concept which provides a close link between producers and users and is relatively robust against external shocks. For scaling-up this concept, a large effort in capacity building for many artisans is required.&nbsp;Strong and organised partners are needed, who know both the country and its people very well, allowing the project to act as a facilitator. Involvement with other organisations, such as NGOs, the private sector, or governmental bodies, is a precondition for achieving sustainable access to household energy for large numbers of people. These already existing partners can be found in many sectors which are related to cooking energy.<br/>
  
In most of our interventions, we focus on the three options in the center of this slide. Self-help “do-it-yourself” stoves tend to be of very low quality (sometime even worse than the baseline stove) due to the low skill level/lack of practice in stove construction. The option of imported industrial stoves is a rather new development which has not been tried yet at large scale in GIZ stove interventions.
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More specialized producers (e.g. in the semi- or industrial production) have more routine in the production of ICS. Combined with tooling and quality control mechanisms, the stoves will have less cases of design drift as compared to fixed stoves being built from scratch at the customer’s house. (Semi-)Industrial stoves commonly are made out of metal. As the manufacturing is done according to defined standards, the (semi-) industrial stoves tend to be more durable as the locally build stoves out of mud, bricks or cement. Hence the latter require more attention in terms of maintenance. Standardized production allows for the observation of important dimensions and principles. Therefore, the (semi-) industrial stoves often provide higher technical potentials for “efficiency” (reduced specific consumption) and for reduced emissions. The actual realization of these potentials is dependent on the user behavior. While many technical aspects favor the standardized, centralized production, the retail costs of these stoves are often higher as compared to their local competition because of cheaper materials, informal price setting and lower transportation costs.
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'''2. Inreasing productivity of production systems'''<br/>
  
There are new trends to “cross the borders” of these categories:
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Another way of increasing the production is the transformation of the existing production system to increase the productivity per producer. This can be based on the introduction of improved tooling (e.g. in Senegal the introduction of flanging, bending and rounding machines for metal works) of local artisans or the establishment of semi-industrial production centers (e.g. introduction of an extruder machine for the production of ceramic liners in Ethiopia).<br/>
  
*Industrial pre-manufactured stove components used in local fixed-stove construction;
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<u>The investment into machinery has various dimensions:</u><br/>
*Industrial flat-pack assembly kits imported for in-country assembly and sales.
 
  
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*The investment has to be financed: there might be a need to support the producers through [[Financing Mechanisms for Cookstove Dissemination|micro-finance instruments]] to facilitate the investment.<br/>
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*The investment must be viable: the additional costs of the investment must be overcompensated by additional income through cheaper production and increase of sales. A business case study for such an investment should be produced before the investment is executed.<br/>
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*Staff qualification: new machines require new skills and knowledge. Existing staff has to be trained or better staff has to be recruited to operate the new machines properly.
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*The investment can increase the vulnerability of the production: If new machines depend on the availability of electricity or the presence of a specific (qualified) staff member, the production might be more vulnerable for forced interruptions. The risks of such vulnerabilities should be assessed upfront.<br/>
  
&nbsp; [[Image:Impact of production systems on the product.JPG|668x501px|Impact of production systems on the product.JPG]]
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[[Image:Chances and challenges for ICS interventions.JPG|668x501px|Chances and challenges for ICS interventions.JPG]]
 
  
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== Donors and Institutions as Customers<br/> ==
  
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Donors such as the '''United Nations Children's Fund (UNICEF)''', the '''World Food Program (WFP)''', or international NGOs supporting school feeding programmes are potential customers for stoves.
  
The different production systems provide different chances and challenges for the implementing organization. Decentralized production requires verifying the quality of the stoves at the site of construction at the homes of the users. This is a huge effort as compared to visiting the production or selling points of portable stoves. <br>While specialized workers in the (semi-)industrial production potentially require a more intense training, the decentralized production systems tend to have lower numbers of stoves produced per producer per year. For the same annual production, far more producers have to be trained and supervised as compared to the centralized production.<br>(Semi-)industrial stoves tend to be more expensive than locally produced stoves in a rural environment. Hence the potential needs for microfinance to lower the investment barrier tend to be higher for the more expensive products. Another reason is that - depending on the country – microfinance tends to be found more frequently in urban as compared to rural settings. On the other hand, rural households have lower cash incomes which increase the need for assistance if investments are required.<br>More efficient stoves have a higher carbon saving as compared to less efficient stoves if compared with the same baseline stove. This applies even more if the more efficient stove has been manufactured in a standardized manner as the technical potential for savings can easily be assessed. Locally build fixed stoves can be all different in their individual performance as for example a small variations of the air inlet of the chimney may either result into too much draft (reducing the efficiency) or too little draft (smoke in the kitchen). The monitoring for the carbon saving verification in the field would require much more effort.<br>
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Institutional stoves can be highly efficient, and their very high savings potential means that institutions (both public and private) spend less on wood fuel, and, for instance, school children spend less time collecting firewood, so more time can be spent in education. Canteens in institutions such as schools, hospitals, or prisons benefit from energy saving stoves. A cost-benefit analysis in Malawi has shown that the use of Institutional Rocket Stoves is profitable in a wide range of institutions.
  
== Planning of ICS interventions&nbsp;  ==
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Also, an impact study of rocket stove in school canteens highlighted the relevance of proper and practical user training not only of head teachers or coordinators but of the cooks themselves. Read more: [[:File:ProBEC_Study_on_the_Impact_of_the_Institutional_Rocket_Stoves_in_School_Kitchens.pdf|ProBEC Study on the Impact of the Institutional Rocket Stoves in School Kitchens]].
  
The planning of interventions to enhance the production of ICS should not be done in isolation. The production is part of an overarching value chain which starts with the access to the required inputs and comprises all the steps including the distribution, sale and utilization of the stoves.
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There is no benefit in training future producers on stove production, if…
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{| style="width: 100%" cellspacing="0" cellpadding="4" border="1"
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'''Institutional rocket stoves in Malawi'''<br/>An orphanage that prepares two meals a day in a 100 litre pot saves 680 US$ yearly on firewood expenditures. If a 200 litre stove is used twice a day throughout the whole year the net benefit during the stove’s four-year life is 4235 US$. Depending on cooking frequency and size, the price for a stove has been paid off after three to nine months. Due to reduced firewood costs canteens save up to 40% on their catering budget.<br/>-> [[:file:Costs-benefits-institutional-stoves malawi-probec-2008.pdf|CBA Malawi Costs and Benefits of Institutional Stoves]]
  
*They cannot access the inputs;
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*They have no access to markets;
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*If the product does not sell;
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*If the product is not used.
 
  
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{| style="width: 390px; height: 27px" cellspacing="1" cellpadding="1" width="390" border="1"
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{| style="width: 100%" cellspacing="0" cellpadding="4" border="1"
 
|-
 
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| '''►Inputs'''  
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| colspan="4" bgcolor="#e0e0e0" | '''Application of Improved Cooking Stoves in Rural Health Centers'''<br/><div><u>Cooking needs in rural health centers can be divided into two categories, depending on the target group, for whom the food is prepared:</u><br/></div>
| '''►Production'''  
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*'''Food for staff'''<br/>It depends mainly on the number of staff, the health center management, and/or the degree of self-organization of the staff. If the meals for staff members are prepared communally, an institutional size stoves might make sense.<br/>Examples: Both Mission and the Government hospitals in Mulanje District (Southern Malawi) have institutional size wood-fired rocket stoves to cater for the staff and the students of the nursing college. Cooking is done by a paid cook, who got trained on the proper use of the stoves. The firewood is provided by the hospital. Savings as compared to the open fire are between 70-80 percent.
| '''►Distribution'''  
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*'''Food for patients'''<br/>Most rural health centers do not provide meals for the patients, even if they have in-patient facilities. The meals for patients are prepared individually by the guardians who accompany the patient often with the main purpose to cater or prepare warm bath water for the patient. Thus individual cooking facilities are needed for the guardians. Usually food ingredients, fuel, and cooking utensils have to be organised by the guardians and are not provided by the health center. Thus, the most prevalent cooking facility is the makeshift 3-stone fire fuelled with firewood or any other biomass that the guardians are able to organise in the immediate surroundings of the health center. A good practice is when health centers provide a sheltered cooking place and define the area where cooking is allowed. To minimise the adverse effects of air pollution and prevent smoke from adding to the ailments of the patients, this location should preferably be at a distance from the wards and care units.
| '''►Sales'''
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| '''►Utilisation'''
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Mulanje Mission Hospital in Southern Malawi went even further. They had already a roofed kitchen for the guardians with 20 simple fireplaces. As hospital facilities were expanding and the number of in-patients increasing, the kitchen became small.<br/>With advice from GIZ-project staff on stove technology and kitchen design, they added another roofed kitchen with improved fixed ‘Epseranza’ -type stoves and good ventilation. In the first weeks the kitchen was not yet well accepted and rather empty, because people were not familiar with the stoves and were unsure how to use them. Upon realizing this, a permanent security staff of the hospital got trained on the correct stove use and was able to show the ever-changing users, who normally don’t use the kitchen longer than a few days. From then on, the kitchen became more and more popular as people became aware of he advantages: the new stoves were more economic, cooked faster, created less smoke, and the building had a better ventilation. Young mothers felt more comfortable bringing their babies in the new kitchen. The challenge remains to organise the maintenance of the stoves, as some of the ceramic pot-supports of the ‘Esperanza stoves’ went missing and the stoves perform poorly without them.
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|}
 
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<br>On each of these steps in the value chain, observations can be made on the micro, meso and macro level:
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<br/>Cooperation with Ministries of Education can further help selling stoves and may offer the opportunity to incorporate household energy into curricula. For example, testing sites at Ethiopian schools offer students and teachers the option of learning more about cooking energy and the dangers involved from smoke inhalation. Programmes for improved housing are potential partners if they provide access to stoves to their beneficiaries.
  
*Micro level: e.g. suppliers, producers, traders, users
+
For these initiatives to happen, organisations must be informed about the project and the technology options the producers offer. When the product is launched, it may be necessary to create links between these institutions and the stove producers, and facilitate communication through meetings and workshops.
*Meso level: e.g. service providers, research stations, transportation systems…
 
*Makro level: e.g. Governments, international companies, donors…
 
  
For each of the levels, it is worthwhile to identify the relevant actors, important influencing factors, opportunities and threats etc. which can or will take influence on the building-up of a commercial supply-demand system for ICS.  
+
Experience in Malawi has shown that even if stoves are bought ‘off the counter’ from the producer, training sessions for the purchasers should be part of the package. Correct stove use is crucial for fuel savings, and for the longevity of the device. This also leads to happy customers and successful producers. Voluntary staff often do the cooking at social institutions such as orphanages. Howeve, they may have no experience with fuel-efficient stoves and would benefit from on-site training on how to use the stoves properly. This training can be done either by the project itself or by the institution. In the longer term, it is better for the institution itself to be trained by the project, so that it can train its own staff in the future.
  
Based on this analysis, important activities can identified which should be considered in the detailed planning of the intervention.
+
<br/>
  
<span style="color: #ff0000">Example for value chain analysis: e.g. Kenya??? </span>
+
'''Industries as customers and development partners'''<br/>Large companies catering for their workers usually cook several hundreds or even thousands of meals every day – often on traditional stoves. Using a fuel efficient cooking technology is very cost effective in such circumstances, and the savings can cover the cost of the stove very quickly. Experience in Malawi has shown that canteens in tea estates or sugar plantations can reduce their fuelwood consumption to 10% of the quantity used on an open fire (a 90% reduction). Companies such as these may be willing to act as development partners by agreeing to test different models in their canteens.
  
== Planning of activities to enhance ICS production&nbsp;  ==
+
Many companies also provide their staff with housing and other services. Access to energy can be incorporated into corporate social responsibility (CSR) initiatives through public/private partnerships (PPP) or similar types of cooperation. Ideally, this is a win-win situation. Risks and costs of research and development, and the cost of improving the house through improved technologies, can be shared between the project and the industry. The agricultural industry (sugar, tea, tobacco) has shown particular interest in CSR activities that involve access to clean, efficient energy, as their corporate social responsibility actions can enable them to achieve a fair trade label.
  
Once the market niche has been identified in the planning process, plans have to be developed how the supply-system of ICS can be established. If it is a new product to the country, this will require to be done in phases of different relationship between the implementing organization (short: the “project”), the producer and the customers of ICS.&nbsp;[[Image:Evolution of production in a project.JPG|658x250px|Evolution of production in a project.JPG]]  
+
-> [[:file:En-probec institutional stoves mw-2007.pdf|ProBEC presentation ‘Institutional Stoves’ with experiences from Malawi]]
  
&nbsp;
+
<br/>
  
Prototypes of new stoves are produced in a lab-controlled environment. There is close collaboration between craftsmen, researcher and stove users. Once the prototype fulfills the required standards, it will be field tested at a larger scale to verify if the stove performs well enough if ordinary households are using it. In reality, there might be alterations between phases if lab testing and field testing. In this period, production is controlled by the project. Market forces do not yet play a role.
+
<br/>
  
Once the field test confirms the satisfaction of the target group with the product, a market based production system will be established for a specific area. In the initial stages, some support to the producers might be required to buffer their risk in production, but there are some lessons from to be shared:
+
<br/>
  
*Do not pay artisans for attending a training workshop on stove production (at least their time should be their contribution into a better future). Good experiences have been made by
+
<br/>
*Do not provide free tooling and free inputs to kick-start production (it may attract the wrong artisans who are just there for the inputs and do with them other work). There can be soft loans or cost sharing arrangements which could be performance based.
 
  
== Piloting ICS Production ==
+
<br/>
  
The initial step from “prototyping” to “piloting production” is very crucial and difficult.
 
  
On the one hand...
+
= Further reading<br/> =
  
*we are not yet sure of the product (teething problems);
+
For over three decades, Aprovecho Research Center has been the global go-to for practical, efficient, and purposeful expertise in the design and testing of biomass cookstoves. Their leading-edge and collaborative research continues to remain open source and accessible to promote the “best use of” resources for everyone from the rural cook to national governments. [http://aprovecho.org/ http://aprovecho.org/]<br/>
*we are not yet sure of the market (new product);
+
 
*we are not yet sure of the market case (production costs vs. sales price);
+
<br/>
*we are not yet sure of the marketing system.
+
 
 +
<br/>
 +
 
 +
<br/>
 +
 
 +
= References<br/> =
  
Because of these uncertainties, there is a (felt) need to protect the initial producers against the risks of entering this new production business. This “protection” can take the form of…
+
This article was originally published by [http://www.giz.de/fachexpertise/html/2769.html GIZ HERA]. It is basically based on experiences, lessons learned and information gathered by GIZ cook stove projects. You can find more information about the authors and experts of the original “Cooking Energy Compendium” in the [[Imprint - GIZ HERA Cooking Energy Compendium|Imprint]].
  
*providing producers required tools;
+
<references />
*providing producers required production materials;
 
*providing producers grants or loans;
 
*giving producers large production contracts (= project buys all the stoves of them);
 
*employ the producers (=time-based contracts);
 
  
While these interventions are useful to get the production going, there are also huge risks for the long term sustainability attached to these approaches.
+
<br/>
  
*The initial producers may consider themselves as “employees of the program” and therefore the program will have to provide a market for the stove/ has to market the stoves for them;
+
[[GIZ HERA Cooking Energy Compendium|--> Back to Overview GIZ HERA Cooking Energy Compendium]]
*These “special conditions” for the early producers cannot be maintained on the long run, if sustainable supply-demand systems are the envisaged goal of the intervention. Hence producers who will be trained later will not benefit in the same way as the initial producers. But the knowledge about the initial conditions will spread fast, leading to constant battles with jealousy between old and new producers and demands for support by the “disadvantaged” producers
 
*If the risk to produce for the market is buffered by the project, there is little motivation for the producers to develop a cost-efficient production concept. The initial price for the stove will always be high as there is no incentive to produce many stoves in short time. As a remedy, projects tend to subsidies the initial price for the customer to still find a market for the stove. Once this system of a workshop-gate on the side of the producers and a project-based subsidized customer price is established, it will be highly difficult to exit this scenario without severe fractions. If the stove price goes up until it reaches the real price, the customers will complain that they are used to have a cheaper stove. Or the workshop-gate price is pushed lower, than the producers may lose interest. Unless there is a clear element of “economy of scale” which will result in a “natural reduction of production costs over a short time”, there is no easy exit of this system. <br> <br>
 
  
== Scaling-up of ICS production capacities  ==
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{{#set: Hera category=ICS Supply}}
  
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[[Category:Cooking_Energy_Compendium_(GIZ_HERA)]]
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[[Category:Improved_Cooking]]
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[[Category:Cookstoves]]
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[[Category:Cooking_Energy]]

Latest revision as of 07:39, 10 September 2020

GIZ HERA Cooking Energy Compendium small.png



Cooking Energy System | Basics | Policy Advice | Planning | Designing and Implementing ICS Supply | Designing and Implementing Woodfuel Supply | Climate Change | Extra


Product Development

Sometimes, existing improved stoves can be further promoted by investing into scaling up interventions. However, very often there is no ready-made improved cook stove model available that adheres 100% to the specific requirements of  the local conditions. Adaptation or even the development of a new product is required to find the best balance between the needs of the targeted customers, the needs of the producers, and the frame conditions of the production chain. For product development the following steps are normally necessary:



Evolution of production in a project.JPG
Evolution of production in a project


Prototypes of new stoves are usually produced in a lab-controlled environment with close collaboration between stove designers and researchers, stove users and potential producers. Once the prototype fulfills the required standards, it has to be field tested at a larger scale to verify if the stove performs well enough and if ordinary households are using it. In reality, there might be alterations between phases of lab testing and field testing.

The development of an ICS is never actually completed. Even after 10 years of promotion, new materials or design features may come up. Researchers and technicians tend to request for long product development phases, whereas project managers tend to push for early piloting. There is no golden rule for identifying when a stove is ready for the market.


There are, however, some general requirements. These include:
• The stove must be safe enough to be used in households without doing harm to the user;
• The stove must perform well enough to satisfy both the potential user as well as the intention by a private or public supporter (e.g. donor) of the improved cook stove;
• The stove must be convenient and appealing enough to convince the target group to buy and use it;
• The cost of stove production (including material cost) must be low enough to allow a retail price which satisfies both the target group (affordability) as well as the producer (profit margin per stove and turn over).

At some stage of the development process, there is a need to interrupt the change processes for at least a year to allow a field based learning on a constant stove model. Otherwise it is difficult to identify which variation of the stove model is related to which feedback or observation. While an early release to the public bears the risk of a public failure (image problem), a prolonged research period increases the cost of development and delays the results of dissemination.


Piloting of Improved Cookstoves (ICS) Production

Once the field test confirms the satisfaction of the target group with the product, the ICS will be produced for the selected market. As there is still the danger of “teething problems” (see below) in the first few years, it is a common practice to start with a geographically restricted pilot project. This will allow a close follow-up for producers and users through “the project” to ensure that the stoves are properly produced and appropriately used. If problems with the design or the materials are arising, there is still the possibility to correct the faults before large segments of the targeted market are already dissatisfied with the product.


The initial step from “prototyping” to “piloting production” is very crucial and difficult:

  • we are not yet sure of the product (teething problems);
  • we are not yet sure of the market (new product);
  • we are not yet sure of the market case (production costs vs. sales price);
  • we are not yet sure of the marketing system.


Because of these uncertainties, many projects feel the need to protect the initial producers against the risks of entering this new production business. This “protection” can take the form of…

  • providing producers with required tools;
  • providing producers with required production materials;
  • providing producers with grants or loans;
  • giving producers large production contracts ( project buys all their stoves );
  • employ the producers ( time-based contracts);


While these interventions are useful to get the production going, there are also huge risks for the long term sustainability attached to these approaches:

  • The initial producers may consider themselves as “employees of the program”. Therefore, clarification of ownership is a must right from the beginning;
  • If the risk to produce for the market is buffered by a program, there is little motivation for the producers to develop a cost-efficient production concept. The initial price for the stove will always be high as there is no incentive to produce many stoves in short time. As a remedy, projects tend to subsidize the initial price for the customer to still find a market for the stove. Once this system of a high workshop-gate price on the side of the producers and a project-based subsidized low customer price is established, it will be highly difficult to exit this scenario without severe fractions. If the stove price increases up to the real price after the removal of the subsidy, the customers will complain that they are used to having a cheaper stove. Or if the workshop-gate price is pushed lower, than the producers may lose interest. Unless there is a clear element of economy of scale, which will result in a natural reduction of production costs over a short time, there is no easy exit from this system.


In many countries, there are artisans who have already worked with former “stove projects”. New interventions often have to also combat expectations which are generated from these past experiences. It requires time, good knowledge of the local stove project history, and strong standing to establish a different system. The selection of the location and the initial producers is something which should be carried out with thorough planning.


It is not possible to suggest “the best way” on how to initiate the ICS production as it is highly circumstantial. However, here are some ideas which have worked in the past:

  • At the end of the prototype-development phase, test-sales can be done to assess how much people would pay for the stove. They can also generate orders for stoves.
  • Based on this concrete demand, artisans with an already established workshop and business can be asked if they are interested to satisfy this documented demand if trained by the program. It is assumed that these producers have all tools and labor required to manufacture the stoves. The project may give a warranty that the investment into the materials for the stoves will be covered in case the stoves are actually not sold despite the orders of the customers.
  • Once these first stoves are produced and sold, the initial producers are invited to participate in awareness and marketing activities to establish their own links to potential target groups and understand how to find markets for their new product.
  • They are continuously supported through quality control and additional awareness campaigns. Feedback rounds with early customers may assist to create a better understanding of the perception of the customers.


There are some lessons from previous interventions to be shared:

  • Do not pay artisans for attending a training workshop on stove production.
    Some projects pay artisans for attending training courses as “they cannot afford to lose a working days income by attending a training course without pay”. But if you pay for participation, people will attend for the money (as a job) and you do not get the interested people. At least their time should be their contribution into a better future. You can buffer the “income-argument” by providing food and by designing half-day trainings close to the homes or work-places of the participants. Hence they can still work half time in their work-shops and still earn a little money.
  • Do not provide free tooling and free materials to kick-start production:
    Access to tools and materials for the production of the new product might be a bottleneck for the newly trained producers. Hence it is tempting to provide them with all tools necessary and the materials required for the first number of stoves with the idea that they can afford to purchase the next materials from the income of the first stoves.
    In some cases this works out fine. But sometimes this attracts the wrong participants who are using the provided inputs to produce any type of other product and afterwards claim that they have to be given another material for the stoves. To avoid this kind of frustration, another option is to provide tools and inputs on a cost sharing arrangement, and the part to be paid by the artisan can be pre-financed by a micro-credit organization. This goes along with the support of the project to connect the artisans with their first customers. By doing so, a strong motivation to produce stoves is generated.



Scaling-up of Improved Cookstoves (ICS) Production Capacities

Once an initial ICS production is established and the market case has been proven by an increasing demand, there is a need to scale-up the production to satisfy larger customer groups.


It is important to consider the coordinated growth of both production and demand:

  • demand without products can frustrate the customers and
  • production without markets ruins the producers.


Scaling-up can be done in two dimensions:

1. Increasing the number of small scale supply-demand systems.

In this case, the concept of “local production for local markets based on local resources and local skills” is maintained. It is a concept which provides a close link between producers and users and is relatively robust against external shocks. For scaling-up this concept, a large effort in capacity building for many artisans is required. Strong and organised partners are needed, who know both the country and its people very well, allowing the project to act as a facilitator. Involvement with other organisations, such as NGOs, the private sector, or governmental bodies, is a precondition for achieving sustainable access to household energy for large numbers of people. These already existing partners can be found in many sectors which are related to cooking energy.


2. Inreasing productivity of production systems

Another way of increasing the production is the transformation of the existing production system to increase the productivity per producer. This can be based on the introduction of improved tooling (e.g. in Senegal the introduction of flanging, bending and rounding machines for metal works) of local artisans or the establishment of semi-industrial production centers (e.g. introduction of an extruder machine for the production of ceramic liners in Ethiopia).

The investment into machinery has various dimensions:

  • The investment has to be financed: there might be a need to support the producers through micro-finance instruments to facilitate the investment.
  • The investment must be viable: the additional costs of the investment must be overcompensated by additional income through cheaper production and increase of sales. A business case study for such an investment should be produced before the investment is executed.
  • Staff qualification: new machines require new skills and knowledge. Existing staff has to be trained or better staff has to be recruited to operate the new machines properly.
  • The investment can increase the vulnerability of the production: If new machines depend on the availability of electricity or the presence of a specific (qualified) staff member, the production might be more vulnerable for forced interruptions. The risks of such vulnerabilities should be assessed upfront.




Donors and Institutions as Customers

Donors such as the United Nations Children's Fund (UNICEF), the World Food Program (WFP), or international NGOs supporting school feeding programmes are potential customers for stoves.

Institutional stoves can be highly efficient, and their very high savings potential means that institutions (both public and private) spend less on wood fuel, and, for instance, school children spend less time collecting firewood, so more time can be spent in education. Canteens in institutions such as schools, hospitals, or prisons benefit from energy saving stoves. A cost-benefit analysis in Malawi has shown that the use of Institutional Rocket Stoves is profitable in a wide range of institutions.

Also, an impact study of rocket stove in school canteens highlighted the relevance of proper and practical user training not only of head teachers or coordinators but of the cooks themselves. Read more: ProBEC Study on the Impact of the Institutional Rocket Stoves in School Kitchens.


Institutional rocket stoves in Malawi
An orphanage that prepares two meals a day in a 100 litre pot saves 680 US$ yearly on firewood expenditures. If a 200 litre stove is used twice a day throughout the whole year the net benefit during the stove’s four-year life is 4235 US$. Depending on cooking frequency and size, the price for a stove has been paid off after three to nine months. Due to reduced firewood costs canteens save up to 40% on their catering budget.
-> CBA Malawi Costs and Benefits of Institutional Stoves



Application of Improved Cooking Stoves in Rural Health Centers
Cooking needs in rural health centers can be divided into two categories, depending on the target group, for whom the food is prepared:
  • Food for staff
    It depends mainly on the number of staff, the health center management, and/or the degree of self-organization of the staff. If the meals for staff members are prepared communally, an institutional size stoves might make sense.
    Examples: Both Mission and the Government hospitals in Mulanje District (Southern Malawi) have institutional size wood-fired rocket stoves to cater for the staff and the students of the nursing college. Cooking is done by a paid cook, who got trained on the proper use of the stoves. The firewood is provided by the hospital. Savings as compared to the open fire are between 70-80 percent.
  • Food for patients
    Most rural health centers do not provide meals for the patients, even if they have in-patient facilities. The meals for patients are prepared individually by the guardians who accompany the patient often with the main purpose to cater or prepare warm bath water for the patient. Thus individual cooking facilities are needed for the guardians. Usually food ingredients, fuel, and cooking utensils have to be organised by the guardians and are not provided by the health center. Thus, the most prevalent cooking facility is the makeshift 3-stone fire fuelled with firewood or any other biomass that the guardians are able to organise in the immediate surroundings of the health center. A good practice is when health centers provide a sheltered cooking place and define the area where cooking is allowed. To minimise the adverse effects of air pollution and prevent smoke from adding to the ailments of the patients, this location should preferably be at a distance from the wards and care units.


Mulanje Mission Hospital in Southern Malawi went even further. They had already a roofed kitchen for the guardians with 20 simple fireplaces. As hospital facilities were expanding and the number of in-patients increasing, the kitchen became small.
With advice from GIZ-project staff on stove technology and kitchen design, they added another roofed kitchen with improved fixed ‘Epseranza’ -type stoves and good ventilation. In the first weeks the kitchen was not yet well accepted and rather empty, because people were not familiar with the stoves and were unsure how to use them. Upon realizing this, a permanent security staff of the hospital got trained on the correct stove use and was able to show the ever-changing users, who normally don’t use the kitchen longer than a few days. From then on, the kitchen became more and more popular as people became aware of he advantages: the new stoves were more economic, cooked faster, created less smoke, and the building had a better ventilation. Young mothers felt more comfortable bringing their babies in the new kitchen. The challenge remains to organise the maintenance of the stoves, as some of the ceramic pot-supports of the ‘Esperanza stoves’ went missing and the stoves perform poorly without them.


Cooperation with Ministries of Education can further help selling stoves and may offer the opportunity to incorporate household energy into curricula. For example, testing sites at Ethiopian schools offer students and teachers the option of learning more about cooking energy and the dangers involved from smoke inhalation. Programmes for improved housing are potential partners if they provide access to stoves to their beneficiaries.

For these initiatives to happen, organisations must be informed about the project and the technology options the producers offer. When the product is launched, it may be necessary to create links between these institutions and the stove producers, and facilitate communication through meetings and workshops.

Experience in Malawi has shown that even if stoves are bought ‘off the counter’ from the producer, training sessions for the purchasers should be part of the package. Correct stove use is crucial for fuel savings, and for the longevity of the device. This also leads to happy customers and successful producers. Voluntary staff often do the cooking at social institutions such as orphanages. Howeve, they may have no experience with fuel-efficient stoves and would benefit from on-site training on how to use the stoves properly. This training can be done either by the project itself or by the institution. In the longer term, it is better for the institution itself to be trained by the project, so that it can train its own staff in the future.


Industries as customers and development partners
Large companies catering for their workers usually cook several hundreds or even thousands of meals every day – often on traditional stoves. Using a fuel efficient cooking technology is very cost effective in such circumstances, and the savings can cover the cost of the stove very quickly. Experience in Malawi has shown that canteens in tea estates or sugar plantations can reduce their fuelwood consumption to 10% of the quantity used on an open fire (a 90% reduction). Companies such as these may be willing to act as development partners by agreeing to test different models in their canteens.

Many companies also provide their staff with housing and other services. Access to energy can be incorporated into corporate social responsibility (CSR) initiatives through public/private partnerships (PPP) or similar types of cooperation. Ideally, this is a win-win situation. Risks and costs of research and development, and the cost of improving the house through improved technologies, can be shared between the project and the industry. The agricultural industry (sugar, tea, tobacco) has shown particular interest in CSR activities that involve access to clean, efficient energy, as their corporate social responsibility actions can enable them to achieve a fair trade label.

-> ProBEC presentation ‘Institutional Stoves’ with experiences from Malawi







Further reading

For over three decades, Aprovecho Research Center has been the global go-to for practical, efficient, and purposeful expertise in the design and testing of biomass cookstoves. Their leading-edge and collaborative research continues to remain open source and accessible to promote the “best use of” resources for everyone from the rural cook to national governments. http://aprovecho.org/




References

This article was originally published by GIZ HERA. It is basically based on experiences, lessons learned and information gathered by GIZ cook stove projects. You can find more information about the authors and experts of the original “Cooking Energy Compendium” in the Imprint.



--> Back to Overview GIZ HERA Cooking Energy Compendium