Botswana Workshop-September 2009-Proposal Annex
2 GHANA MINI HYDRO
5 EGYPT BIODIESEL
10 LESOTHO IMPROVED STOVES
13 BURKINA FASO SOLAR WATER PUMPING
15 KENYA FLOODWATER HARNESSING
GHANA MINI HYDRO
Project Title: DEVELOPMENT OF PILOT MINI-HYDRO POWER SCHEMES IN GHANA
Executing Agencies Ministry of Energy,
Ministry of Environment
Ministry of Local Government
Implementing Agencies Energy Commission,
Environmental Protection Agency
Local district assemblies
Randall Fall on Oyoko River, Kintampo, Brong Ahafo Region
Tsatsadu Falls on Tsatsadu River, Alavanyo-Abehensi, Volta Region
Sanwu Falls on Sanwu River, Sefwi Boinzah, Western Region
Project is projected to cost US$3,425,000
Ghana Government contribution in kind through Energy US$500,000.
Commission and District Assemblies:
Co-funding being sought from GEF: US$2,925,000.
The project will be implemented over a period of 4 years.
Ghana is endowed with renewable energy resources such as solar energy, biomass, wind
and mini hydro. Intensive studies for over 20 years in Ghana which strived for the harnessing
of small and mini hydro power development has revealed the enormous mini hydro potential
in the country. Currently 16 mini hydro sites have been identified. The conclusion of the
studies led to selection of Randalll Falls (380kW) at Kintampo, Tsatsadu Falls (320kW) at
Tsatsadu, Likpe Kukurantumi Falls at Likpe Kukurantumi and Sanwu Falls (60kW) at Sefwi
Binzah as some of the most attractive mini hydro sites.
The apparent slack in the development of the mini hydro sites largely arise from the fact that
there has been little or no interest by the power utilities in Ghana to generate electricity from
mini hydro plants. This is because power from the large hydropower plants at Akosombo and
Kpong (1020MW) is seen to be cheap and sufficient for the nation. Again there is no
regulatory and legal framework for the development and utilisation of renewable energy
sources. There is no or little economic incentive in place to attract investment in small hydro
dams. Currently the Energy Commission is developing the regulatory framework for the
promotion of the renewable energy, which will be passed into Law by the Parliament of
Ghana by the end of year. This Law will create the enabling environment for private sector
investment into the renewable energy sector. The power utilities have also changed their
attitudes towards the renewable for the better.
The Government of Ghana has a target to increase its current level of power of about
2000MW to around 5000 MW by 2012 to sustain the rapid economic development of the
country. To this end, Government is looking to develop the various sources of energy
available to the country which include the renewable energy sources.
The Energy Commission has the mandate to ensure the development and utilisation of the
country’s indigenous energy sources. It has thus initiated action to develop the country’s
renewable energy resources particularly the four mini hydro sites listed below.
The various studies have revealed the following technical information about the Falls.
Randall Falls Tsatsadu Falls Sanwu Falls
River Oyoko Tsatsadu Sanwu
Location (Town) Kintampo, B/A Alavanyo-Abehensi, Sefwi Boinzah,
Catchments area (km2) 465 40 3.4
Head (m) 18 43 falls + 43m rapids 150
Designed Flow (m3/s) 2.6 0.5 0.05-0.1
Proposed installed 380 320 60
Annual energy 1,900,000 1,220,000 264,000-300,000
Project model Mini grid/Tourism Grid connected Micro grid
Model for Grid connected
The Government made the effort to develop the Likpe Kukurantumi Falls in the 1990s but was
suspended when the national grid was extended to the area. Now with the government’s
policy of exploiting all available indigenous resources of the country the development of Likpe
Kukurantumi Falls into a grid connected mini-hydro plant has become utmost.
The development of the Tsatsadu Falls into a hydro power plant was initiated by the Ministry
of Energy in 2007. Currently, a 150kW generator has been donated to the Government of
Ghana toward the project by the Chinese Government. Power generated will be fed into the
national grid. What remains to be done are the civil works (intake and weir, intake channel,
penstock, turbine house, tailrace channel, site access, construction details), electrical works
and grid connection.
Model for Mini grid for Tourism site
The Kintampo North District Assembly has commenced the development of the Randall Falls
site into a tourist centre. Currently a rest stop has been constructed at the site. The
surrounding areas have been earmarked for hotels, horse ranch and other amenities. In view
of the mountainous nature of the area, mountain hiking has been planned for the area. Power
provision is currently by expensive diesel which is also not regular. Power generation from
the Randall hydro power plant will serve the facilities that are earmarked at the tourist centre.
Model for Micro grid
The Sanwu Falls is a perfect location from the implementation of micro grid hydro plant for
power supply to a nearby village of Sefwi Boinza in the Western region.
The objective of the project is to generate electricity from the Randall, Tsatsadu, Likpe
Kukurantumi and Sanwu Falls to enhance power supply as well as opening up the localities
for tourist attraction to improve the socio-economic development of the areas. The project is
consistent with the national goal of pursuing measures and programmes toward low-carbon
economy as envisioned in Ghana’s Technology Transfer and
Adoption Plan (TAAP).
The following activities will be undertaken:
Environmental impact assessment to include GHG mitigation potential assessment
Remote sensing and geological survey
Civil, electrical and mechanical designs
Construction of the dam
Acquisition of equipment
Installation of equipment
Commissioning of plant
The following activities have already been undertaken:
- The Energy Commission has held project consultation meeting with all stakeholders
of the locations of the projects.
- The Ministry of Energy has secured a 150 kW generating equipment (turbine,
gearbox, generator, control system) for the Tsatsadu Falls hydro project.
Projects Implementation and Management
The Energy Commission will coordinate the implementation of the pilot projects. Private
companies with the requisite expertise will be procured to team up with the utilities to
implement the various aspects of the project. This is to ensure smooth transfer of technology
to the utilities. A steering Committee, made up of the utility, (Northern Electrification
Department (NED) of the Volta River Authority and the District Assemblies of the project
locations will be set up to during the project implementation phase.
At the operation and management stage of the plants a Board comprising Energy
Commission, ECG/NED and the District Assemblies will be constituted to manage the plants.
The Energy Commission will own the power plants. The District Assembly will provide
operational office and collect bills from customers while ECG/NED will be responsible for the
technical operation of the plants. The utilities will use the plant as learning facilities for such
things as connectivity of renewable energy plants to the distribution network and operation of
mini grids. All revenue collected by the District Assembly will be lodged into an account
operated by the Energy Commission. The revenue will be divided into three depending upon
the equity shares of the agencies as follows:
Energy Commission share of Towards maintenance of the power plants
revenue and the grids
Utility company share of revenue Towards wages of technicians seconded to
District Assembly share of revenue As share of project’s contribution towards
revenue generation in the project location
The Energy Commission will mange the plants for a period of three years after which the plant
will be handled over to the private sector or the utilities to manage based on competitive
bidding to ensure the minimal provision of government subsidies to the plants.
Project site Power Plant Revenue Operation and Provision of
ownership collection Maintenance of Project Office
power plant and
Randall falls Energy District Northern District
Commission Assembly Electrification Assembly
Likpe Energy District Electricity District
Kukurantumi & Commission Assembly Company of Assembly
Sanwu falls Energy District Northern District
Commission Assembly Electrification Assembly
Environmental impact assessment US$ 100,000
Remote sensing and geological survey US$ 25,000
Civil, electrical and mechanical designs US$ 100,000
Civil works US$1,000,000
Acquisition of equipment US$800,000
Electrical & mechanical works US$200,000
Grid connection US$600,000
Office rental and operations US$500,000
The Energy Commission and the local district assemblies will provide office spaces for the
Project Proposal for
Biodiesel Production from Jatropha curcas seed
Date: 30 July 2009
Name of the project: Biodiesel Production from Jatropha curcas seed by enzyme
extraction and ethyl transesterification.
Location: The southern part in Egypt – Luxor city, it will cover around 100 hectares
(equivalent to 250 feddans).
Champion's contact information: Egyptian Environmental Affairs Agency, Climate Change
Unit, 30, Misr Helwan El-Zyrae Road, Maadi, Cairo.
Tel/fax: +20225246162, E-mail: email@example.com
Product or service: Biodiesel
Abstract: We aim to develop a technologically innovative low cost project for the
production of biodiesel derived from Jatropha Curcas seed, currently under cultivation on
the southern part in Egypt – Luxor. In more details, the proposed research activity is
centred on the development and verification of an innovative system, which involves the
enzymatic rather than mechanical extraction of oil as well as a transesterification phase
using ethyl alcohol, with a resulting savings in processing costs. There are five macro
phases to the project: the first being a laboratory phase, the second involves the
installation of a pilot facility, the third, to be carried out simultaneously with phases 1 and
2, will focus on establishing and managing an experimental Jatropha farm. The objectives
of this activity include the integration of the Egyptian Environmental Affairs Agency
(EEAA) knowledge base with regard to the cultivation of this species as well as the
definition of an agro-industrial model that is economically, environmentally and socially
sound. Furthermore, a macro-phase shall aim at studying the applicability of the Jatropha
cultivation system in line with an economic and financial profile on an industrial scale. The
final phase of the project will include demonstrations using the combustible oil that has
been produced in the pilot facilities to fuel public transport vehicles.
Technology: The extraction of Jatropha curcas seed oil via enzymatic process &
Production of biodiesel by transesterification with ethanol. Figure 1, presents the steps of
the production process.
Figure 1, Schematic diagram for the steps of the production process
OLEAGINOUS OIL ON BIODIESEL
SEED (Jatropha) (Ethyl Alcohol)
Customers/clients: This project can provide biodiesel to industry, transport and energy
sectors for using it in companies and enterprises and fuel stations for diesel engines in
the surrounding area as biodiesel can be mixed with petrol for use in diesel engines in
any ratio, bettering the engine’s performance, etc...
Current status: The project did not start yet.
Project size, expected schedule and cost:
This process consists of 2 main steps which are extraction of oil via enzymatic process &
Production of biodiesel by transesterification with ethanol. This is a three year (36 months)
project, where the period starts from the formal date of the allocation of funding by the
institution financing the project.
- Overall costs amount to €2131440 (around 2996382.05 US$).
The project includes 5 phases, where each phase includes some activities as presented in
Table 1, Phases of the project:
PHASE ACTIVITY EXPECTED RESULTS Schedule Cost (Euro)
1.1 – Research on the state of the art Review of the existing technology and
processes of interest; review of the existing
literature on the cultivation and use of
1- Laboratory phase
1.2 – Identification of the enzyme(s) Identification of the correct mixture required
best suited to the enzymatic for a complete enzymatic process to the 30200
extraction process seed. 12
1.3 – Fine tuning of enzyme kinetics Optimization of enzyme kinetics of oil
extraction in Erlenmeyer flask.
1.4 – Enzymatic extraction process Optimization of enzyme kinetics for
scale up in fermentator extraction of seed oil in fermentator.
1.5 –Transesterification trials with Laboratory trials on the efficiency of the
ethanol process with ethanol.
2.1 – Planning and construction of the Project execution and prototype 24
pilot plant construction. months
PHASE ACTIVITY EXPECTED RESULTS Schedule Cost (Euro)
2.2 – Pilot plant start up and testing Adjusted and functioning prototype. 51000
2.3a – Process parameters Biodiesel production from Soy – production
optimisation using Soy beans parameters optimized.
2.3b- Process parameters Biodiesel production from Jatropha –
optimisation using Jatropha seeds production parameters optimized.
2.4 – Research and testing of the Product characterization and certification.
physical-chemical properties of the
obtained Biodiesel for use in 62000
3.1 - Detailed planning of the Site selected; detailed design of the
Jatropha crop, arrangement of the experimental cultivation; farm-use plan;
farm-use plan and the experimental experimental programme;
3- In field phase
3.2a – Infrastructure construction 120000
Experimental Jatropha farm established and
3.2b - Nursery propagation and started up
bedding out of the plants 70000
3.3 – Farm management and Initial results obtained from agronomic,
execution of the experimental ecological, and physiological 105000
4.1 - Evaluation of CO2 balance Evaluation pertinent to CO2 balance.
4- Transfer to Industrial
relative to the processes and the
vegetation cycle of the raw material
4.2 - Analysis and evaluation of Socially and environmentally sustainable 14
social-environmental sustainability of management models. months 80000
the “Jatropha - Biodiesel” system
4.3 - Feasibility study for the Feasibility study for the industrial scale
construction of a full scale Biodiesel application of the developed process. 65000
production plant in Egypt
5.1 - Realization of a demonstrative Results obtained from laboratory trials on
campaign through the utilization of the engines; field monitoring of Biodiesel use;
produced Biodiesel for fuelling Cairo’s people sensitization on the specific issue. 60000
public transport. Possible tests in
5.2 - Results dissemination Events focused on the specific theme in
Egypt; articles on scientific and economical months
magazines regarding the research and the
5.3 – Construction & maintenance of Web site on line and updated progressively.
a dedicated web site
General Expenditures (including VAT) 364640
Total Cost (Euro) 2131440
Total Cost (US $) 2996382.05
Current needs and request: The overall costs amount to €2131440 (around
2996382.05 US $). The current need is laboratory and technology facilities in order to
extract oil from Jatropha curcas seed and then transesterification process.
Market conditions: Egypt supports switching into consuming biodiesel instead of fossil
fuel, as it can be supplied to factories acting with diesel engines in the industrial
sector, transport sector, energy sector & residential purposes. The product can be
exported to southern European countries. Also, the by-product (glycerol, used seeds)
can be used in soap industry as well as animal feeding processes.
Operating conditions: This project is a three year project. The operational plan is
subdivided into five macro-phases, each comprising a series of activities. In more
details: phases 1 and 2 shall consist in the actual development of the process and
shall be conducted using Jatropha as a raw material as well as soy seeds for
comparison; and phase 3 shall consist in the preparation and management of the
experimental Jatropha farm as well as the execution of agronomic testing; and phase
4 shall consist in collecting the results obtained in the various research activities with
the aim of carrying out economic – financial evaluations concerning the feasibility of
full scale Biodiesel production plants in which the process developed and tested in
the research is applied; agro-industrial and eco-socio sustainable models shall
furthermore be analyzed and evaluated; and phase 5 shall consist in the
demonstration and dissemination of the results obtained.
Regulatory conditions: Egyptian Environmental Law (4/1994) encourages renewable
energy projects, in addition to waste water treatment which could be used in Jatropha
cultivation. There are some required permits such as permit to obtain loan (grant)
approval, environmental impact assessment (EIA), and permit for the land and
treated sewage water that will be used in cultivation of Jatropha.
Owners and sponsors: Egyptian Environmental Affairs Agency is the owner of this
project; Egypt encourages Private-Public-Partnership (PPP) and provides its support
to such activities.
Team: The working group will be organized according to function in the following
1- Management: responsible for project coordination, under both scientific and
operational points of view;
2- Research: responsible for the development of scientific activities and research;
3- Communications: responsible for the development of demonstration activities, for
results dissemination and publication as well as for the construction & maintenance of
a dedicated web site.
Stakeholders: This includes all sectors that will be affected by the project such as:
farm sector (labours, farmers, seeds collectors, etc...) and, transport sector (using
biodiesel in vehicles and trucks engines, etc..), and industry sector (factories that will
use biodiesel as fuel in production processes, etc..), and energy sector (Using
biodiesel in power stations, etc..), and surrounding area (through employment, desert
land reclamation, etc..).
Governance and management structure (decision-making, authority and
responsibility): This will be organized between the Egyptian Environmental Affairs
Agency and sponsor(s).
Impacts and returns: There are many impacts such as the experimentation and fine-
tuning of innovative biodiesel production methods; the reduction of costs related to
the construction of biodiesel production facilities and related production costs, which
are presently somewhat high; to promote the cultivation of vegetable crops such as
Jatropha Curcas in order to effectively combat desertification which presently affects
large tracts of land in developing countries; to contribute to the reduction of
greenhouse gases since “cradle to grave” analysis (the cultivation of Jatropha
Curcas) is characterized by a reduced emission of CO 2 when compared to the
equivalent fossil fuel production-combustion cycle; the reduction of fossil fuel
consumption in favour of a cleaner renewable energy source; the promotion of
renewable energy sources; to offer a positive contribution in the establishment of
sustainable development in developing countries, with the positive effects that the
cultivation and production of Jatropha Curcas has on the environment, employment
and economy of the people in these countries; to encourage transfer of
environmentally sound technologies and provide opportunities in generating CERs -
Certified Emissions Reductions..
Risks and measures to handle them: table 2
For sustainability of the project, training a team
Inexperienced management team
before applying the project is needed.
This risk is assumed to be mitigated through secure
Non-achievement of sales targets signed memorandum of understanding from
customers and sign supply contract with customers
The strict enforcement of safety standards by the
regulatory bodies is also expected to mitigate this
Failure to comply with safety codes and
risk. The company will also secure comprehensive
insurance coverage for the plant just before it
Unreliable supplies Assuring seeds, enzyme, and alcohol supply,…etc
Foreign currency: a sharp depreciation in the
Making calculations taking into account currency
value of the local currency against foreign
depreciation, inflation trends and the tax rates in
exchange may happen. The business will
generate revenue in local currency
This is a new technology in Egypt, so competition
Competition will be very low and this product (biodiesel)
represents a vital product in Egypt.
Detailed Implementation steps and plan submitted: (See Table 3 of original
LESOTHO IMPROVED STOVES
Date: May 2009
Name of project or enterprise:
Green Stoves (Pty) Ltd.
Green Stoves (GS) is a technology to be introduced in the foothills and lowlands of Lesotho.
Champion’s contact information:
Mr. Simon Molapo, Director GS (Pty) Ltd; Room 24 LNDC Block F, Maseru, Lesotho.
Tel: +266 22 32 4374
Fax: +266 22 32 5057
Product or service:
Marketing and distribution of GS Technology
GS are a compact of economical fuelwood stoves for house heating and cooking.
GS will provide on the market modern stoves to about 26,840 rural households, community organisations
and societies, and schools over the next four years.
The region has been identified and market analysis near completion. The company is a registered
propriety limited entity. The technology is approved and emits very less smoke when used properly.
Currently in search of needed financing to commence work.
Project size, expected schedule and cost:
The Company will provide about 5000 stoves in the first year with an estimated sales increase of 0.2%
per year thereafter.
Current needs and request:
A total investment of USD2.6 million will be needed. GS will dedicate 20% from its resources and will
need to fill remaining 80% in a form of loan distributed in a four year period. Loan repayment can be
accomplished in an annual interest rate of 0.5%.
The selected region has largest available fuelwood in the country. However, the fuelwood is gradually
decreasing. Fuelwood is the largest source of energy in that region contributing to over 50% of total
energy needs. The region accommodates population of about 1 million with a household of about 4
people. The stoves will provide services to over 107,360 people. The lowlands are the economic hub of
the country. Stoves that consume less fuelwood but maximize benefits will promote longer availability of
wood and help country emit even more less greenhouse gases.
Legislation permits retailers like GS to source goods direct from manufactures and sell them directly to
Regulatory conditions (including all required approvals):
GS will need a trading licence from the Trade and Marketing Department. Also, safety certificate will be
needed from the relevant Health Department.
Owners and sponsors:
Mr. Simon Molapo is a well established businessman. He holds a Master’s degree in Environmental
Economics, a Diploma in Business Administration.
GS will recruit a marketing manager, cashier, a driver and support staff to reinforce current team.
Governance and management structure (decision-making, authority and responsibility):
Mr. Molapo will oversee all operations of the business.
Implementation steps and plan:
The following is a tentative project implementation schedule.
Cash flow and schedule details:
The selected base case shows that the project will generate enough cash to sustain its operations. The
cash flow and the balance sheet represent a financially sound company, which should position it to
secure finance from local sources for expansion.
Impacts and returns:
The enterprise will necessitates little fuel consumption and allow for more natural re-growth of forests in
the region. It will also reduce air pollution and thus improve general health of communities. It will reduce a
number of long journeys women and young girls travel to collect firewood.
Risks and measures to handle them:
The main risk can be unmet sales targets as a result of global economic meltdown and people continuing
losing jobs. This risk can be handled by introducing saving schemes to communities with the savings they
get from abandoning their old technology and adopting this new one. By using the new technology there
will total savings of USD10 per month per household.
Task 1: Describing WHAT is being proposed, keeping the technology, service, product and client
description, factual and clear.
1.1 Product or service
This enterprise aims at reducing fuelwood consumption in the region and introducing cheaper technology
to communities. The product will be guaranteed for a period of three year with immediate replacement to
equipment for factory faults.
The stove is much more efficient than traditional cooking methods and saves a lot of time. It is cylindrical,
enclosed and molded in stainless steel. On top of firewood, fuels like maize husks, cane stalks and dried
animal dung can be used.
The stove is built into a stainless steel base and two layered walls that insulate it so that less heat is lost.
This also makes it more stable. And because the stove produces much less smoke than a traditional fire,
families suffer fewer.
About 20% of firewood is saved when using this kind of technology, but warming and cooking are much
Potential clients can be classified into three main categories:
This market consists of individuals who use GS mainly for domestic and ceremonial cooking purposes.
Clients for this market can be found in the rural.
Task 2: WHERE? Research and describe the setting in a balanced and transparent way to show that the
local setting is understood.
GS is a newly identified technology and has been used in other parts of Africa. It will be used in the parts
of the country where firewood is predominantly source of fuel.
2.2 Country conditions:
In winter when it becomes really cold in Lesotho, firewood and other forms of fuel like crop residues and
dried cow dung are used for heating purposes in Lesotho. Firewood is used predominantly and fills about
40% of energy consumption in winter in the region identified. Crop residues follow with 25%. Other fuel
sources like cow dung and paraffin are the next dominant fuel sources.
2.3 Market conditions
The GDP per capita in Lesotho stays at 5.1%, the inflation as of June 2009 is at 8.1% and unemployment
rate is over 22%. The 2006 census put the population of the country at just over 1.8 millions. About 15-
20% of the population in the region is projected to use the GS stoves as about 30-40% of the population
in the region is currently employing the old stoves technology to warm and cook.
2.5 Marketing plan
The will be one outlet of the GS stoves in the country and will be located in Maseru. This is because the
city is in the center of the region. Demonstration and free pamphlets will be developed and shown to the
population in the region to market the product. Efficient services will be employed to win the loyalty of the
customers and this will reduce the risk of other investors winning the customer base we will have
2.6 Regulatory setting
By legislation, retailers such as GS can purchase stocks directly from the manufactures. This eliminates
the middle man and thus benefits the customers by keeping the prices low and comfortable for the
Task 3: WHO? Evaluate and present the team and stakeholders, showing who will be involved and
demonstrating their capabilities.
Champion (owners and sponsors)
Simon Molapo is a well established businessman. He is the sole owner and Managing Director of GS
(Pty) Ltd. He has worked as a marketing manager at Sunshine Fuel Suppliers which provides energy
products to the local businesses in Lesotho and has worked as a leading environmental officer in the
Department of Energy in the country. He will be leaving his post to fully engage in this assignment.
Task 4: Organizing and presenting the steps to implementation, showing HOW the core idea will be
turned into an operating reality.
4.1 Implementation plan
The accompanying table lists important project milestones, with dates, managers in charge and budgets
for each step. The milestone schedule shows our emphasis on planning for implementation.
Commitment to these schedules is of prime importance for the success of the company. The business
plan includes complete provisions for plan versus actual analysis, and we will hold monthly follow up
meetings to discuss any variances and the course for corrections.
Activity Schedule Planning Construction Pre-operation
Task 5: WHY? Estimate the impacts, outcomes and expectations of the proposal, itemize its benefits and
create a matrix of benefits, inventory proposal impacts and mitigation measures.
5.1 Environmental and social impacts and conditions to monitor
Support for this business will provide direct employment for the staff of GS and will empower local
communities to establish private saving schemes. Cheaper and efficient products will benefit
economically and will also improve the levels of life to the communities as cleaner environment will be
Less time by the vulnerable females for firewood collection will be beneficial to them as they can
concentrate and dedicate time to other important household activities.
Reduced deforestation will indeed be achieved by using the technology as less firewood will be collected
and the forests can have much regeneration. Air quality in the region will be enhanced.
The project site lies adjacent to the road to the regional capital N. Originally, the project site was farmland
used intermittently by a local farmer. Later, sand-winning contractors extracted material for construction
from this particular site and adjacent areas. It later lay unused until it was acquired for the proposed
Task 6: Build the base case
6.1 Basic assumptions
Financial projections for the next four years were informed by real case studies of two existing similar
projects at other neighboring countries. A sensitivity analysis was conducted for two different scenarios
using past trends in price increases, shortages and salary levels as variables and testing their impact on
The projected cash flow of the company shows that it will generate enough cash to sustain its operations.
GS physical equipment is not notorious for breakdowns; the company will thus not have large expenses
to manage such situations should they occur. The cash flow and the balance sheet represent a financially
sound company, which should position it to secure finance from local sources for expansion.
6.2 Evaluating feasibility
A sensitivity analysis was carried out to showcase two possible scenarios that could occur in the life of
In the first scenario, the company could generate enough funds to cover all the operational and financial
expenses. The worst case is presented in the second scenario, in which the company would not be able
to service the loan. That scenario might occur in the unlikely event of a long absence on the part of the
entrepreneur and a lack of commitment and possible misapplication of funds by his successor. In the
event of that scenario, the lender has an option of recovering its investment through the sale of the filling
The first scenario is considered the base case scenario based on conservative projections and guided by
the actual sales of similar start-ups in comparatively developed markets. The growth in the sales is also
informed by the researched market trends and is not overly ambitious.
6.3 Financing plan
To carry out the proposed business plan, a total investment of USD2.6 million is needed. GS will dedicate
20% from its resources and will need to fill remaining 80% in a form of loan distributed in a four year
period. Loan repayment can be accomplished in an annual interest rate of 0.5%.
f 146,640 is needed. The sponsor is prepared to contribute 29.8 per cent (43,650) from his own resources
and is requesting a loan in the amount of 102,990 with a term of no less than five years. Cash-flow
projections estimate that an interest rate of up to 7 per cent can be paid on an annual basis.
With an interest rate of 7% per annum the owner can fill the debt obligation should a need be by utilizing
his equity and assets.
Task 7: What If things do not go as planned? Show how reasonable it is to expect these results by
examining and estimating contingencies.
Risks and mitigation strategies
Risk: Inexperienced management team
Mitigation: The sponsor has identified some training needs for the staff and has linked with other similar
businesses in the neighboring countries for attaching staff with them. Medium term formal training in
business will be identified for managerial positions.
Risk: Non-achievement of sales targets
Mitigation: Failure to achieve sales targets will have significant consequences on the business’s financial
projections and thus its ability to repay the loan. In recognition of this, the business’s financial projections
have been prepared based on a conservative sales estimate that takes unforeseen implementation
problems into account.
Risk: Failure to comply with safety codes and regulations
Mitigation: The business will provide continuous education to its staff and clients. In addition, the strict
enforcement of safety standards by the regulatory bodies is also expected to mitigate this risk. The
company will also secure comprehensive insurance coverage for the plant just before it commences
Risk: Unreliable supplies
Mitigation: A lack of a regular and reliable supply of stoves to the central retail store which is about 400
kilometers in South Africa is a potential risk to the business. To mitigate this risk, the entrepreneur has
concluded negotiations with the supplier to provide the business with regular haulage services.
Risk: Foreign currency
Mitigation: The business will generate revenue in local currency; the repayment of the loan, however, is
expected in dollars. A sharp depreciation in the value of the local currency against foreign exchange
would therefore affect the repayment of the loan as more local currency would be needed. To mitigate
this risk, the interest rate on the loan has been calculated taking into account currency depreciation,
inflation trends and the tax rates in the country.
BURKINA FASO SOLAR WATER PUMPING
Date: July 2009
Name of the project:
Introduction of solar pumping photovoltaic into the small village irrigation/National council for Environment
and Sustainable Development / Albert Schweitzer Ecological Center in Burkina Faso
Introduction of the proposed photovoltaic solar pump in the small village irrigation will be implemented in
15 provinces of Burkina Faso
Champion’s contact information:
Mr. SEMDE Idrissa, 01 BP 6486 Ouagadougou 01 Burkina Faso
E-mail: firstname.lastname@example.org , Phone: (+226) 50 31 31 66 / (+226) 70 23 89 54
KONSEIBO Charles Didace, 01 BP 3306 Ouagadougou 01, Burkina Faso
E-mail: email@example.com / Phone: (+226) 50 34 39 27/ (+226) 70 35 77 03
Product or service:
Product or service the project aims to establish 15 sites in Burkina Faso stores for vegetable farming,
including water supply system is made by solar photovoltaic pumping on drilling. This project will also
supply drinking water to populations. Thus the project activities will include:
Realization of positive drillings to great flows;
Drilling major positive flow;
Installation of solar photovoltaic pumps;
Installation of water towers and standpipes for water supply and distribution of potable water;
Construction of ponds of water for irrigation;
Development of training schemes and vegetables Vegetable;
Construction of storage of finished goods and agricultural inputs;
Establishment of units drying vegetables;
Support for marketing.
The technology of pumping will be done by solar pumps of large flows (4-5 m3 / h) using solar
photovoltaic energy. The installed power for pumps and 800WC vary between 1000WC, a total project of
approximately 15 000WC, solar thermal is used for drying and storage of production. It will also
popularize the installation of tanks for water storage and distribution of fire hydrants to the people.
Vegetable production will be done in the villages and after the local village level, most of the production
will be consumed in the major cities of Burkina Faso. The surplus production will be dried and sold for
consumption in times of shortage, or for export.
The market-gardening production is currently done with surface water. Burkina Faso is a Sahelian country
where rivers dry up very quickly. The rainy season is very short (3 months) and a very long dry season (9
months). Approximately 90% of the population live on agriculture, which is severely limited by lack of
water. It is therefore necessary to consider gardening with water from the aquifer.
Furthermore, the current use of groups pumps by farmers, releases greenhouse gases and has also
become difficult because of the soaring price of oil. This makes the business unprofitable.
Expected schedule and cost:
The project is expected to cover 15 sites in Burkina Faso at a cost of approximately 1, 302, 400, 000 Fcfa
is 2, 960, 000 USD.
Current needs and request currents:
At present, the initiators of the project seeking funding from 2,960,000 USD. The national has not been
Burkina Faso is a democratic and politically stable country. The national currency the CFA franc is also
stable as the Euro. The population is 14 million with an average annual growth rate of 2.4%. 82.72% of
the population live in rural areas and rely on agriculture. Agriculture contributes to 40.8% of gross
domestic product. The GDP growth rate is 8% to 295.2 USD per capita.
The CEAS has proven experience in technology transfer and implementation of solar energy projects in
Burkina Faso and will in this project provide any guarantees of success of implementation and monitoring.
The SP / CONEDD which is a mission of housing the climate change focal point will make his full support
to the administrative management of the project.
Initiators of the project:
The initiators of the project consist of an NGO (CEAS), which specializes in research on appropriate
technologies and the State of Burkina Faso through the SP / CONEDD structure which is the coordinator
of implementation of the actions of the Convention on climate change.
Owners and sponsors:
A multidisciplinary team will be established to lead the implementation of the project (agricultural, Energy
Company, food, rural development, environmental, hydraulic, agricultural economist, etc.)
Governance and management structure (decision-making, authority and responsibility):
The SP / CONEDD structure is the eve of Burkina Faso in environmental governance. Therefore it brings
together a panel of experts who work with technical partners in the implementation of project activities.
Steps and implementation plan:
The project will run over 4 years, 3 sites for the first year and 4 sites / year for 3 years.
Cash flow and schedule details:
The detailed program of the project will be presented later, but for now we will run it for 4 years or 3 sites
for 1 year and 4 sites / year for 3 years. Budgeting activities will also be later.
Impacts and returns:
The social and environmental benefits of this project are enormous. It will ensure food security, provide
drinking water for people, reduce the consumption of fossil fuels and contribute to the fight against
Risks and measurements to handle them:
This project like any other can pose a risk to the lender and the beneficiary. But the risks are mitigated by
1. National legislation requires an assessment of impacts of projects before implementation in order
to increase the success rate and reduce negative impacts;
2. The CEAS, the technical implementation of activities is very well experienced and this may
reduce the risk of interruptions in operation;
3. Stability and monetary policy of the country will decrease the risks of currency fluctuations,
expropriation of capital and changes in policy.
KENYA FLOODWATER HARNESSING
TITLE: HARNESSING FLOOD WATER FOR SMALL SCALE IRRIGATION FOR
AGRICULTURAL PRODUCTION IN BUDALANGI AREA, BUSIA DISTRICT – KENYA
OBJECTIVE: TO ENHANCE AGRICULTURAL PRODUCTION AND FOOD SECURITY
BENEFICIARIES: LOCAL COMMUNITY IN THE FLOOD AFFECTED AREAS
TECHNOLOGY TRANSFER FROM: ISRAEL, EGYPT AND HOLLAND
PERIOD: 3 YEARS
START DATE: JANUARY 2010
FINANCIAL REQUIREMENTS: U$ 3.00 MILLION
EXECUTING AGENCIES: MINISTRY OF WATER AND IRRIGATION, MINISTRY OF
STATE FOR SPECIAL PROGRAMMES, MINISTRY OF
ENVIRONMENT AND MINERAL RESOURCES, NATIONAL
ENVIRONMENT MANAGEMENT AUTHORITY AND OFFICE
OF THE PRESIDENT PROVINCIAL ADMINSITRATION
Flooding is a frequent and recurring phenomenon in the lower catchment of River Nzoia at Budalangi.
This phenomenon has been exacerbated by the effects of climate change in that the intensity and
impacts have increased over the years. Every year during the long rains (March to June), the people
living in this area are disturbed by floods and the related losses are enormous to the local and national
The dykes have been constructed along the river using funds from the development partners as well as
the Kenyan government. These have helped but still the problem persists since the intensity of the
flooding destroys the dykes and the amount of funds used for maintaining these structures every year is a
lot. This means we need to move away from just wanting to control the floods by use of the dykes to also
look for ways of utilizing the flood water for agricultural and other productions. The water can be stored
and be used during the dry spells which occur just after the floods. Such water can also be used for
domestic as well as livestock development purposes.
The Ministry of Environment and Mineral Resources is formulating a National Climate Change Strategy.
Consultative forums from the grassroots and national levels have been started and by December of this
year the strategy will be formulated. Such a national document will assist the government and other
stakeholders to work towards mitigation and adaptation to climate change.
THE BALI ACTION PLAN ON TECHNOLOGY DEVELOPMENT AND TRANSFER
The Bali Action Plan calls for enhanced action on technology development and transfer to support action
on mitigation and adaptation and for enhanced action on the provision of financial resources and
investment to support action on mitigation and adaptation and technology cooperation. In the context of
the climate negotiations, the UNFCCC defines five key elements for effective action to transfer technology
County-driven technology needs assessments
Enabling environments for private sector investment in technology transfer
Capacity building and particularly capacities and institutions in developing country parties to
enable them to assess, adapt, manage and develop environmentally sound technologies
Mechanisms to enhance coordination among stakeholders and facilitate the development of
projects and programmes to support these ends
POLICIES IN FLOOD MANAGEMENT
The National Water Resources Management Strategy (2005-2007) defined Budalangi area of Nzoia River
basin as an area susceptible to floods. The following are listed as the required activities for flood
prevention, mitigation, preparedness, response, recovery and rehabilitation.
Improve catchment conservation and protection so as to retard surface-runoff
Construction of flood control dams and dykes in the flood prune areas
Develop options for inter-basin transfer of excess flood water
Implement upstream engineering measures for soil and water conservation for flood prevention
Develop infrastructure design parameters and regulations to ensure that structures can sustain
flooding at the design return periods
Enhance data recording and information management systems, particularly of extreme events, to
enable design for protection against floods
Table1: Development Expenditure of the Ministry of State for Special Programmes (2006/07)
Programme Government Donor Total Remarks
Disaster Emergency Response & Coordination 153.1 817.6 970.7 UNDP, UNICEF,
Arid Resources Management Project 1,320.1 120.0 1,440.1 WB
National AIDS Control Council 706.8 780.0 1486.8 Various donors
Western Kenya Flood Mitigation Project 48.7 - 48.7 --
Support for Emergency Preparedness 44.7 - 44.7 --
TOTAL 2,273,4 1717.6 3,991.0
Source: Estimate of Development Expenditure of the Government of Kenya
2006/07, June 2006(in Mil. Ksh.)
The project area is located at the lower catchment of Nzoia River where it enters Lake Victoria (figures
1,2 and3). The flood plain is expansive and includes part of Yala Swamp and borders Uganda where the
Samia people reside. The people of this area cannot plan and carry out their economic activities well due
to the disruptions caused by flooding. After the floods, there is usually along period of drought. The main
economic activity is agriculture although a number of the people are fisher folks since they are living on
the shores of Lake Victoria.
Fig. 1: Map of Kenya
Fig. 2: Map of Western Province and Busia District
Floods occasionally cause disasters in Kenya. Areas of Kano Plains in Nyanza Province, Budalangi in
Western Province and the lower parts of the Tana River are susceptible to floods. Arid and semiarid
areas of the country also experience flash floods. In 1997/98 the El-Nino phenomenon affected many
parts of Kenya causing damage worth millions of shillings, loss of lives, famine and waterborne diseases.
With inadequate preparation for the El-Nino floods, national resources were over-stretched in the
response phase. The El-Nino Emergency Project was part of the Governments efforts to address the
problem. The Government through the relevant line ministries/department were to undertake floods risk
mapping and implement integrated flood management projects in flood prone areas.
In the project area, Budalangi, floods occur almost on annual basis during the long rains with destruction
of livelihoods, death of people, livestock, aesthetics and landscape. Waterborne diseases are usually
rampant during the flooding period. The occurrence and intensity of the floods has been enhanced by
climate change. The suffering of the people of this area need be addressed by the government through
mitigation and adaptation means.
The existing dykes break due to the intensity of the flood water then the water invades people’s farms and
settlement. This necessitates the government and other humanitarian institutions like Red Cross to come
in and evacuate the flood areas. It is usually followed by humanitarian assistance to the affected area.
The flooding problem therefore results into disruption of people’s lives and in many occasions results also
into loss of lives and livelihoods apart from environmental degradation.
HISTORICAL FLOODS IN KENYA
Kenya Red Cross Society estimates that 300,000 people have been affected by floods, landslides and
conflict and released a national appeal for USD 7.5 million in 2008.
Severe flooding started in Budalangi district on 10 November 2008 after water burst through the dykes
on the Nzoia River; at least 5,000 people were displaced or marooned.
At least five people were killed, including two children, due to flooding in the Ukambani Region
between 6-10 November 2008
Flash floods from Mount Kilimanjaro displaced at least 100 people and destroyed farms in Taveta,
Coast Province in 2008.
The KRCS reported that floods have affected 29,570 people in Trans Nzoia district and submerged
1,800 acres of farmland in 2008.
In Wajir district, 400 were displaced and approximately 80,000 were otherwise affected by floods in
Twenty-two were killed by flooded rivers in Eastern Province in 2008.
Source: Red Cross Report 2008
Fig.3: Areas Affected by Flooding in the Lake Victoria Basin
To enhance agricultural production through irrigation as a flood mitigation and adaption in the flood prune
areas of Budalangi, lower Nzoia River Catchment
To control flood intensity in the area
To enhance agricultural and livestock production by using flood water
To harness flood water for domestic use during water scarcity
To reduce the impact of flooding to the people of the Budalangi
Sensitize the local people on climate change issues
Exchange programme for the locals and technical(government) persons to Egypt, Israel and
Holland to learn about flood management technologies and Climate Change best practices
Construction of flood water storage facilities
Riverbank stability and conservation through afforestation
Strengthening stability of dykes by planting trees along the whole length (20Km on both sides of
the River Nzoia).
Start or enhance small scale irrigation activities for horticultural crops and livestock development
Train local communities on water harvesting technologies
Mapping of the area using GIS technology for planning purposes
Documentation of successes of the project as a pilot
Monitoring and evaluation
The activities proposed above will be implemented in an integrated manner with a number of institutions
pooling together synergies to ensure that the objectives set out are fulfilled. Input from the local
communities living in the affected areas will be involved all through. It is noted that the government
technical personnel from the following ministries will be involved:
Ministry of State for Special Programmes
Ministry of Water and Irrigation
Ministry of Environment and Mineral Resources
National Environmental Management Authority (Coordination)
Office of the President, Provincial Administration
Others who will play key roles are the local civil society organizations and these will be identified later
IMPLEMENTATION STRATEGY AND BUDGET
ACTIVITY OBJECTIVE OVI TIME-FRAME BUDGET ( U$)
Sensitize the local To make the local people No. of Reports Jan-Feb 2010 20,000.00
people on climate understand issues related
change issues to climate change
Exchange visits to To learn about mitigation No of visits March, June, 150,000.00
Israel, Egypt and and adaptation systems No of reports December 2010
Construction of flood To mitigate against flooding No of facilities September – 1,000,000.00
water storage and put to good use flood December 2010
facilities(5 pans, 3 waters and September –
underground tanks) Dec 2011
Start or enhance To enhance benefits from No of irrigation January 2010 – 1,000.000.00
small scale irrigation flood water schemes started June 2011
activities Quantities of
Train local To enhance their No of water Quarterly from 150,000.00
communities on knowledge on water harvesting facilities 2010 to 1012
water harvesting harvesting technologies establishes
Mapping of the area Establish the extent of Maps developed April-June 2010 180,000.00
using GIS areas affected by flooding
Planting trees on To strengthen and stabilize No of trees of right January- 100,000.00
dykes the dykes species planted December 2010
Planting of trees on To stabilize the riverbank No of hactares January- 150,000.00
the riverbank and conserve the planted December 2010
Documentation of To use the information for No of reports Half yearly from 100,000.00
successes of the management of floods in 2011-2012
project other affected areas
Monitoring and To enhance success of the No of reports Quarterly from 150,000.00
evaluation project by capturing the 2010-2012
challenges of implementing
UNFCCC (2007): Bali Action Plan; Report of the Conference of Parties on its 13 Session
Government of Kenya (1999): Environmental Management and Coordination Act of 1999
Government of Kenya (2009): National Environment Action Plan (2009-2013)
Government of Kenya (2005): Water Resources Management Strategy (2005-2007)