At COP26, India set an ambitious target of achieving net zero carbon emissions by 2070. Low-carbon technologies and planned mitigation efforts will play crucial roles in every step towards that goal. Piyush Sohani, who heads the India division of Sistema.bio, an Ashden Award-winning social enterprise working in clean energy, is a strong advocate of such sustainable technologies that would help the current generation and future generations.
Established in 2010 in Mexico, Sistema.bio has been operating in India since 2017. Last year, the company inaugurated the world's largest modern biodigester manufacturing plant in Pune. Sistema.bio employs an effective business model that utilizes carbon credits, enabling them to manufacture and distribute modern, innovative biodigesters at a comparatively low cost to smallholder farmers. These biodigesters convert animal waste into renewable energy and organic fertilizer. The company is rapidly expanding its operations and sustainable mission to reach every remote corner of the country. In an exclusive interview with THE WEEK, Sohani discusses his company’s big plans to enhance efforts for a sustainable earth.
Sistema.bio has already installed over 75,000 biodigester units across India, which is quite significant. Considering India's diverse terrains, farming methods, and traditions, could you share some key challenges you faced while scaling your operations in such a varied country?
Indeed, India’s vast geography and cultural diversity presented significant challenges. One major obstacle was reaching remote areas. India is a large country with numerous villages and districts, each with its own unique culture. Establishing our service network, installation teams, and promotion and sales infrastructure to ensure farmers in all regions could access our technology and services was a complex task. This effort took six years, but now we are proud to have a presence in 21 states with an extensive service network to support farmers.
Another challenge was affordability. Many farmers in India struggle to afford advanced technology. Although India has millions of dairy farmers, 60-70 per cent of rural families still cook using firewood due to the high cost of LPG gas. To address this, we developed various business models and schemes to make our products more affordable. I'll discuss these models later. The two main challenges were building a service network and ensuring affordability for farmers.
Farmers often have long-standing traditions and conventions. How did you convince them to adopt this new technology? Also, what are the benefits of your technology for farmers?
Many families traditionally cook with firewood or LPG. For those using LPG, switching to biogas was relatively straightforward since the cooking experience is similar. For firewood users, the transition was more significant. However, we found that most firewood users wanted a better cooking method, whether LPG or biogas. We conducted demonstrations in rural areas and invited families to see the units in action, which helped sensitize them to the benefits.
Biogas is not new in India; the government has installed over 5 million biogas plants over the past 30 years. However, many of these older units faced issues like poor service and outdated technology. Our technology is more advanced, requiring no civil construction and taking only one day to install, compared to the weeks required for older systems. This efficiency is a significant advantage.
Is there any system to track your biogas units using IoT technology?
Yes, we use IoT technology, though it’s currently a bit expensive, costing around Rs 7,000 per device plus data charges. We install these devices on a sample basis to monitor system performance. Additionally, we conduct regular monitoring visits to ensure operational effectiveness.
Can you explain how corporations earn carbon credits by investing in your projects and how it benefits both the corporations and local farm communities?
The carbon credit mechanism helps make our systems affordable for farmers. Internationally recognized organizations like Gold Standard and UNFCCC register carbon programmes. We can propose to install, say, 10,000 biogas plants in a state and estimate that each system will reduce 8-10 tonnes of CO2 annually by replacing LPG and firewood usage.
Once approved, these credits can be bought by organizations aiming to offset their carbon emissions. For example, a company producing soap might emit 100 tons of carbon annually. By supporting our biogas programme, they can offset their emissions while providing upfront subsidies to farmers. This benefits the farmers, the corporations, and the environment.
How much do farmers have to spend on the product?
Our standard product costs between Rs 35,000 and Rs 40,000, varying by region. Recognizing that many farmers cannot afford this upfront cost, we ask them to pay between Rs 5,000-8,000. The remaining cost is covered by corporations or carbon credit buyers, who can then claim the resulting CO2 reductions.
Are CSR funds also used in this?
Currently, we do not use CSR funds. Instead, we utilize sustainability funds. When an organization announces its goal to become net zero, it allocates funds specifically for sustainability initiatives. These funds are then used to support projects like ours.
How many corporate partners do you have in India?
We have over 10 corporate partners, ranging from small to large organizations. Some notable partners include Nestle in Punjab and Infosys. We use various tracking mechanisms with each partner to ensure effectiveness.
How do you measure and verify CO2 reductions?
We follow standardized processes set by Gold Standard and other UN bodies. We collect baseline data such as family size, number of cattle, land for agriculture, and fuel usage. After installing a biogas system, we revisit annually to collect usage data, which we submit for verification.
How do you determine the right product mix for different regions and what innovations can we expect in the future?
Our technology is customizable. For example, a small family with three to five animals might need a system producing two cubic metres of gas per day, equivalent to 1-1.5 LPG cylinders per month. Larger families with more animals would need bigger systems. We’ve designed systems to suit various climates, like hotter southern regions and colder northern regions. Additionally, we’ve developed appliances to help families use biogas more effectively.
How large is your team, given the need to cover so many rural areas?
We have over 700 people across various states and districts in India. We’ve also trained local technicians to handle service requirements, ensuring that customer issues can be promptly addressed.
Could you share your future plans and expansion strategies?
We have ambitious plans. Similar to how solar energy rapidly expanded in India, we believe bioenergy is poised for significant growth. India’s 17 million dairy farmers have tremendous potential for biogas adoption. Our goal is to install over 1 million biogas plants in the next five years. We are expanding our manufacturing capacity and field presence, including our large biogas plant manufacturing facility in Pune, which can produce over 1,00,000 units per year. India has vast potential for bioenergy. We are at a pivotal stage where we can significantly impact both people's lives and the environment through the widespread adoption of biogas technology.
