The Organic Material Anaerobic Digester 1

Jordan ODonnell

AGR1110

Tuesday November 28th, 2017

The Organic Material Anaerobic Digester

 The Organic Material Anaerobic Digester 2

PART 1: PRODUCT INFORMATION

The Organic Material Anaerobic Digester

Recycling organic waste reduces greenhouse gases and landfills, creates renewable

biofuels, generates jobs, and produces a healthier planet for future generations. Sounds too good

to be true? The incredible outcomes of efficient organic waste recycling is what sets a new

biotechnology company called The Organic Mechanic apart from other companies. The secret to

the Organic Mechanics success is its high efficiency, one-of-a-kind system called the Organic

Materials Anaerobic Digester (The OMAD). Unlike other recycling systems, The OMAD

accepts the input of all organic wastes created by plants, humans, and animals, and converts them

into renewable biofuels through the use of specialty microorganisms. The special

microorganisms act as an anaerobic digester that breaks down all of the organic material in the

absence of oxygen (Yee, 2015). The biofuels created are a clean fuel alternative that can be used

to heat homes, farms and businesses, as well as operate farm equipment and machinery

commonly used in North America and worldwide. The OMAD is portable, and comes in a

variety of sizes to suit specific needs from large (for farms and large industries), medium (for

mid-size business) to small formats which can accommodate an average 4 bedroom home. This

all-Canadian company located in Sault Ste.Marie Ontario, will be using Canadian made and

locally manufactured steel for the main components of the OMAD, and industry grade solar

panels, as an alternative heat source. The OMAD will become a household name and will forever

transform the way the world views garbage.

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Figure 1. This is an example of a small-scale anaerobic digester that requires input of organic

waste, microbial digestion, and the output of biofuels.

NYeurt, 2014)

Sault Sainte Marie, Ontario, Canada

Sault Ste. Marie, a northern Ontario town popular for its forestry

and steel production plants, will be home to The Organic Mechanic, the

maker of The OMAD. This city is an ideal location because of its strategic

location at the junction of the TransCanada highway 17 and the United States Interstate 75

allowing for reciprocal business exchanges between Canada and the US (Sault Ste. Marie EDC,

2017). Popular for its steel production plants, Essar Steel Algoma Inc. has the highest

employment rate of steelworkers in Sault Ste. Marie (Sault Ste. Marie EDC, 2017) and will

expand its employment opportunities by providing the steel necessary in making The OMAD

(Algoma, 2017). The OMAD also requires industrial grade solar panels as a heat source to heat

the microorganisms, allowing them to break down the chemical bonds in the organic waste to

produce the biofuels. Heliene Inc., a solar panel manufacturer located in Sault Ste. Marie, will
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provide various sizes of solar panels specialized to fit The OMADs three-size formats (Heliene,

2017). Sault Ste. Marie is the ideal location for The Organic Mechanic company as it will use

local resources, improve their local economy, and is close to a major US border.

Table 1. Contact Information

Phone Number Address Email

Essar Steel 105 West Street Email through website at:

Algoma Inc. +1-705-945-2351 Sault Ste. Marie, Ontario, https://www.algoma.com/
(Steel Company) Canada contact-us/

Heliene Inc. +1.705.575.6556 520 Allen's Side Road generalinfo@heliene.ca

(Solar Panel ext.155 Sault Ste. Marie, Ontario
Company)

Inputs/Labour and Costs Required

All organic materials such as plant compost (leaves,

branches, soil, etc.), human-created organic waste (organic

outputs such as biodegradable diapers containing human

waste, food and paper waste), and animal waste (manure and

other animal parts such as bones, fat, muscle), are starting

agents for The OMAD. These are the physical inputs to the

machine as the microorganisms will break down this organic

waste to produce the biofuels. Other inputs required to

successfully operate The OMAD is in the form of human labour which is needed to construct the

framework and manage the system. Both Essar Steel and Heliene Inc. would require their own

manufacturing inputs such as materials and human labour to create the parts The OMAD. Once

these parts are delivered to The Organic Mechanic plant, more human labour would be required
 The Organic Material Anaerobic Digester 5

to produce, sell and market, manage and transport The OMAD in order to successfully sustain

the company.

The cost of building The OMAD varies due to the price and quantity of steel at time of

purchased and delivered by Essar Algoma Inc. to The Organic Mechanic. As Steel prices

fluctuate, it is in the best interest of The Organic Mechanic to buy large quantities when prices

are considered optimal (lowest available). On average, the large-size OMAD requires one ton of

steel which is approximately $990 CAD per ton of steel (MEPS International, 2017) The cost of

the solar panels manufactured and delivered to The Organic Mechanic by Heliene Inc.are

considered more stable as the industry grade materials needed to create the solar panels do not

fluctuate as widely in the market. The cost per solar panel will vary based on the size needed per

machine, however, the average panel that will be used is an 85 watt solar panel that will cost

$320 per panel (Heliene Inc., 2017). The anaerobic microorganisms needed to complete the

system have an assumed cost of $1/gram with 1000 grams needed to break down waste in a

large-size OMAD. In total, The OMAD costs on average $2310 for a large-size machine, but

will be sold for $25,000 CAD to account for sales, marketing, general administration, shipping

and other costs related to running the OMAD business successfully. At a selling cost of $25,000

CAD, buyers will recoup costs by generating their own biofuels that can be used to operate their

farms and businesses thereby saving them thousands of dollars in traditional fuel costs. The

Organic Mechanic will profit generously from global demand of The OMAD as market demands

increase thereby requiring more production of units sold which will allow The Organic Mechanic

to continue to grow and innovate their product lines.

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Market Opportunity

The market opportunity for The

OMAD is extremely high as it will allow

communities to be self sufficient in

recycling their organic waste into renewable

biofuels that can be used to heat their

homes, farms, businesses and operate their

machinery. Food waste is a large contributor of greenhouse emissions in the atmosphere mostly

through the creation of carbon dioxide and methane (Kallbekken and Saelen, 2013). This global

issue has been increasing steadily over the years and will continue to climb until a suitable

solution is adopted by many. The OMAD is the solution to the global issue of food waste

contributing to greenhouse gas emissions. The OMAD will be used by large populations as it

will be shipped to many countries, cities, and communities to help reduce their greenhouse gas

emissions and save on fuel costs through the production of clean, renewable biofuels. The

OMAD will appeal to industries such as farming, and food production facilities as these

industries create massive amounts of organic waste and are very costly in terms of heating and

operating their machinery so would benefit the greatest from purchasing The OMAD. As The

OMAD becomes more popular for mid-size industries (such as hospitals, schools and business),

production will need to increase to satisfy the demand, which will in turn create more jobs and

stimulate the economy further. As more and more consumers become aware of the technology

that decreases greenhouse emissions and saves money, they will generate an increase in
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consumer demand for the compact version of The OMAD. The market opportunity for The

OMAD will continue to increase until it becomes a global household commodity.

Benefits to Canada

As The OMAD is known for its environmental and cost saving

benefits to industries and general consumers alike, it also generates

numerous economic benefits to Canada. A major strength of having The

Organic Mechanics head office based in Sault Ste.Marie, Ontario is an

improved local economy as it generates jobs, increases incomes, and therefore the buying power

of their employees, further stimulating their economy. The jobs for these locals include sales,

marketing, production, maintenance and transportation functions of The OMAD. The company

also employs a number of administrative staff to help operate the business. Another large benefit

of being located in Sault Ste. Marie is that it purchases materials from local companies such as

Essar Steel Algoma Inc., and Heliene Inc. Purchasing resources from these two companies

reduce transportation costs to The OMAD production facility, and in turn increases overall

revenues thereby increasing employment opportunities for Essar and Heliene workers. The

OMAD provides countless benefits to the environment, the local economy and the people of

Sault Ste. Marie, and Canada as a whole.

As The OMAD will be shipped to many places in the United States, the main focus will

be exporting them to San Francisco, California. This export plan will further develop the trade

relationship between Canada and the United States. Canada and the United States share one of

the closest and most extensive bilateral relationships in the world (U.S Department of State,

2017). This relationship will continue to grow stronger as The OMAD will be exported to
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California and other states via train and containership. This is a major benefit to Canada, as well

as the United States.

The OMAD has many direct and indirect benefits to Canada since it is fully

manufactured in the town of Sault Ste. Marie. The direct benefits would include all of the

components that are being manufactured and used to construct The OMAD. These resources

would include the steel and solar panels from Essar Steel Algoma Inc., and Heliene Inc. The

indirect benefits to Canada include the increase in employment rates related to sales and

marketing, production and management of The OMAD. Indirect benefits would also include the

local transportation of materials used to produce The Organic Mechanic factory, and the

transporting of the complete product to its final destination in California and abroad. The overall

benefits to Canada are both broad and contribute to GDP as they include both direct, and indirect

forms.

The Organic Mechanics production of The OMAD will help disadvantaged Canadian

communities in the Sault Ste. Marie area as it employs many of its inhabitants who in the past

were unemployed due to the economic downturn affecting the steelworker industry (Sault Ste.

Marie EDC, 2017). As The OMAD provides numerous employment opportunities to the citizens

of Sault Ste. Marie by reducing unemployment rates and poverty through job creation. This

company will also advance education and the knowledge of many locals regarding greenhouse

gases and the environment, as well as allow them to participate in reducing their own

communities greenhouse gas emissions.

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PART 2: EXPORT POTENTIAL TO CALIFORNIA

Californias Market

As our population continues to grow, the demand for fossil fuels will increase drastically

(Lin et. al, 2012). An increase in population will also cause an increase in the food production

industry and agricultural sectors, which will increase the amount of organic waste produced

globally. Food waste is a major issue for all countries as it induces greenhouse gas emissions and

dramatically increases the amount of landfills. California in particular throws away 6 million

tons of food per year (CalRecycle, 2016). More specifically, The OMAD will be shipped

directly to San Francisco, California as they desperately need help, and a solution to reduce their

greenhouse gas emissions and their carbon footprint. San Francisco is currently suing five major

fossil fuel industries such as Shell and Exxonmobil, as they have recently admitted to

consciously contributing to high greenhouse gas emissions (Paddison, 2017). Evidently,

California is in imminent need of a

solution for a clean alternative to

these fossil fuels, as well as a way to

reduce their greenhouse gas

emissions. The solution is The

OMAD and it will be exported

throughout California, focusing on

San Francisco, drastically reducing

their carbon footprint.

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Transportation

The OMAD system can be transported by train and containership to farms, businesses,

hospitals and homes in communities looking for an environmentally friendly way to recycle their

organic waste into a renewable, usable fuel. The OMAD will be shipped by train directly from

Sault Ste. Marie, Canada, to San Francisco, California. The Canadian National, Canadian Pacific

and Huron Central railways are readily available from Sault Ste. Marie to facilities in the United

States (Sault Ste. Marie EDC, 2017). When it reaches San Francisco, it will be directly

transported by truck to different locations such as farms, hospitals, schools, businesses and

homes. As the following map displays, the route will cross through approximately six states

before it reaches its final destination in California. As the exportation of The OMAD will be

costly, and time consuming, the future environmental benefits will outweigh the shipping costs.

Figure 2. Map of Transportation from Sault Ste. Marie to San Francisco

Required Documentation

Exporting cargo from Canada to the United states requires five main documents including

the following: Bill of Lading, Inward Cargo Manifest, U.S Customs Invoice, Eight-digit

subheading from the Harmonized Tariff Schedule of the United States, the name and address of
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the foreign individual or firm who is responsible for invoicing the merchandise. Additionally, the

shipment value, deductions, conditions of sale, insurance, and licences must all be valid and

submitted (Calgary Region, 2012).

Potential Consumers

The OMAD is a product that will be used by a variety of businesses and people of

differing economic statuses in California. Since the primary goal of The Organic Mechanic is to

produce a simple, cost-effective and portable machine that will regenerate organic waste into

biofuels. An indirect benefit of The OMAD will be its contribution to the reduction of

greenhouse gas emissions by decreasing the need for costly traditional carbon-based fossil fuels.

As a result, The OMAD can be used by anyone and everyone that produces organic waste. On a

large-scale, the biggest OMAD being produced will be shipped directly to large farms and

industries that generate high volumes of organic waste. The new system will be used to recycle

plant and animal waste and convert them to useable biofuels as an alternative form of energy to

operate farm equipment and heat their buildings. The portable, small and mid size OMAD is

easy to set up and operate and has a price point that will appeal to small and mid-size businesses.

Average sized households will appreciate the size and portability of The OMAD as it will only

take up a few feet in an average size backyard.

Benefits to San Francisco, California

In addition to The OMAD providing

numerous benefits to Canada, it will also benefit

the exporting nations who purchase and use The

OMAD. For example, The OMAD solution will

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production of food waste, they will need some economic incentives and a strong marketing

campaign to educate their businesses, farmers and citizens to participate in reducing their overall

carbon footprint by 2050. The following will include some strategies of how The Organic

Mechanic will promote The OMAD in its exporting nation, California.

The OMAD regenerates all organic materials into useable biofuels thereby reducing the

number, and size of landfills all over California. Smaller number and size of landfills further

reduces greenhouse gas emissions as less food waste in these sites will produce less carbon

dioxide and methane. One of the main outcomes of The OMAD is the reduction of these

emissions by reducing the number and size of landfill sites therefore contributing to a

eco-friendly environment.

Another alternative benefit to the city of San Francisco, and the

state of California is to use The OMAD to produce its own renewable

biofuels for running farms, businesses and homes. These renewable

biofuels will be cleaner, safer, cheaper and more beneficial to the

environment, than the alternative fossil fuels that are used for energy.

The renewable biofuels will be used throughout California to heat homes, produce light for

businesses and provide energy to run machinery such as farm tractors. As San Francisco is suing

5 major fossil fuel industries for admitting to consciously contributing to high greenhouse gas

emissions, they are in need of a cleaner alternative solution. The OMAD provides San Francisco
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with the solution to create its own biofuels that will meet the majority of their fuel needs, and

contribute to a healthier, sustainable environment.

Marketing Strategy

The challenge of convincing local businesses and citizens of California to participate in

the lofty goal of reducing food waste by 70% by 2050 can be overwhelming. The Organic

Mechanic and its talented marketing staff have developed a strategic plan to help California with

their worthy initiative. Part of the strategy is to entice local farmers, business owners and

citizens to attend various information sessions on how they personally contribute to Californias

high carbon footprint through the creation of food waste. Demonstrations and presentations to

schools and businesses, showing how harmful greenhouse gases impact the environment should

encourage them to make a change to their everyday food wasting lifestyles. As The OMAD is a

portable, simple and easy to operate solution for reducing food waste while reducing fuel costs,

many informed farmers, business owners and regular citizens will be open to investing in The

OMAD. If California provides an economic stimulus such business and personal tax break for

purchasing The OMAD, it should translate to increased demand and use of this new system

which will in turn help reach their goal quicker. If other states and countries recognize the

effectiveness and return on investment of The OMAD in California, this will increase overall

demand for the product which will ultimately reduce global greenhouse gas emissions.

Competitors

The Organic Mechanic will face fierce competition from major fossil fuel companies that

export oil, gasoline, and coal traditionally used to power farm equipment and fuel vehicles.

These large fossil fuel companies will be threatened by The OMADs ability to take down these
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companies by providing a cheaper, cleaner and more environmentally friendly alternative to

earth harming fossil fuels. Another competitor of The Organic Mechanic will be the global

recycling and landfill firms that develop expensive systems to manage organic waste. These

companies work hard to come up with new solutions to reduce the increasing volume of waste

generated by various industries. As anaerobic digesters have previously been created and

developed to help the environment, The OMAD differs in many ways. The following chart

depicts competition of another anaerobic digester called the High Solids Anaerobic Digester

Fermentor, produced in Edmonton, Alberta compared to The OMAD (Yee, 2015). Despite

being a new player on the block, The Organic Mechanic has competitive advantages and has

developed new strategies that will overcome competition.

Table 2. Anaerobic Digester Competition

The OMAD Anaerobic Digesters

(HSADF)

Inputs ALL organic materials (plant, High solids, food waste

human, and animal waste) in low in m
oisture
high or low moisture

Design Comes in three different sizes Comes in one size

Materials Steel, solar panels, specialty Building (expensive brick,

microorganisms steel, tile, concrete, etc)

Producers The Organic Mechanic C.O.E

Location Sault Ste. Marie, Ontario Edmonton, Alberta

Export Nation San Francisco, California N/A (used where built)

Extra Details Solar panels are used to Large building requiring a

generate heat, as an lot of fossil fuel based
alternative form of electricity energy
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Future Studies/Recommendations

To properly evaluate the export potential of this product, further research must be conducted

on a few aspects of The OMAD. A priority would be to genetically modify microbes to be able

to break down the chemical bonds in all types of organic waste. Unlike other microbes used for

competitive anaerobic digesters, The OMADs specialty organisms will have the chemical

capability to break down all organic waste. Whether it is food waste from humans, plant material

or animal byproducts, the microbes in The OMAD will have the ability to break down the waste

and create useable biofuels as an output. Other anaerobic digesters have microbes that are only

capable of breaking down food waste. This is one of the many benefits of The OMAD compared

to other anaerobic digesters on the market.

Future studies on the processing of biofuels will be needed to further reduce processing time

and cost of producing The OMAD. These studies would include finding faster and more efficient

ways to process the breakdown of organic materials in The OMAD, such as including a catalyst

to help speed up the reaction time. The production costs and market pricing of the various sizes

of The OMAD would require further studies as The Organic Mechanic needs to ensure that they

can efficiently produce all three sizes of The OMAD and price them competitively yet still be

highly profitable. Transportation costs will also vary depending on the size and final destination.

Shipping within Canada will be relatively inexpensive, but exporting outside of Canada to the

United States or internationally can have high export costs requiring further research. As

detailed previously, exporting The OMAD will require multiple forms of documentation and

licenses.
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Conclusion

Portable, compact and easy to install and implement, The OMAD is a cost effective and

environmentally friendly system that can be easily transported to both large cities and remote

locations in Canada, and the US. The opportunity to export The OMAD outside of North

America is very likely as food waste is an ever increasing issue around the world as is the need

to reduce greenhouse gas emissions to help protect the environment. The Canadian company

The Organic Mechanics solution The OMAD, will directly help the environment and will

forever change the way the world views garbage.

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California Department of Resources Recycling and Recovery (CalRecycle). (2016, September 08).

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https://www.sault-canada.com/en/investlocateexpand/transportationlogistics.asp

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Yee.pdf