Head Office

1, Navjeevan Vihar, New Delhi 110 017, India

+91 11 2669 3868

Project Office
E-24, Vikram Puri, Secunderabad 500 009
Andhra Pradesh, India
+91 40 2784 5276

www.winrockindia.org

05060050_Cover_PAP.pmd 1 6/3/2005, 10:41 AM

 © Winrock International India

All rights reserved.

The information presented in this publication resulted from investigations of the
work of the Commercializing Renewable Energy in India (CREI) project supported
by the United Nations Foundation and implemented by Winrock International India,
Winrock International and the United Nations Department of Economic and Social
Affairs (UNDESA). The views expressed are not necessarily those of any of these
agencies. Photo credits
Written and designed by Eric M McGaw.
MVF: pp 17 (lower), 20, 33 (middle and lower), 35, 36 (both), 38 (lower), 39.
www.mcgaw-associates.com
WII: p 33 (upper)
Printed by Pragati Offset Private Limited
www.pragati.com All other photos by the author.

05060050_Cover_PAP.pmd 2 6/3/2005, 10:41 AM

 Contents

1. Let there be light!

How village women empowered themselves by
investing in solar-powered lanterns 5

2. Getting something from nothing

Generating incomes with an oil expeller 12

3. Cooking with biogas

How biogas stoves turn lives around 17

4. Harnessing the sun

Women use a solar dryer to control the market 22

5. We’re farmers, not barbers!

New alternatives from forgotten crops 29

6. Cleaner cooking, healthier girls

The benefits of biomass cooking 35

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 The CREI approach

Renewable energy (RE) for productive
end uses

Technology-neutral, demand-driven
intervention

Location-specific institutional design

Market development through local
entrepreneurs

CREI’s objectives

Income augmentation and rural poverty
alleviation through RE services

Generation of local employment

Local capacity building

Market development

Local and global environmental benefits

Project components

Entrepreneur incubation

Institutional and human capacity
building

Sustainable financial mechanisms

RE business resource centre

Pilot demonstration of business plans

05060050_1_40.pmd 2 6/3/2005, 10:23 PM

 Renewing lives with renewable energy
Six rural business models for Indian villages

C ommercializing Renewable Energy in

India (CREI) is an innovative project that
focuses on providing reliable and viable
energy services to rural communities through
renewable energy (RE) technologies. The
project, which runs through early 2006, is
funded by the UN Foundation. It is jointly
implemented by Winrock International India,
Winrock International and the United Nations
Department of Economic and Social Affairs
(UNDESA).
CREI identifies RE services that generate
incomes and increase the buying power of
communities, thus enabling RE markets to
develop. A major outcome of the project is
the development of rural enterprises out of
such institutions as women’s self-help
groups (SHGs), livelihood committees and
thrift committees.
After assessing the market in seven districts
in the state of Andhra Pradesh, the project
selected two – Mahbubnagar and
Rangareddy – for implementation. Over 20
specific business plans were developed, and
technical assistance in capacity building,
awareness creation and entrepreneur

05060050_1_40.pmd 3 6/3/2005, 10:23 PM

 incubation was provided. Financial
mechanisms were also designed to create
access for the rural poor.
All the interventions were facilitated in
collaboration with M Venkatarangaiya
Foundation (MVF), an NGO that works with
self help groups on sustainable development
and child labor.
The case studies described in this booklet
illustrate the CREI project’s success in
providing value addition and income
generation through RE technology
interventions. The potential is large to
replicate these business models throughout
Andhra Pradesh in the short term, and
throughout the country in the long term.
Like anything new, the technologies
discussed in this publication did not come
about overnight. It took a great deal of time
and hard work by dedicated people who
were challenged to create market access
and linkages to new products for rural
people. But when awareness of the
usefulness of the products that could be
derived from RE was created in the target
communities, and a marketing strategy had
been put into place, there was no looking
back!

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 1. Let there be light!

M ondi Gowrelly village in Yacharam mandal, Ranga

Reddy district, is like many other villages in rural
Andhra Pradesh. Most of its inhabitants make their living
from agriculture. Some cultivate crops, some sell them,
some do both. They have similar problems also. One of
these problems, especially for women who find it
inconvenient to travel far from home to seek work, is
finding reliable sources of income.
Another common problem in the village is the
undependable supply of electrical power. By and large,

New prosperity:
the women of the
Chaithanya Mahila
Sangam with their
solar lanterns.

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 the villagers are quite used to getting along without
electricity. Few are wealthy enough to afford electrical
appliances like irrigation pumps or televisions. And like
most farmers, they are accustomed to sleeping and
waking early, so illumination at night is usually
unnecessary.
However, there are times when artificial light is very
desirable. Like most Indian parents, the residents of
Mondi Gowrelly want their children to succeed in school,
so when important exams loom large in their youngsters’
lives, having access to light for extra study time is very
important. Light is an advantage during social functions
like marriages that often take place at night. Also, once in
a while, an important community task such as desilting a
pond cannot be completed in daylight. Traditionally, when

The solar panels on the

village sarpanch’s rooftop
recharging the lanterns. A
fully charged lantern
shines brightly for about
four hours.

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 villages need artificial light, they rent kerosene lanterns. Sangam members proudly
But these petromax lanterns have several show their Resolution Book,
duly attested with
disadvantages. They are smoky and unreliable, even
thumbprints and signatures,
dangerous. They are also expensive to rent, and one as well as their account
has to travel far to obtain them. book and vouchers.
Training in accounting and
Chaithanya Mahila Sangam, a local women’s self-help
business procedures has
group with 35 members, wanted to find a solution to done much to empower
the perennial problem of how to earn a steady income these villagers.
without leaving the village. They were also concerned
about the inconveniece and expense of petromax
lanterns. How to solve both problems?
The CREI team, which was focused squarely on just
this sort of problem, had a solution. They mounted an
awareness campaign about using solar-powered
lanterns to earn money. Village representatives,

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Asked about the initial reaction of the
villagers to the lanterns, Laxmamma said,
“At first some people were sceptical
because our village has electicity. But
power outages are frequent, so over time
the value of the lanterns was noted.”
including Laxmamma, the sangam
president, were invited to a demonstration.
Solar power, they were told, is clean,
available and best of all free. Renting them
to customers at a price competitive with
that of petromax lanterns would be a sure
way to provide the sangam with a steady
income without having to walk long
distances to work as labourers.
Winrock selected an appropriate
manufacturer (see box) and supported the
sangams with rural meetings and
organised training sessions. Marketing,
mostly by word of mouth, the fastest
method of communication in rural settings,
was supplemented by displays at malls,
local fairs and panchayat meetings.

Private sector collaboration

Andromeda Energy Technologies, a
private company with a service agenda,
is part and parcel of CREI’s solar lantern
project. It was a fortuitous match – the
government was looking for suppliers of
alternative energy and Andromeda
needed a reliable source of funding to
fabricate its lanterns.
To get the project off the ground,
Winrock held an awareness meeting in
Hyderabad. Once the villagers’ interest
was assured, Andromeda’s depots Above: Andromeda
served as convenient training centres for employees display two
the sangams. The next step was to solar lantern models.
conduct training for repairmen who Inset: convenient
could service the lanterns. directions in Telugu.

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 Laxmamma and her colleagues decided to purchase five ‘They are men, we are
solar lanterns from Andromeda at a reduced corporate women, but look! They
rate of Rs 2500 ($60) each for a total of Rs 12,500 stand behind us!’ says
Laxmamma. Clearly, these
($300). CREI provided the sangam’s 50 percent share women have taken the
of the capital as a loan. initiative.
A three-day training session on best practices for both
CREI staff and sangam members was organised. Also
invited were some television and radio repairmen who
were trained to repair switches and other movable parts.
No stone was left unturned to give the sangam every
chance of success.

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 Mr Nakka Narsimha, the
village sarpanch, keeps the
lanterns safe in his house. He
has supported the initiative
from its inception.

The sangam members proudly signed their Resolution

Book and immersed themselves in the business of
renting their lanterns. Each committee member took a
lantern home to show to their neighbours. Word spread
rapidly that a viable alternative to petromax lanterns was
available.
The sangam charges a rental fee of Rs 20 ($0.45) per day
for members, Rs 30 ($0.70) for others. They make
Rs 500-600 ($12-14) every month – about Rs 8000
($180) a year. Importantly, the lanterns provided
immediate income, which meant that the sangam was
able to begin repaying their loan right away.
What about the reaction to the initiative in other villages?
Explains Raman Nageswara, CREI Project Officer,
“Groups in 16 villages are now in the business of renting
out solar lanterns. Each has five lanterns. The groups are
legal entities, each one is registered as a cooperative
society. They have bank accounts, they deal with tax
issues – in short, they have a sense of empowerment
they never knew before.”
Clearly, Laxmamma and her colleagues have brought
light to their village in more ways than one!

10

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 Business summary

Business: Solar lantern rentals

Enterprise: Chaitanya Mahila Sangam

Market: 16-village cluster

Products: 5 solar lanterns manufactured by Andromeda
Energy, a private company

Management: Self Help Group (SHG) members

Location: Mondi Gowrelly Village, Ranga Reddy district

Economics

Cost of lanterns: Rs 12,500 ($280) for 5 lanterns

Financing: 50% CREI loan, 50% SHG

Terms: 7.5% interest over 5 years

Rental Charge: Rs 20-30 ($0.45-0.70)

Annual Profit: Rs. 8,000 ($180)
SHG expects to make full repaymnent in 2-3 years.

Scale-up potential

Of the 500,000 SHGs in Andhra Pradesh, about 200,000 have
obtained credit from banks and micro-lending organizations.*

If only 1% of these SHGs are interested in taking up these
activities, it amounts to 5000 new enterprises.

This scheme has very high potential under the Ministry of Non-
conventional Energy Sources (MNES) project called the Village
Energy Security Initiative (VESI). VESI will be launched in
about 200,000 remote villages throughout India.
* Source: National Bank for Agriculture and Rural Development
(NABARD)

11

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 2. Getting something from nothing

O ne of the most important agricultural interventions

that has come out of the CREI project is the
cultivation of oilseed tree crops, especially jatropha
and pongamia. Both of these oilseeds are poisonous
and cannot be consumed by either humans or animals,
but the oil is used for medicinal purposes and is also a
highly effective organic pesticide. These oil-bearing
seeds, along with traditionally popular neem and
castor, can be used to make money for cash-poor
village women. Since the seeds of each of these four
plants mature at different times of the year, oilseeds of
The oil expeller at work.
one species or another are available nearly year-
round.
The difficulty with oilseed production is the cost of
expelling the oil from the seed. Oil expellers are
expensive – about Rs 1.5 lakh ($3500) – and therefore
out of reach of most villagers. However, MVF
as part of its promotion of the
Cleaning neem seeds.
commercialization of
renewable energy, agreed to
guarantee a loan of Rs 1 lakh
($2300) to a women’s sangam
in Kothapally village, and the
women contributed Rs 50,000
($1160) from their savings.
The sangam accrues its
savings from the dues of
members at Rs 20 ($0.50) per
member per month, as well as
from interest on loans to
others. The women lend at
24% interest, about Rs 2
($0.05) per month as opposed
to outside moneylenders, who

12

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 Weighing
Weighing the
the oilseeds
oilseeds
before
before expelling
expelling the
the oil.
oil.

charge 60% interest, about Rs 5 ($0.12) per month. New

members are continually invited to join the sangam, and
all castes are welcome.
The location was strategic. Kothapally is located close to
the important town of Mall, where the residents of 25
villages spread throughout three districts (Mahbubnagar,
Ranga Reddy and Nalgonda) do their shopping. The
proximity of Kothapally to Mall means that the products of
the oil expeller can be conveniently marketed.
Neem oil in storage.
The Kranthi Mahila Sangam, which now has 100
members, was established in 2000. The president,
Guddula Narsamma, says “Traditionally, we collected wild
oilseeds daily, selling them at Rs 1-1.5 ($0.02-0.03) a kg.
After CREI came, we were able to sell directly to the
sangam – there was no longer any need to leave the
village at all.”

13

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 Another improvement is that unlike previously,
when each woman worked alone, now they are all
involved. They benefit individually by collecting
the seeds, and as a group by selling them. They
also benefit from the added value derived from
the cake made from the oilseed residue, which is
sold as insecticide.
The project’s marketing efforts are geared
towards four uses: A happy customer with his neem
• To blend the oil with diesel for use as fuel residue. He will dry it, grind it into
powder, mix it with water and spray
• For domestic lighting purposes
the environmentally friendly
• For sale as raw material to bio-fuel pesticide on his crops.
production units
• Sale of cake as a manure

Narsamma,
Narsamma, president
president
of
of the
the sangam,
sangam,
explains
explains how
how the
the oil
oil
expeller
expeller has
has
transformed
transformed their
their
lives.

14

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 The sangam employs 10 workers at Rs 25 ($0.60) per day.
Women do everything except operate the machine; they
hire a man to do that at Rs 1000 ($23) per month. Before
the expeller was purchased, they had an unenviable
choice: either seek work as labourers elsewhere or remain
idle, without any income. Now, even after spending about
Rs 3000 ($70) on lubrication and fuel, they earn Rs 5000-
6000 ($116-140) per month profit.
Winrock’s Raman
Nageswara with a key Besides running the expeller, the women have been
member of the empowered in other ways. They have been trained in
sangam.
marketing, accounting, inventory and sales – all this has
given the women a new sense of confidence.

A litre of neem oil fetches Rs 60 ($1.40), its residue (in the white bag) Rs 4 ($0.10) per kg.

15

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 Business summary

Business: Oil expeller

Enterprise: Kranthi Mahila Sangam

Market: 25-village cluster

Products: Bio-diesel (jatropha, pongamia, neem)

Management: 10 SHG members, 1 mechanic employed at
Rs 30 ($0.70) per day

Location: Kothapally village, Ranga Reddy district

Economics

Cost of expeller: Rs 150,000 ($3500)

Financing: 70% CREI Loan, 30% SHG

Terms: 7.5% interest, 5 years to repay

Annual profit: Rs 60,000 ($1400)
SHG expects to make full repayment in 3-4 years.

Scale-up potential

Based on seed availability and other factors, there is clear
potential for installing at least 2-3 expellers in each of Andhra
Pradesh’s 27 districts.

This amounts to a potential of 60-70 oil expellers in the state,
and 800-1000 all over India.

This scheme has very high potential under VESI.

16

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 3. Cooking with biogas

Y ara Santhosha’s life in

Thadiparthy village used
to be very hard. Once a week
she would trudge for hours to
gather enough firewood to
cook for the next week.
Sometimes she would go with
other women, sometimes
alone. Each time she went out
for wood, the journey was a
little longer, and it was always
an exhausting and painful
experience. Often, she was so
Yara cooking her family’s
tired that she was unable to do lunch. No smoke, no
any work for a day or two afterward. Occasionally her pollution!
weakened condition led to sickness, and having to cook
on a wood fire just aggravated her condition. The indoor
pollution choked her, causing red eyes and coughing fits.

The only
significant
expense in setting
up a biogas stove
is its installation.
The mason in the
photo was
provided by an
energy-conscious
government, which
is fully supportive
of biogas cooking.

17

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 On top of everything else,
what she was doing was
illegal. As a conservation
matter, the government
prohibits cooking with wood
fires to preserve trees.
Yara’s husband Anjaiah faced
a moral dilemma. As chairman
of Thadiparthy village’s Vana
Samrakshna Samathi (VSS),
a forestry conservation group
funded by the Andhra Pradesh
Forest Department, it is his job
to make sure that his fellow
villagers obey the
government’s conservation
laws. So allowing his wife to
cook with firewood was a
contradiction. Her unfortunate
plight in having to work so

Stove
Stove

The drop pit (top inset), where the dung and water
mixture is placed, leads to the domed fermentation
tank (pictured on the previous page). A pipe carries
methane gas from the tank to Yala’s kitchen stove, as Inlet
Inlet pipe
pipe
shown in the photo to the right. The solid waste flows
into the slurry pit (bottom inset). Slurry is excellent
fertilizer, selling for Rs 4/kg ($0.10).

18

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 hard to gather the wood
compounded the problem.
Anjaiah was no stranger to
adversity. As a child, he was a
bonded labourer, a virtual slave.
Fortunately, he was rescued from
a life of misery by MVF, an NGO
focused on the eradication of child
labour. (MVF is described on page
35.) After completing his
education, he became employed
by MVF, and this relationship led
him to the CREI Project.

Through CREI, Anjaiah found out about biogas. By Anjaiah uses the slurry left
mixing cow dung with water, they told him, a biogas over from biogas cooking
called methane can be produced. Methane is flammable as fertilizer in his
and burns with a steady blue flame. It is efficient, clean, vegetable patch with
safe, and best of all, free. He and Yara would need to excellent results, as
shown by the juicy
purchase a stove and some pipes, and a masonry pit
tomatoes held by his
would have to be built to hold the dung/water mixture. daughter.
Altogether this would cost them about Rs 8000 ($170),
an amount they could ill afford. But the CREI team
said the government, which is keen to promote
alternative energy, would be willing to provide partial
support for the initiative.
When Anjaiah explained the plan to Yara, she was
delighted. With assistance in the form of a Rs 4000
($85) loan from CREI, they invested in a biogas unit. A
mason was hired by an organization called the Khadi
Village Industries Commission (KVIC), a central
government agency that promotes small-scale cottage
industries. They train and depute masons to install the
units and materials are donated.
After the biogas is burned off as cooking fuel, the solid

19

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Cashing in on a good
thing – the sangam
women know that the
Government of India has
decreed that all
schoolchildren must be
given a mid-day meal. If
the women can furnish the
cooking with biogas, their
costs will be negligible,
their income assured and
the children will eat well.
20
05060050_1_40.pmd 20
waste, or slurry, flows into a
second pit where it is
collected and sold as
fertilizer. Demand is high,
and Anjaiah sells it for Rs 4
($0.10) per kilogram. He
estimates that he and Yara
will earn Rs 1500 ($35) a
year from the slurry.
Yara doesn’t have to worry
about faulty valves on an
expensive LP gas cylinder.
She just turns the stove on,
lights a match, and dinner is
ready in no time. No indoor
pollution from smoke, just a clear blue flame – and no more
tedious hikes to gather firewood!
The savings are impressive. An LP gas cylinder costs Rs 300
($7). An average family uses one cylinder per month.
Firewood, if purchased instead of gathered, costs Rs 150
($3.50) per month. Using methane, which is absolutely free,
means that Yara will be able to repay the Rs 3000 ($70) loan
for the stove simply by not cutting firewood for three years.
Yara’s biogas stove is the first one in Thadiparthy. Her
neighbours were doubtful at first, but now about 20
families have expressed interest in building their own
biogas-producing stoves, and construction on several of
them is under way.
“When I started cooking with biogas,” says Yara, “my
friends were confused. They couldn’t find the gas
cylinder. When I showed them how the stove worked,
they couldn’t believe it. But now everybody wants one!”
6/3/2005, 10:23 PM
 Business summary

Project: Biogas digester

Client: Household (a former bonded labourer)

Products: Cooking gas, organic fertilizer

Location: Thadiparthy village, Ranga Reddy district

Benefits: Smokeless cooking, replacement of diminishing
supply of wood, sale of fertilizer

Potential market: Supply fuel for state government’s mid day
meal schemes for schoolchildren

Economics

Digester cost: Rs 8000 ($170)

Financing: 50% CREI, 10% householder, 40% government
incentive

Interest rate: 7.5% over 5 years

Payback Period: 3 years

Annual Profit: Rs 10,000 ($220)

Scale-up potential

Over 3 million biogas plants have been built in India so far; the
estimated potential is 15 million.*

The potential for installing biogas plants all over India is
significant.

The scheme has very high potential under VESI.
* Source: MNES 2004.

21

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 4. Harnessing the sun

V enkatamma had a problem. Like most of her

neighbours in Peddathundla village, she grew
vegetables and various crops to feed her family. When she
had a few extra tomatoes or chillies, she would take the bus
to the nearest town to earn a bit of cash. But because her
produce ripened at the same time as her neighbours’ crops,
the market was often glutted. Prices were low and
competition was fierce. After sitting in the hot sun all day, all
she could show for her efforts were a few coins. The worst
part was having to throw away her unsold vegetables. With
no way to preserve them, they rotted quickly.
A display of the sangam’s
dried food products.

22

05060050_1_40.pmd 22 6/3/2005, 10:23 PM

 It’s as easy as One, Two, Three!
One: the women wash the food items (left).
Two: the food is placed on the drying tray (above).
Three: a few hours later, the food is ready for storage or
sale (below). Venkatamma is second from the right.

23

05060050_1_40.pmd 23 6/3/2005, 10:23 PM

 At a loss as to what to do, she turned to Vasundara, her
self-help group. The group, which was formed in 2000, has
30 members, all Peddathundla village women. Vasundara
was set up as a savings group. Each member contributes
Rs 30 ($0.70) per month. Mostly, the members earn their
money by working as agricultural labourers at about Rs 40
($0.90) per day. The idea was to build up a fund so that
money could be lent with interest. The incentive to join the
group was that members were eligible for lower interest
rates than non-members. But Venkatamma didn’t want to
borrow money, she wanted to find a more reliable source
of income.
She discussed her problem with Yellama, the group leader,
and other members. There had to be a better way.
There was. The CREI team made the women aware of the
possibility of earning money with a solar dryer. It was an
ideal way of increasing incomes, they said, without
damaging the environment. Because dried food did not
spoil, it could be sold year round. This meant that the

Justifiably proud of their

empowerment, the women
keep careful accounts of
each transaction.

24

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 vicious cycle that
Venkatamma had found
so maddening would be
broken – the need to sell
vegetables when prices
are lowest would be a
thing of the past. Best of
all, solar power is free!
After due consideration,
the group agreed to use
their savings to buy a
solar dryer, and nothing
will ever be the same.
The first step was to
Various foods (here, a identify the correct dryer.
green leafy vegetable, This took 6 months. Solar dryers are not an off-the-shelf
tomatoes and curry
item in India, and the CREI team, once they understood
leaves) can be dried at the
same time. what the Vasundara women wanted, had to hire a local
fabricator to build it to specifications. The cost was
Rs 40,000 ($900). The women borrowed half the money
from the CREI Project, which gave them a generous
repayment time of seven years. However, the solar dryer
has been such an unqualified success that the Vasundara
women expect to be able to pay back the full amount in only
two years.
Nothing was left to chance. Every element in the
enterprise was covered in extensive training sessions in
the food drying process, as well as associated matters
such as hygiene. The women learned about food grade
standards and quality control in drying and packing
operations. Marketing was an important component in the
training too, and links were made to supermarkets that
stock dried food products. Special deals were struck with
college hostels, where the women would provide dry
foods for specific functions. And of course the products

25

05060050_1_40.pmd 25 6/3/2005, 10:23 PM

 would be sold
regularly in local
markets.
The process began
with a participatory
approach, which led
to the identification of
local resources and
skills. Once
renewable energy
technologies were
adopted, business
plans could be
developed, leading to
capacity building.
A second CREI-sponsored solar drier is in operation at
In solar drying,
Gaddamallai Guda village. The tomato chips under preparation in
different procedures this photo will sell for Rs 100-120 ($2.30-2.80) per kg.
must be followed for
each commodity. The
most important foods
in Peddathundla are ginger, coriander, chillies, tomatoes and curry
leaves. Although each commodity is different, the average time for
drying food is 9-10 hours. Vasundara employs four of its members
to manage the solar dryer at a daily wage of Rs 30 ($0.70). The
women could make Rs 40 ($0.90) outside, but they much prefer
this arrangement because they don’t have to leave the village.
The women make more than Rs 3000 ($70) per month – about
Rs 40,000-50,000 ($900-1200) per year. Their revolving fund is
continually replenished, and their lending business flourishes.
Besides the Vasundara group, two other groups have invested in
solar dryers, and more are sure to follow.
Asked to summarize the impact the solar dryer has had on her life,
Venkatamma has a ready answer: “Before, we threw away our
excess vegetables, a total waste,” she says. “Now, our friend the
sun makes money for us!”

26

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 Solar-dried products on sale
at Mall. The jars contain
curry leaves.

“Welcome to our stall – get your sun-dried foods here!”

proclaims the banner.

27

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 Business summary

Business: Drying of agro products

Enterprise: Vasundhara SHG

Market: Weekly fairs, supermarkets

Products: Ginger, chillies, tomatoes, curry leaves, masala
powder

Management: 4 SHG members hired at Rs 30 ($0.70) per day

Economics

Location: Peddathundla village, Ranga Reddy district

Cost of dryer: Rs 40,000 ($900)

Financing: 50% CREI loan, 50% SHG

Terms: 7.5% interest, 5 year repayment plan

Annual profit: Rs 45,000 ($1000)
SHG expects to make full repayment in 2-3 years.

Scale-up potential

Of the 500,000 SHGs in Andhra Pradesh, about 200,000 have
obtained credit from banks and micro-lending organizations.*

If only 1% of these SHGs took up these activities, the result
would be 5000 new enterprises.

This scheme has very high potential under VESI.
* Source: National Bank for Agriculture and Rural Development

28

05060050_1_40.pmd 28 6/3/2005, 10:23 PM

 5. We’re farmers, not barbers!
You are like the barber who has no work calling people to
shave their heads!
Why are you planting trees that grow wild in the jungle?
Despite the derision from their neighbours, the Pundu
brothers, Jangaiah and Ramulu, and a few other far-
sighted farmers in Chintula, a small village in Ranga
Reddy district, have been doing something extraordinary.
They have been working hard to bring fields long
considered wasteland into cultivation. What is even more
surprising to their neighbours is the crop they are
cultivating – a crop that has traditionally only been used to
mark boundaries between fields, a crop that grows wild in
the jungle. That crop is jatropha.
Growing jatropha as a cash crop is a totally new idea.
Farmers have always known the plant, but not that it was
profitable to grow. It was traditionally used as a lighting oil.
But never before had jatropha been seen as a source of cash.
Largely due to the interventions of the CREI team, more
and more farmers are cultivating this hardy tree. Much of

The Pundu brothers explain their

work. Left to right: Pundu
Jangaiah; Mr Eeshwar,
President of the Jeeva Avarana
committee; Pundu Ramulu.

29

05060050_1_40.pmd 29 6/3/2005, 10:23 PM

 The Pundus reclaimed this land. Just a few months ago it was considered
completely useless.

the emphasis is on cultivating wastelands, areas long

considered incapable of rendering anything profitable.
The point is that jatropha, as well as pongamia, another
oil-bearing seed tree, can be cultivated with ease in
marginal lands. Both are resistant to drought, and both
will grow on poor soils. Although the oil produced from
both species is in demand for a variety of uses, their
main use is for biodiesel production, an important priority
for many of India’s state governments.
But because both trees take a long time to reach maturity
– jatropha takes about two years, pongamia four – part of

30

05060050_1_40.pmd 30 6/3/2005, 10:23 PM

 the strategy is to sustain
farmers’ interest by
promoting intercrops that
command high demand in
the market. Legume
crops, because they
increase soil fertility, are
particularly favoured. The
legume best suited to
conditions in Chintula is horse gram.
Although not as prized as pigeonpea, the
favourite pulse crop for making dhal in
southern India, horse gram grows well in
marginal lands, yields 7-8 quintals/hectare
and sells for Rs 6 ($0.14) per kilogram. It
is mostly used to make rasam, a soup.
Another interim crop is henna, which is
used to decorate the feet and hands of
women on auspicious occasions,
especially brides. Henna is a perennial
crop that commands a good price in the
market. CREI’s thinking was that the Above: Jatropha is traditionally used to mark
promise of immediate income from horse boundaries. Inset: mature jatropha oilseeds
ready for collecting. Below: Pundu planting a
gram and henna would give the farmers jatropha tree.
enough confidence to prepare the land for long-term
gain from jatropha and pongamia. The Pungus only
earned about Rs 2000 ($47) in additional income
from their horse gram crop, but the thing to consider
is that previously unused land is now generating
cash.
The farmers contributed 50% of the cost for land
preparation, mostly through labour. They borrowed
Rs 13,000 ($300)/hectare from CREI at 7.5% interest
over 6 years. The jatropha, which was planted 6
months ago, will not be ready for harvest for another
18 months.

31

05060050_1_40.pmd 31 6/3/2005, 10:23 PM

 The Pundu brothers
threshing horse gram.
The legume produces
seeds of two distinct
colours.

Says Mr Eeshwar, president of the Jeeva Avarana

committee in Chintula, “The Pundus are unusual farmers.
All the farmers here work hard, but the Pundus have
Henna is a useful
vision. They understand that jatropha can be a valuable
intercrop with jatropha and
pongamia. crop.”
Jatropha sells for Rs 5-6
($0.12-0.14) per kilogram.
Like neem, it is used as
insectide. Unlike neem,
however, it is poisonous,
and cannot be ingested by
humans or livestock. Its
primary use is as a biodiesel
input, especially for use with
stationary engines. After the
oil is extracted from the
seeds, the residue cake is
dried, powdered, and mixed
with water to be sprayed on
various crops.

32

05060050_1_40.pmd 32 6/3/2005, 10:23 PM

 The oil produced from both jatropha
and pongamia can also be used as
biodiesel to fuel standing engines.
Indian President Abdul Kalam, a big
promoter of renewable energy, has
indicated that 200,000 hectares will
be made available over the next
year by the government of Andhra
Pradesh for cultivation of crops that
provide biodiesel. Chintula farmers
like the Pundus are listening. They,
and nine other farmers like them, Forgotten crops: jatropha (left) and pongamia
are doing their part. (right), if cultivated properly, can provide
income from marginal lands.

Planting jatropha as an
activity for schoolchildren
is promoted as part of the
CREI Project.

Jatropha and pongamia

plants are raised in this
nursery in Ibrahimpatnam
for cultivation by
beneficiaries of the CREI
Project.

33

05060050_1_40.pmd 33 6/3/2005, 10:23 PM

 Summary

Business: Biodiesel plantation

Model: Intercropping on 6 hectares of wasteland (jatropha with
legumes and henna)

Lead time: 24 months

Management: A two-brother team and the Environment
Committee

Location: Chintula village, Ranga Reddy district

Cost economics (per hectare)

Financing: Rs 13,000 ($300) from CREI

Terms: 7.5% interest over 6 years

Current profit: Rs 5,000 ($110)

Expected profit: Rs 20,000 ($450)

Potential: Thousands of hectares of wasteland put to use for
economic benefit of resource-poor people

Scale-up potential

Of the 94 million hectares of wastelands in India, 7.6 million
are in Andhra Pradesh.*

If only 10% of these lands are brought under rainfed jatropha
cultivation, the result would be 10 million hectares in India and
800,000 in Andhra Pradesh.

This scheme has very high potential under VESI because the
oilseeds can be converted into biodiesel, thus meeting all the
village’s energy needs.
* Source: Ministry of Agriculture 2004.

34

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 6. Cleaner cooking, healthier girls
The M Venkatarangaiya Foundation (MVF) is a
Hyderabad-based NGO dedicated to the eradication of
child labour. MVF believes that all children should be in
school, and that a child not in school is a child in labour. In
pursuit of its lofty goals, MVF has developed an extensive
network throughout rural Andhra Pradesh – just the sort of
network needed by Winrock to launch its clean energy
business models through the CREI project. The MVF-
Winrock collaboration was a match made in heaven, and
although they had different targets, they were able to
share their resources and knowledge to mutual
advantage.
One particular initiative has brought the two
organizations even closer together. MVF runs a

In its efforts to make schoolchildren out of bonded labourers, MVF has developed an
extensive network in the villages of Andhra Pradesh. Their intimate involvement in the lives
of rural people makes them ideally suited for identifying appropriate local organizations that
can adopt RE technologies.

35

05060050_1_40.pmd 35 6/3/2005, 10:23 PM

 residential hostel for
underprivileged and
exploited girls in the
village of Hayathnagar, in
Ranga Reddy district. It is
called the MSK Girls’
Hostel. Funds to run the
hostel come partly from
the government of Andhra
Pradesh and partly from
other sources. The hostel
is a bridge course school;
it brings girls who have
had no schooling at all up
to primary school level so
that they can then be
placed in mainstream
schools. Apart from quality education, the hostel employs Cooking with biomass
means that fuel is
a cook to provide three meals a day to between 50 and
abundant and free – that’s
60 girls. enough to put smiles on
Before the CREI intervention, LPG (bottled gas) was used anyone’s face.
for all cooking needs. The gas was bought from Hyderabad

MVF hostels are typified

by artwork that decorates
as well as educates.

36

05060050_1_40.pmd 36 6/3/2005, 10:23 PM

 at a cost of Rs 300 ($7)
for a cylinder. Monthly
consumption amounted
to seven cylinders at
an average cost of
Rs 2100 ($48).
Moreover, the cook,
who had to commute to
the city (100 km round
trip) at least twice a
week, faced enormous
difficulties transporting
the cylinders.
An MVF staff member
The CREI project’s intervention of installing a biomass explains the advantages of
stove changed everything. The stove, which burns biomass cooking to
material that would otherwise have gone to waste, needs representatives of several
only 4 kg of wastewood/biomass to meet the hostel’s self-help groups. The inset
daily cooking needs. It costs Rs 6000 ($140). shows the stove itself.

Monthly expenditure has reduced to Rs 500 ($12), a

quarter of the previous cost. These savings are hugely
important for a hostel accustomed to operating on a
shoestring budget. On top of all the other advantages, the
stove daily produces a kilogram of charcoal as residue,
which can be used as additional fuel. The quality of food is
better and meals are cooked in less than half the time using
LPG. Before, it took 2 hours; now the job can be done in
only 45 minutes. The 20 kg of rice that forms the staple part
of every meal can be prepared in only 20 minutes in the
new biomass stove, while the requisite 5 kg of pulses take
only 25 minutes to cook. The biomass stove is very easy to
use and operate. It produces clean energy and no smoke,
burning with a blue flame just like LPG.
Hostel staff were trained in the use of the biomass stove
by Winrock personnel. Everyone concerned is very
happy – especially the cook who no longer has to

37

05060050_1_40.pmd 37 6/3/2005, 10:23 PM

 undertake arduous travel and transportation headaches.
Says hostel warden Prescilla, “It is amazing what
technology has done for us. We used to spend four times
as much on cooking as we do now. For us, this amounts
to substantial savings and comfort as we can avoid all
the travel and transportation challenges. We are able to
better utilize our time now by spending more time with
the children.”
Thousands of SHGs are involved in providing food to
schools as part of the Mid Day Meal Scheme of the
government of Andhra Pradesh, spending as much as
Rs 1750 ($40) per month on firewood and LPG. While
the firewood option is a major health and environmental
hazard, LPG is expensive and logistically unwieldy.
Because biomass stoves have the potential to alleviate
all these problems, they are the ideal solution.
Many SHGs involved in meal schemes have already
Schools are perfect places for the transfer of technology.
If parents can see that their children are healthier as a
No one is happier about
result of clean energy, they are likely to adopt the
biomass cooking than the
technology themselves.
cook, who no longer has
to inhale smoke or make
long and complicated
forays to the city to collect
gas cylinders.

38

05060050_1_40.pmd 38 6/3/2005, 10:23 PM

 visited and received training on the biomass stove at the MSK
hostel, which has won the reputation as a ground-breaker. The
example they have shown has convinced other groups to adopt
the technology, thus saving money and improving their health.
The productive application of renewable energy technologies
directly affects livelihood improvement. The SHG involved in the
MSK Hostel, for example, earns about Rs 15,000 ($350) per
year. Best of all, the problem of indoor air pollution caused by
inhaling the smoke from wood fires indoors, a hazard that
especially affects women and children in rural India, assuming
the technology is widely adopted, will soon be but a bad
memory.

Us too! The residents of boys’ hostels are as enthusiastic about the advantages of biomass
cooking as the girls at MSK.

39

05060050_1_40.pmd 39 6/3/2005, 10:23 PM

 Business summary

Business: Mid day meals scheme using a biomass stove

Enterprise: MSK Girls’ Hostel

Management: Hostel warden and cook

Location: Hayathnagar, Ranga Reddy district

Economics

Cost of stove: Rs 6000 ($140)

Financing: 50% CREI loan, 50% hostel

Terms: 7.5% interest over 5 years

Annual profit: Rs 15,000 ($350)

Scale-up potential

Of the 867,000 schools in India covered by the Mid Day Meals
Programme, Andhra Pradesh alone has 65,000 shcools.*

The potential for scaling up is tremendous. Almost every group
involved in this scheme uses firewood and all are desperate to
cut costs.

The scheme has very high potential under VESI.
* Source: National Program of Nutritional Support to Primary
Education 2004.

40

05060050_1_40.pmd 40 6/3/2005, 10:23 PM

 © Winrock International India

All rights reserved.

The information presented in this publication resulted from investigations of the
work of the Commercializing Renewable Energy in India (CREI) project supported
by the United Nations Foundation and implemented by Winrock International India,
Winrock International and the United Nations Department of Economic and Social
Affairs (UNDESA). The views expressed are not necessarily those of any of these
agencies. Photo credits
Written and designed by Eric M McGaw.
MVF: pp 17 (lower), 20, 33 (middle and lower), 35, 36 (both), 38 (lower), 39.
www.mcgaw-associates.com
WII: p 33 (upper)
Printed by Pragati Offset Private Limited
www.pragati.com All other photos by the author.

05060050_Cover_PAP.pmd 2 6/3/2005, 10:41 AM

 Head Office
1, Navjeevan Vihar, New Delhi 110 017, India
+91 11 2669 3868

Project Office
E-24, Vikram Puri, Secunderabad 500 009
Andhra Pradesh, India
+91 40 2784 5276

www.winrockindia.org

05060050_Cover_PAP.pmd 1 6/3/2005, 10:41 AM