Two Attempts from BSH

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B O S C H U N D S I E M E N S H A U S G E R Ä T E G R U P P E

Two Attempts from BSH

“How to create effective markets for low carbon energy solutions that ensure equitable and widespread access to energy services in the Global South?”

Samuel Shiroff

London, June, 2013

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B O S C H U N D S I E M E N S H A U S G E R Ä T E G R U P P E Two Attempts I Sustainability I 24.06.2013 I Folie: 2

Agenda

BSH Overview

Protos: An interesting case study

HealthyHoods: A tool in an improving arsenal

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The BSH shareholders 2011 | 2

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Brands■ about 70 companies in 49 countries■ Global sales and customer service network

■ 13 brands, 42 factories, about 45,000 employees■ around 9.7 bill. Euro sales in 2011

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Agenda

BSH Overview



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Ave

rag

e l

evel

of

smal

l p

arti

cles

µg

/m3

EU annual standard40 µg/m3

Berlin City Center Bangkok Roadside Hut with open fire

30

240

3000

Traditional Cooking on Open Fires

Air pollution

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•Facts and figures:Power range: 2.0 – 2.5 kWUsage: 2-4 liters oil per week for a family of 4-5

→ 100 – 200 liters per yearFuel: All plant oils, also used oils Efficiency: 45 – 58 %Emissions: Ten times lower than with keroseneCO2-balance: Neutral

Reason for introduction of Protos :- Powerful stove- Usage of renewable energies- Environmentally friendly- Healthy for the user- Local economic added value & job creation

Protos – The World‘s First Plant Oil Stove

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2004

Protos – Product Development

2005

2006 2007 2008-2010

$250

$75 ~$50$60

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current

customers

Developing WorldLPG Users

Non-monetized Bio-mass users

Kerosene and Monetized Bio-mass

Target market: who and where are our users?

“The Cooking-fuelPyramid”

Establishing the Target Market

Initial Market FocusDetermined via field tests with ~1000 families in:

Test Start Guatemala 1999 Philippines 2003 Tanzania 2005 India 2007 Indonesia 2007

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Business Model: Cost of the Cooker

Production Cost ~ $50 (includes tank) Sales Cost ~ $20 Cost gap ~ $30 per unit

Question: To whom does the cooker bring added value?

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Protos: Innovative Business Models

Companies

Warm Food, Safe Fuel, Faster, Low Cost

Payment

Health / MDGsEnvironmental

Services

WHO / UN

IGOs/ NGOs

General Public

Foundations

Development Orgs

Wh

o cares H

Value

Reputation / Brand

Political

Operational

Gra

ntsReduce Costs:

Scale,Technical

Development

Governments

CE

Rs

/ VE

Rs

Cost Gap

Pa

ym

en

tReduced DeforestationCO2 Neutral Fuel

Maternal HealthChild Health

CDM

Individuals paying for:

Kerosene Charcoal

Wood

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Three Possible Business Models

Traditional

Cooker Price ~$50 ExWWarranty DeductedSpare Parts Optional % of

purchase

Total User Cost: $55++++Cooker + Transport + Training +Profit margin +Warranty

Customers Businesses in regions where user can pay

Builder Model

Cooker Price ~$50 ExW +Warranty 1-year ~$?? +Service ~$?? +Builder Subsidy - $xx

Total User Cost: <55Cooker + Transport + Training

Customers Government Plantations Charitable Organizations CSR

CO2 Model

Cooker Price ~$50 ExW+Warranty 7-year ~$?? +Service ~$?? +CO2 Project Cost $xx CO2 Revenue -$yyTotal User Cost: <<55

Cooker + Transport + Training

Customers CO2 Project Developers CSR Energy Companies

overlaps

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Project Conclusion: It didn’t work

The Technology never outcompeted Kerosene

Plant oil supply chain was difficult and controversial

Carbon market collapse made primary financing model impossible

Adequate economies of scale could not be achieved

Decision 2010: Cease production and make patent available to all

www.plantoilcooker.org

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Agenda

BSH Overview



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http://www.youtube.com/watch?v=y0HXGqHvbUM

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Concept:

Using BSH core competence in co-operation of an NGO (Practical Action) to create solutions for global health issue

Design & Optimize smoke hoods for developing countries and establish construction guidelines:

– Taking into consideration available materials and manufacturing capacity– Variable depending on family size and needs– For a variety of regions and heating/cooking needs– Using local manufacturers

Distribute information on website and with partners to leverage impact

Generate media awareness

Partners:

Universität der Bundeswehr München: Institute for Thermodynamics

Practical Action: UK-based non-profit organization with extensive experience

Project Overview

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Design smoke hoods

Establish design guidelines

Create a functional internet-accessible overview

Generate awareness of the problem and potential donations for the solution

Establish scalable and sustainable business model.

Make a Positive Difference and reinforce BSH‘s reputation “Do good things and talk about them”

Project Overview Goals

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Project Organization

Bundeswehr UniCFD

BSH€ + Mngmt

Practical ActionUK & Nepal

GaretoTraining & Mngmt

ManufacturerLocal CoopFinancing

Users

DEG€200k

Users Users UsersUsers

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Social marketing for demand generation

Implementation model

Technology fabrication at local level

Capacity building of local fabricator

Establishment of revolving fund and capacity building

Awareness raising

Quality Assurance

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Impacts to date

•82% indoor smoke reduction•30% less firewood used and drudgery reduction of women, and reduction in Co2 emission•>800 households reached Significant reduction of smoke related diseases•Expansion efforts underway

•82% indoor smoke reduction•30% less firewood used and drudgery reduction of women, and reduction in Co2 emission•>800 households reached Significant reduction of smoke related diseases•Expansion efforts underway

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Core funding for revolving funds

Investor-friendly business model

Bundling with improved cookstoves

Core funding for revolving funds

Investor-friendly business model

Bundling with improved cookstoves

Key Economic Challenges

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Thank you www.healthysmookehoods.org

Documents

Two Attempts from BSH