Rising Ventures: CleanStar Brings Biofuels Benefits to the BOP
Following earlier discussions on Biofuels and the BOP, Rajya profiles a company that has found a way to establish itself in this sector while offering benefits to local communities. Download the PDF version of this feature here.
by Rajya Karipineni – New Ventures India
Following their award-winning Oxford study on sustainable bio-fuel production in India, Sagun Saxena and Shashank Verma decided to put their research into action by forming CleanStar Energy. This company transforms previously unproductive land into fields of Jatropha and Karanj trees which yield oilseeds that produce a commercially-viable and eco-friendly alternative to diesel.
Many Indian entrepreneurs have clamored to capitalize on the growing global demand for alternative fuels, but CleanStar’s founders entered this field three years ago with a focus on more than just profits. They had seen how many semi-arid tropical regions in India are struggling with low agricultural productivity, increasing water scarcity, rising energy costs, and degrading soil conditions. In some villages in central Maharashtra up to 70 percent of villagers migrate annually after monsoon season as they cannot survive off their own land. It was in these areas that Sagun and Shashank saw the potential for introducing commercial BioFuel feedstock cultivation as a means to promote sustainable rural development.
CleanStar’s unique perspective is evident in its operations, starting with the way the company manages the soil at its field sites. CleanStar uses a significant amount of the seedcake that remains after oil extraction as a natural soil fertilizer even though the seedcake could also be marketed as a fuel. Forgoing sales, however, makes sense from a blended-value perspective. By using fertilizer derived from the seedcake as one of the nutrients for its own trees, CleanStar reduces the financial and environmental cost of its cultivation operations.
Through experimentation CleanStar has also developed different practices for expanding its labor force. The most common method for hiring workers in rural areas is to engage a local contractor who then brings together laborers, often from outside areas. CleanStar instead engages women-led self-help groups that already exist as efficient operational management units within rural areas. Through this technique, CleanStar ensures that local communities benefit more from income generation opportunities. This has generated significant awareness and trust for CleanStar regionally, and several village Panchayats have expressed a desire to collaborate with the company.
Sagun and Shashank take pride that their venture is on track to deliver meaningful returns for people, planet, and profit. While the entrepreneurs are currently focused on the local rural market to reduce logistical expenses, they aim to expand their work throughout India by partnering with reputable, locally based groups. CleanStar is also partnering with like-minded experts in agriculture, engineering, law and finance to offer advisory and implementation consulting to project developers and investors who promote scalable and sustainable BioFuel production in other parts of the world. Through their work, Sagun and Shashank have created a presence in the clean energy market by generating environmental and social benefits for local communities, thereby proving that these entrepreneurs are committed to turning sustainability-based concepts into action.
The Rising Ventures Series features articles, announcements and profiles of investors and entrepreneurs related to the theme of innovative small and medium businesses (SMEs) in emerging markets that deliver social and/or environmental benefits. These business models have been identified through the New Ventures (www.new-ventures.org) and Development through Enterprise (www.nextbillion.net) projects. To view other Features in the Series, visit http://www.new-ventures.org/risingventures