The Economic Case for Sanitation
Enviro Loo hoping to make money while building economies and saving the planet
Editor’s note: Enviro Loo is a South Africa-based company that since 1993 has made waterless, chemical-free toilets. Company officials believe their system is suitable for urban and rural communities in both developed and developing countries, and helps address worldwide pollution and water problems. Enviro Loo offers three toilet models, based on capacity, that use air movement and heat from the sun to reduce solid waste to about 5 percent of its original volume. It’s more of a dehydrating than composting process, officials say. Here, as part of NextBillion’s ongoing series of Q&A blogs about different business models and technologies addressing sanitation, Mark La Trobe, founding member and international managing drector of Enviro Loo, answers a few questions about the company and its future plans.
Kyle Poplin: How do your toilets work, and what makes them different from other water-less toilets?
The Enviro Loo operates through a process of dehydration and evaporation, occurring naturally through the use of the sun, wind and gravity. The decomposition of the waste takes place in a sealed unit, thus ensuring no water or ground contamination can occur. The Enviro Loo separates the liquid waste from the solid waste to devitalise all the possible disease-spreading pathogenic bacteria, allowing the waste to be reused as a byproduct for agricultural purposes.
Unlike other waterless toilets, Enviro Loo is designed taking into account infrastructure restrictions, cost constraints and the longevity of a sanitation facility, making it more cost effective over its lifetime when compared to other systems.
KP: What’s your revenue model? Do you sell toilets, or is it fee-based? What are your expectations concerning profitability?
Our revenue includes sales of the Enviro Loo as a capital asset and annuity-based income through an ongoing maintenance/waste management contract. However, we are looking at taking a rental model to market in the future and are currently in discussions with several commercial banks in South Africa to fund such a model.
Enviro Loo is for-profit company but we truly believe and measure ourselves on a double bottom line – we target profitability and actively measure ourselves on the impact we are making to the earth as well as the lives of the people living on it. Our metrics include lives impacted, water saved by use of the Enviro Loo and economic benefit derived from regions where Enviro Loos have been implemented.
KP: What is your target market?
Enviro Loo is a universal sanitation solution, relevant for urban and rural areas, developed and developing countries. Specifically (it’s designed) for areas with no access to water, lack of infrastructure, as well as progressive countries striving to preserve precious water resources.
Enviro Loo further targets the following entities and/or sites: governments and the public sector, educational institutions, the healthcare industry, rural and urban housing, public facilities (transport hubs, religious facilities, etc.), NGOs and NPOs (non-governmental and nonprofit organizations), refugee camps and military, heritage and tourism sites and corporates.
KP: How many of your toilets are in use now, and where? What feedback have you received from users?
To date, there are more than 100,000 Enviro Loos successfully installed in 52 countries worldwide. Over 45,500 installations are in South African schools. The Enviro Loo is installed in many developed (Australia, France, U.S., Canada, Germany, Greece) and developing countries (India, Nigeria, Ghana, Kenya, South Africa).
The widespread experience globally has demonstrated that the Enviro Loo is a cost-effective, respectable, hygienic and environmentally friendly sanitation system that satisfies the dignity of all users.
KP: We hear a lot about how bad the sanitation problem is in India. How bad is it in South Africa, relatively speaking?
An estimated 23 million South Africans do not have access to adequate sanitation facilities. Those who have inadequate sanitation are using the bucket system, unimproved pit toilets or, sadly, open defecation.
KP: Will you have to change peoples’ habits in South Africa to get them to use your toilets?
Through our experience in the market, we have found that education is imperative when approaching a user. The user needs to understand why they now have to use a waterless toilet instead of the conventional flush, and how the Enviro Loo works and the benefits thereof.
At Enviro Loo we have introduced two concepts: social facilitation and end-user training. Social facilitation is introduced to a community prior to installation, to address the community concerns, requirements with regard to sanitation and to educate the community as to why they will be receiving waterless toilets. End-user training is conducted after installation, when the units are on the ground, to teach the user how to use the system and daily janitorial needs required.
KP: Aside from environmental impacts, what economic impacts might Enviro Loo have in communities where you’re located?
The Enviro Loo contributes massively to the economy, environment, education and health system. Approximately 240 million litres of water per year is being saved by communities and institutions that use the Enviro Loo, together with annual water charges of $26 million. The installations have helped over 2 million people contribute to the socioeconomic development of their communities. Over $540 million in economic benefits have been realised from Enviro Loo installations.
KP: Is an Enviro Loo toilet expensive to install, compared with other toilets designed for developing countries?
Poor sanitation cripples national development; workers produce less, live shorter lives, save and invest less, and are less able to send their children to school. The economic case for sanitation is no longer in doubt; each U.S. $1 investment in sanitation delivers a U.S. $9 return.
The World Bank’s Economics of Sanitation report shows that the cost of not addressing sanitation is indefensible. The lack of safe sanitation results in increased health expenditure, untimely mortality, contributes to malnutrition, causes land and water table contamination and greatly affects work productivity. Investing in sanitation makes investments in education more effective; girls are more likely to attend school when adequate sanitation is available. Investments in sanitation also protect water resources, make investments in water supply more effective and increase tourism revenues.
The economic impact of poor or zero safe sanitation is catastrophic but preventable.
KP: Given the recent water crises experienced in many parts of the world, might you market Enviro Loo toilets in developed countries? If so, might that subsidize their sale in developing countries?
This is an avenue which we have done successfully in the past; we have had many projects funded by the various aid organisations which have been established by different developed countries. Furthermore, we are beginning to see instances where sanitation is being funded by the private sector from certain developed countries.
Of late there has been an interesting development in that we are seeing that the developed world is willing to fund the start of businesses in the sustainability space, as opposed to funding projects for delivery of services. They view that funding specific projects does not sufficiently constitute sustainability, but funding commercial businesses will result in true sustainability.
KP: What are your short- and long-term goals?
Long term, Enviro Loo aims to bring forward the day that every person has access to sustainable sanitation facilities, whilst the short-term goal is to continue to ease the backlog of school and household sanitation and provide an environmentally friendly system that does not put strain on scarce water and power resources.
KP: What advice would you give others who might want to start a business in a developing economy?
Starting a business in a developing economy requires character traits of patience and perseverance. Furthermore, it is vital to do thorough homework on the economy concerned. It is imperative that there is an understanding of the political, funding and commercial structures of the public and private sector, as the case may be. Without this core understanding and background, you could potentially be pulled from pillar to post in search of results but with little success.
Kyle Poplin is the editor of NextBillion Health Care.
- Health Care