VayuGrid, a biofuel supply chain company based in Bangalore, has signed a memorandum of understanding to create a biofuel cluster for its VayuSap — high-yield Pongamia — in Ethiopia.
The company said the cluster will create a $2.5-million biofuel investment opportunity and is part of a larger government plan to develop a biofuel park in Ethiopia. Starting with a 2,000 acre, the long-term goal is to create a cluster of 100,000 acres under a collaborative model.
The biofuel park is a critical step to reduce the country’s commitment of 87 per cent of free cash on imported crude while at the same time creating local job opportunities and an ecosystem of value-added businesses.
Ethiopia was chosen strategically based on the economics and agriculture. Its large land bank of arid and unproductive land lends itself perfectly to creating a green energy supply base for local and global markets.
Phase 1 is a 2,000-acre footprint under a collaborative model involving the participation of a local partner bringing in land and labour, investors putting the capital and VayuGrid providing the IP and downstream contracts, thereby creating a sustainable and replicable business model.
“VayuGrid is bringing together local and global businesses that are dependent on crude and looking for ways to hedge against currency fluctuations while ensuring a predictable supply of green energy,” said Doug Peterson, CEO, VayuGrid.
“Our biofuel clusters ensure a sustainable biofuel supply for downstream markets and high returns for governments, land owners and investors,” he added.