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close this book Application of biomass-energy technologies
close this folder II. Improved charcoal production
View the document A. Introduction
View the document B. The Malawi Charcoal Project
View the document C. Charcoal markets
View the document D. Constraints
View the document E. Policy environment and role of the Government
View the document F. Role of entrepreneurs and informal-sector artisans
View the document G. Local research initiatives and indigenous technical skills
View the document H. Role of non-governmental organizations
View the document I. Role of end-users
View the document J. External financial support and local credit and banking institutions

B. The Malawi Charcoal Project

The Malawi Charcoal Project started in 1986 as part of a World Bank-financed credit for restructuring the wood-industries sector. In 1989, the project was continued as a component of the Phase 2 of the Malawi Wood Energy Project discussed in chapter II. The project was under the auspices of the Forestry Department and technical assistance was provided by a German consulting firm, Interdisziplinaere Project Consult. The principal objectives of the Malawi Charcoal Project were to:

• Develop and improve the utilization of waste and surplus production in forestry plantations for charcoal production;

• Commercialize and privatize on-going charcoal production activities within forest plantations;

• Undertake wide-scale dissemination of improved charcoal production and utilization technologies.

One of the first activities undertaken by the project was the selection of an appropriate charcoal production system. After careful review of a wide range of options, the project adopted a half-orange kiln design which is widely used in Argentina and Brazil.

With a diameter of 3.5 m and an effective capacity of about 13.3 m³, the half-orange kilns were mainly made of fired bricks and clay soil plus a steel bar for the door frame. The total cost of the kiln in 1988 was $US150. The performance of these kilos yield an estimated efficiency by weight of 31.2 per cent with a feedstock of average moisture content of 20 per cent. With mainly pine and cypress logs of an average diameter of 20 cm and a density of about 250 kg per square metre, the typical production cycle lasted about 70 hours with cooling accounting for 30 hours.

The softwood charcoal produced by the kilns was found to be satisfactory with a fixed carbon content of 85 per cent and an ash content of 3 per cent.

The most important factors that determined the quality of the charcoal were found to be moisture content of the feedstock and the skill level of operators. The quality of output was satisfactory when the kilns were worked by operators who had, at least, between three to six months of training and practical experience.

After detailed assessment of the various investment options, the project selected a production system consisting of the following:

14 half-orange kilos

4 ox-carts

7 pairs of oxen

1 charcoal store water tanks and tools

In 1988, the total investment cost of the above model production centre was Malawi kwacha (MK) 25,000 (1 $US = MK 2.5 in 1989). The total charcoal output of the centre was 1000 tons per year with a feedstock of about 13,300 m³. The centre's site was selected to allow access to a catchment area of about 1000 hectares using ox-carts for transporting wood to the charcoal kilns. Labour costs were based on a piece-rate system to provide an incentive to increase production. About 10 work-days were needed to process I metric ton of charcoal which worked out to a total of MK 35 per ton of charcoal inclusive of the cost of feedstock extraction and transport. The total production cost of charcoal at Viphya amounted to MK 90 per ton (about $US36 per ton) which is comparable with costs in other African countries. (A World Bank mission estimated that in 1987, the production cost of a ton of charcoal in the United Republic of Tanzania was about $US30 (World Bank, 1988).)

One of the key strategic concerns of the promoters of the project was to determine the optimum pricing policy for the Viphya charcoal. Three options were considered: (a) to set the charcoal price on the basis of prevailing fuelwood stumpage rates; (b) to price the charcoal on the basis of replacement costs of the feedstock used; or (c) to base the price on prevailing prices of traditional hardwood charcoal. The first and second options were considered unrealistic because the production circumstances of plantation fuelwood were significantly different and replacement costs were not relevant since the Viphya charcoal was made from wood waste. Consequently, the price of traditional hardwood charcoal provided the benchmark for determining the price of the Viphya charcoal.

A uniform stumpage fee for Viphya thinning was used to avoid the administrative complexities associated with a discriminatory stumpage fee that would differentiate the charcoal by the profit margin realized at the point of sale. The collection of the stumpage fee was on the basis of capacity to encourage optimum utilization of existing installations. The other options, namely, collecting the stumpage fee on the basis of per unit of output; sales commission; unit of input; and profit were found to be too cumbersome and complicated to administer.

At MK 285 per ton, the landed cost of Viphya charcoal was competitive with that of traditional hardwood charcoal (MK 265-290 per ton) and the locally available coal (MK290 per ton). The distinctive feature of the cost structure is the importance of the cost of transport which accounts for about 70 per cent of the total landed cost. (The cost structure of charcoal in Dar-es-Salaam showed similar characteristics with the transportation accounting for close to 60 per cent of total landed cost (World Bank, 1988).)

This has important implications for energy policy since it is often assumed that traditional fuels provide an independent source of energy but clearly in the case of charcoal, access and pricing of petroleum fuels - imported in most parts of the region - are crucial determining factors.