Agro-industries: Opportunities and Barriers to Clean Energy Production

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By law, smallholders are required to sell their coffee through local growing cooperatives, who then pass the coffee to millers for processing and grading. For decades, coffee milling was managed by five mills, including the Kenya Planters Cooperative Union (KPCU) the largest mill. The mills pass the processed and graded coffee to licensed marketing agents, who sell the coffee at the Nairobi Coffee Exchange. This complex market structure means coffee growers must work through several layers of bureaucracy to reach the market. Furthermore, the sector is tainted allegation of price manipulation as well as collusion between millers and market agents to keep price down. The consequence of these practices is more by coffee growers who sometimes receive as little as 30 percent of sales proceeds. These inefficiencies combined with fluctuating global market price for coffee has been forcing farmers to abandon the crop altogether (the Economist, 2016).

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Coffee Sector Potentials as Energy Resource: After harvesting, the coffee cherries are mainly processed by wet fermentation method. During this process, large amounts of waste like pulp and wastewater are produced. According to the Coffee Research Foundation in Kenya, for each tonne of parchment about 2.15 tonnes of pulp and 80m3 of wastewater are produced, which means, the total amount of residue could add up to 145,125 tonnes of pulp and 4,104,000 m3 of wastewater per year (Fischer et al, 2010). The potential electricity production from coffee residues in Kenya is outlined below. It is envisioned that small coffee factories can install small cogeneration plants which can add up saving the atmosphere of a la.In Kenya, the coffee sector potential as energy resource is limited by two factors: first, production is in decline, which poses a challenge to the future of securing feedstock. Second, coffee harvesting and processing is seasonal, as it only happens a few months of the year, this could further complicate efforts to develop sustainable clean energy projects.Furthermore, as discussed above, currently the sector faces organisational and efficiency problems that need to be resolved to beforehand.

There are a growing number of examples of innovative cleaner energy plants that are planned or installed in other agro-industries such as wood & forestry, palm/vegetable oil, livestock, rice and sisal. Particularly, it appears that clean energy development is likely to be of some importance in three other agro-sectors, namely: wood/forestry, palm oil processing and sisal/fibre production.

The 2006 Energy Act empowers the Ministry of Energy to promote the development and use of renewable energy technologies including biomass, biodiesel, bioethanol, charcoal, fuelwood solar, tidal waves, hydropower, biogas, and municipal waste. The Least Cost Power Development Plan (2013-2033) sets ambitious goals of having renewable energy account for nearly 50 percent of the country’s power generation capacity, primarily from wind, hydro, and geothermal. Renewable energy development is also considered and encouraged through other programmes and initiatives including the Rural Electrification Master Plan, the National Climate Change Response Strategy, and the Investment Plan for Scaling-up Renewable Energy Programme (SREP). In 2016, following the rise in the number of investment in renewable energy, particularly in wind and solar projects, the ERC also revised the Electricity Grid Code to enhance the country’s capacity to absorb renewable electricity. Other regulatory frameworks such as the standardized PPA for small scale renewable energy (up to 10MW) (2012), the Energy (Complaints and Dispute Resolution) Regulation (2012), and the Mini-Grid Regulation (2016) are already in place. The reforms that unbundled the vertically integrated energy sector has also stimulated investments. This has then encouraged some agro-industrial sectors to improve efficiency by generating their own power from waste, and where possible, diversify revenue streams by selling power to the grid.

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