The first 2,000 acre phase will be developed in co-operation with a local partner, who will bring in land and labour, and with investors who will put in the capital. VayuGrid, meanwhile, will provide the intellectual property (IP) and downstream contracts.
The long term goal is to eventually replicate the project, scaled up to 100,000 acres. "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, VayuGrid’s chief executive.
The project is part of a larger government plan to develop a biofuel park in Ethiopia, which is in turn part of a plan to boost the economy and reduce the country's dependence on imported crude oil.
"With an increased focus on biofuels as an energy solution, have policy makers been too optimistic about how soon second-generation biofuels can be developed?"
- taken from our series of articles, "how viable are biofuels..."
“Ethiopia was chosen strategically based on the economics and agriculture,” VayuGrid said. “Its large land bank of arid and unproductive land lends itself perfectly to creating a green energy supply base for local and global markets over the next 60 years.
VayuGrid's IP in Pongamia combines plant technology along with customised practices to ensure economic returns, the company said. The economics are boosted by the fact that management of the biofuel plantations can be carried out by local labour, as it does not call for highly skilled workers, it added.