Business school students work out plan for biofuels in undeveloped countries

Using the jatropha plant in African villages could help stabilize local economies

When Jake Schnarre, Kevin Lehnbeuter, Steven Gabster, Keith McLamb and Tom Stehl signed on to a practicum with the Center for Experiential Learning at the Olin School of Business, they never imagined that their efforts would make such a big impact on their lives – and possibly the lives of thousands of others. The students joined forces in the spring to work on what appeared to be a straightforward task: explore the feasibility of alternative fuels, such as ethanol, in developing countries.

The practicum was sponsored by the World Agricultural Forum, a non-profit organization that examines domestic and global agricultural policy, and helps to implement solutions through policy and practice. Working on an ethanol-related project appealed to some of the students because of their backgrounds in agriculture and science.

Jatropha plants
Jatropha plants

“My undergraduate degree is from the University of Missouri-Columbia in agriculture systems management,” said Schnarre, P.M.B.A. ’07. “Plus, I grew up on a fairly large farm in northern Boone County. In my professional life, I work at Emerson Electric and don’t get a lot of chances to utilize the skills from my original degree. I thought the practicum would give me a chance to do something in that field.”

Each participant brought unique skills to the project that helped it succeed. In addition to Schnarre’s agricultural background, Lehnbeuter, M.B.A. ’07, has an undergraduate degree in plant genomics; Stehl, M.S.W./M.B.A. ’07, had already spent a good deal of time working in developing countries; McLamb is scheduled to graduate in 2007 with a dual degree in law and business; and Gabster earned a B.A. in 2006, majoring in political science and finance.

The first meeting about the project that the students had with W.A.F. board members was overwhelming, said Lehnbeuter.

“They wanted to use biofuels as a catalyst for economic growth. But they piled up their expectations from there. They talked about water, about health care — they covered the gamut about the current situation in the developing world and how they wanted to use biofuels to save the world,” Lehnbeuter said.

The W.A.F. had visions of building 50-million-gallon ethanol-processing facilities like those in the United States. The students understood the goal, but also realized that it might be a little unrealistic.

“There are a lot of underdeveloped nations and countries that don’t have the infrastructure and ability to implement large scale projects like that,” Schnarre said.

The task seemed daunting, but the practicum team dove into the project and began to research the feasibility of building ethanol plants in developing countries. In almost no time, they realized that ethanol is only one possibility for providing fuels in remote locations — and it wasn’t the most cost-effective one. The other option comes from a plant indigenous to sub-Saharan Africa called jatropha.

The plant is primarily used as a hedge because it is very hardy and inedible. Oil can be extracted from the plant’s seeds and used for generating engines, cook stoves or lamps. Compared to the yield soybeans must generate to make ethanol, jatropha is a bargain. One hectare of jatropha can produce 1,800 liters of oil (or 190 gallons per acre). One hectare of soybean oil has a yield of only 446 liters.

The oil could be used to run a multi-function power unit, a very rudimentary generator that could run eight hours a day for a year on just nine hectares of jatropha.

“Once they have the power to run the engine, there are three or four other tools that they can power,” Schnarre said. “And with those tools there is a series of benefits that result. The grain mill will be labor-saving. The generator can power lights or a water pump to clean water. The generator would also power the oil expeller for extracting more oil from the plant.”

If each village has its own crop of jatropha it could run its own generator, which would relieve dependence on outside sources of fuel. The team suggested that if organized correctly, villages could set up regional cooperatives to run and utilize the multi-function power unit. The benefits of such a system would improve the quality of life for people in village. Work hours for cottage industries could be expanded and the village could sell excess oil to other cooperatives. The generator could improve health care by pumping fresh water or powering refrigeration to store medicine.

“The individual communities would need to purchase the power unit,” Lehnbeuter said. “They need to have a stake in the success of the unit, and the use of the generator has to be operated like a business or a small co-op. It would be owned by the community and people would put their own money and effort into it so they could enjoy the benefits of it.”

In late April, the practicum traveled to Washington, D.C., to present their findings to the World Agricultural Forum. Their audience included dignitaries from the United Nations, current and former executives from American companies such as Anheuser-Busch, Monsanto, Novus International and Bunge North America, as well as firms based in Morocco, Costa Rica and Argentina.

Don Kloth, retired vice president and group executive at Anheuser-Busch, is a board member on the World Agricultural forum who worked closely with the business school team. He said the students did a remarkable job on a challenging project.

“They took an enormous amount of data and boiled it down to something that we could continue to work on,” Kloth said. “I had never heard of jatropha before, but now a lot of people are talking about it. We are eager to do our part to make people more aware of it, and stimulate others to view the plan as an opportunity to become a catalyst for rural development.”

Because the organization’s function is to provide a neutral venue to discuss improving agriculture in developing countries, the W.A.F. won’t be making an investment in the process of turning jatropha nuts into oil. However, based on the business school students’ work, the forum is building a model to demonstrate how the oil is extracted and then used to power a generator. Once people see what the oil from jatropha can do, Kloth said, he expects that philanthropic groups and investors will be interested.

The forum has kept Schnarre on board to continue working on the project, but all of the students said that the experience will help them in their future endeavors. Tom Stehl, who is working on his joint degree with social work, said the project gave him perspective on what kinds of jobs he wants to do in the future.

“The fact that I can say that this project is actually happening and improving people’s lives leaves me with a sense of great satisfaction and happiness, Gabster said. “The fact that we were able to present to and meet with the type of world leaders who can actually effect real change still amazes me.”