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PREO support enabled Bodawerk to test affordable mechanisation services for agro-processing on smallholder farms in Uganda

In September 2022, Kampala-based social enterprise Bodawerk completed their PREO-supported field trial of farm mechanisation services powered by renewable energy in rural northern Uganda. The trial tested the deployment of their multi-purpose electric tractor which provided local smallholder farmers with access to machinery for their ploughing, tilling, threshing, milling, and grain transport activities. This initiative enabled Bodawerk to better understand how well their mobile mechanisation services meet the needs of low-income farmers, particularly around cost savings and improved productivity.

Specialists in developing circular energy solutions in the field of lithium-ion batteries, Bodawerk was founded as a social enterprise in 2017 to bring beneficial products and services to low-income customers. Smallholder farmers in remote, off-grid regions of sub-Saharan Africa typically struggle to afford the high upfront costs of labour-saving machinery, which can be difficult to source and runs on expensive and polluting diesel fuel. To address these challenges, Bodawerk pioneered the ‘AgrE-Hub’, which brings a range of farming technologies within reach for smallholder farmers as a one-stop service-based business.

Charged at a standalone solar PV station, the Bodawerk system entails electric tractors transporting cutting-edge lithium-ion batteries over long distances whilst also being powered by them, enabling smallholder farmers to pay flexibly for mechanised services at a low cost and at a suitable point in their agricultural cycle. Mechanisation powered by clean energy provides a vital means for farmers to improve their livelihoods by reducing time spent on preparing the field and post-harvest processing, whilst also enabling them to get fresh produce to market quicker. Further benefits include less waste, reduced manual labour and fuel cost savings.

PREO interviewed Bodawerk’s Chief Operations Officer Janos Bisasso as the pilot was coming to an end to find out about their experience and capture some of the key lessons learned.

Q. Can you elaborate on what you intended to achieve through the PREO project and Bodawerks’ initial targets?

Smallholder farmers in sub-Saharan Africa are unable to access affordable mechanisation services as grid connectivity is typically poor and affordable off-grid mechanisation is usually unavailable. The PREO project aimed to assist Bodawerk in addressing these development challenges.

With support from PREO and co-financing from the DOEN Foundation, Bodawerk International Limited set up an AgrE-Hub in June 2019 in the Apac District of Northern Uganda. The objective of the project was to facilitate the productive use of renewable energy within agricultural mechanisation services.

To pilot the concept, Bodawerk established an AgrE-Hub comprising of the E-Trak and the AgrE-Hub:

The E-Trak is a low-cost, multi-purpose tractor that can provide agro-processing services. These services ploughing, tilling, threshing, milling, grinding and transportation services using a multi-purpose electric tractor. The Battery pack is a li-ion battery pack charged through a Bodawerk-owned standalone Solar PV station. During scaleup, we plan to purchase electricity from rural mini-grid operators thereby improving their utilization instead of building in-house infrastructure.

The AgrE-Hub structure allows for the use of E-Traks as mobile power stations that serve farming communities within a 50km radius of the solar PV station and enables low-cost farm mechanisation as a service.

Q. What were the key service packages that Bodawerk designed and delivered through the PREO project? What problems did they solve for the smallholders?

The goal of agricultural mechanisation was to reduce the manual labour required by farmers and increase their crop yields, while also improving the sustainability of farming practices. Bodawerk implemented a categorisation system for our services, dividing them into four major categories: field services (such as ploughing and tilling), hub-centric services (such as threshing, milling, and grinding/pasting), transportation services and energy-as-a-service. This categorisation allowed us to effectively track our activities and streamline the data-labelling process. Furthermore, it has also enabled us to communicate more clearly with our clients and stakeholders about our services and how they fit into our business operations.

The pilot featured the following services available to clients and stakeholders:

Field services

Farmers were able to hire ploughing services to facilitate early planting which leads to decreased incidences of pests and diseases, resulting in higher yields.

Hub-centric services

Farmers were able to access value-added services for their produce at a convenient local hub, avoiding the need to transport crops to distant processing locations. Reduced transportation costs resulted in lower production costs and increased profitability for farmers.

Transport services

Electric tractors are more cost-effective than gasoline-powered vehicles. They have lower operating and maintenance costs, making them an attractive option for farmers who need affordable transportation. By having access to affordable transportation, farmers were able to transport their goods to local markets more efficiently.

Energy-as-a-service

Providing energy-as-a-service to customers through smart lithium-ion battery technology offered several benefits to farmers and small businesses. By powering small-to-medium enterprises such as welding and fabrication businesses, retail shops and restaurants, energy-as-a-service created opportunities for farming households to engage in income-generating activities. This can help farmers to diversify their income streams and improve their financial stability. Smart lithium-ion batteries are portable and can be easily transported to different locations, particularly beneficial for farmers needing to move their energy source from one location to another.

Q. What were the most significant challenges that Bodawerk faced in implementing the project?

Some of the key technical challenges that we faced included, imported equipment purchased for tractors that were tested on arrival and we, unfortunately, ran into mechanical issues during operation. These issues required a considerable amount of time, knowledge, and skills to modify and retest the equipment ready for operation. Another challenge came from operating just two tractor prototypes at a time as we sometimes encountered breakdowns in parallel. This led to lengthy recovery processes from the field as we were then without a tractor to pull the broken one back down to the hub. We also experienced several technical challenges with the tractors. To overcome these barriers, our project engineer and his team had to repeatedly conduct repairs under the guidance of the Chief Technical Officer at the head office.

In addition to the technical issues, we also faced significant capacity constraints, including skills gaps among our staff which became evident during the implementation of the mechanisation activities, which we did by training the workforce with tailor-made resources.

It also became evident that there was a need to allocate and train more resources in machine operation to meet the increasing demand for agricultural mechanisation services in our area of operation. For instance, during the land preparation season, the team trained in ploughing also handled other activities such as grinding or milling if customers had requested those additional services at the same time. Without enough trained staff in place, a specific service has to be prioritised, causing delays in production. This challenge highlighted a significant need to allocate more budget to training personnel, materials, and facilities.

Lastly, smallholder farmers also reported challenges around not having enough money to pay for services upfront, yet the Agr E-hub did not offer more flexible payment options for customers such as credit or instalments.

Q. What challenges did Bodawerk face in building a commercially sustainable model in the provision of farm mechanisation services? What solutions might allow you to achieve business viability?

Upon analysing the agriculture ecosystem, we assessed that the revenue generation over a period of 18 months amounted to approximately UGX 15,000,000 (equivalent to roughly 4,000 USD) per AgrE-Hub. We found that this amount was relatively insignificant considering the costs of acquiring and maintaining the necessary assets and infrastructure.  Considering this, we determined that the revenue generated would not be sufficient to justify investment into these assets.

If we were to present a scenario where a less energy-dense battery had already been fully amortised, and then integrated into our agricultural hub system, this could be more economically viable and would present an opportunity to utilise the battery at a lower overall cost. If the initial use of the battery is within the e-mobility sector, which has high energy requirements, then after 2-3 years when the batteries no longer achieve their full capacity of 4kWh, we can repurpose them for use in agriculture mechanisation services. At this point, the battery would have already been written off and can be used for stationary storage in service provision.

Bodawerk’s core business model is battery manufacturing and building a network of swap stations for electric motorcycles, with plans to expand into rural communities in Northern Uganda. As we progress, we aim to revisit our business case for providing agricultural mechanisation services by integrating learnings generated from the PREO-supported project. Such learnings include using amortized batteries from e-mobility businesses and leveraging pre-existing infrastructure such as e-mobility charging stations which we believe provides a more practical use case.

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