Lahan, Siraha district, Tel.- (+977J-33-60411 S -33-60412; Fax: {+977}-33-60413 Mailing Address. P.O. Box 1457, Kathmandu, Nepal.

E-mail: chfdp.gopa_ageg@gtz.org.np

File No. G 6 0.0

Mr. Felix E.W. ter Heegde Program Manager Bio-gas Support Programme (SNV) Jhamsikhel Lalitpur, Nepal

Lahan, January 18, 2000

Re:

Study Report on Bio-gas Programme through ChFDP

Dear Mr. Heegde. Please kindly find attached a study report on "Bio-gas promotion through ChFDP - an Analysis of Frame-conditions". In the report, an attempt has been made to study the situation of the project area in Siraha. Saptari and Udayapur in view of promotion of bio-gas programme, and difficulties faced in promotion with special focus on Siraha and Saptari. Some recommendations to improve the situation in the future are also given at the end. We hope that you will find the report useful and interesting. Your suggestions/comments, and ideas to further intensify the programme in Siraha and Saptari are most welcome.

With best wishes, Yours sincerely,

Peter Laubmeier Team Leader

Dinesh Uprety NGO Coordinator

Bio-gas Promotion through ChFDP

An Analysis of Frame-Conditions

Siraha, Saptari and Udayapur Districts

Dinesh Uprety September 1999

A Project of Ministry of Forest and Soil Conservation, HMG Nepal, Supported by German Technical Cooperation, GTZ Tel: (+97/)-33-6UAI2, email. chfdp@gtz.ora.np Mailing Address: P.O.Box 1457, Kathmandu, Nepal

Bio-gas promotion through ChFDP- an analysis of frame conditions

Table of Contents
Chapter 1: Introduction of project, Bio-gas Program and Progress achieved 1.1 An introduction of ChFDP 1.2 Alternative energy program of ChFDP 1.3 ChFDP's involvement in Bio-gas program 1.4 Actors involved in Bio-gas promotion 1.5 Progress of NGOs to date Chapter 2: An overview of frame-condition of Siraha, Saptari and Udaypur 2.1 An overview of frame-condition 2.1.1 Socio-economic conditions 2.1.2 Forestry conditions 2.1.3 Fuelwood supply and demand Scenario 2.1.4 Household energy consumption 1-3 1 1 2 2 2 4-6 4-6 4 5 5 6

Chapter 3: An analysis of bio-gas plant installation cost in Siraha, Saptari and Udaypur 7-10 3.1 Presentation of cost structure 3.2 Factors leading to high installation cost in Siraha and Saptari 3.3 Major obstacles behind the lack of adequate promotion of bio-gas in Siraha and Saptari Districts. Chapter 4: Conclusion and Recommendations Annex 1; Bio-gas Cost Structure of Siraha, Saptari and Udaypur Districts 8 11-14 7 8

List of Tables Table No.1: Table No:2: Table No.3: Table No.4: Table No.5: Table No,6 Table No.7 NGOs involved in Bio-gas Promotion . Progress of NGOs Overview of Socio-economic conditions Genera! Information about Forestry situation Fuelwood supply and demand scenario Energy Consumption for cooking Bio-gas plant installation cost 2 3 4 5 6 6 7

Bio-gas promotion through ChFDP- an analysis of frame conditions

Abbreviations

BPG BSP CAFT ChFDP Cm CPFDC CRT EnFoL FY ha hh(HH) ICS Km NGO PSU SNV tons/a VDC

Bio-gas Promotion Group Bio-gas Support Program of SNV Center for Agro Forestry Technology Churia Forest Development Project Cubic Meter Community and Private Forestry Development Center Center for Rural Technology Environment for Life Fiscal Year Hector Households Improved Cooking Stoves Kilo meter Non Government Organization Project Support Unit Netherland Development Cooperation Tons per annum Village Development Committee

Bio-gas promotion through ChFDP- an analysis of frame conditions

1.

Introduction of Project, Bio-gas Program and Progress Achieved

1.1

An Introduction to Churia Forest Development Project

Churia Forest Development Project was started in 1992 first as an orientation phase (1992-M994) at the request of HMG, Nepal in order to provide assistance to support the forest [development in South Eastern Nepal. The core development goal of the Project is to reduce [ecological imbalances of Churia forest. Since January 1999, the project is in its second implementation phase, which will last up to December 2001. The duration of the German [support is expected to be continued up to 2006 with German Technical Cooperation (TC) contribution. The program activities of the ChFDP are guided by three-pronged core strategies of the project: increase production of forest product (fuelwood, timber) decrease consumption of forest products alleviate poverty by creating alternative opportunities for (off forest) income.

Promotion of bio-gas and improved cooking stoves and other fuelwood saving technology come under the strategy of decreasing consumption of forest products.

1.2

Alternative Rural Energy Program of ChFDP.

The focus of the ChFDP under alternative rural energy program is on the introduction of viable I fuelwood saving technologies in the project area in order to reduce consumption of forest products. However, ChFDP has not seen much option till date for a realistic fuelwood saving technologies, which is low-cost, feasible for poor households, and which can contribute to a reduction in household energy requirement. The first step taken by ChFDP was the introduction of improved cooking stoves (ICS) during the period of 1995-1996. The lCS introduced by CRT (Center for Rural Technology) was a low cost technology and widely used in other parts of Nepal by several development agencies. However, 5 the evaluation of the program after one year revealed that there are lots of cultural barriers in the adoption of technology by the beneficiaries, which were not given due consideration in the course of project implementation.. Further, it was revealed that the improved cooking stoves designed by CRT could not actually save fuelwood compared to ordinary stoves. Hence, very few people became ready to adopt the technology After the failure of improved cook stoves, ChFDP has taken initiation to implement bio-gas program since early 1998 especially for Siraha and Saptari Districts. Studies are also going on also to introduce low cost and acceptable fuelwood saving technologies for the project area.

Bio-gas promotion through ChFDP- an analysis of frame conditions

1.3

ChFDP's involvement in Bio-gas Program in Siraha and Saptari.

Plants for Life, a partner NGO of ChFDP1, was involved in bio-gas promotion since 1995 in Tapeshwori VDC of Udaypur district. With the technical support of Gobar Gas and Krishi Bikash Company, the NGO assisted the farmers to install some 30 bio-gas plants. From 1996, Holistic Development Service Center, another partner NGO of ChFDP, became involved in facilitating bio-gas program in Basaha VDC of Udaypur. But all these attempts were, however, concentrated in Udaypur district only not in Siraha and Saptari. During this period, it was observed that Siraha and Saptari Districts also have high potential for bio-gas plants . Likewise, the problem of forest degradation for fuel wood and loss of soil fertility due to the use of animal residue for cooking purpose were observed in massive scale and very much severe in these two districts compared to other parts of Nepal2. However, very little attempts were seen to promote bi-gas in these two districts. The report of BSP (1997) shows "that in Saptari alone there is a potential of 56,258 bio-gas plant installation while only a total of 106 (.19%) plants were installed by then. This percentage is the lowest of al! terai districts and f there has been very few further addition in the number of plant installation since then. Siraha 'District shows a bit higher percentage of installation (.66 % or 367 plants). Whatever plants have been installed in Siraha and Saptari, this has been through a very long -time efforts of Bio-. Gas and Krishi Bikash Company based in Siraha. This Company is working since past 10/12 {years in Siraha and Saptari but has not been able to bring positive results due to very poor economic conditions of people and difficulty in motivation than other parts of the country. ChFDP observed that if the works continue in the same trend, the same prevailing condition will exist in this area even after 10 years. Therefore, ChFDP-PSU took initiation in early 1998 to facilitate bio-gas program in these two districts in close cooperation with SNV-BSP. To begin with, bio-gas promotion training was organized in January 1998 for the NGO partners of ChFDP with the help of SNV-ESP.

1.4

Actors involved in Bio-gas Promotion in the Project Area of ChFDP

Under the umbrella of ChFDP, following NGOs are involved in bio-gas promotion at present: S.N NGOs Working area Dates Started 1 CAFT Siraha, Saptari and Udaypur Jan.1998 2 CPFDC Siraha and Saptari Jan.1998 3 EnFoL Saptari and Udaypur Nov. 1998 Table no. 1: NGOs involved in Bio-gas promotion Private companies associated with NGOs are Gobar Gas and Krishi Yantra Bikash Company situated in Lahan Siraha and Krishi Gas Company Pvt. Ltd. in Mirchaiya Siraha.

1.5. Progress of NGOs in Bio-gas Promotion Since January 1998, the NGO partners of ChFDP involved in bio-gas promotion have achieved the following progress:

1
2

ChFDPs partnership with Plants of Life ended on July 1997.

A detailed analysis is made in the latter section of this paper

Bio-gas promotion through ChFDP- an analysis of frame conditions

From January 1998 to March 1999

NGOs/Districts Completed Plants CAFT CPFDC EnFoL Under Construction CAFT CPFDC EnFoL Plan for FY 1999 CAFT CPFDC EnFoL

Siraha 6 6

Saptari 15 5 7 3 2 2

Udaypur 11 7 4 4 4

Total 33 18 7 7 6 4 2 78 50 15 13

25 20 5

30 15 10 5

23 15 8

Table No.2: Progress of NGOs from January 1998 to March 1999 Out of 50 Bio-gas plants planned for 1999 by CAFT, 17 plants are now already under banking process. Construction of the plants will be started as soon as the banks make loans available.

Bio-gas promotion through ChFDP- an analysis of frame conditions

2.

An Overview of Frame-conditions of Siraha, Saptari and Udayapur

The objective of this overview is to make the concerned readers aware of the frame- conditions of the project area, the complexity of the problem in three districts in the promotion of bio-gas program and to make suitable policy decisions accordingly. It is an attempt to show the status and correlation among three districts in terms of supply and demand scenario of forest products, timber and fuelwood consumption, and the resultant effects due to the lack of promotion of bio-gas or measures similar to it.

2.1. An overview of frame-conditions 2.1.1 Socio-economic conditions The overall population of the three districts amounts to 1.2 million people with 210,006 household according to the National Census of 1991. The annual population growth has been 3% on the average for three districts. However, this population growth is heavily affected by the in-migration in the three districts. A glimpse of the socio economic frame conditions of the three districts is presented in the table below.

Factors Population 1991/no. of hh Population 2001/no. of hh Area (km2) Households below poverty line Land less and near landless household (<0.2 Concentration of land ownership

Siraha 460,746/83,716 592,709/107,765 1226 67% 29%

Saptari 465,668/85,720 599,117/110,948 1237 69% 25% 8% of HH own 50% of land 38%/17% 13%

Udaypur 221.256/40,570 298,550/54,282 2187 83% 6% no such pronounced 40% /24% 23%

7% of HH own 50% of land Literacy: all/ female only 32%/14% Household in which women own land 4%

Table No. 3: Overview of socio-economic conditions of the project area3

The above table shows that poverty is severe in case of all districts. However, the landlessness and the concentration of land ownership are much severe in the case of Siraha and Saptari. In Siraha and Saptari 7.5 percent of the population in average own 50 percent of land of the area. This situation is further aggravated in these two districts because of the high population compared to Udaypur. The status of women in Siraha and Saptari is comparatively very miserable in terms of literacy (only 14% and 17% female literacy rates), ownership of property and their economic and social status. According to the PFS report, out of 100% firewood collected per annum, 85% and 57% of woods are collected by women in Siraha and Saptari respectively.

Source: Pre-feasibility Study Report of ChFDP, by AGEG, 1996.

Bio-gas promotion through ChFDP- an analysis of frame conditions

2.1.2

Forestry Conditions

Persistent deforestation and rapid degradation of forest are the main characteristics of the forestry situation in the project area. High population pressure with increased illegal encroachment of forest for firewood, timber and agricultural land are the main reasons for the degradation. Uncontrolled and excessive grazing by ever increasing livestock population is another preventing factor for a natural regeneration process of the forest. This rapid deforestation process has resulted in the depletion of almost all forest resources in the plain Terai upto Indian border. Siraha 1.8% 0.05 ha 3.45% Saptari 2.4% 0.07 ha 1.09% Udaypur 0.8% 0.76 ha 28.08%

Average annual deforestation Average forest area per capita Forestry User household (of total HH)

Table no.4: General Information about forestry situation4

The total forest area of the three districts is approximately 145,000 hector, which is about 30 percent of the total district area. However, only 12% of this (about 17,500 ha) are dense forest and are mainly found in Udaypur District. Siraha and Saptari comprise only about 14,000 ha of forest in each district entirely located in the Churia hills to the north of the districts.

2.1.3

Fuelwood supply and demand scenario.

Fuelwood for cooking is the major source of household energy in all three districts. In Udaypur district, almost 99% of household energy requirements are met by fuelwood while in the southern part of Teria Districts, the use of farm manure for cooking purpose is predominant. It is estimated that almost 95% of fuelwood are consumed by households in all three districts and 5% by the commercial establishments like brick kilns, tile factories and roadside hotels. The use of other alternative energy is negligible (for example, use of kerosene and other energy is 1 % in Udaypur and 3% in Siraha and Saptari).

Year

1991 1996 2001 2006

Udaypur Supply (tons/a) 226,836 213,275 199,715 186,155

Demand (tons/a ) 205,083 240,168 276,447 313,935

Siraha Supply (tons/a) 21,744 20,025 18,307 16,588

Demand (tons/a 31,084 35,321 39,749 44,450

Saptari Supply (tons/a) 22,996 21,707 20,419 19,130

Demand (tons/a 60,208 68,592 77,270 86,379

Total Deficit All Districts (tons/a) -24,871 -89,073 -155.025 -222,891

Table No. 5: Fuelwood supply and demand scenario5 In 1991, Udayapur District still featured a fuelwood surplus of about 22,000 tons per annum, while the annual deficit in Siraha and Saptari amounted to 9000 and 37,000 tons per annum respectively. The case of Siraha and Saptari is revealed to be much more serious. In 1997, the amount of fuelwood removed was estimated at 210,000 tons where as the supply amounted to 70,000 tons only in Siraha and Saptari.

4 5

Data taken from Reversibility Study Report of ChFDP, 1996, and Development Indicators, 1997 by ICIMOD and SNV . Table taken from Pre-Feasibility Study Report of 1996, by AGEG

Bio-gas promotion through ChFDP- an analysis of frame conditions

2.1.4 Household energy consumption The consumption patterns of household energy differ markedly for the three districts. The table below shows that there is still a marked difference in the use of energy pattern even in the south and north belt of the Terai district. This can be explained through the distance of forest in the south and the increasing scarcity of fuelwood. Energy Consumption Av.Kg/annum/HH wood collected % HH using wood AV.kg/annum/HH of dung % of HH using dung % of HH using crop residues Udaypur North South 6331 100% 0 0% 74% 5816 99% 0 0% 43% Siraha North 1638 52% 1386 83% 65% Saptari North 3139 93% 806 57% 87%

South 697 20% 2579 95% 84%

South 376 43% 3137 95% 97%

Table No. 6: Energy consumption for cooking6 The use of dung in mass scale for cooking purpose has resulted in the severe reduction in the soil fertility in Siraha and Saptari. According to the reversibility study report, 38% of the household use only 6% of available dung and 48% of HH use 15% of dung for manuring fields in Siraha and Saptari respectively . The rest is used for cooking purpose. While in Udaypur, 90% households use 90% of dung in the field. The case of Saptari North area looks more serious as the study report shows that 93% of people here still use fuelwood for cooking purpose.

The percentage figures do not show the exact consumption of wood, or dung by HH, rather it presents the combination of energy consumption pattern of all energy available. For example, if 83% of north Siraha people use dung, this does not mean that they only use dung. But they use it in combination of wood and crop residues. So the same HH is again counted in data collection if they also use wood of crop residues.

Bio-gas promotion through ChFDP- an analysis of frame conditions

3.

An analysis of cost of Bio-gas plant in Siraha, Saptari and Udaypur

Under almost same level of poverty conditions in the district of the study area, it became pertinent for us also to study the real cost of bio-gas installation. The purpose of this analysis is to know the real cost of bio-gas installation to be paid by Users in the three districts of the project area. This could become a good basis, along with the findings of previous chapter, to recommend to introduce suitable subsidy or incentive measures for Siraha and Saptari by the concerned agencies. 3.1 Presentation of Bio-gas Plant Installation Cost7 The cost presented below are based on the cost received from plant makers of the project area through NGOs. Since the cost varies in some headings from village to village even within one district, an average cost is estimated based on samples of each plant capacity. As we found that there is very little variation in the installation cost in Saptari and Siraha, same cost structure is established for both districts.

A. Cost with Subsidy Plant Capacity Siraha/Saptari Udaypur foothill Cost Excess by in Siraha/Saptari B. Cost without subsidy Plant Capacity Siraha/Saptari Udaypur foothill Cost excess by in Siraha/Saptari Rs. Rs Rs. 6 Cm 19,320 16,759 2,561 8 Cm 24,900 21,580 3,320 10 Cm 30,450 26,960 3,490 Rs. Rs. Rs. 6 Cm 12,320 6,759 5,561 8 Cm 17,900 11,580 6,320 10 Cm 23,450 16,960 6,490

Table No. 7: Bio-gas plant Installation cost to be paid by Plant Owner

The subsidies given by the SNV-BSP are 10,000 for hilly area and 7000 for terai region. The logic behind the high subsidy for hilly regions is clear and reasonable- high transportation cost, high price of raw materials compared to terai regions.

For detail breakdown of cost, please see the Annex 1

Bio-gas promotion through ChFDP- an analysis of frame conditions

However, these subsidy rates are adopted equally at par for all terai regions and for all hilly districts irrespective of situation of poverty, level of fuelwood consumption, forest degradation etc. of the district in question. (It is also understandable that it is difficult for SNV-BSP to take into account situation of all districts because of lack of information). The situation of Siraha and Saptari now reveals this fact that the level of poverty and high cost in plant installation are equally sever (or more sever in case of forest situation) like hilly districts and also the major obstructions for the effective promotion of bio-gas program. The above table reveals that the cost of bio-gas plant installation is comparatively higher in Siraha and Saptari than Udaypur foothill even without subsidy. In an average, the people of Siraha and Saptari have to pay Rs. 6123 more than the cost that occurs in Udaypur foothill. The cost of bio-gas plant installation without subsidy in Siraha and Saptari also comes to an average of Rs. 3123 more than the cost of Udaypur. This clearly reveals that if equal rates of subsidy are given to all concerned districts, for example, the cost of plant installation will still be higher by Rs. 3123 in Siraha and Saptari districts.

3.2 Factors leading to high cost of plant installation in Siraha and Saptari. The obvious factor that makes the plant owner to pay more on plant installation in Siraha and Saptari is the less amount of subsidy granted to these districts. The subsidy here falls short by Rs. 3000 than the hilly districts which means that given the equal rates of plant's materials and equipment, the people of Siraha and Saptari have to pay Rs. 3000 more additionally like other parts of terai region. The use of the type of materials has played an important role in increasing the cost. Due to the unavailability of stones in Siraha and Saptari, the construction of the plant depends on the use of brick. Bricks are almost twice costly than stones, while the Udaypur people have easy access to stones at very cheap prices, and which are also found to be in use in Udaypur in 99 percent cases. Likewise, the rates of pebbles, sand and unskilled manpower are also high in Siraha and Saptari compared to Udaypur. All these factors have together led to an increase in the cost of plant installation in Siraha and Saptari. The table No. 7 above reveals that due to the high cost of materials and manpower, the cost in average is higher by Rs. 3123 irrespective of whether subsidy are given or not.

3.3

Major obstacles/reasons behind the lack of adequate promotion of Bio-gas in Siraha and Saptari.

The Project has found following major difficulties in relation to such a slow rate of promotion and extension of bio-gas program in Siraha and Saptari. 1. Lack of adequate promotion of the technology In Siraha and Saptari and specially to its southern belt, people are found almost unknown about the bio-gas program. Some of them have heard about it but they do not know about the cost, size of plants and the benefits related to the plant installation. Even if some were found interested to install bio-gas they did not know from where the services could be taken. Many of them who have heard about it just took it for granted that bio-gas could be an extremely costly affair and nobody ever approached to such person for providing adequate suggestions. Such

Bio-gas promotion through ChFDP- an analysis of frame conditions

absolute lack of information on the part of people in these districts is found to be one of the main obstacles in the promotion of bio-gas program.

2. Inadequate Bio-gas companies for the two districts. Since past 10/12 years until recently, only one bio-gas company had been working for these two districts based in Lahan, Siraha. Due to the lack of adequate manpower and large size of the area, this company could not become effective in promoting the technology. The reluctance of Siraha and Saptari people to adopt bio-gas due to the high cost of technology and poverty also forced the company to concentrate its effort more to such an area where price of technology was comparatively cheap and people showed willingness to adopt the technology. So gradually the company started to focus more on adjoining Udaypur and Sindhuli Districts where subsidy was high and cost of materials were cheap compared to Siraha and Saptari. Although some plant installation work continued for some rich people, the middle level people of Siraha and Saptari who could also afford to the technology with due persuasion remained mostly neglected. The performance of this company in Siraha and Saptari also became an indicator for other private companies in order to be able to prioritize to establish their offices in these two districts. It's only towards the middle of 1997 that two bio-gas company namely Public Bio-gas and Krishi Bio-gas opened up their offices in Mirchaiya, Siraha. However, keeping in mind that the selection of office location in Siraha becomes more convenient to provide services to Udaypur and Sindhuli districts rather than Saptari and Siraha. 3. Poverty viz. high cost of technology

Due to high cost involved in the installation of bio-gas plant, SNV-BSP has provided subsidy to the farmers and provision of bio-gas loan through banks are also made available to them. However, poverty is such prevalent in this area that the installation cost that comes after the subsidy becomes a very big amount for them. Although the adoption of this technology is targeted toward middle level farmers, the very low agricultural yields and lack of other alternative income opportunity except agriculture leaves them no savings at all to invest on new endeavours. One of the common features of the people here is that they are very much reluctant to take loan from banks. It can be attributed to their illiteracy, unable to understand the bank documents and forms, and mainly their negative experience with banks due to their bureaucratic processes and commissions. The chances of becoming indebtedness on the part of people after taking loan also made them reluctant to take bank loans. 4. Cultural Barriers Joint family system is one of the main features of this area. In such family in average 15 to 16 people stay together. It means that plant capacity of at least 10 Cm is needed to sufficiently provide bio-gas to cook two times meals and morning breakfast for such big family given that the family also have sufficient cattle to generate gas. Installation of high capacity plants involves high cost, which becomes one of the obstructing factors for the poor family. Further, even if the plant is installed it becomes a point of debate within family when there occurs division of family later on as to which member should own the plant. The division also reduces the number of cattle to provide necessary dung to generate gas, which affects efficiency of gas generation. Many families are found who simply do not like to cook their meals on bio-gas. However, continuous persuasion from NGO Worker has helped to solve this problem to a greater extent.

Bio-gas promotion through ChFDP- an analysis of frame conditions

But to convince people to attach toilet with plant is still a remote matter. The problems of big family after the installation of plant are not also small. Once they start to cook meals in bio-gas, they find that their big pots to cook meals for the big family are not suitable on the small oven provided by the biogas company. So either they have to change their pots or again they start cooking meals on the traditional oven using firewood. Therefore, not only the pre-installation promotion is necessary but also post-installation persuasion and advises to the farmers becomes equally important in the context of this area. 5. Effect of the failure of previous bio-gas model. Towards 1980s, several old drum system bio-gas plants were constructed particularly in Siraha District. These old model plants due to the immature technology of that time could not last long and had also several difficulties in operation. Because of their failure, many people got the impression that bio-gas is not a dependable technology and it will only be the waste of their money. In order to overcome such impression, lot of promotion of the new model is required and reliability of the technology needs to be guaranteed by the promoter.

Bio-gas promotion through ChFDP- an analysis of frame conditions

4.

Conclusion and Recommendations.

4.1 Conclusion In relation to the promotion of bio-gas technology, we observe that not only economic but also cultural, social and promotional factors play an important role. The bio-gas technology is directly concerned in the conservation of forest resources, particularly fuelwood. Therefore, seriousness in the promotion of this technology in Siraha and Saptari needs to shown as early as possible in order not to let the rapidly degrading forest of this area further degrade. The seriousness of the issue in the context of Siraha and Saptari could be concluded under the following summarized points. 1. Poverty, overpopulation, in migration and high concentration of land ownership by few people are the main social features of Siraha and Saptari Districts. While poverty restricts people to afford to alternative means of household energy, high population pressure combined together is making the forest situation worst in search for fuelwood, which is the only traditional means of rural household energy. For many poor landless people, fuelwood collection has become a means for their survival and it will remain so until the demand for fuelwood continues from the middle and rich class people. In such situation, in order to reduce consumption of fuelwood it becomes necessary to target the middle and rich class people to motivate them to adapt technology like bio-gas. Likewise, there is also an equal need to promote low cost fuelwood saving technology for the poorer sector. The data that 85% fuelwood of Siraha and 57% fuelwood of Saptari are collected by women shows the major burnt of household energy problems borne by women. It takes one full day for women to collect fuelwood from forest and back to home. When the time of majority of women is being spent on collection of household energy, it becomes difficult to generate women's participation in the natural resource management and other social development processes as intended by the project. Without alternative means for firewood and thus reducing the household energy problems of women, the situation of women as well as the forest condition of the project area will not improve. The supply and demand situation of timber products in Siraha and Saptari is characterized by an immense deficit with about 40,000 cubic meter per annum. In the year 1996, the supply and demand situation of fuelwood had a deficit of 62,181 tons per annum. If the same trend continues, it is estimated that in Siraha and Saptari there will be a total deficit of 78, 293 tons fuelwood per annum by 2001. This trend clearly shows that the forest products, which are good for timber, are also being used for firewood purposes due to over demand of fuelwood than the forest's capacity of its natural re-growth. And if this ever increasing demand for firewood is not alternatively met by the introduction of other effective fuelwood saving technologies, any resources put for the increase of forest productions will also be easily nullified. 4. The poverty of Siraha and Saptari people is considerably related with very low agricultural productivity. Beside lack of irrigation, reduced scale of soil fertility of the agriculture land is one of the major reasons for low agriculture yields. This is evident from the fact that in Siraha and Saptari south, almost 95 percent people use dung for cooking purpose in mass scale. Scarcity of firewood and distant forest from south has resulted in the immense use of dung thus depriving the land from the use of organic fertilizer.

2.

3.

Bio-gas promotion through ChFDP- an analysis of frame conditions

In order to improve soil fertility, the trend of using dung for cooking needs to be reversed by offering people other alternative household energy. In this context, promotion of bio-gas technology has two-fold benefits. It saves the forest by not using firewood while the slurry that comes after the generation of gas is proved to be a very good organic fertilizer for the land. Therefore, promotion of bio-gas is not only related with the conservation of forest but also to help people to increase land productivity and their income. 5. While the promotion of bio-gas is very much urgent in Siraha and Saptari, it's promotion is largely obstructed by its high installation cost which is beyond the affordability of the majority of middle level farmers of this area. In the co text of high level of poverty and rapid forest deforestation prevalent in the area, the project and/or the agencies involved in the promotion of bio-gas program should introduce measures to reduce plant installation cost besides the subsidy given by SNV-BSP. Without introduction of such measures, there seems hardly any chance to promote this technology as intended and to help reduce the ever increasing fuelwood deficit of the area.

4.2 Recommendations In order to efficiently extend the bio-gas program in the districts of Siraha and Saptari, two-fold extension strategies are recommended. 1. 2. Increase promotional activities Reduce plant installation cost

4.2.1 Increase promotional activities To aware the people about the cost and benefits of bio-gas technology requires sufficient promotion. In Siraha and Saptari, lack of promotion of technology is one of the major reasons behind such slow expansion. There are several promotional materials developed by SNV-BSP like posters, pamphlets, audio-visual etc. On the top of that there is a need of such materials and services like billboards, cinema slides, mass education through target group orientation, workshops and even door to door visit to potential plant makers. Some form of such promotion is being done by the Bio-gas Companies, however, their intervention is in a very limited scale. The need is to promote technology in a mass scale which not only aware people about the bio-gas but also provides necessary information of the installation processes, cost, benefits and so on in cooperation with Bio-gas Companies and NGOs. Together with promotional activities, training component of the program is also equally important. One type of training could be technical training with the help of SNV-BSP to produce sufficient technical manpower as plant makers for Siraha and Saptari who will also provide services in repairing and maintenance of plant after installation. There is evidently lack of such manpower in the districts. Second type of training is for extension workers to provide them knowledge on methods of social mobilization and promotion of program in the field. Another form of training is for operation, maintenance of plant and slurry management to plant owners.

Bio-gas promotion through ChFDP- an analysis of frame conditions

Although one-day trainings for this purpose are under the provision of bio-gas Company, they are apparently not sufficient due to very short time span. The need is to provide them practical and a bit detailed knowledge in plant operation, and especially in slurry management which has multiple benefits for the farmers. For the promotion of bio-gas, a close cooperation with SNV-BSP and existing bio-gas companies is also equally important, for they are the agencies mainly responsible for the promotion of bio-gas in Nepal. 4.2.2 Reduce plant installation cost It is not possible to extend bio-gas program in Siraha and Saptari without introducing some measures which reduce the economic burden of plant installation borne by the beneficiaries. In order to do that, some ways of reducing cost are priority-wise suggested below. a. Increase rate of subsidy (Option No. 1)

In the view of high installation cost to be borne by beneficiaries and the existing level of poverty of Siraha and Saptari people as presented above, the subsidy rate of Rs. 7000 provided for all terai region does not take into account the above features of this area. Therefore, there is a need to readjust this rate giving due consideration to the factors that have become hindrances for such a slow promotion of this technology in this area compared to other districts of Nepal. SNV-BSP and Nepal Bio-gas Promotion Group are the main responsible bodies to decide on the rate of subsidy. Therefore, we request both of these agencies to consider all risk of the two districts that the people are facing/ going to face in natural resources and agriculture productivity due to the absence of efficient promotion of this technology. From our analysis, we recommend that it would be a great relief for the people of Siraha and Saptari if subsidy rate is increased from Rs. 7000 to Rs.10,000. The frame-condition analysis presented in this paper could be very much helpful to facilitate the concerned agencies to reach this decision. b. ChFDP provides the subsidy (Option No. 2)

This option is valid only if SNV-BSP and Bio-gas Promotion Group do not agree to increase the rate of subsidy. In that case, it is very important that Project provides this subsidy to promote this technology and thus achieve Project's objectives. However, the subsidy to be provided by the Project should be in kind equal to about Rs. 3000 per plant, but not in cash. The type of materials to be provided in kind and the mechanism to provide it requires further discussion. Nevertheless, Project prefers and recommends that subsidy rate is adjusted by the concerned agencies responsible for making subsidy policy since this could only be a lasting solution compared to the subsidy provided by the Project. In that case, Project would be. more responsible for promotional and training activities, c. NGOs work through its own developed bio-gas technicians instead of bio-gas company (Option No.3) This option is valid only when option No.1 does not work and the Project also declines to provide anything in the name of subsidy under option No.2. But feels easier to provide assistance in other forms.

Bio-gas promotion through ChFDP- an analysis of frame conditions

This option may look somewhat radical but is also possible under certain understanding with SNVBSP. The clue of reducing cost under this option is that Bio-gas Companies are profit-making companies. In plant construction, they charge the customers such cost like Rs. 3500 for construction and technical services, Rs. 600 for guarantee fee and Rs. 500 as promotion fee. Thus a total of Rs. 4600 is to be borne by the plant makers as their service and other fees. If any of the partner NGO of ChFDP develops bio-gas technician certified by SNV-BSP or hire them, the service cost of technician comes around Rs. 1600 only including transportation cost to the plant sites. Since service cost of NGO staff are already borne by ChFDP and they are not profit making institution, there will be a net saving of Rs. 3000 for plant makers. However, following conditions need to be fulfilled in order to implement this option. 1. ChFDP agrees to financially support technician development training (in collaboration with SNV-BSP) and provides necessary additional manpower to the NGO to coordinate implementation of bio-gas program. 2. SNV-BSP agrees to provide an equal status like bio-gas company to the NGO recommended by ChFDP (but of course not as a profit-making institution as long as NGO remains partner of ChFDP). Otherwise, it will be difficult for NGO to avail bio-gas loan from banks for the farmers.

1. SNV-BSP should look it as a separate model or trial program and provide all services to the NGO as it is providing to the Bio gas Companies. If such experience already exists with SNV-BSP, it can share the experiences and suggest to ChFDP. 2. There should be a strict and regular quality monitoring of constructed plants by SNV-BSP.

4.3 Suggested mechanism to facilitate bio-gas program by ChFDP. The promotional and implementation role of bio-gas program should be entrusted to the intermediary institution. For this purpose, the partner NGOs already working in the bio-gas program are the appropriate institutions: Their responsibility will be to motivate and inform the local people about the program, conduct promotional activities and link farmers with local bio-gas companies and agriculture banks for necessary implementation processes. They are also responsible to provide necessary User level plant operation and slurry management training. In this context, the role of local NGOs also needs to be explored, as they are more familiar with the area than any other NGOs or Institutions.

The role of ChFDP will be to develop linkage with SNV-BSP and concerned agencies in Bio-gas Promotion to facilitate implementation at field level. It wilt be responsible to organize necessary technical and promotional training for NGO extension workers, develop bio-gas technicians in the district as required, avail already developed promotional materials to the NGOs. It's main role will be to support NGOs financially for extension and promotional activities and play the role of advisor, organizer as in the case of other ChFDP supported programs.

Bio-gas promotion through ChFDP- an analysis of frame conditions

Annex 1 Average Bio Gas Cost Structure

Udaypur foot hill area Materia used 1. Materials a. Stone b. sand c. Pebbles d. Cement e. Rod 2. Unskilled Labour 3. Transportation a. Cement b. Rod 4. Amount submitted to Bio-gas Company (for stoves, pipes etc.(average) Sub-total 5. Subsidy Net expenditure per plant For Siraha and Spatari Materia used 1. Materials a. Brick b. sand c. Pebbles d. Cement e. Rod 2. Unskilled Labour 3. Transportation a. Cement b. Rod and other c. Bricks 4. Amount submitted to Bio-gas Company (for stoves, pipes etc.(average) Sub-total 5. Subsidy Net expenditure per plant 6 Cm) Quantity Rate Amount Rs. 1400 pc 2.5 3,500 1 tractor 600 600 0.5 600 300 13 bags 285 3,705 12 kg 27 324 20 md 60 1,200 13 12 1400 10 3 0.5 130 36 700 8,825 19,320 7,000 12,320 8 Cm) 10 Cm) Quantity Amount Quantity Amount Rs. Rs. 1850 4625 2200 5,500 1.5 900 2 1,200 1 600 1.5 900 16 4560 22 6,270 15 405 20 540 28 1680 36 2,160 16 15 1850 160 45 925 11,000 24900 7,000 17.900 22 20 0.5 220 60 1,100 12,500 30,450 7,000 23,450 6 Cm) Quantity Rate Amount Rs. Rs. 3 tractor 1 tractor .5 tractor 14 bags 12 kg 20 MD 14 bags 12 kg 600 400 300 285 27 50 15 5 1,800 400 150 3,990 324 1,000 8 Cm) 10 Cm) Quantity Amount Quantity Amount

4 tractor 1.5 tractor 1 tractor 18 bags 15 kg 28 md

2,400 600 300 5,130 405 1,400 270 75 11,000 21,580 10,000 11,580

6 2 1.5 24 20 36 22 20

3,600 800 . 450 6,840 540 1,800 330 100 12,500 26,960 10,000 16,960

210 18 bags 60 15 kg 8,825 16,759 10,000 6,759

Cm = Cubic Meter Notes: 1) Costs of Sotnes, sands and pebbles are inclusive of transportation cost. 2) Amount submitted to BGC is the deposit amount by the beneficiaries. 3) Rates are established based on average of 5 real cost structures of each capacity and are based on market rates of 1998/99