It is no secret that global solid waste production is increasing at an alarming rate, with the UN estimating that municipal solid waste generation will rise from 2.1 billion tonnes in 2023 to 3.8 billion tonnes by 2050. This, combined with mismanagement of waste, has serious consequences for our health and environment. As we challenge ourselves to produce less waste, what if we also challenge the way we see waste? By investing in innovative circular economy solutions, we can harness the power of waste as a resource to produce vital materials and help rejuvenate, rather than harm, our planet.
Carbon Masters is a small and growing business (SGB) in India rethinking how we approach organic waste. By looking at solutions above and below the ground they have successfully developed and marketed a series of low carbon and climate friendly products, which each year help to save over 11,000 tonnes of CO2. In 2023, Carbon Masters became the third investee of our Take-a-Stake (TAS) initiative and today, environmental engineer and co-founder, Som Narayan, shares with us a snapshot of their journey to becoming a global model for fighting the climate crisis and why it is more important than ever to invest in the circular economy.
Where did the idea for Carbon Masters come from?
We started as a consultancy firm helping companies measure their carbon footprint but then people asked for help overcoming the problems we had highlighted. So, we decided to try solving these problems. We realised that finding an alternative to organic waste going to landfill could address the climate crisis and give a solution for replacing fossil fuels, whilst also solving an agricultural problem around soil health.
Our focus is now on converting organic wet waste streams, which usually end up in landfill, into two climate friendly products which we brand and sell as Carbonlites. We are collaborating with existing waste management companies and have set up facilities which can process organic wet waste into sources of clean energy and carbon enriched fertiliser.
And how does this transformation of organic waste happen?
Firstly, through the process of anerobic digestion (AD) where we feed the wet waste into reactors and generate raw biogas. We then convert this into biomethane (CBG), a renewable natural gas which can be used for applications which currently rely on fossil fuels e.g LPG – a non-renewable energy source and very common fuel in India for cooking and industrial heating.
We then use the by-product from this process, the nutrient rich digestate slurry taken from our digestors, to produce a bio enriched organic fertiliser. As part of our circular economy model (see below), we work with 2,000 farmers who are putting this back into the soil to help close the loop.
And what is your main motivation behind your work?
I am an environmental engineer; this is all I know. It has been challenging trying to solve problems but also motivating as we see the progress with one plant, and then four plants and now we are talking about making at least 10-15 larger scale plants.
We also want to encourage others to do this, making it an open book. What we are trying to do with our initial facilities is to perfect every aspect of the value chain: from the design and building of the facilities to marketing and sales. This can then be scaled up to a franchise model where you can take the operations as a blueprint for any country – and then we have a success story, a training ground. An orange peel is an orange peel, whether it is in Germany or India – we have the same problem the world over. What we are doing is diverting waste from landfill – we are not going to stop producing waste, so we need it to be properly disposed of in a circular economy fashion, what we are doing with waste is complete closure of the loop. These are things which motivate us, it doesn’t get better than helping to solve a major problem in the climate crisis.
And how important are businesses of your size and structure in responding to the climate crisis?
There are at least 10-15 players, mostly large corporates, in the last 12 months who have all jumped into this sector, but it is companies like ours who will eventually end up executing because these big corporates don’t have on the ground presence or the networks to make it happen. These projects still require a community approach, it cannot be one company who owns all the plants across the country, it requires a decentralised regional approach, building relationships to make this happen – collaboration with farmers and aggregators of waste. We need to have multiple companies of our size to solve this problem. India is a huge country and produces 62 million tonnes of organic waste, so there is an abundance of waste.
What do you think are the key factors for your growth?
I think the discipline around business operations, as well as constant innovation, and being lucky enough to gain the much-required support from our investors – including TAS – who have deployed capital knowing that these projects are high risk.
Through TAS we received about half a million USD in debt financing. We can use this to move projects forward and it also unlocks the opportunity to talk to other debt providers, who are potentially offering much larger debt sizes with investors almost five times larger – so suddenly it becomes two to three million USD versus half a million, but it had to start with that crucial half a million to get to a three million thought process. Ultimately it has enabled us to have a scale up plan.
What needs to be improved to see more financing flowing to businesses like yours?
Initially we had very limited knowledge of fundraising, but we are getting better the more we interact with some of the European and Indian funds. Impact capital is available, but it takes a lot of time to identify. For example, the solar story is already well established in India, whereas the biogas story is not yet fully developed so we need awareness raising to increase financing. There needs to be more funds that will lean in on circular economy, waste management, biogas, renewable energy –I think it is slowly happening but so far there is a very limited amount of people and funds.
How crucial are businesses of your size to reaching the SDGS, what kind of impact do you have?
We meet almost 10 of the 17 SDGS, (e.g climate action, affordable and clean energy, sustainable cities and communities). Our projects promote organic farming, regenerative agriculture culture and cleaner fuels but the most important aspect is the local jobs we create – we have about 20 people working in our Siddipet plant and they come from within a 3 km radius. In our ultimate model we are looking at how we can create agri-entrepreneurs in rural areas selling our Carbonlites fertiliser product. We are about 70 people strong now and most of our workers are hyperlocal. We invest a lot of time in training young people too, giving them the skills which start their whole career path; we have had people for five to six years on the team who are now able to run their own plants and are passing their skills onto others.
Finally, do you have any advice for other small and growing businesses in this space who are looking to raise funds and gain investment?
As founders you need to lead fundraising as well as running the company – you need to build connections, your network & reach out to the right investors. I don’t think there is any alternative or easier way to raise funds.
Finally, it is important to be a mission and purpose driven organisation. Success will only come if the mission and passion required to solve the problem you are responding to are in place and working. There always needs to be that passion that keeps driving you and reminding you why you are here.
If you would like to partner with TAS and support inspiring businesses like Carbon Masters, or simply find out more, then please contact: [email protected]. Or why not meet another of the inspiring SGBs TAS is working with by catching up with our previous interview with an SGB who is transforming e-waste in Africa.
