A quiet killer.

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Can a High-Tech Wood Stove Save the World?

Justin Fox is a Bloomberg View columnist. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”
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So, this is cool. It's a stove, powered by wood or cow dung or whatever other combustible material you happen to have lying around, that generates an almost smokeless, gas-like flame -- and also enough electricity to light a room or charge your phone.

Photographer: Justin Fox/Bloomberg View

I saw this particular stove in action recently at the headquarters of BioLite, a Brooklyn, New York, startup with grand ambitions. The company began as a side project of two guys at the design-consulting firm Smart Design who wanted to build camping stoves that didn't require bringing fuel along. They came up with a design that uses a fan powered by the heat of burning wood to blow air onto that wood and get it to burn much more efficiently.

In 2012, Alec Drummond and Jonathan Cedar started selling their BioLite camping stoves online. Since 2013 they've been available at REI and other outdoor retailers. Along the way, though, Drummond and Cedar learned that there's a global campaign under way to get cleaner-burning cookstoves into people's homes in developing countries. About 3 billion people worldwide depend on open fires or traditional stoves for cooking and heating; exposure to their smoke and fumes is responsible for an estimated 4.3 million premature deaths a year. BioLite's stove technology seemed like it might be able to help with that.

And so BioLite is going global. It distributed its first 10,000 home stoves last year in Ghana, India and Uganda. In Ghana this was part of a public health trial, funded by the National Institutes of Health, to compare the effects on pregnant women of using BioLite versus gas stoves. In India and Uganda it was a commercial test to find out how much people were willing to pay (current thinking is between $50 and $60) and get feedback from customers on how well the stove works. Next spring the company plans to start selling home stoves at scale.

That's all pretty exciting. But there have been earlier efforts to displace sooty open fires with cleaner cookstoves, and most have flopped. India's National Programme on Improved Chulhas in 1985 started distributing 35 million stoves with chimneys that were supposed to vent smoke outdoors but (a) often didn't do that very well and (b) never really caught on with consumers even though the stoves were given away by the government. Not long after that effort wound down in the early 2000s, several multinational companies targeting what the late management scholar C.K. Prahalad dubbed the "bottom of the pyramid" moved into the Indian cookstove market. 

The most ambitious was energy giant BP, which worked with Prahalad's consulting firm, Next Practice, and tried to make money not on the stoves, which could burn either liquefied propane gas or agricultural-waste pellets, but on the fuel. Prahalad and Next Practice co-founder Jeb Brugmann wrote in the Harvard Business Review in 2007 of how BP worked with nonprofit groups in India to build “a business ecosystem that brings different economic entities -- a global corporation, local social organizations, informal micro-entrepreneurs, and a research institute -- into an efficient value chain. “

Only… it wasn't quite efficient enough. BP spun off the stove effort to its management team in 2009, and First Energy, as the venture is now called, has since shifted almost all its efforts to selling pellet-fueled stoves and boilers to restaurants and other commercial customers.

What killed the effort, says Ethan Kay, who worked at one of the Indian nonprofits involved in the stove effort and then wrote his Oxford doctoral dissertation on its struggles, was that Indian villagers couldn't afford the fuel. By helping to create a market for the agricultural waste used to make its fuel pellets -- sugar-cane stalks, mainly -- BP ended up driving up the price. Another issue, says Brugmann, was that BP had been hoping to buy an Indian oil company. When it became clear that wasn't going to happen, the company's executives lost interest in a stove project that was mainly, he says, "about establishing the BP brand in the minds of rural Indians."

Lots of other corporate efforts hatched in the initial enthusiasm for Prahalad's bottom-of-the-pyramid thesis (he published his famous article on the topic in 2002) have faced similar struggles. Western companies still have some things to learn about building successful businesses that cater to the world's poor.

Can BioLite make a go of it? Kay certainly thinks so -- he is now the company's managing director for emerging markets. "We meet users where they are in terms of locally available fuel," he says. That, and the electricity-generating feature appeals to men who might not otherwise be interested in spending money on a new stove.

For Brugmann, it isn't so much BioLite's stove that gets him excited. The Dutch multinational Philips has designed a similar stove, now manufactured in Lesotho by African Clean Energy, while Fort Collins, Colorado-based Envirofit has already sold simpler clean-burning stoves (minus the fans and electricity generation) in 45 countries. BioLite's business model, though, is unique. "If they can grow the recreation business and the base-of-the-pyramid business at same time, it's a very different corporate positioning," Brugmann says. By serving both high-end and developing markets with the same basic technology, the company has a chance at achieving scale and staying power.

It can definitely attract impressive people. Among those I met on a tour of BioLite's offices was Ryan Gist, the company's associate director of engineering. His previous job? Senior aero-thermal engineer at Pratt Whitney Rocketdyne. Now Gist is trying to figure out how to make BioLite's air-injection technology work in the flat-top plancha stoves popular in Latin America. He's a rocket scientist, working to make wood (or dung) burn hotter and cleaner.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author on this story:
Justin Fox at justinfox@bloomberg.net

To contact the editor on this story:
James Greiff at jgreiff@bloomberg.net