Economic Viability Assessment of Small-Scale Biomass Composting Project Within a Developing Country Context

Albert Banunle (), Bernard Fei-Baffoe, Kodwo Miezah, Nana Ewusi-Mensah, Uffe Jørgensen, Robert Aidoo, Alice Amoah, Patrick Addo-Fordjour and Robert Clement Abaidoo
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Albert Banunle: Kwame Nkrumah University of Science and Technology, University Post Office, PMB, KNUST
Bernard Fei-Baffoe: Kwame Nkrumah University of Science and Technology, University Post Office, PMB, KNUST
Kodwo Miezah: Kwame Nkrumah University of Science and Technology, University Post Office, PMB, KNUST
Nana Ewusi-Mensah: Kwame Nkrumah University of Science and Technology
Uffe Jørgensen: Aarhus University
Robert Aidoo: Kwame Nkrumah University of Science and Technology
Alice Amoah: Kwame Nkrumah University of Science and Technology
Patrick Addo-Fordjour: Kwame Nkrumah University of Science and Technology
Robert Clement Abaidoo: Kwame Nkrumah University of Science and Technology

Circular Economy and Sustainability, 2024, vol. 4, issue 2, 951-971

Abstract: Abstract Promoting investment in biomass composting is necessary to halt finite resource depletion and transition consumption and production processes into sustainable circular bioeconomy paths. This notwithstanding, there is a lack of demonstrable evidence of the economic viability of such investment, which often disincentivises the adoption of composting and other greener production technologies by entrepreneur. To address this problem, this study evaluates the economic viability of composting as technology for valorising biowaste and tropical aquatic invasive plants in the Owabi catchment in the Ashanti Region of Ghana. Using data from interviews with key informants, pilot study findings and market survey, a cost–benefit analysis (CBA) was performed to determine the economic viability of composting organic waste under public and private ownership models (M1P1 and M1P2, respectively) as well as aquatic invasive plants under similar models (M2P1 and M2P2). The findings show that a positive net present value (NPV) of GHS 507,520.31(US $64,243.08) to GHS 1,217,358.77 (US $154,095.92) is achievable from the alternative scenarios modelled. Each of the scenarios analysed (M1P1, M1P2, M2P1 and M2P2) resulted in a benefit–cost ratio (BCR) greater than 1 and an internal rate of return (IRR) greater than 28%. These results remain robust even with sensitivity analysis based on pessimistic assumptions about costs, benefits, discount rate and project lifespan. The study thus concludes that investing in a small-scale compost production technology with biowaste and aquatic invasive plants as feedstock is a feasible business with positive social, economic and environmental net benefits. Future development in the carbon credit market will make biomass composting even more economically viable to investors and thereby contribute to sustainability and the transition to a circular economy.

Keywords: Biowaste; Invasive plants; Composting; Profitability; Ghana (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s43615-023-00328-4

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