Oikocredit, together with FairClimateFund, is investing in biogas for farmers in one of the most underdeveloped areas in India, namely the Chik Ballapur district in the state of Karnataka. With this investment, according to Fairtrade principles, they ensure that farmers and day labor workers gain access to clean cooking by means of a biogas plant. This not only leads to CO₂ reduction and income from the sale of CO₂ credits, but also ensures better living conditions. This makes Oikocredit the first investor in the Netherlands with a completely Fairtrade CO₂-neutral business management.
The Chik Ballapur district in the state of Karnataka is one of the most underdeveloped areas in India, where mainly day laborers and small farmers live in poor conditions. The polluted streets cause health and climate problems, the conditions inside are hardly better because the traditional oven, made of stone and clay and burning on kerosene and wood, cause a lot of harmful smoke.
The investment of Oikocredit and FairClimateFund enables the installation of approximately 500 biogas plants that replace kerosene and wood for cooking and hot water with biogas. A biogas plant of 2 cubic meters provides enough gas for a family of four to five people to cook on a daily basis. Each household helps with the construction of the biogas plant and pours cow manure, organic and biomass waste into the installation. Project development, monitoring and maintenance are carried out locally.
The local farmers transform organic waste into a sustainable and healthier alternative to their wood or kerosene ovens. They save a lot of time and money. After all, they no longer have to search for wood, the use of organic waste is much cheaper than kerosene and health problems caused by kerosene use will therefore occur less often. Finally, the residual product of biogas is a very fertile manure that can be used on land.
Fair prices for Fairtrade Carbon Credits
The CO₂ reduction that is achieved with cooking on the biogas plants is certified in Fairtrade Carbon Credits that are sold at a fair price to companies and organizations for climate compensation. In the CO₂ market, local households usually receive no compensation for these carbon credits. In order to overcome this, Fairtrade International and Gold Standard – together with FairClimateFund – have developed the Fairtrade Climate Standard. The credits from the biogas project are Gold Standard certified and also comply with the Fairtrade Climate Standard, which means that the local households own the credits. Companies are therefore certain that the CO₂ emissions are actually compensated and that a fair price is paid to the families who have realized the CO₂ reduction in India.
Thos Gieskes, managing director Oikocredit International: “Oikocredit thinks it’s important to protect the environment and pay attention to all of its investments. At the same time, realizing social impact lies at the heart of everything we do: we want to improve the lives of people on low incomes. That is why Gold Standard Carbon Credits that are also Fairtrade certified fit perfectly with our mission.”