Closing the gap in cleantech: An interview with Edwin Khew

Khew, who has a chemical engineering degree from the University of Queensland and an MBA from the National University of Singapore, has since turned his focus to waste management in the past 15 years, after becoming concerned about the challenges of growing volumes of rubbish and the lack of landfills in a highly consumerist and disposable economy.

Currently, as the managing director of Singapore-based Anaergia Pte Ltd, one of two Asian offices of the global waste to energy firm headquartered in Canada, he is helping the city-state to reduce food, animal and other organic waste that goes into landfills. He says this not only reduces additional land use, but also protects the atmosphere, since organic waste in landfills release methane which is more damaging than carbon dioxide emissions. This waste can also be harnessed to provide much needed clean energy. 

Khew is also the chairman of the Sustainable Energy Association of Singapore or SEAS, which is a non-profit that represents companies in the industries of renewable energy, energy efficiency, carbon trading, and those developing clean development mechanism projects, which is a scheme under the Kyoto Protocol that allows emissions reduction projects in developing countries to earn carbon credits.

The organisation provides platforms for these firms to collaborate on various projects and also gives them networking opportunities to regional governments. It also assists member companies in developing their clean technology businesses, and making it attractive for investors, whether they seek to grow in Singapore or the region. The association recently started an incubator to accelerate the growth of cleantech start-ups.

Representing SEAS, he also sits on the steering committee of the Asian Development Bank Energy For All (E4All) partnership. He is the co-chairman of this programme that aims to increase energy access in the Asia Pacific, and concurrently chairman of the Enterprise Development Working Group under the E4All partnership.

In this interview, the former Nominated Member of Parliament and vice-president of The Institution of Engineers, Singapore (IES), opens up to Eco-Business about his current endeavours, on lessons learnt after decades in the cleantech business and the keys to success.

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There needs to be a greater awareness by the ‘technopreneur’ on how to commercialize their technology … Investors need to see a well thought out business plan, not a research project

Before heading waste tech firm Anaergia, what made you first venture into the cleantech and sustainability sector?

When I entered the world of water, wastewater and air pollution treatment in the late 1970s, it was not known as sustainability in those days. So I have been in the business for more than 35 years and only in the last 15 years, I focused on waste-to-energy resources as I found that the world urgently needed solutions in this sector, as more waste was being generated because of effluence and we are running out of landfills.

I realised then that the sector for waste treatment, whether waste to resource or waste to energy, was neglected as there were easy and cheap means of getting rid of waste, such as throwing municipal solid waste (MSW) into holes in the ground - the dumpsites. However, this not only creates toxic leachate that contaminates ground, river, and sea water, but it also causes the release of nasty methane into the environment.

The main culprit among the MSW that causes all these problems is food waste. So I focused on researching this technology of turning food and organic waste into renewable energy and into a bio-fertilizer. There is also a potentially large global market for this when land becomes a premium due to lack of landfills and dumpsites.

This appealed to me very much as an engineer and as an entrepreneur since I could see the market for this technology. At the same time, I could help the environment by reducing methane emissions from all future dumpsites and landfills, which is a practice still widely used in Asia and many developing countries.

Singapore has identified the cleantech sector as a key economic growth area in recent years. What do you think is the potential of the sector? 

In March 2007, Prime Minister Lee announced S$350 million funding to grow clean energy with focus on solar energy. In 2011, an additional funding for R&D of S$195 million was announced by the government and another S$300 million for a National Innovation Challenge on Energy Resilience (Energy NIC), which is under the National Research Foundation of the Prime Minister’s Office. The aim of the Energy NIC is to transform the energy landscape in the country by boosting R&D to increase energy efficiency, increase energy options and reduce emissions. 

This will create 18,000 jobs which will create a big impact for the cleantech sector in Singapore and contribute S$3.8 billion to the economy. This forecasted growth will also include the development of technologies, knowledge and skills that can be used in the region, particularly in the energy, agriculture, air pollution and water sectors.

What challenges do Asian companies face in financing clean technology projects?

There needs to be a greater awareness by the ‘technopreneur’ on how to commercialize their technology. There are still gaps between technology development (R&D) and commercialisation through implementation, or translating the concept into a commercially viable product or project. What exists in the lab or at the development stage is not necessarily a solution ready for the market. It has to transition from research into a business model. 

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There are still gaps between technology development (R&D) and commercialisation through implementation, or translating the concept into a commercially viable product or project. 

The gap is mainly in the way the projects are developed from a business perspective. At the start, the entrepreneur enlists funding for the research and development of the project. However, once the project or the technology is developed, the entrepreneur has to consider how to present it as a business plan, show the potential for this project to grow and for the solution to be adopted.

The funding acquired at the beginning is not necessarily the same as the investment sought after project completion, which will push the project into the market. Investors need to see a well thought-out business plan, not a research project. The ‘technopreneur’ needs to develop this skill, aside from this technical expertise. 

On the other hand, investors also need to be educated on the various cleantech solutions in the market and how to de-risk investments. They have to be well informed on the technical aspect to understand and manage the risks that come with either supporting new technology, the company or the cleantech industry.

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Singaporeans are used to laws and fines to drive what they do. If there are no laws then the conclusion is it is not important so it is not necessary to do

Can you identify a leading company in the cleantech space in Asia that perhaps start-ups can emulate?

There are many companies, both start-ups and new, in the cleantech sector, but I cannot identify one firm as a model company that is leading the sector.

Perhaps in the next one to two years we can see emerging companies with models that are successful and can be emulated, but if they can’t be commercialized, they will not get funds and will remain as an idea or a lab project. 

Speaking of companies that don’t make it, your previous company, IUT Global, a food waste recycling company, had to close down because Singapore was not quick enough to legislate food waste. What lessons did you learn from that experience?

Very often, a business decision to invest in any project is based on the ground situation and economic projections at that time. All indications in terms of government support and willingness of our potential business customers to support the segregation of food waste at source were very positive at the time. By that, I refer specifically to industrial and commercial waste (ICW).

But as the economy took a turn for the worst in 2008 to 2009 on the back of the global financial crisis, the government was reluctant to look at legislation, and as such, our supportive customers had problems in implementing the segregation of food waste at their facilities as there was no law requiring it.

Singaporeans are used to laws and fines to drive what they do. If there are no laws, then the conclusion is it is not important so it is not necessary to do. And when your costs double, you quickly conclude that either you raise more funds, reduce operational costs and minimize the losses until a law is passed to support food waste recycling, or close it down.

Unfortunately, we had to decide on the latter as our shareholders were not confident of a law being passed. The lesson learnt is perhaps to start much smaller in terms of investment and plant size, and then expand when conditions turn out to be positive for the growth of the company.

There is some discussion that Singapore will finally legislate the recycling of food waste in the near future. What are your thoughts on this and what will this mean for Anaergia?

For food waste recycling to happen on a long-term basis, a law must be in place to require source segregation. This is true for all countries that I know that have successful food waste recycling, such as in Japan, Korea and Taiwan.

If and when a law is enforced, Anaergia has a machine that can automatically separate food waste from non-food waste, which it can then treat separately. This can be used for food waste from mixed domestic waste generated by the large population staying in high-rise apartments with garbage chutes in Singapore. The food waste portion will be processed with anaerobic digestions into bio-gas, power or heat, and bio-compost, while the non-food waste portion will be processed into recyclables, refuse derived fuel (RDF) or power through a gasification process. Therefore, the potential is huge, both for the company and the country.

How does anaerobic digestion technology work and how does it complement the rest of the company’s clean technology solutions?

Anaerobic Digestion or AD has been around for centuries. It is a process where organic material is broken down or digested by anaerobic bacteria under conditions where there is no oxygen, and produces methane gas and other gases like carbon dioxide. We know this as natural gas, which we tap in large amounts from deep under the ground or oceans, liquefy and sell as transport and use as LNG.

Anaergia has its own suite of technologies and patents that digest all forms of organic materials in digestors that are highly efficient in producing large amounts of biogas and bio-compost, which we utilise to produce power – a form of renewable energy –and bio-fertilizer, a renewable resource to grow more food. 

Lastly, as SEAS chairman, what role does the association have in the sustainable energy scene in Singapore and what plans does SEAS have for the near future?

As an association we are helping our member companies promote their business in Singapore and in the regional countries, and we also work with governments to develop policies that will help Asian countries adopt renewable energy in their energy mix and increase energy efficiency. This is so that it becomes attractive for investors and banks to invest in these projects.

We also provide capacity building in terms of training, overseas trade missions and providing other opportunities to enhance technical skills to install, operate and maintain renewable energy systems like solar systems, biomass and bio-gas systems. We provide training on improving energy efficiency and energy audits through our SCEM (Singapore Certified Energy Manager) courses and we are developing other courses for our members so they can provide support services to all their customers in Singapore and the region.

SEAS has also started an incubator at the Cleantech Park, an eco-business complex that houses local and international organisations focused on clean technologies and renewable energy, to help develop Singapore into a cleantech hub for technology R&D and adaptations, providing clean energy and energy efficiency solutions, project financing and capital and corporate growth financing.