Circular Economy is Climate Protection

The oil manufacturer Olivado relies on climate-neutral agricultural production in Kenya

About 70 kilometres north of Nairobi, in the Kenyan highlands, lies the settlement of Makuyu. The New Zealand company Olivado started growing avocados here 15 years ago and is considered the world’s largest producer of cold-pressed avocado oil. But there is a problem with avocados: they need an incredible amount of water. One kilo of the high-fat fruit requires about 1,000 litres. So, if you want to grow avocados on a large scale, you need water, a lot of water. There is plenty of rain in the Kenyan highlands, it is humid enough, so additional irrigation is not necessary even for the thirsty avocado. Growing conditions are therefore almost ideal.

But the Olivado farm in Makuyu, according to managing director Gary Hannam, is “in the middle of nowhere”. So many things that are needed to run smoothly in a global supply chain are missing, including access to waste management. Kenya has strict regulations on how to deal with rubbish and waste. “Although they may be flouted many times,” says Hannam, “the regulations are still there.” So, the question remains what to do with the waste? The seeds, shells, and whatever else the oil press leaves behind?

Rubbish is a resource, not just waste

The key is recycling it somehow. Hannam’s son had the idea to use the waste as a resource. The production facility depends on cooling that requires a stable supply of electricity. But the electricity supply here in the middle of nowhere is unreliable, and the emergency generators, which run on diesel, are a burden on the environment and the climate.

“We set out to find a solution here in Kenya” explains Hannam, stressing the importance that the solution is one that could be run by the team.

Olivado runs another farm in Tanzania, and other small farmers operating in more or less remote regions in Africa have similar problems: Where to put the waste and where to get a reliable power supply? So instead of simply designing a plant for their Kenya-based farm, a system was developed that is technically and economically viable under the prevailing conditions “in the middle of nowhere”, that can be operated in an environmentally sound manner and that helps local communities and small businesses.

Two underground fermentation stations, each capable of storing up to 1,400 cubic metres of gas, now form the core of Olivado’s subsidiary “Olivado Biogas Africa Ltd.” Research, development and construction of the stations took three years, longer than expected. But now the gas sales bring in around 450,000 euros annually. All in all, the plant will have refinanced itself in a good three years. If you exclude the costs from the testing and trial phase, which are not incurred again when replicating the plant, the investments are recouped after one and a half years.

A self-built biogas plant

That is certainly also due to the approach. “What you see here was developed in this factory. It’s homegrown,” Hannam explains. Therefore, it is suitable for remote areas. This also means that, wherever possible, Olivado used materials that are readily available locally. Only special parts had to be procured abroad – in this case in India and Germany.

So now the plant is up and running, and once they succeed to run Olivado’s truck fleet on biogas, they will have achieved a full circular economy. The biogas plant was originally developed for economic reasons. Nevertheless, it will be good for the climate, because circular economy contributes to climate protection. Recycling and reusing waste can save tons of carbon dioxide emissions. And once you have relied on climate-friendly production, you will continue to think in terms of green technologies. This is not only true when it comes to avocados’ supply chain, but also when it comes to mangoes.

Fighting climate change with innovative ideas and adaptive agriculture

“When we started the mango project, we were looking at making mango pulp,” Hannam explains, “but mango powder is one twelfth of the volume.” Why this is climate-friendly? The answer is simple: Sending mango powder halfway around the world is much cheaper and uses less energy. With only a fraction of the volume, more mango can be stored in much less space – and storage space costs rent, electricity, heating or cooling. In short: money and energy.

The product launch of the mango powder, which is to be followed by other innovative products such as avocado powder, is supported by the Water and Energy for Food project,implemented through the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), the European Union (EU), and donors from Sweden, the Netherlands, and the US. The funding not only pays off for the environment and the climate. It also benefits smallholder farmers in Kenya. During the ten years that Olivado has been working in Kenya, climate change has had a significant impact on the weather at the plateau. Seasons have shifted, and even though there is still sufficient rainfall, it is more often that heavy rains flood the fields. Olivado has responded to this by training the farmers from whom the fruit is sourced in climate-smart agriculture. In addition, former sugar cane farmers have been contracted: Sugar cane has not grown here for a long time, leaving smallholder farmers with land but no income. Changing this for the better, thousands of them now grow mangoes and avocados for Olivado – at secure prices that allow them to earn a living and build up reserves.

Watch the video to learn more about innovator Olivado!

WE4F Contact Person: 


 Kilian Blumenthal, Advisor in the WE4F East Africa Hub based in Nairobi, Kenya


Kilian holds a B.Sc. in Environmental Engineering of the HAW Hamburg and a M.Sc. in Agricultural Sciences in the Tropics and Subtropics of the University of Hohenheim. His academic research focused on Solar Water Pumping Systems in Bolivia and the Potential Use of Solar Energy in the Maize Value Chain in Benin. He has done numerous trainings on the SPIS Toolbox and gained experience during longer stays in South America and Sub Saharan Africa.