Impact Enterprise Showcase
Dialogue with Shriti Pandey, CEO, Strawcture Eco
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Shriti Pandey
CEO, Strawcture Eco |
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1 Green construction solutions, including companies like Strawcture Eco, have witnessed an increasing level of interest in recent years. Can you elaborate on how the industry of green construction solutions has evolved and expanded over the years?
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The concept of Green Buildings, though initiated in the 1990s, started to gain a massive traction from 2015 after the Paris Climate Agreement, where countries individually pledged Net Zero. Increasing concerns regarding growing environmental pollution have led governments across the globe to form policies, regulations and Energy rating systems (LEED, BREEAM, GRIHA etc.), which require use of eco-friendly solutions, and provide lucrative monetary and tax incentives for compliance. Furthermore, there has been a rapid onset of ESG reporting mandates by big corporations from 2021. These are two major factors driving the growth of the Green building industry in the late 2010s, currently at a CAGR of 9.6%.
Since the late 2010s, there are four crucial trends driving the growth of Green buildings: Decarbonization, electrification, efficiency and digitalization. These work in combination to reduce the carbon emissions and overall energy and cost of infrastructure. Buildings can achieve zero carbon by eliminating the use of fossil fuel, using renewable energy, and recycled materials in construction. The last is where startups like Strawcture Eco are aiming to make a difference. As of today, there are more than 80 young startups globally working on natural alternate fibers, such as Hemp, straw, coconut, mycelium, cork, bamboo, etc. to build an ecosystem of low carbon building materials.
However, we still have a long way to go in making the Green Building technology more mainstream and affordable.
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2 Strawcture uses Agri-fiber panels as the raw materials for manufacturing eco-friendly building materials. Could you please explain the value chain of Strawcture Eco? What are the key features of the product that Strawcture manufactures that can help with reducing carbon footprint?
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Our flagship product, Agribiopanel, is made from straw, a by-product of rice and wheat farming. We source all our straw directly from farmers, in close proximity to our production unit. This fosters and activates the local agrarian ecosystem, providing the farmers an opportunity to earn a supplemental income for a material they consider waste and incinerate to get rid of.
Post collection, the raw material is transported to a decentralized factory nearby, and manufactured into construction panels- increasing the value of the organic waste by 6x. The finished product, 100% recyclable, is sold directly to customers, to be used for the next 30- 50 years.
We measure our impact on Carbon reduction through a metric called the Life Cycle Assessment (LCA). Strawcture Agribiopanels are Cradle to Gate Carbon negative across their value chain. They are built with a core principle to have no waste and use minimal energy across their life cycle- from the product’s raw material procurement stage, manufacturing, usage and end of life cycle. The main factors that influence this are:
1. They are made of 96% straw, which is inherently not a carbon intensive polymer based raw material.
2. Unlike traditional building materials, use zero water during manufacturing and usage.
3. To run our factories, we use 50% biomass in place of coal, a fossil fuel.
4. Our factory is within a 50 km radius of the source of raw material, which keeps our transportation cost of materials minimum, further minimizing the added Carbon footprint through transportation.
An Agribiopanel stores 3 kg CO2 per square meter and substitutes plasterboard, which has a positive Carbon footprint of 1.83 kg per square meter, hence removing 4.83 kg CO2 per square meter of usage in total. This year, we are coming up with 2 new Carbon negative product lines, to offer a complete building solution- including wall, ceiling and flooring system, that can offset 10 kg CO2 per square meter of usage.
Till now, we have successfully sold over 150,000 Square meters of AgriBioPanels, sequestering over 12,000 Metric Tonnes of Carbon Dioxide from the atmosphere. As we grow in our range of Carbon negative product offerings and increase sales by 300% YoY, our goal is to sequester more than 0.5 Gigaton of CO2.
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3 Strawcture Eco clearly demonstrates the multi-sector impact on the construction as well as agriculture industries. Could you explain the business model of Strawcture and how it is able to achieve impact for the low- income communities?
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Strawcture Eco is a B2B company that manufactures carbon negative building products. Our customers include Architects, designers, consultants, contractors and material dealers, who get our product specified in projects, and end customers, who are builders or owners of Institutional buildings.
We have 2 sales channels- One, our in- house Sales team of 4 (accounting for 40% sales), that primarily sells to Architects and designers. Two, our Channel partner network (accounting for 60% sales)- Green material consultants and PMCs in India, and distributors in the Global market, starting with Western Europe in 2023.
Through our business model, we aim to foster and activate the local ecosystem by building local economies of manufacturing, supporting farmers by buying biomass from them, and building an overall community resilience.
1. Ethical sourcing: Our plant currently produces AgriBiopanels worth $10,000 per day. This is equivalent to straw worth $1500 per season- which is a direct secondary income that goes to 150- 200 farmers at the source, per season of selling straw, for a period of 30-40 days. This is a tangible increase of 20% to each small farmer’s income, every season, in India. In 3 years, we plan to set up 6 decentralized factories, tangibly adding a supplemental income of $9000 per season for over 1200 farmers.
2. Job creation: Our factory currently employs over 20 locals full time. We have replicated a similar sourcing, backend supply chain, and manufacturing model for our second product line, based out of animal residue, in collaboration with the pastoralist community in rural Rajasthan.
3. Upskilling for blue collar workers: Carpentry with traditional particle boards is often a daily wage worker job ($8.5/ per day). Working with a straw board like AgriBiopanels involves a specific skill set and finesse, that we impart to laborers on our payroll (5 till now) or as part of our Carpenter training programme (100 carpenters trained till now), which enables them to land a secure paying job, worth $12/- per day, enabling them to earn a 35- 40% increased monthly income. We plan to impart such training to 500 workers in the next 3 years.
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4 Strawcture Eco made a valuable contribution during the COVID-19 pandemic by leveraging their trademarked product 'Agribiopanels' to facilitate the setup of a ‘Green Hospital’, which was set up using biomaterials. Could you please provide more information about this initiative?
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At the onset of the pandemic, the availability of quality healthcare centers to handle the sharp surge in Covid cases was majorly lacking in a village called Mushari, in Patna, Bihar. To tackle the situation, Doctors For You (DFY) initiated the construction of Vistex Hospital, a 75 bed Covid care facility, partnering with Strawcture Eco, SELCO and IKEA foundation.
Considering the health of the patients, the walls and ceilings were built using our flagship product, Agribiopanels- a 100% organic and healthy alternative to conventional building materials like plywood and cement, which emit harmful Volatile Organic compounds (VOCs), that can be fatal for high- risk patients.
The superior thermal insulating properties of our panels kept the built environment thermally comfortable, thus enabling a speedy recovery of the patients. The 2 Hr+ fire rating ensured a safer and risk-free environment. And the drywall partition with 40 dB+ acoustic insulation helped the healthcare management staff maintain a peaceful, stress- free ambience.
Considering the pressing need of the hour, DFY was delighted that Strawcture Eco completed the entire construction (6000 Sqft) within a span of just 60 days, owing to the use of prefabricated construction that entailed minimal on-site finishing work. Had the client opted for a traditional brick-mortar and cement construction, the turnaround time would have gone up to 160 days. The structures, including furniture, were built at Rs. 2300/ Sqft, which is 20% cheaper than traditional construction.
Strawcture Eco constructed 3 similar healthcare centers- Batra hospital (Jalandhar, Punjab), and two in Nagaland (in the Dimapur and Mokokchung districts. In all, we constructed a built- up healthcare center area of 20,000 Sqft, with over 250 beds, pan- India.
The usage of sustainable building materials like Agribiopanels led to a reduction in the buildings’ energy consumption, enabling them to achieve a higher performance, ultimately leading to cost savings. The added advantage was a massive reduction in carbon emissions, which ensured an improved indoor air quality, translating to a healthy healing environment for the patients.
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5 Going ahead, for green construction solutions to become more affordable and accessible in India, what, in your opinion, would be the key macroeconomic drivers that can enable this change? What is the nature of financial capital support that you foresee this industry to require, for it to be scaled up?
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1. Financial Support and Access to Capital:
Access to affordable financing options and capital is essential for the adoption of green construction solutions. Financial organizations can provide specialized loan products, green bonds, or venture capital to support green construction projects. These financial mechanisms can help reduce the upfront costs of green construction, making it more financially viable for builders and developers.
2. Government policies and incentives:
Including tax benefits, subsidies, and grants for adopting sustainable building practices and using eco-friendly materials. For example, the Government of Andhra Pradesh offers a 25% subsidy on total fixed capital investment of the project for buildings which obtain a green rating from Indian Green Building Council.
3. Stakeholder collaborations at a macro level:
Partnerships between innovators, Government and Capital providers can massively drive the advancement in technology and the scale of innovation. That results in increased efficiency, cost optimization, and improved affordability, which drives accessibility and demand, ultimately leading to mass adoption.
For example, advancements in construction techniques, such as modular construction and prefabrication with drywall material, now lead to a direct 20% reduction in the costs of any building built using this technology, as compared to traditional brick-mortar and concrete buildings.
To sum up, a combination of investment capital, specialized financing, supportive Government policies and public-private partnerships, are required to scale up the green construction industry in India, making it affordable and accessible.
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