A Business Model for Producing Clean Energy in Developing Countries

Abstract

Similar to other business projects, clean energy projects also has orientation for profit maximization in developing countries. Environmental problems caused by industrial wastes have been becoming serious issues in developing countries. Hence, recycling industrial wastes, in order to create more renewable and clean energy, has been recognized as one of ways to reduce adverse impact of global warming and negative effect of greenhouse gases. According to statistics, Viet Nam discharges about 400,000 tons of waste tires annually and this number in the US is estimated about 4,200,000 tons per year (source: vnu.edu.vn). This creates many environmental issues. Hence, this paper aims to propose a business model to solve problems mentioned below in the paper. Building a tire shredding plant in California, USA (for example) to cut the whole tires into small shredded tires then export to developing countries like Vietnam is one method to convert wastes into clean energy and protecting our environment. This is one main objective of this research paper. Another purpose of this study is to find out a financial model to evaluate socio-economic values of renewable energy projects that help to protect our environment, as well as a modern viewpoint of not including or adding (+) new debt issuances to increase net cash flow when estimating FCFE cash flow. Using pyrolysis technology to crack carbon linkage into smaller linkages, and then convert waste tires into renewable energy (FO-R oil, carbon black and steel). This is an application of chemical engineering. Through the economic and technical analysis of this model, we can see the practical benefits of the energy project in terms of economic efficiency, profitability, which bring surplus value for investors, effective solutions for customers and a quality energy product for the society. And it also suggest the relevant government of developing countries to consider proper policies to encourage environment protection and businesses in the field of converting industrial wastes such as tires into clean energy.