This case discusses route taken by a Singaporean company who involved in an expensive venture to convert food waste into energy. IUT a highly experienced business in waste management was the brain child of Edwin Khew.
IUT's bio-methanisation plant was an ambitious endeavor. Budgeted at $60 million, the plant was designed to process 800 tonnes of food waste and generate 10 megawatts of electricity most of which would be sold to Singapore's national electricity grid. Investors were confident that with their state of the art process technology, the plant would generate a continuous income flow once it was set up and running. Yet, IUT ran into problems from the beginning of creation although less than 10% of food waste in Singapore was being recycled.
It was unable to gather enough food waste and those accumulated containing a higher percentage of contaminants. Furthermore, food operators resisted the need to separate food waste from solid waste. Unsuccessful after three years of losses, and to fulfill its production targets, in 2011, IUT entered into liquidation, and with it the closure of Singapore's first large scale food waste -to-energy facility. The case explores the following issues: First mover pitfalls in a sustainable energy venture; Analysis of new venture business plans; Implementation challenges for start-ups; Assumption testing/sensitivity analysis in costing of new enterprises.
Recycling Food Waste to Energy - First Mover Pitfalls IUT Global Pte Ltd Case Study Solution
PUBLICATION DATE: August 24, 2015 PRODUCT #: NTU075-HCB-ENG
This is just an excerpt. This case is about INNOVATION & ENTREPRENEURSHIP
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