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THE CHALLENGE

Diarrhea is one of the leading causes of death in emerging economics. Even when not fatal, it has been shown to increase rates of malnutrition and stunting. With 2.5 billion people still lacking access to a toilet, access to improved sanitation remains one of the most under realized Millennium Development Goals (MDG).

Given basic human physiology, there will always be a demand for sanitation services and, in response, a number of market-based solutions have been developed to serve the Base of the Pyramid (BoP), which refers to the four billion people living in emerging economies, in a financially sustainable manner. These groups offer improved sanitation solutions at a price that people are willing to pay.

One such group on the cutting edge of this research is SOIL, a Haiti-based non-profit organization, that tackles sanitation issues by recapturing and reusing nutrients in waste. SOIL's approach simultaneously improves water quality and creates compost, a valuable soil resource. Additionally, SOIL's work targets the creation of livelihoods by generating revenues along the entire sanitation value chain from toilet construction to waste collection to composting to agriculture.

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BACKGROUND

While in university, Sasha Kramer, SOIL executive director and 2014 Schwab Foundation Social Entrepreneur of the Year, had to answer an exam question: "You are a nitrogen molecule, describe your journey through the ecosystem."

"This inspired me to view the world in terms of elemental cycles. Ecological sanitation (EcoSan), where nutrients in human food are recycled back into agriculture, is an elegant way to reduce our dependence on fossil fuels and chemical fertilizers by harvesting the power of soil ecosystem services to provide nutrients through the recycling of human waste," said Ms. Kramer.

Nowhere is the cycle of poor sanitation, environmental degradation, and poverty more evident than in Haiti, where the majority of the population lacks access to a toilet, diarrhea accounts for 16 per cent of deaths in children under five years of age, and the childhood diarrheal incidence rate is the highest in the world.

Despite the billions of dollars spent on failed aid projects in Haiti, too many organizations have struggled to deliver on their goals by providing only short-term solutions. SOIL seeks to ensure sustainable service delivery by creating social enterprises which fulfill the need for sanitation services.

SOLUTION

Tackling both waterborne disease and malnutrition simultaneously, SOIL's simple system collects wastes from EcoSan toilets and transports them to a composting waste treatment facility, where through a carefully monitored process that exceeds international standards for thermophilic composting, the waste is transformed into nutrient-rich compost. SOIL then sells the compost for use in agriculture and reforestation projects, providing an environmentally-friendly alternative to chemical fertilizers while generating revenue to support the provision of sanitation services.

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Customers rent an EcoSan toilet for approximately $5 (U.S.) monthly (SOIL maintains ownership of its toilets), with the fee paying for weekly waste collection and toilet maintenance services. Revenue from monthly toilet user fees, waste treatment fees, and compost sales is collected to support ongoing project costs and to showcase the private sector potential to affordably and sustainably provide sanitation services in the world's most impoverished communities.

SOIL's social business development work is complemented by providing education around best-practices for waste collection, waste treatment, resource use, transport, and other components of running viable, thriving sanitation social businesses.

Since SOIL built the first EcoSan toilet in Haiti, it has supported more than 20 organizations and community groups in beginning to implement similar models, but SOIL remains the only organization with large scale composting facilities that can be leveraged for future national expansion.

SOIL intentionally keeps new technologies as simple and low-cost as possible while still being user-friendly in order to allow for rapid construction and widespread implementation without expensive investments in manufacturing equipment or dependence on third-party vendors. Too many innovations have failed because planned business models to achieve scale never take off and the technologies in themselves are not affordable for their intended market.

RESULTS

Grand Challenges Canada – funded by the government of Canada – has recently funded SOIL's work to help stress test the scalability of its market-based solution. As one of only a few successful models for providing low-cost, dependable, and environmentally-sound sanitation, SOIL represents an elegant health and environmental intervention for rapidly expanding and vulnerable populations.

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SOIL is currently transforming over 20,000 gallons of waste each month for less than three dollars per person per month. With approximately 300 households paying for sanitation services, and 3,500 people accessing SOIL toilets, SOIL collects just over 2,000 five gallon buckets of waste each month. With nearly a 100 per cent satisfaction rate for its toilets (in October only three per cent of customers discontinued services due to lack of funds), SOIL's waitlist is already 500 names long. To date SOIL has sold over 75,000 gallons of its EcoSan compost and is currently selling it as soon as it is produced. SOIL expects to see breakeven at approximately 500 toilets. Considering current sales and demand, SOIL is well on its way to demonstrating the potential for social businesses to enter into sanitation service delivery.

Over the next few years, SOIL aims to construct over 1,500 toilets, design a franchise system to support independent social entrepreneurs in becoming franchise owners, transform more than one million gallons of waste into compost for resale, and create a guide for public sector waste management agencies about the potential for cost recovery in waste treatment operations. SOIL has also begun discussions with some of Haiti's current sanitation service providers about subcontracting some of its services like collection and transportation of waste in order to integrate into the existing waste management value chain.

SOIL's initiative has the potential to vastly expand sanitation access in an affordable, sustainable way, while creating new jobs and livelihoods. Its model not only prevents further harm to the environment, it actively restores soil health through compost generation – reducing food insecurity, erosion, mudslides, and flooding in the process. SOIL strives to inspire a shift to a more ecological and equitable sanitation solution globally while working every day to increase national access to sanitation in Haiti.

Jonathan Hera is course director of the microfinance and social impact investing course at Schulich School of Business at York University and Senior Portfolio Manager for Grand Challenges Canada.

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