Skip to content
search
Trailblazers How One Biofuel Company Is Using Waste Oil To Help Rebuild The Economy

How One Biofuel Company Is Using Waste Oil To Help Rebuild The Economy

Image: Unsplash
By Chong Seow Wei
By Chong Seow Wei
September 30, 2020
FatHopes Energy's founder and CEO Vinesh Sinha shares his libertarian perspective on the traditional oil and gas industry, and how biodiesel made from oil people throw away can help us to power a cleaner future

It was an episode of British motoring TV series Top Gear that first piqued Vinesh Sinha’s interest in biodiesel, the type of diesel fuel derived from plants or animals that currently forms the bedrock of his Malaysia-based business, FatHopes Energy. It was in 2005 after watching one of the show’s hosts Jeremy Clarkson fuelling a red, diesel Mercedes-Benz with used cooking oil, when he decided to try the same thing with his own car. 

“To be honest, I wanted to ruin the car my dad gave me, hoping I’ll get a new one,” admits Sinha. “I was studying at an international school in Penang at the time and driving an unpopular 20-year-old Mitsubishi Pajero, while all the other students were driving fancier cars. Anyway, unluckily for me at the time, the car managed to run on the cooking oil.” 

This fuelled the entrepreneurial spirit in him and he started producing this diesel substitute for himself, his family and friends in Kuala Lumpur. “I was lucky to have found a raw material that didn’t require a million-dollar refinery like plastic. I could actually convert used cooking oil and waste oil into biodiesel over my stove.” 

When he realised the potential of biofuel as a business, he was pursuing his Bachelor’s degree in business and finance at the London School of Commerce. “I suddenly found myself thinking if I could use what people were throwing away or didn’t value for something else. This eventually became the concept to which I now call Economy 2.0.”

Vinesh Sinha
Vinesh Sinha

Eventually, a contract to sell biofuel to a Malaysian logistics company incentivised him to drop out of university and return to KL in 2009 to scale up his business. A year later, he officially established FatHopes Energy, which is named after the core product of his company but is also a remembrance of the time when people around him were sceptical of his choice to create a business out of waste oil. 

“A lot of people thought the business was rubbish and questioned what I was doing with my life,” recalls Sinha. “Everyone I told my idea to wasn’t convinced. So FatHopes came about because that’s exactly what we hope to do, to convert cleaner energy from fat that nobody thought would be useful. It’s also a play on the colloquial expression ‘fat hopes’ because nobody thought the business would take off. I didn’t think it was going to go very far either.” But business did take off and about two years ago, it forged a partnership with a major European oil and gas company.

See also: How Our Love Of Meat Is Changing The Planet

It's Time We Change Our Consumption Habits

“Humanity, as a whole, prefers short-term gains, which is often economic gains, rather than long-term gains, such as clear skies,” says Sinha, describing the role that governments as well the traditional oil and gas industry has to play in the environmental crisis. “There’s a mismatch between what we need and what we have.” 

Using his home country Malaysia as an example, he says, “we sell sweet crude oil and buy sour crude oil, which makes us economically viable because the former is more expensive than the latter. But we also end up using dirtier oil for ourselves, which is causing the black smoke coming out of the exhausts of our diesel vehicles. The current mindset is that we can sell what we have to others for higher prices, so why shouldn’t we?” 

“This is because we're not worried about being energy-independent, unlike countries that are resource-scarce,” he says. “For resource-scarce nations like Singapore, being energy independent is very important. We’ll see such nations using their waste materials to create energy because that waste is going to cost them to bury in the landfills anyway.” 

But Sinha is hoping to change this mindset. Over the last decade, since he started FatHopes, he and his team have managed to convince about 18,000 sources, primarily food producers and vendors operating in Malaysia such as McDonald’s and Tesco, to pass on their waste oil to them.

See also: Here's Everything You Need To Know About The Gen.T x Credit Suisse Social Impact Awards

I’ve always said that I want to leave the planet a better place than when I joined it.

Vinesh Sinha

Working With The Traditional Oil And Gas Industry For Collective Change

The growth and success of FatHopes Energy is very much tied to its willingness to collaborate with—instead of crucifying—major oil and gas players. “What I’ve learned over the years is that everyone has their own priorities and it’s not right to say another’s isn’t right just because it doesn’t align with yours,” says Sinha. 

“If we, small companies, want to go up against these big guys and provide alternative energy options to try and win them, it’s never going to work. Instead of working against one another, I feel that we should work together to reach our climate goals as fast as possible.”

He admits, however, that he didn’t start off his journey with this mindset. “I was initially of the perspective that we needed to take down these big companies, who are harming our planet.” But over the years, seeing some of them publicly commit to transforming their business and moving away from fossil fuels has made him more open-minded about them. 

“The intent is there and that’s what matters. And over time, I realised—and many of these major players too—that finding a middle ground and collaborating with each other is more crucial to helping our planet.” 

Explaining why many large oil and gas companies haven’t gone full speed with putting in place more responsible practices, Sinha says, “The biggest factor for change is deployed capital.” Many of these companies have already invested millions, if not billions of dollars, into multiple projects with the aim of receiving their returns on investment (ROI) across an extended period of time. “They aren’t going to consider or want to listen to conversations that governments and the world are having about wanting to change the way we live, because they haven’t received the ROI for their last project yet.”

“They’re instead going to ask one simple question: ‘If I halt my projects today, who’s going to recover the losses and answer to my shareholders?’ The reality is that it doesn’t make economical sense to these big companies to drop what they’re doing and reinvent themselves.” 

Sinha says the biggest challenge for large companies to effect change now is to learn how to manage capital that has already been deployed. “When do they make the decision to pivot away? My take is to do this slowly and steadily, such as when a project is nearing expiration or you’ve gotten your ROI,” he says.

See also: Casetify Founder Wesley Ng On How To Pivot Your Business Amidst A Global Crisis

 

The Future Of The Energy Market

With global energy demand continuing to increase, the era of a unified source of energy is coming to an end, says Sinha. As more look to move away from fossil fuels, experts say supplies of renewable energy such as that provided by FatHopes Energy will rise at an unprecedented pace.   

Contributing to a global biofuels market valued at US$135.7 million, FatHopes Energy has converted over 150 million kg of waste oil into biodiesel in five production plants across Malaysia since it started a decade ago. It has also abated more than 45 million kg of carbon emission thanks to the cleaner fuel it produces. 

“Moving into the future, I believe we’re going to see a diversified portfolio of energy,” he says. “Countries will need to conduct an energy mix and balance analysis to know what they need and have, before they rely on imports.” 

But there isn’t a fixed perspective of what’s the way forward, he says. “If someone tells you they know what the energy mix of the future will be, they’re lying because at any point in time, we can see a breakthrough in fusion technology, hydrogen gas and so on,” he declares. “Rather, it's about building a framework that will enable us to bring these new energy sources into the mainstream market.”

“For this to happen, collaborations between small and big companies are crucial,” he adds. “Smaller companies are agile and are able to innovate faster, while larger companies have the financial capacity to invest and test out new technologies by smaller companies. We should also have a dispersed energy network that allows consumers to tap into their local resources, such as a river or used cooking oil, to power themselves.” 

The unmistakable passion Sinha has for what he does stems from the sense of responsibility he says he’s assumed. “Free rides don’t sit well with me. That's why I need to know that we’re pushing the envelope at FatHopes Energy and that I’m not a burden to the planet. I’ve always said that I want to leave the planet a better place than when I joined it.”


See more honourees from the Engineering, Manufacturing and Energy category of the Gen.T List 2019

Tags

Trailblazers Social Impact Awards energy environment sustainability social impact

clear
keyboard_arrow_up

In order to provide you with the best possible experience, this website uses cookies. For more information, please refer to our Privacy Policy.

close