What is the Construction Cost of an Aquaponic Facility in Kenya vs. U.S?
To get an understanding of construction cost, we must break down the capital investments:
Greenhouse structure
Grow Area
Fish tanks and plumbing
Miscellaneous Site Infrastructure
The cost to build a greenhouse in the United States is about $25/sqft for greenhouses with HVAC (heating, ventilation, and air-conditioning system) systems, and these systems are only found in areas with extreme climates. In more temperate regions of the US, simple greenhouses without HVAC systems can be built for less than half of that cost, around $5.26, which means a 16,000 sqft facility would cost about $84,000. In typical residential home construction in the US, labor accounts for 40-50% of the cost of construction, but this number is higher in greenhouse construction, due to the lower cost of materials and simple structure. In residential home construction, the biggest line items are usually kitchens and baths, which we dont require. With labor accounting for 75% of construction costs, labor costs would be roughly $63,000, and materials would be $21,000.
The greenhouse in Phase 1 of our Nairobi operation is 16,000 sqft, and costs us $25,000. Materials costs us $20,000, and labor costs were about $5000. There were some differences in the cost of materials, largely due to cheaper local alternatives, but the cost of labor in Kenya is around 5% of the cost of labor in the US. In terms of total project cost, labor cost was 20% in Kenya.
Grow Area:
The grow area consists of 100ft long Deep Water Culture troughs where the plants float. In Kenya, due to lack of food grade materials, we had to import the majority of the materials. For example, XPS board, which holds the plants and allows them to float on the water, is not found in Kenya. We could only find EPS board, which is basically styrofoam. Styrofoam is not suitable because over time sunlight breaks it down into poisonous chemicals that kill the fish. However, even with import taxes and shipping, the cost was actually slightly lower than what we would have spent in the US.
Fish tanks and plumbing
The fish tanks were made using locally sourced materials, and were therefore much cheaper than we expected. However, the plumbing was different. Plumbing materials (HDPE pipe, elbows, fittings, etc) are 3-8 times the price that we see in the US. We sourced most locally, and imported the most expensive items, the elbows were particularly expensive. Overall plumbing costs were higher than what we anticipated, or what we would have spent in the US.
Miscellaneous Site Infrastructure
There are miscellaneous parts of the site that include the processing area, office, bathrooms, rainwater harvesting ponds, electrical grid connection, etc. There is one building on the site that consists of the processing area in the front, where produce is prepared for delivery, and a small office in the back. We initially dug one rainwater harvesting pond after we realized it was cheaper than buying water. When this filled up at the start of the rainy season, we dug another pond. We now have enough water for a year of production. The labor and material cost differences were largely the same as what we saw with the greenhouse.
Conclusion
Our experience has shown that the costs of construction in Kenya are significantly lower than those in the U.S. With the support of the government for the expansion of the manufacturing sector in Kenya the costs are inevitably going to become even lower if materials no longer need to be imported.