Thirty years ago, when textile engineer John Finlay was involved in constructing a biogas plant for a private household in Bhairawa, the last thing he expected was that the technology would transform Nepal.

Finlay was a young and ambitious engineer at the Butwal Technical Institute set up by the United Mission to Nepal (UMN) in 1974. He was looking forward to create small-is-beautiful technologies that would help Nepali farmers.

One day he met the Belgian Jesuit, Fr Bertrand Saubolle at St Xavier's School in Godavari who boiled water from a demonstration gobar gas plant on his balcony. You mixed cow dung and water, put it inside the drum and out came methane gas: it was as simple as that. Finlay nearly shouted "Eureka!" and together with Saubolle began designing lifesize models for Nepali homes.

He went to Ajitmal across the border in Uttar Pradesh in 1974 and met Ram Baux Singh of Gobar Gas Research Station, the Indian biogas pioneer. Together with Nepali engineers, the first plant from an oil drum was constructed and exhibited at an agricultural fair during the coronation of King Birendra in 1975.

The government was so much impressed that it launched a gobar gas program and backed it up with interest-free loans for farmers to install plants. The United Nations stepped in with subsidies and the project took off. UMN helped set up the private sector Gobar Gas Company (GGC) in 1978 which started building affordable biogas plants with indigenously designed underground digesters that did not need maintenance like the Indian drum model. With the UMN, Agricultural Development Bank and Fuel Corporation as three major shareholders, GGC built 10,000 plants in 10 years.

The Nepali biogas design was so cheap and efficient that it spread like a tarai grass fire. The design proved to be far superior and popular than those built in India and China, where biogas technology has existed for 100 years. They also had incredible lifespans, some of the plants that Finlay helped build 25 years ago are still going strong. "Unlike in India, over 95 percent of gobar gas stations in Nepal have continued to work," explains Finlay.

By 1992, the Dutch aid group SNV introduced a comprehensive Biogas Support Program (BSP) and Nepal's biogas program was poised for another big leap forward. Financed with microcredit hundreds of thousands of new plants were built across Nepal. Subsidised loans made the plants affordable, the farmers saved on firewood and forests were conserved. Kitchens became smokeless and children didn't fall ill. In addition, the effluent slurry could be made into rich fertiliser.

"Nepal is now the highest per capita user of biogas in the world," boasts Sundar Bajgain of BSP-Nepal which has now spun off from an SNV project into an autonomous group. There are more than 140,000 biogas plants all over Nepal. The basic underground dome design and the credit subsidy model has been replicated in Bangladesh, Vietnam, Laos and Cambodia where about 1.3 million of people have access to biogas.

Biogas users in Nepal have been reaping benefits for decades. All it takes is an investment of Rs 11,000 but the rate of return is 35 percent and the investment is recouped in three years. It is a cheap alternative to LPG, kerosene, firewood and electricity. "The returns keep coming throughout their life," explains Bajgain. According to Alternative Promotion Energy Centre, one biogas plant can save two tons of fuelwood, 0.8 tonnes of agricultural waste, 0.45 tonnes of dung cake and 50 litres of kerosene per household. And women make up 90 percent of the beneficiaries of gobar gas because it saves them drudgery and provides smokeless kitchens. The organic fertiliser of the spent slurry saves farmers money because they don't have to use chemicals.

Biogas is now also going to benefit the country because we can claim compensation from the International Clean Development mechanism (CDM) project for saving carbon emissions into the atmosphere. With the Kyoto Protocol going into effect on 16 February, it is possible for Nepal to actually trade the carbon dioxide not emitted by using biogas and earn up to $ 5 million per year. Unfortunately, Nepal has yet to ratify the Kyoto Protocol, which was an opportunity missed during the Sher Bahadur Deuba time when there was lack of decision and parliamentary mandate. Many are now pinning their hope on the new government which can make this possible through a Royal Ordinance.

"If we reach the target of building 200,000 plants by 2009, Nepal can claim $30 million every year from the CDM," says Finlay for whom the success of Nepal's biogas program is also his crowning achievement in Nepal.