Green Economy Journal Issue 54
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G R E E N<br />
<strong>Economy</strong><br />
journal<br />
ISSUE <strong>54</strong> | 2022<br />
STRATEGIC<br />
ALLIANCES<br />
A win-win for oil and gas<br />
14<br />
TARGETING<br />
COULD HYDROGEN<br />
SAVE SA’S<br />
ECONOMY?<br />
30<br />
THE<br />
TRANSITION<br />
44<br />
PLASTIC<br />
DEMAND<br />
GROWS
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G R E E N<br />
<strong>Economy</strong><br />
journal<br />
EDITOR:<br />
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Alexis Knipe<br />
alexis@greeneconomy.media<br />
Gordon Brown<br />
gordon@greeneconomy.media<br />
Alexis Knipe<br />
alexis@greeneconomy.media<br />
Danielle Solomons<br />
danielle@greeneconomy.media<br />
CDC Design<br />
Melanie Taylor<br />
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alexis@greeneconomy.media<br />
REG NUMBER: 2005/0038<strong>54</strong>/07<br />
VAT NUMBER: 4750243448<br />
PUBLICATION DATE: September 2022<br />
PUBLISHER’S NOTE<br />
Dear Reader,<br />
The slow pace of the roll-out of infrastructure in the energy sector has<br />
played a key role in precipitating the heightened crisis.<br />
Eskom has taken two years to enter contracts for the supply of<br />
833MWh of battery energy storage, eventually signed on 29 July this<br />
year, and the Department of Mineral Resources and Energy is due<br />
to publish the long-awaited 513MW Battery Energy Storage RFP by<br />
30 September 2022.<br />
This week, Eskom is asking NERSA to approve R16.9-billion for diesel<br />
to fire the Open Cycle Gas Turbine (OCGP) plants for the upcoming<br />
financial year. How much of this wasteful spending year-on-year could<br />
have been avoided had Eskom been able to acquire these battery<br />
projects on schedule, along with untold generation capacity of wind<br />
and solar, part of which would also have offset the diesel spending?<br />
One must commend the efforts of the presidency in trying to speed<br />
things up, while sadly now being hamstrung by local strikes and<br />
international supply chain challenges.<br />
Nevertheless, and as the country limps from one infrastructure crisis<br />
to the next, consumers and businesses are moving at pace to become<br />
more self-reliant for energy, water and waste services, catching up, as<br />
it were, to security and education as services one simply can no longer<br />
expect government to deliver.<br />
This trend to self-sufficiency, as it happens, is perfectly in line with a<br />
move to more sustainable living and operating, and so therein lies the<br />
silver lining, that by the time we are through this energy crisis, we will<br />
have undergone a paradigm shift the likes of which could not possibility<br />
have been imagined in South Africa.<br />
Strength to you,<br />
Publisher<br />
www.greeneconomy.media<br />
All Rights Reserved. No part of this publication may be reproduced or transmitted in any way or<br />
in any form without the prior written permission of the Publisher. The opinions expressed herein<br />
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copyrights and permissions. The Publisher does not endorse any claims made in the publication<br />
by or on behalf of any organisations or products. Please address any concerns in this regard to<br />
the Publisher.<br />
EDITOR’S NOTE<br />
In the move towards green economies, it’s become apparent that there’s<br />
a need to not only introduce new emission reduction technologies<br />
and green energy sources, but also to adopt new practices that allow<br />
our existing infrastructure to be repurposed, and which bolster other<br />
green energy generation models.<br />
Considering that South Africa has one of the highest renewable<br />
energy generation potentials in the world and with existing<br />
infrastructure in place, the opportunities exist. Given that South Africa<br />
is the world’s largest producer of platinum, there is an opportunity for<br />
it to be a leading manufacturer of underlying technology.<br />
Establishing widescale pipeline distribution is key to enabling a<br />
high-penetration hydrogen economy. Again, this presents an exciting<br />
opportunity in terms of infrastructure development. Could hydrogen<br />
be the future of our economic success? (Page 14).<br />
We aim to transition to a green economy, combining economic<br />
development, social progress and environmental preservation. Both<br />
the economy and society remain, however, highly unsustainable.<br />
Targeting the transition to an inclusive green economy therefore<br />
signifies a massive shift, commanding a new model of development<br />
(page 30).<br />
There are global initiatives to move towards renewable energy<br />
sources and public consciousness of sustainability is increasing. As<br />
such, there is opportunity for new PV technologies to enter the mix<br />
(page 36 and 40). To combat the impact of plastic on environment,<br />
the industry is transitioning towards a circular economy (page 44).<br />
Increasing agriculture to feed the growing world population is a key<br />
sustainability challenge too (page 50).<br />
Enjoy this issue!<br />
Alexis Knipe<br />
Editor<br />
5
1012344<br />
<strong>Economy</strong><br />
G R E E N<br />
journal<br />
CONTENTS<br />
9 NEWS AND SNIPPETS<br />
14 ENERGY<br />
Could hydrogen be the future of SA’s<br />
economic success?<br />
18 OIL & GAS<br />
Strategic Alliances<br />
22 Growing SA’s economy: Petroleum Agency<br />
South Africa<br />
24 WASTE<br />
SRK Consulting: high standards of waste<br />
management in Angola’s oil sector<br />
27 ENERGY<br />
Loadshedding and the rising petrol price<br />
29 SKILLS DEVELOPMENT<br />
NCPC-SA developing green skills<br />
30 SPECIAL REPORT<br />
Targeting the transition<br />
33 WASTE<br />
Bemical and the 11-million elephants<br />
34 ENERGY<br />
NMISA saves energy for SA<br />
36 The future is bright for perovskite PV<br />
40 Going beyond silicon’s limitations<br />
43 WASTE<br />
A successful event for Plastics SA<br />
44 Plastic demand grows<br />
47 PRODUCT<br />
SA’s advanced PET strapping solution<br />
48 MOBILITY<br />
A rolling start for EV manufacturing plans<br />
50 AGRICULTURE<br />
Building resilience of African farming<br />
systems<br />
09 30 44<br />
THAT’S SUSTAINABILITY, FIRST.<br />
As the first to introduce a CO 2<br />
rating system across all products, AfriSam<br />
became the first cement manufacturer to achieve a 33% reduction in<br />
CO 2<br />
emissions since 1990. It’s just one of the firsts we’re proud to have<br />
laid the foundations for since starting our sustainability journey over<br />
three decades ago. As the industry’s leaders in sustainability, putting<br />
sustainability first has been, and always will be, second nature to us.<br />
READ REPORT<br />
THOUGHT [ECO]NOMY<br />
greeneconomy/report recycle<br />
To access the full report in our Thought [ECO]nomy report<br />
boxes: Click on the READ REPORT wording or image in the<br />
box and you will gain access to the original report. Turn to the<br />
page numbers (example below) for key takeouts of the report.<br />
key<br />
02<br />
key<br />
key<br />
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takeouts<br />
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of the<br />
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01 03<br />
www.afrisam.com<br />
Creating Concrete Possibilities<br />
7
NEWS & SNIPPETS<br />
CABINET ON ENERGY<br />
Cabinet conveys regret that intermittent loadshedding is happening<br />
at the time when government is vigorously engaged with the<br />
interventions announced by President Ramaphosa in July 2022 to<br />
overcome the surmountable energy crisis facing the country.<br />
Public Enterprises Minister Pravin Gordhan recently presented<br />
a briefing on the capacity of Eskom and a progress report from the<br />
Technical Committee of the National Energy Crisis Committee.<br />
Cabinet is still deliberating on these reports and following further<br />
interventions, announcements will be made.<br />
Meanwhile, Cabinet remains committed to resolving the issue of<br />
energy security in the country and welcomes the concerted efforts<br />
being made by government and stakeholders to find a permanent<br />
solution to end loadshedding.<br />
POWER STATION TO BE RECYCLED<br />
The Komati Power Station is a coal-fired plant that started<br />
operating in the 1960s, and finally is being shut for good. Eskom’s<br />
plan, part of the just energy transition (JET), is to repower<br />
Komati with renewable energy, and repurpose it into a training<br />
facility for Eskom employees and the surrounding community to<br />
be able to operate renewable energy facilities, and as a factory<br />
for the assembling of containerised solar microgrids.<br />
There are 600 employees at the Komati Power Station in<br />
Mpumalanga – 200 permanent staff, 200 contractors and 200 ERI<br />
Eskom road tech industry contractors.<br />
Mandy Rambharos, GM of<br />
the Just Energy Transition<br />
programme at Eskom, at<br />
the signing ceremony for<br />
the development of the<br />
power station, said they are<br />
not retrenching any of the<br />
full-time Eskom employees<br />
– they will be reskilled and<br />
redeployed at the training<br />
facility.<br />
Eskom is partnering with the South African Renewable Energy<br />
Technology Centre (Saretec), which will run the training, and the<br />
Global Energy Alliance for People and Planet (Geapp), which is<br />
providing the funding of $2-million over the next two years.<br />
The goal is to train 500 workers, some of them existing Eskom<br />
workers and some community members in Mpumalanga. Saretec<br />
will educate, reskill and upskill Eskom Komati Power Station staff<br />
and qualifying beneficiaries from the surrounding communities.<br />
The power station will be repowered with 150MW of solar,<br />
70MW of wind and 150MW of batteries, which will most likely be<br />
built under an EPC (engineering, procurement and construction)<br />
contract, because it requires a high skill level.<br />
SAVE THE RHINO<br />
South Africa’s commitment to ensure the protection of its black<br />
and white rhino populations is clear from the partnerships<br />
that have been created over the years and the resulting<br />
collaboration, to conserve the species, says the Minister of<br />
Forestry, Fisheries and the Environment, Barbara Creecy. The<br />
proportion of rhino on private land has grown from about<br />
30% in 2012 to about 60% at present, complemented by antipoaching<br />
successes.<br />
The Department of Forestry, Fisheries and the Environment has<br />
recognised the significant progress made on security, biological<br />
management and responsive legislation with some critical<br />
milestones remaining outstanding, most notably on community<br />
empowerment, demand management and Cabinet approval of<br />
the National Strategy to Combat Wildlife trafficking.<br />
In terms of the country’s overall rhino conservation plan, the<br />
private sector is playing an increasing role in South Africa and the<br />
rest of Africa. At present, the private sector is conserving about<br />
60% of South Africa’s national herd. Therefore, government takes<br />
building partnerships and relationships of utmost importance in<br />
the conservation of this iconic species.<br />
Over the last year conservation and anti-poaching efforts<br />
have intensified countrywide as a joint effort is made by the<br />
collaborative initiatives of state-owned conservation areas,<br />
government and private landowners to reduce the poaching of<br />
rhino in South Africa.<br />
Information collected and communication flows through the<br />
Environmental Enforcement Fusion Centre (EEFC) continues to<br />
support the teams at both a tactical level and strategic level in<br />
both the private and public sector.<br />
From a biological management point of view, the department<br />
in partnership with the Rhino Management Group and all relevant<br />
stakeholders are in the process of revising the Biodiversity<br />
Management Plans for rhinos.<br />
An additional important measure of recent success in the<br />
management of the rhino meta-population has been the<br />
successful translocation of 27 rhino from South Africa to the<br />
Zinave National Park in Mozambique.<br />
9
NEWS & SNIPPETS<br />
PRIVATE SECTOR REQUIRED<br />
Minister Senzo Mchunu says there is a need to increase private<br />
sector involvement in water services to achieve the 2030<br />
Sustainable Development Goals (SDG).<br />
The minister spoke at the International Water Association World<br />
Water Congress in Denmark, in September. This year, the summit<br />
focused on Innovative Funding for SDGs and Climate Change.<br />
In his speech, Minister Mchunu indicated that some of the<br />
challenges that hinder achieving the SDGs are the way municipalities<br />
run water and sanitation services. Minister Mchunu explained<br />
that municipal water supply is supposed to be managed as a selfsustaining<br />
business, with maintenance, operation and refurbishment<br />
costs covered by revenue from the sale of water.<br />
“In many municipalities, water and sanitation services are in a poor<br />
state and deteriorating,” said Minister Mchunu. “And the percentage<br />
of the population with access to reliable and safe water and sanitation<br />
services is declining.<br />
“Causes include weak governance and corruption, poor billing and<br />
revenue collection, poor asset management, operations management,<br />
maintenance and a lack of recruitment of people with the required<br />
qualifications and experience.”<br />
The minister said where there is a constraint in the municipalities<br />
in terms of finance and expertise, there is substantial expertise in the<br />
private sector and banks and pension funds.<br />
“However, private sector involvement in municipal water and<br />
sanitation services is considerably low compared to other middleincome<br />
countries. The reason for this is a lack of capacity in<br />
municipalities to take bankable projects to the market, coupled<br />
with a Public Private Partnership (PPP) regulatory framework, which<br />
means it takes eight to 12 years to facilitate a PPP.<br />
“In this context, we are doing two key things, a) Putting in place<br />
public-private collaboration agreements with industries, such as the<br />
mines and agriculture, for joint funding of infrastructure projects.<br />
This agreement will simultaneously provide bulk water to industry<br />
and reticulated water to communities, and b) putting in place a Water<br />
Partnerships Office (WPO) to assist municipalities [on how] to contract<br />
for PPP and independent water producers (IWPs),” he elaborated.<br />
The WPO is a ringfenced entity in the Development Bank of<br />
Southern Africa, and the work of such a WPO will be assisted by<br />
the PPP regulatory framework currently being finalised by the<br />
National Treasury.<br />
Minister Mchunu concluded by assuring all relevant stakeholders<br />
that South Africa is keen to learn from the experience of other<br />
countries as it embarks on this journey.<br />
THE ALL-NEW<br />
COROLLA<br />
CROSS<br />
CANNABIS MASTER PLAN<br />
The wheels of change are rolling and the North West Department<br />
of Agriculture and Rural Development stands firm on ensuring the<br />
Cannabis Master Plan finds space in agriculture transformation<br />
in the province. This follows the Department hosting the hybrid<br />
Cannabis Lekgotla at the North West University in September. The<br />
first of its kind in the North West Province, the gathering met its<br />
objective of discussing the rollout of the National Cannabis Master<br />
Plan and engaging on the economic purpose of commercialisation<br />
and development of the herb.<br />
MEC Desbo Mohono in her opening remarks said that the<br />
department provides a stark reminder that every avenue to<br />
create employment and fight poverty must be pursued, allowing<br />
businesses to grow, emerge and thrive, while also using the<br />
capabilities of the state to create a conducive environment<br />
for farmers. Mohono said, “This is hands on deck indeed and a<br />
dream come true for people of the North West province, for they<br />
too deserve to benefit from the value chain of this herb. As the<br />
government, we always appreciate the direct, considered and<br />
constructive approach that higher institutions of learning take in<br />
responding to the challenges facing our country. That is why we<br />
saw it fit as the North West Department of Agriculture and Rural<br />
Development to rope in North West University, in particular,<br />
looking at their research output, which is amongst the best in the<br />
entire country.”<br />
In conclusion, MEC Mohono said the Lekgotla unlocked many<br />
opportunities through commissions and the education drive. “In<br />
going forward, we will march to our traditional leaders as the<br />
department in forging a partnership and making sure that our<br />
people in communal land are not left behind by the train of this<br />
economic hub. The department will also set aside a certain amount<br />
of money in making sure that we train our farmers fully about how<br />
to be experts in this field. This will be done through roping in<br />
experts that we have met in this Lekgotla because we do not want<br />
to take a ride with our people’s time,” explained Mme Mohono.<br />
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10
ENERGY<br />
ENERGY<br />
COULD HYDROGEN BE<br />
THE FUTURE OF SA’S<br />
ECONOMIC SUCCESS?<br />
If so, how do we get there?<br />
Novel hydrogen technologies bring new challenges to environmental assessment practitioners,<br />
developers, investors, lenders and regulators as the risks and impacts associated with hydrogen<br />
production, and specifically green hydrogen, requires further research.<br />
BY CLIFFE DEKKER HOFMEYR<br />
The production of hydrogen presents unique environmental<br />
challenges because it is a water-intensive process that not only<br />
requires large volumes of water, but also high-quality treated<br />
water. The desalination of sea water is considered a viable water<br />
resource option for hydrogen production and offers an opportunity<br />
not only for further infrastructure development but possible<br />
opportunity to mitigate South Africa’s water shortages.<br />
One significant by-product associated with desalination, however, is<br />
the salt-rich effluent (brine) produced during the process, which is then<br />
discharged into the ocean and this effluent generation will need to be<br />
weighed up in the impact assessments.<br />
Building a desalination plant may trigger an environmental<br />
authorisation (EA) Listed Activity, subject to the production capacity,<br />
while the discharge of the brine may also trigger coastal water<br />
discharge permits. The movement to green hydrogen will also<br />
allow the desalination process to be powered by renewable energy<br />
from which the hydrogen itself is generated, allowing for a clean<br />
circular process.<br />
14<br />
In the move towards green economies, it has become apparent<br />
that there is a need to not only introduce new emission reduction<br />
technologies and “green” energy sources, but also to find solutions<br />
and adopt new practices that allow our existing infrastructure to be<br />
repurposed, and which work in parallel with and bolster other green<br />
energy generation models.<br />
Considering that South Africa has one of the highest renewable<br />
energy generation potentials in the world and with existing<br />
infrastructure in place, the opportunity exists to invest in electrolysis<br />
technology. This would also support the platinum sector as<br />
platinum is a required raw material for both fuel cell and electrolyser<br />
Establishing widescale pipeline<br />
distribution is key to enabling a highpenetration<br />
hydrogen economy.<br />
manufacturing. Given that South Africa holds most of the world’s<br />
platinum reserves, and is the world’s largest producer of platinum,<br />
there is an opportunity for it to be a leading contributor in the<br />
manufacturing of the underlying technology.<br />
In terms of repurposing, establishing hydrogen production facilities<br />
at existing mines and coal-fired power stations, for instance, may offer<br />
the opportunity to treat wastewater and contribute to combatting<br />
acid mine drainage where treated contaminated water can be used for<br />
green hydrogen production.<br />
The use of hydrogen will play a critical role in the transition of the<br />
transport sector, which currently accounts for more than 20% of global<br />
carbon emissions. In this regard, hydrogen can be used as fuel for<br />
long-haul aviation, maritime shipping, certain road vehicles and heavy<br />
freight transportation.<br />
Further, hydrogen can be used as an intervention in other industries<br />
such as steel production and in cement making; it can be used as a<br />
cleaned-up chemical feedstock in processes such as fertiliser production;<br />
it can contribute to the flexible dispatch and long-duration storage<br />
needs of a high-renewables electricity grid; and it can support contextspecific<br />
decarbonisation requirements.<br />
A notable practical benefit to green hydrogen usage is that its<br />
distribution and storage can be linked to that of natural gas, as<br />
hydrogen can be stored in aboveground tanks and transported in<br />
gaseous form via pipelines, liquified for shipment, or even converted<br />
into denser forms such as ammonia.<br />
Establishing widescale pipeline distribution is key to enabling<br />
a high-penetration hydrogen economy. In this regard South<br />
Africa’s establishment of and upgrades to pipeline infrastructure<br />
remain a priority as pipelines are conducive to hydrogen<br />
distribution, which can be carried out in a manner like, and<br />
potentially together with, the existing distribution and use of<br />
natural gas. Again, this presents an exciting opportunity in terms<br />
of infrastructure expansion and development.<br />
ESG AND GREEN FINANCING<br />
While ESG standards may initially have seemed somewhat abstract,<br />
ESG is becoming an increasingly tangible custom in corporate society,<br />
capable of swaying investor appetite and developer innovations<br />
towards greener and more socially responsible projects. The more<br />
investment capital is reserved for greener developments, the more<br />
developers will focus on projects that align accordingly.<br />
ESG has become the foremost investment consideration and<br />
financial institutions must weigh up short-term costs (which are often<br />
extensive) with long-term benefits (that may likely be unquantifiable).<br />
Institutions need to design and implement ESG strategies that amount<br />
to the “tools” to practically implement ESG objectives, without which<br />
the objections may remain nebulous and ineffectual.<br />
Considering hydrogen’s versatile application and its emissionreducing<br />
potential, it could form a key component of impactful ESG<br />
strategies and stimulate investment in hydrogen projects for their ESG<br />
potential. For example, hydrogen could be incorporated into projects<br />
with high revenue-generation potential to make them appealing<br />
targets for impact investing.<br />
Examples of such projects include algae farming in South Africa’s<br />
coastal waters, as algae growth produces hydrogen as a (green)<br />
by-product, or repurposing existing gas transmission infrastructure for<br />
green hydrogen distribution.<br />
Another strategy is improved data analysis, as one of the main<br />
barriers to companies implementing ESG initiatives is the lack of data<br />
available regarding its (mainly financial) benefit. By improving data<br />
analysis techniques, companies will be better equipped to introduce<br />
tailored ESG objectives that also result in financial gains, including<br />
those involving hydrogen.<br />
While hydrogen has major potential in terms of technology<br />
innovation, sustainable repurposing existing infrastructure, job<br />
creation, economic recovery and overall contribution to reducing GHG<br />
emissions, the extent of the potential, the cost, and implementation<br />
constraints all require further investigation. By bettering research<br />
and investigation into ESG motivated projects such as hydrogen<br />
technology and development, companies can confidently develop<br />
and hopefully easily access investment in green hydrogen projects<br />
that will bolster their ESG ratings that, and not superficially, reflect<br />
meaningful impacts.<br />
Considering hydrogen’s versatile<br />
application and its emission-reducing<br />
potential, it could form a key component<br />
of impactful ESG strategies.<br />
Although the application of ESG criteria appears to primarily<br />
feature at the investment decision level, it also plays a vital role in any<br />
company’s day-to-day operations. Offering a competitive advantage,<br />
ESG observance at business level will naturally also be more attractive<br />
to ESG-committed investors and lenders. ESG implementation may<br />
have reputational benefits and risks risk of reputational harm if the ESG<br />
goals or outcomes are overstated or otherwise misrepresented.<br />
To tie back to the need to be conscious of the appetite for increased<br />
civil challenges against the environmental impacts of infrastructure<br />
development, stakeholders, including environmental and community<br />
interest groups, are holding investors and corporates accountable,<br />
scrutinising environmental and social monitoring reports, publicly<br />
criticising failures to provide transparent disclosures and instituting<br />
ESG related litigation.<br />
In South Africa in particular, with its development needs and just<br />
transition approach, these challenges are likely to arise irrespective of<br />
the robustness of an ESG-led investment decision.<br />
Ultimately, in all ESG initiatives there needs to be a balance between<br />
responsibility and profitability, but there also needs to be a mindset<br />
shift to where costs are viewed as investments. The introduction of<br />
green hydrogen production technologies will be extremely capital<br />
intensive and will not be without challenges and barriers, particularly in<br />
the context of South Africa’s economic, political and social constraints.<br />
That notwithstanding, hydrogen presents a major opportunity to<br />
synergise sustainability and profitability and is therefore perfectly<br />
aligned with South Africa’s just transition goals.<br />
This article is an excerpt of the Cliffe Dekker Hofmeyr webinar: Could hydrogen really be the future of SA’s economic success? And if<br />
so, how do we get there?<br />
15
ENERGY<br />
ENERGY<br />
ZERO-EMISSION FUEL CELL EVs<br />
The Quantron QHM fuel cell electric vehicle (FCEV) was unveiled at<br />
IAA Transportation 2022 and the first orders for the vehicle have been<br />
placed. As a result, Quantron ordered 140 fuel cell engines from Ballard<br />
Power Systems to secure the supply chain, totalling approximately<br />
17MW with an option to purchase an additional 50 units. The fuel cell<br />
modules are expected to be delivered in 2023 and 2024.<br />
As of September 2021, Quantron and Ballard are engaged in a<br />
strategic partnership to accelerate the development of heavy-duty<br />
hydrogen vehicles. Ballard has made a minority equity investment<br />
in Quantron AG as part of Quantron’s financing round of up to<br />
50-million euros.<br />
Quantron QHM FCEV at IAA Transportation.<br />
(Above) The fuel cell from Ballard Power Systems integrated in the<br />
Quantron QHM FCEV. (Left) FCmove-XD 120 kW fuel cell from Ballard<br />
Power Systems.<br />
The zero-emission fuel cell electric vehicle platforms developed<br />
by Quantron will integrate Ballard fuel cell products for various truck<br />
applications in Europe and the US. The company’s initial market focus<br />
is Germany. In the next step, a total of four FCEV models are planned<br />
in cooperation with Ballard Power for 2023.<br />
“We are seeing growing global demand and policy support for<br />
zero-emission transport as companies strive to reach decarbonisation<br />
targets. This collaboration accelerates our entry into the European<br />
truck market and aims to have Quantron’s initial hydrogen-powered,<br />
zero-emission trucks on the road in the next 18 months,” says Randy<br />
MacEwen, CEO, Ballard Power Systems.<br />
Quantron AG<br />
Shell UK Future Fuels hydrogen refuelling station.<br />
INNOVATION IN HYDROGEN PRODUCTION<br />
Boasting some of the world’s best renewable resources, the Africa<br />
Middle East (AME) region is well-positioned to host gigawatt size<br />
hydrogen production sites.<br />
“It is anticipated that the region will drive product platform<br />
and foundational core technology innovation in the hydrogen<br />
production and energy storage area,” predicts Alan Zhao, who heads<br />
up the New Power business for power technology leader Cummins<br />
in the AME region.<br />
For the New Power technologies requiring large-scale infrastructure<br />
buildout, Zhao expects these to follow a similar path as the traditional<br />
internal combustion engine. The full ecosystem of zero-emission<br />
technology includes upstream, midstream and downstream. Cummins<br />
continues to invest in other advanced technology to minimise<br />
emissions, including fuel-agnostic engines such as hydrogen and<br />
natural gas engines.<br />
Looking more broadly at the hydrogen economy, Zhao defines<br />
this as an ecosystem of products and solutions that commences with<br />
hydrogen generation, to hydrogen and energy storage to applications<br />
and business segments enabled by hydrogen. In addition, the<br />
hydrogen economy also means powering economic activities in a<br />
decarbonised manner to eliminate carbon emissions.<br />
The hydrogen economy means viable and thriving economies<br />
based on the hydrogen ecosystem. “This is a critical component<br />
to deliver sustainable impact. If it is not viable and thriving, it will<br />
not last, and therefore not deliver the desired lasting impact,”<br />
stresses Zhao.<br />
“I believe strongly in a thriving hydrogen economy, based on<br />
some successful use cases and strong fundamental business cases<br />
for certain business segments. Those successes provide positive<br />
reinforcements to the hydrogen ecosystem. However, it will take<br />
time to go through the innovation adaption curve, just like any<br />
great innovation,” acknowledges Zhao.<br />
“There are likely to be some applications and use cases generating<br />
a great deal of enthusiasm now that will not pass the harsh reality<br />
of economic viability, but some will return as thriving applications<br />
when the ecosystem is ready for it,” he points out.<br />
Zhao concludes: “Successful energy transition requires massive<br />
Hydrogen refuelling.<br />
innovation and collaboration from the entire ecosystem of willing<br />
partners. Friendly competition is a key ingredient to drive critical<br />
and continuous improvement towards sustained impact. So, while<br />
competing to offer the best we can at any given stage of this long<br />
transition, together we can make it happen.”<br />
James Cannon James Cannon<br />
Miquel Gonzalez<br />
16<br />
17
OIL & GAS<br />
OIL & GAS<br />
KEARNEY’S PURCHASING CHESSBOARD<br />
1<br />
Typical approach by procurement has<br />
revolved around encouraging competition<br />
among suppliers, creating short-term benefits<br />
but a lack of long-term relationships.<br />
High<br />
Innovation<br />
breakthrough<br />
Respecification<br />
Value chain<br />
management<br />
Value<br />
partnership<br />
Kearney Analysis<br />
2<br />
Many categories risk getting positioned on<br />
the top left with “hot” markets increasing their<br />
supply power and buyers not having room<br />
to manoeuvre.<br />
Supply<br />
power<br />
Risk<br />
management<br />
2 3<br />
Technical<br />
data mining<br />
Integrated<br />
operations<br />
planning<br />
Cost<br />
partnership<br />
3<br />
The ideal end goal is to explore shifting the<br />
category dynamic to the top-right quadrant,<br />
leverage longer-term supplier relations and<br />
seek joint advantage with the suppliers, such<br />
as through strategic alliances.<br />
Co-sourcing<br />
Commercial<br />
data mining<br />
Tendering<br />
1<br />
Supplier<br />
pricing review<br />
Photographic Services, Shell International Limited.<br />
Figure 1. Strategic alliances are a good approach when demand and supply power are high.<br />
Low<br />
For example, delivering a well 20% quicker at 20% lower cost<br />
produces more benefits than simply a few days and dollars saved as<br />
production accelerates in a now viable project. This benefit grows<br />
as improved delivery continues over the longer term (three years or<br />
more) and can make borderline or uneconomical projects attractive<br />
again. Finally, companies can improve project delivery (completion<br />
timeframes) by 15% if they team more closely with third parties.<br />
Demand<br />
management<br />
Volume<br />
bundling<br />
Globalisation<br />
Target<br />
pricing<br />
Low Demand power High<br />
Strategic alliances are an<br />
excellent way to reach the next<br />
level of performance by working<br />
differently with suppliers.<br />
STRATEGIC ALLIANCES<br />
A win-win for oil and gas operators and suppliers<br />
Let’s be frank. The oil and gas industry excels at many things but getting operators and suppliers<br />
to trust each other and work closely for mutual benefit is not one of them. Business cycles drive<br />
relationships, with the price of oil at their heart.<br />
WHAT WIN-WIN LOOKS LIKE<br />
Strategic alliances work best when power is high for both the<br />
demand (operator) and supply sides. Referring to the Kearney<br />
Purchasing Chessboard, procurement encourages competition<br />
among suppliers, leading to short-term benefits rather than longterm<br />
relationships, as shown in the lower right-hand quadrant of<br />
Figure 1.<br />
Many categories risk being positioned at the top left, where hot<br />
markets increase supply power, limiting buyers’ room to manoeuvre.<br />
The ideal end-goal with a strategic alliance is to shift the category<br />
dynamic to the top right by leveraging longer-term supplier<br />
relationships and seeking joint advantage.<br />
BY KEARNEY CONSULTING*<br />
Yet, strategic alliances pose real benefits for oil and gas<br />
(O&G) companies and partners, especially as they tackle<br />
new challenges on the road to becoming energy companies<br />
with new suppliers in areas such as wind turbines, solar panels<br />
or customer and software solutions. Wouldn’t it be great if their<br />
relationships were decoupled from oil prices and based on win-win<br />
outcomes instead?<br />
There are good reasons to pursue strategic alliances now. For<br />
operators, 70% to 80% of their cost base lies with suppliers, and there<br />
is a wealth of value to be found there. Traditional contracting offers<br />
limited opportunity to uncover additional value, and companies need<br />
more innovative and collaborative ways to work with the supply chain<br />
that go beyond reducing costs.<br />
Most would agree the industry could operate better with fewer<br />
silos – not to mention an efficient request for proposal (RFP) process.<br />
Plus, managing suppliers for value could be a competitive edge in an<br />
increasingly complex and tightening market.<br />
Strategic alliances are an excellent way to reach the next level of<br />
performance by working differently with suppliers. We have seen a<br />
10% to 25% reduction in the total cost of ownership when operators<br />
and suppliers work collaboratively to fully tackle value and costs.<br />
We’ve also seen value unlocked in a multiple order of magnitude.<br />
Article courtesy of Kearney Consulting<br />
18<br />
19
OIL & GAS<br />
Kearney Analysis<br />
1. Base cost<br />
- “True” costs (no<br />
margins based on<br />
best historic delivery<br />
achieved)<br />
1<br />
2. Risk and<br />
inefficiencies<br />
- “True” costs for<br />
inefficiencies and lost<br />
time<br />
- Incurred as cost<br />
or accrued as<br />
margin driving<br />
efficient delivery<br />
and continuous<br />
improvement<br />
Short-term goals<br />
3. Fixed fee<br />
- Fixed fee to ensure<br />
income margin is<br />
always captured,<br />
capping downside<br />
risk for alliance<br />
members (10% to 25%<br />
of typical margin)<br />
Accrual<br />
mechanism as<br />
check and balance<br />
4. Performance<br />
margin<br />
- Margin based on<br />
non-time-related<br />
performance levers<br />
(floating mechanisms)<br />
Agreed “fair” %<br />
margin for average<br />
performance<br />
2 3 4<br />
Long-term goals<br />
5. Long-term<br />
incentives<br />
- Additional margins<br />
split members on<br />
reaching key project<br />
or yearly milestone(s)<br />
5<br />
Key concepts and guiding principles for commercial framework<br />
Fosters a one-for-all, all-forone<br />
spirit among partners<br />
(win or lose together)<br />
Incentivises the long term<br />
while still rewarding<br />
short-term performance<br />
No scenario in which<br />
alliance (non-operator)<br />
members incur a loss<br />
- Transparency on cost and margin (open book, true cost)<br />
- Step-change improvement margins are multiple times normal margins (win-win-win)<br />
- Average performance results in lower-than-average margin (improvement is needed)<br />
- Balance of long-term and short-term incentives (weighted towards the long term)<br />
- Incremental improvement >>incremental margin uplift, step-change improvement >> step-change<br />
margin uplift<br />
- Accrual mechanism (#2) to incentivise faster delivery, linked to performance margin (#4) as a check and<br />
balance to ensure outcomes in performance (such as HSE or quality)<br />
- The upside (and value potential) for suppliers is not capped<br />
- Suppliers never lose money (floating fixed-fee mechanism to ensure this)<br />
Figure 2. The commercial framework needs to drive win-win outcomes and the right behaviours. [Note: HSE is health, safety and environment]<br />
Strategic alliances work best<br />
when power is high for both the demand<br />
(operator) and supply sides.<br />
Having a commercial framework that drives win-win outcomes<br />
is paramount (see Figure 2). It can incentivise for the long term<br />
while rewarding short-term performance. It supports step-change<br />
improvement margins that are multiple times normal margins (a winwin-win)<br />
while seeking to improve average performance that renders a<br />
lower-than-average margin.<br />
BENEFITS OF A WIN-WIN<br />
• It delivers mutual value from partnerships. C-level heads on the<br />
operator and supplier sides will both be dedicated to making<br />
things work.<br />
• It improves the teams’ productivity by focusing on standardised<br />
processes, value-added work and a one-team mindset. Both<br />
parties will ask, “If we were one company, how would we solve<br />
this problem?” Then, they’d do it.<br />
• It leverages data tools to develop value opportunities for all parties<br />
and stress-tests the framework to ensure win-win outcomes.<br />
• It uses common language and promotes transparency on<br />
performance and activities. Partners must be willing to have an<br />
open book with no hidden margins.<br />
• It creates the potential for end-to-end value optimisation.<br />
Strategic alliances are dynamic and require continual crosscompany<br />
alignment and co-development to keep projects moving<br />
forward at every phase. Having an objective referee oversee the<br />
coming-together of partners at every phase is essential. At Kearney,<br />
we have found it very effective to bring all parties together in<br />
a room for a joint scrum to collectively work the needs and drive<br />
consensus and alignment on objectives, identifying the value case<br />
and principles everyone can work toward from the outset.<br />
A BREAKTHROUGH ALLIANCE<br />
Strategic alliances can be valuable for a wide range of projects,<br />
including drilling and well services, offshore wind, operations<br />
management (such as turn-arounds) and infrastructure.<br />
IN PLAIN SIGHT<br />
The opportunity to form strategic alliances in the O&G industry<br />
has been there for years. Enduring mindsets – and perhaps being<br />
comfortable doing things the way they’ve always been done –<br />
have kept companies from exploring the benefits. A tightening<br />
market may trigger some to collaborate now, but it is also a smart<br />
move for thinking five to 10 years down the road. Finding partners<br />
through strategic alliances ensures operators have the help they<br />
need and presents an opening for shaping what the market looks<br />
like in the future.<br />
*Authors: Christian Tapolcai, Partner and James Pearce, Partner, Kearney Consulting<br />
20
OIL & GAS<br />
OIL & GAS<br />
GROWING SA’S ECONOMY<br />
Petroleum Agency SA<br />
commercial oil and gas production, leaving it reliant on imports of the<br />
fuel. Its search for domestic resources has encountered unprecedented<br />
opposition in recent months by communities and activist groups<br />
who have successfully blocked exploration activities by companies<br />
including Shell Plc.<br />
“As the Petroleum Agency, we acknowledge that South Africa’s<br />
upstream oil and gas industry has become litigious,” CEO of PASA,<br />
Phindile Masangane says. “Steps are being taken to enhance the<br />
guidelines around local consultation, which have been criticised by<br />
groups in court, while the regulator looks to increase activity.”<br />
Production from the newly discovered Block 11B/12B could revive<br />
PetroSA’s Mossel Bay gas-to-liquids plant which ordinarily produces<br />
45 000 barrels a day but has run out of feedstock. (PetroSA is South<br />
Africa’s national oil company and is separate from Petroleum Agency<br />
SA.) South Africa also plans to use the fuel to transition away from coal,<br />
which is used for South Africa’s electricity generation.<br />
Most of the coal consumed locally is utilised not as a final energy<br />
product but as feedstock, primarily for electricity and synthetic fuel<br />
production; coal supplies about 77% of the total primary energy<br />
market in South Africa. It is government’s stated objective to diversify<br />
the energy mix and environmental pressures suggest that at least part<br />
of this demand be met by a clean source such as natural gas.<br />
If TotalEnergies meets the requirements, obtains environmental<br />
authorisation and starts the development, output could potentially<br />
begin as soon as 2026 says Masangane.<br />
Eco Atlantic Oil & Gas Ltd and its partners have hired a rig to start<br />
exploration in Block 2B, which is offshore South Africa. Masangane says<br />
that processes leading to the activity have been followed properly.<br />
The demand for energy has surpassed supply and alternative energy<br />
sources are being sought to deal with the ever-growing demand.<br />
Petroleum Agency SA, together with the Council for Geoscience<br />
and the Department of Mineral Resources, is conducting extensive<br />
studies into South Africa’s potential shale gas resources. Natural gas<br />
has been discovered off the west coast of South Africa in the Atlantic<br />
Ocean (Ibhubesi gas field) and off the southern coast in the Indian<br />
Ocean (F-A, E-m and other fields of the Bredasdorp Basin). Both areas<br />
have great potential.<br />
South Africa has also returned its attention to the Karoo, a gas-rich<br />
semi-desert region of the country where several wells were planned<br />
almost a decade ago by Shell and other explorers before environmental<br />
concerns and legal uncertainty saw activity diminish.<br />
Regulations were published in July 2022 for public comment by the<br />
environment minister around hydraulic fracking, a drilling technique<br />
that raised concerns over water use in the Karoo.<br />
The government will conduct seismic activity by the end of 2022 to<br />
determine which blocks to license after the rules are finalised, according<br />
to Masangane. She says that groundwater and geological studies are<br />
being conducted in the biodiversity-rich areas.<br />
Other operations of interest include exploration of the deep water<br />
and ultra-deep water of the southern Orange Basin. There is continued<br />
interest in the ultra-deep water of the northern sector. The deep water<br />
of the southern offshore, soon to be tested by Total, holds exciting<br />
potential for large oil reserves.<br />
In addition to well-developed air and rail links, South Africa has<br />
750 000km of roads and over nine-million registered vehicles. South<br />
Africa thus represents an important world market for petroleum<br />
products and this market is expanding rapidly. Since over 60% of<br />
current demand is met by imported crude there is a ready local<br />
market for any indigenous hydrocarbons that are discovered in<br />
South Africa.<br />
Oil and gas remain the most critical of energy resources, and<br />
Petroleum Agency SA is in full support of those entering the South<br />
African oil and gas exploration and production industries. The Agency<br />
is fully committed to ensuring that our government and policymakers<br />
sustain the sector for the benefit of all involved and will do everything<br />
in its power to advance the industry.<br />
Petroleum Agency SA has been designated by the government as the official agency responsible<br />
for the promotion and regulation of South Africa’s petroleum resources. The Agency regulates and<br />
monitors exploration and production activities and is the custodian of the national exploration and<br />
production database for petroleum.<br />
Petroleum Agency SA (PASA) is South Africa’s state-owned<br />
company established through a ministerial directive in 1999.<br />
The Mineral and Petroleum Resources Development Act<br />
(MPRDA) came into operation in May 2004 and in terms of this Act, the<br />
Agency received its mandate to operate. The Agency is responsible<br />
for the promotion and regulation of exploration and development<br />
of South Africa’s oil and gas resources. The Agency archives all data<br />
related to oil and gas exploration and develops the local upstream<br />
industry for the benefit of all South Africans.<br />
In terms of strategy, the Agency actively seeks out technically<br />
competent and financially sound clients to whom it markets acreage,<br />
while ensuring that all prospecting and mining leases are for the longterm<br />
economic benefit of South Africa. By application of appropriate<br />
technology, the agency improves the understanding of the commercial<br />
potential of South Africa’s natural oil and gas resources to attract<br />
investment, both locally and internationally.<br />
By facilitating the process of attracting qualified international<br />
explorers to invest in the oil and gas sector, PASA can further grow<br />
the South African economy and contribute to the aims of the National<br />
Development Plan 2030. The plan envisages that by 2030 South Africa<br />
will have an adequate supply of electricity and liquid fuels to ensure<br />
that economic activity and welfare are not disrupted, and that at least<br />
95% of the population will have access to grid or off-grid electricity.<br />
Both the National Development Plan and the Integrated Resource<br />
Plan call for natural gas to contribute a far greater percentage to South<br />
Africa’s primary energy supply mix.<br />
Previous challenges affecting investment decisions, such as the low<br />
oil price and the uncertainty introduced by the MPRDA amendment<br />
bill, are now a thing of the past. The MPRDA amendment bill has been<br />
withdrawn from parliament. Both President Ramaphosa and Minister<br />
Matashe have explained oil and gas exploration will be governed by<br />
separate legislation, and no longer grouped under general mining<br />
legislation. South Africa is on the brink of major developments in the<br />
upstream industry and the next few years will be key in determining<br />
its future energy profile and how oil and gas contribute to the greater<br />
energy mix.<br />
There are currently plans for massive gas production off South<br />
Africa’s coast. South Africa expects TotalEnergies SE to submit a<br />
production plan to utilise a prolific offshore gas discovery that will form<br />
a major part of increasing investment in the sector. South Africa lacks<br />
There is an excellent case to be<br />
made for investment in South Africa’s<br />
burgeoning oil and gas exploration<br />
and production sector.<br />
CEO OF PETROLEUM AGENCY SA<br />
Dr Phindile Masangane is arguably one of the best-qualified women in the South African energy sector. She holds a PhD in Chemistry, an MBA<br />
from Wits Business School and a Bachelor of Science degree. Dr Masangane has overseen the development and commercialisation of all CEF<br />
Group renewables, alternative and new technology advancements through strategic partnerships with private and public sector entities. She<br />
has vast experience in developing, deal structuring and financing of renewable energy projects. She has participated in national energy policy<br />
development, including for biofuels, renewables and the gas programme.<br />
22<br />
23
WASTE<br />
WASTE<br />
“To ensure a high standard of design, SRK has in the past applied<br />
the minimum requirements from South Africa’s Department of Water<br />
and Sanitation. In recent years, Angola also began developing its own<br />
regulations – especially regarding characterisation of waste – so we<br />
incorporate these too,” adds Engelsman.<br />
This developing legal landscape for waste management requires,<br />
for instance, more detailed investigation of leachable characteristics<br />
as well as the total concentration of contaminant of concern in the<br />
waste. Two streams of testing are therefore conducted – one for the<br />
leachable concentrations and another for total concentrations. Based<br />
on the outcome of these tests, there are restrictions on what materials<br />
can enter the landfill.<br />
“Our extensive experience in waste management in South Africa<br />
– in the field of tailings dams, for example – equips us very well for<br />
these projects,” says Engelsman. “Tailings waste has to be classified to<br />
assess whether a lining is required under the facility – a decision with<br />
significant cost implications.”<br />
Unsplash<br />
Unsplash<br />
Angolan municipalities face a considerable challenge dealing with waste<br />
from residents and local businesses.<br />
High standards of<br />
waste management<br />
in Angola’s oil sector<br />
As Sub-Saharan Africa’s second-largest oil producer, Angola has seen the application of world-class<br />
waste management standards in its oil and gas sector.<br />
BY SRK CONSULTING<br />
SRK Consulting has been involved in landfill design and<br />
environmental impact assessments in Angola for almost 20<br />
years, according to Bruce Engelsman, principal engineer at<br />
SRK Consulting.<br />
“Most of the waste from the offshore platforms comprises drill<br />
cuttings, which emanate from many kilometres of off-shore exploration<br />
drilling,” says Engelsman. “These have to be brought ashore, treated<br />
and disposed of responsibly, especially to manage the hydrocarbon<br />
content in this waste stream.”<br />
A specialist Angolan firm treats these cuttings extracting the oil in<br />
the cuttings using the latest Danish thermal desorption technology<br />
before the material can be sent to landfill. There is also hazardous<br />
waste from offshore and onshore facilities that is incinerated as<br />
well as general domestic waste which is landfilled. In line with<br />
best practice and Angolan regulations, emissions emanating from<br />
treatment are scrubbed and monitored as part of closely managed<br />
waste disposal.<br />
Environmental protection principles are in fact embedded in the<br />
country’s constitution 1 , which highlights that the State “shall promote<br />
the protection and conservation of natural resources guiding the<br />
exploitation and use thereof for the benefit of the community as<br />
a whole”. It also gives all citizens the right to “live in a healthy and<br />
unpolluted environment” and requires the State to “take the requisite<br />
measures to protect the environment and national species of flora and<br />
fauna... and maintain ecological balance”.<br />
Engelsman explains that Angola has several main service hubs to<br />
support its oil and gas sector. One is Luanda with its extensive port<br />
facilities, and the other is in the far north at Soyo – on the Congo River.<br />
“These sites boast total waste management solutions that use leadingedge<br />
technology,” he says. “The treated residue is deposited in landfill<br />
facilities designed by SRK, ensuring that best international practice is<br />
applied regarding environmental and social impact. The total design<br />
includes the cells themselves, groundwater monitoring, roads and<br />
other infrastructure.”<br />
Angola has several main service hubs to support its oil and gas sector,<br />
boasting total waste management solutions.<br />
REFERENCES<br />
1 https://energycapitalpower.com/angolas-oil-and-gas-industry-can-thrive-alongside-its-rich-biodiversity/<br />
2 https://www.unep.org/news-and-stories/story/partnering-strengthen-chemicals-and-waste-management-angola<br />
To ensure a high standard of<br />
design, SRK has in the past applied<br />
the minimum requirements from<br />
South Africa’s Department of Water<br />
and Sanitation.<br />
The Cacuaco facility, with which SRK has been involved for 15<br />
years, is nearing the end of its life. After closure, operations will<br />
move to Bengo in the Viana district, on which SRK is currently busy<br />
with design work.<br />
“We partner with a local firm of professionals to conduct the<br />
environmental impact assessments (EIAs), including high-tech work<br />
such as air emissions modelling,” he adds. “The recommendations from<br />
the EIAs are then incorporated into our designs.”<br />
Angolan municipalities also face a considerable challenge dealing<br />
with waste from residents and local businesses, and SRK has recently<br />
become involved in feasibility studies in this segment.<br />
“Cities like Luanda have struggled for many years to manage the<br />
rapid urbanisation from the war years, when people flocked to cities<br />
for safety,” Engelsman says. “For instance, Luanda reportedly produces<br />
some 6 000 tons of solid waste every day, and its infrastructure was not<br />
developed to cope with such volumes.”<br />
The country continues to develop its waste management capacity<br />
with partner agencies. In 2019, the United Nations Environmental<br />
Programme (UNEP) – through its Chemicals and Waste Management<br />
Programme – launched an ambitious three-year project 2 in Angola,<br />
focused on establishing a sustainable and integrated national structure<br />
to better manage chemicals. The strategy has been coordinated by<br />
the Angola Ministry of Environment, through a National Chemicals<br />
Management Unit. This works towards the implementation of the<br />
project and ensures that Angola can continue to manage chemicals<br />
and hazardous wastes into the future.<br />
24<br />
25
ENERGY<br />
Loadshedding and the rising petrol price<br />
Practical tips for SMEs to overcome challenges facing the sector<br />
It’s time to harness renewable energy,<br />
go off grid, harvest rainwater, and<br />
ultimately reduce your business’<br />
running costs.<br />
Following two years of lockdown restrictions, South Africa’s<br />
economic recovery is being thwarted by several adversities on<br />
both local and global fronts. Locally, several antagonistic forces<br />
are at play, namely significant fuel price hikes and the ongoing bouts<br />
of loadshedding, which continue to undermine the stability of the<br />
energy system and put additional pressure on small and mediumsized<br />
enterprises (SMEs) in the country.<br />
This is the opinion of Rene Botha, area manager at South African<br />
SME financier, Business Partners Limited, who explains that the effects<br />
of these realities are felt most acutely by small businesses. Within<br />
this context, SME owners need to focus single-mindedly on finding<br />
creative ways to circumvent these challenges to maintain a semblance<br />
of business as usual.<br />
businesses, especially where factors like food storage need to be<br />
considered. A good, practical exercise for SME owners would be to add<br />
up the line-item costs of undergoing a complete shutdown during<br />
loadshedding versus the initial outlay of a backup power source or the<br />
cost of going completely green for your building. In most cases, the cost<br />
saving potential of backup energy or going green justifies the initial<br />
investment especially with finance that comes with rebates as with the<br />
Business Partners Limited’s <strong>Green</strong> Buildings Finance programme.<br />
THE EFFECTS OF THE FUEL PRICE HIKE<br />
Hikes in fuel prices affect South African small businesses across several<br />
sectors. SMEs who deliver or collect goods or transport people as part<br />
of their business model are directly impacted. Small businesses are<br />
also affected indirectly when supplier prices escalate to accommodate<br />
rising fuel prices. From a macroeconomic perspective, fuel hikes can<br />
drastically reduce consumers’ disposable and spending power, which<br />
can also have a knock-on effect on an SME’s bottom-line.<br />
Botha offers the following tips on how small businesses can mitigate<br />
the effects of the fuel price increase:<br />
1. Prioritise vehicle maintenance<br />
Depending on the vehicle being used, there are ways to maintain<br />
a car to ensure that its fuel consumption remains relatively low. For<br />
example, tyres that are underinflated have a higher rolling resistance<br />
on the road, which generates excess friction and increases fuel<br />
consumption in the long run. Tyre pressure should be checked at least<br />
once a month, engines need to be serviced frequently and air filters<br />
should be kept cleaned.<br />
A SPOTLIGHT ON LOADSHEDDING<br />
Loadshedding has led to significant revenue losses, with the most<br />
recent figures presented by technology company, Yoco, suggesting<br />
that about 30% of small businesses have lost up to 10% of their<br />
annual revenue due to the onset of loadshedding. There are several<br />
theories on how much longer loadshedding will continue, with one<br />
source suggesting that it could persist well into 2025. The consensus,<br />
however, is that it is a South African reality for which small businesses<br />
need to prepare.<br />
Botha offers the following tips for SMEs on how to reduce the effects<br />
of loadshedding:<br />
Our <strong>Green</strong> Buildings Finance Programme provides up to 100%<br />
property finance ranging from R500 000 to R50 million to established<br />
entrepreneurs with a viable business who want to invest in green<br />
buildings and achieve green building certification. We finance the<br />
purchase, construction, and/or retrofit of buildings if their designs<br />
are certified under an eligible green building certification.<br />
Extra benefits:<br />
The cost of green certification is covered by a non-refundable<br />
grant of up to R150 000. We offer a rebate of up to 40 percent of<br />
the capital expenditure needed to green your building and<br />
achieve green buildings certified status.<br />
1. Surge protect your property<br />
With small businesses playing such a crucial role in the subsistence<br />
of South Africa’s economy, finding innovative ways to mitigate<br />
loadshedding needs to be a priority. At a minimum, SMEs should have<br />
preventative measures in place to reduce damage to their property,<br />
which includes installing surge protection plugs.<br />
2. Install a backup power source<br />
Another way to avoid incurring severe revenue losses because of<br />
loadshedding is to invest in battery-powered backup technologies<br />
like point-of-sale devices, so that sales can still be processed when the<br />
electricity is cut off. With the wide variety now available, SMEs should<br />
be able to find battery-powered solutions that meet their needs.<br />
Portable nano solutions are relatively cost-effective when compared<br />
to the potential revenue loss of being completely unable to operate.<br />
Solar powered backup generators are also viable options for larger<br />
2. Optimise your travel arrangements<br />
Technology is a powerful enabler when it comes to finding ways<br />
to be more fuel-efficient. Navigation apps like Google Maps and<br />
Waze collate millions of data points to provide users with accurate<br />
information on traffic capacities and alternative, faster routes. By<br />
using these apps to avoid peak traffic times, SMEs can reduce their<br />
fuel input cost. Incremental savings in the short-term can accumulate<br />
into longer-term savings.<br />
SMEs that deliver goods can introduce set delivery slots and<br />
use digital tools to position these slots within hours that roads are<br />
relatively free of traffic. This can be marketed to customers effectively<br />
by emphasising how set delivery times will help goods recipients to<br />
plan their schedules more efficiently.<br />
Visit Businesspartners.co.za to find out more<br />
27
SKILLS DEVELOPMENT<br />
NCPC-SA DEVELOPING GREEN SKILLS<br />
Globally, there is a resounding push towards a circular economy and just transition. Responding<br />
to the inevitable change to industry, NCPC-SA hosted a green skills development workshop at the<br />
5th Biennial Industrial Efficiency Conference.<br />
BY NCPC-SA<br />
20 years of<br />
Industrial Efficiency<br />
THA 36-2022<br />
National Cleaner Production Centre<br />
South Africa<br />
A national industrial support programme that partners with industry<br />
to drive the transition towards a green economy and save money.<br />
Services include:<br />
<strong>Green</strong> skills development<br />
Contact us for a free assessment<br />
www.ncpc.co.za | ncpc@csir.co.za<br />
Funded by the dtic, hosted by the CSIR<br />
Industry and sector knowledge-sharing<br />
Company technical support<br />
At the 2019 United Nations Climate Action Summit, 46<br />
countries committed to support a just ecological transition<br />
by formulating national plans for a just transition and<br />
creating decent and green jobs. However, as the just transition<br />
becomes increasingly prevalent across the globe, the South African<br />
industry and her youth are left wanting and struggling to, in most<br />
cases, make the relevant shift.<br />
To help bridge the gap, the National Cleaner Production Centre<br />
South Africa (NCPC-SA) workshop reflected on the skills required for a<br />
just transition, the move to a sustainable economy and the inclusion of<br />
marginalised sectors or society and industry.<br />
“A green or environmental transition can actually lead to the<br />
creation of a lot of jobs if we take the right measures and approaches<br />
at the level of policies and strategies,” explains Alice Vozza, ILO<br />
Decent Work Team for Eastern and Southern Africa. Speaking on<br />
behalf of the International Labour Organisation (ILO), Vozza delivered<br />
a presentation titled, The Just Transition and Skills for <strong>Green</strong> Job<br />
Initiatives in Eastern and Southern Africa. To access the presentation<br />
visit: www.ncpc.co.za.<br />
Thought leaders from the GIZ, National Business Initiative and<br />
the Council for Scientific and Industrial Research (CSIR) joined<br />
Vozza in reflecting upon their organisations’ programmes on skills<br />
development and the green economy. The presentations provided<br />
insight into available opportunities and developments in new skills<br />
sets and learning platforms that can assist industry to transition to<br />
efficient ways of doing business.<br />
As an important catalyst that facilitates the demand and supply<br />
of skills that support the transitioning towards a circular economy,<br />
NCPC-SA has, over a 12-year period, offered introductory, end-user<br />
and expert level training in the fields of:<br />
• Resource Efficient and Cleaner Production (RECP)<br />
• Energy Management Systems (EnMS)<br />
• Energy Management 101<br />
• Energy Performance Measurement Indicators (EnPMI)<br />
• Power quality principles<br />
NCPC-SA has established itself<br />
as a leader in the green economy<br />
training field.<br />
• Water efficiency (under development)<br />
• Sustainable finance<br />
• Renewable energy courses<br />
• Biogas<br />
• Solar thermal (under development)<br />
• Energy Systems Optimisation (ESO):<br />
• Compressed air systems, motor systems, pump systems, steam<br />
systems, fans systems, and large-scale cooling and industrial<br />
refrigeration systems.<br />
NCPC-SA has established itself as a leader in the green economy<br />
training field. “We have become global players and global leaders<br />
winning international awards,” celebrates Ndivhuho Raphulu, NCPC-SA<br />
director. Over the past decade, NCPC-SA has trained more than 8<br />
646 professionals, and certified 401 experts and 252 local trainers.<br />
The project registered seven national qualifications framework<br />
occupational qualifications and created 13 original training courses.<br />
Held every two years, the Biennial Industrial Efficiency Conference<br />
has established itself as a benchmark for platforms that equip and<br />
highlight best practice in South Africa’s circular economy transition.<br />
Visit www.ncpc.co.za for information on the conference, training<br />
programme and services.
SPECIAL REPORT<br />
SPECIAL REPORT<br />
TARGETING THE TRANSITION<br />
GREEN ECONOMY POLICY REVIEW<br />
South Africa aims to transition to an inclusive green economy, combining economic development,<br />
social progress and environmental preservation. Both the economy and society remain, however,<br />
highly unsustainable. Targeting the transition to an inclusive green economy therefore signifies a<br />
massive and disruptive shift, commanding a new model of development.<br />
Industrial policy is core to this process, notably to ensure a “just<br />
transition” and manage a balancing act, consisting of maximising<br />
the benefits of the transition and minimising the risks associated<br />
with not transitioning; but in line with South Africa’s capabilities<br />
to minimise the short-term trade-offs and threats. This requires a<br />
careful alignment of South Africa’s industrial policy with the inclusive<br />
green economy paradigm to support the country’s green industrial<br />
development. Ultimately, this requires the shift from industrial policy<br />
to green industrial policy.<br />
To inform such a transformation, this report reviews South Africa’s<br />
industrial policy, from an inclusive green economy lens. It investigates<br />
the extent to which South Africa’s industrial policy is responding to, if<br />
not driving, the country’s transition.<br />
POLICY DESIGN<br />
Several broad policy documents, such as the National Development<br />
Plan (NDP), the Innovation Plan and the National Strategy for<br />
Sustainable Development and Action Plan (NSSD) have called for the<br />
This report is an excerpt from <strong>Green</strong> <strong>Economy</strong> Policy Review of<br />
South Africa’s Industrial Policy Framework. The policy review<br />
was compiled by the departments of Forestry, Fisheries and the<br />
Environment; Trade, Industry and Competition; and Science and<br />
Innovation and was produced by the United Nations Environment<br />
Programme in 2020. Lead authors are Gaylor Montmasson-Clair and<br />
Gillian Chigumira from Trade & Industrial Policy Strategies (TIPS).<br />
transition to a more sustainable development path in South Africa.<br />
Such documents mention and support (at least in principle) a green<br />
industrial transition, but they do not constitute a strategic, coherent,<br />
green industrial development vision.<br />
The National Planning Commission (NPC) has embarked on a<br />
process to develop 2 050 pathways for South Africa which may<br />
provide the platform to establish the country’s vision for green<br />
industrial development (and beyond). Despite some “green shoots”,<br />
South Africa’s industrial policy, historically structured around the 2007<br />
National Industrial Policy Framework and the rolling Industrial Policy<br />
Action Plans (IPAPs), has not shaped a green development vision.<br />
The dti has provided leadership for the development of green<br />
industries, with building blocks to support renewable energy, resource<br />
efficiency, the circular economy and e-mobility. In addition, the<br />
department increasingly focuses on aligning industrial policy with<br />
environmental objectives. Industrial policy has been core to designing<br />
and implementing a just transition, leading with the identification<br />
of vulnerable sectors and stakeholders, the development of resilience<br />
plans and the Socioeconomic Impact Assessment System (SEIAS).<br />
Going forward, industrial policy will be structured around the<br />
development of Master Plans for key industrial value chains, as<br />
coordinated by the presidency’s Re-imagining our Industrial Strategy<br />
for Inclusive Growth framework. The presidency’s approach has not,<br />
however, overtly embraced a green economy lens and focuses on<br />
traditional sectors and activities.<br />
National Development Plan | Executive Summary [2011]<br />
National Strategy for Sustainable Development<br />
and Action Plan [2011]<br />
A general coherence seems to emerge, in theory, from national<br />
policy documents, with renewable energy, energy efficiency, green<br />
buildings, waste management and sustainable transport arising as key<br />
focus areas. In practice, several issues lack consensus or clarity. This is<br />
the case around key technological choices in the energy space.<br />
From an institutional perspective, the cross-cutting nature of the<br />
transition to a green industrial development leads to responsibilities<br />
being scattered among multiple entities. Ultimately, elements of green<br />
industrial policy are conducted by a wide array of stakeholders, mostly<br />
with conflicting interests, including all spheres of government.<br />
Multiple official channels aimed at aligning public policy exist,<br />
such as the Forum of South African Directors-General, the Economic<br />
Sectors, Employment and Infrastructure Development (ESEID) cluster,<br />
ministerial political and technical structures and the Intergovernmental<br />
Committee on Climate Change.<br />
Industrial policy has been elevated to the presidency, opening<br />
the door for a more coordinated approach. A strong push for green<br />
industrial development from the presidency could effectively require<br />
the dti and other departments to be more proactive. The Climate<br />
Change Bill makes provision for additional coordination mechanisms<br />
at national and provincial levels.<br />
Beyond the coordination of public action, social dialogue is a<br />
central aspect of the transition to green industrial development,<br />
particularly because of its socioeconomic implications. It is historically<br />
vibrant in South Africa, notably through the National Economic<br />
Development and Labour Council (Nedlac). The NPC aims to reach<br />
a social compact through an extensive process of bottom-up<br />
consultation. Furthermore, the establishment of a Presidential Climate<br />
Change Coordinating Commission (PCCCC) shows a strong interest<br />
by all social partners in improving coordination of the (just) transition.<br />
At the industrial level, the degree of stakeholder engagement<br />
varies vastly from one industry to the next. In most cases though,<br />
engagement appears to be more reactive than proactive and<br />
culminates if issues (or crises) arise. Furthermore, stakeholders often<br />
do not consider their concerns and proposals to be considered<br />
meaningfully. The extent to which such engagements are mobilised<br />
to discuss issues pertaining to the transition to a green industrial<br />
development also seem to depend on the political agenda.<br />
The Master Plan approach may provide the adequate platform for<br />
proactive, forward-looking planning and implementation. At the<br />
monitoring and evaluation level, the knowledge base necessary for<br />
evidence-based decision-making and effective implementation of<br />
a green industrial development agenda, although growing rapidly,<br />
remains largely incomplete.<br />
POLICY IMPLEMENTATION<br />
Mirroring the multitude of strategies and numerous measures that have<br />
already been implemented in South Africa to foster the transition to<br />
green industrial development. Altogether, while far-reaching, the<br />
mix of measures appear to lack coherence and certainty. There is no<br />
clarity on the role, scope and impact of the mix of measures and the<br />
interaction of its many components.<br />
In some cases, like the carbon tax and budgets, the integration<br />
remains weak. In addition, the mix of measures does not adequately<br />
capture the diversity of industrial situations vis-à-vis the transition<br />
and fails to propose tailored solutions. All industrial policy tools<br />
have, however, been used to some extent to foster the transition.<br />
Industrial finance directed at the transition has steadily increased<br />
over the last 10 years. Overall, the energy sector, namely renewable<br />
energy and energy efficiency, has garnered the most focus, through<br />
the Renewable Energy Independent Power Producer Procurement<br />
Programme (REIPPPP) and a series of tax incentives.<br />
Despite the increasing focus on green industrial finance, material<br />
gaps remain. They range from policy-related issues (misalignment<br />
between the industrial and green economy policy frameworks) to<br />
structural problems (the lack of a funding pool for some segments) to<br />
skill and capacity issues (the misunderstanding of green economy by<br />
financiers) to fund design problems (the focus on renewable energy<br />
and energy efficiency).<br />
The transition also rests on the ability to identify and supply green<br />
skills. Overall, no central repository of learning opportunities exists<br />
in the country, hindering the rollout of competencies. South Africa<br />
does not have a comprehensive, cross-cutting approach to green<br />
skills development, despite existing initiatives in some universities,<br />
Sector Education and Training Authorities, and Technical Vocational<br />
Education and Training colleges. For champions driving the transition,<br />
a wide spectrum of learning opportunities relevant to a green<br />
economy already exists in South Africa, such as resource efficiency.<br />
Regulations have a fundamental impact on the transition and have<br />
been used with various degrees of success in South Africa. Commandand-control<br />
regulation, such as licensing for impact assessment,<br />
pollution prevention or industry waste management plans, is widely<br />
used in South Africa. However, its implementation remains highly<br />
imperfect, from the lack of enforcement to the difficulty in obtaining<br />
some licences. In some cases, it has had a hindering effect on the<br />
transition by obstructing circular economy initiatives or preventing the<br />
roll-out of new technologies.<br />
The Climate Change Bill [2018]<br />
From a climate change perspective, quantity-based regulations<br />
around greenhouse gas (GHG) emissions have been implemented<br />
at national (peak, plateau and decline trajectory), sector (emissions<br />
targets) and firm (carbon budgets) levels. Price-based instruments<br />
have been used to change behaviours. The levies on electric filament<br />
lamps and plastic bags have had a positive impact on consumption,<br />
while the impact of a carbon tax on new vehicles is more tenuous. A<br />
carbon tax on GHG emissions has been implemented since 2019.<br />
Frameworks (the REIPPPP and industrial symbiosis programmes)<br />
as well as procurement and fiscal rules (such as deductions for<br />
“green” investments) provide the regulatory settings for certain<br />
operations and have been used in South Africa. The use of standards<br />
and targets has shown mixed results. In line with the National Energy<br />
Efficiency Strategy, fast-rising energy prices have led to a dramatic<br />
progress in industrial energy efficiency over the last two decades.<br />
South Africa lags other key industrialised economies in the rollout of<br />
International Organisation for Standardisation (ISO) standards, such as<br />
ISO14001 for environmental management and particularly ISO50001<br />
for energy management.<br />
30<br />
31
SPECIAL REPORT<br />
WASTE<br />
Local content requirements are a key industrial policy tool<br />
to develop the manufacturing capability in the country. “<strong>Green</strong><br />
procurement” has yet to be rolled out in South Africa, despite some<br />
initial investigation. In the meantime, the REIPPPP has been the<br />
main avenue used to localise green goods. The sound design and<br />
governance of the programme attracted numerous manufacturers.<br />
However, implementation issues forced most facilities to close.<br />
Over and beyond local content requirements, products can be<br />
earmarked (“designated” in South African terms) by the dti for local<br />
procurement by public entities.<br />
Industrial parks support, manage and administer industrial activities<br />
within a specified area to facilitate socioeconomic benefits for the<br />
surrounding area, its tenants and the country as whole. They can<br />
also be eco-industrial parks, bringing multiple economic, social and<br />
environmental benefits. South Africa hosts a variety of economic<br />
zones and multiple initiatives are under way to tap into the<br />
opportunities associated with the transition to a green economy.<br />
The dti, through the National Cleaner Production Centre (NCPC-SA),<br />
runs a programme aimed at greening the country’s industrial parks<br />
through resource efficiency and industrial symbiosis.<br />
Some industrial development zones and Special Economic<br />
Zones (SEZs) are engaged in the transition to eco-industrial parks,<br />
with the East London, Atlantis, Dube Tradeport and Richards Bay<br />
SEZs leading the way. In addition to initiating the transition to<br />
eco-industrial parks, some SEZs aim to harness the manufacturing<br />
opportunities associated with the transition to a green economy<br />
(<strong>Green</strong>tech Atlantis, Upington Solar Corridor and Bojanala Platinum<br />
Valley SEZs).<br />
Trade policy, as a component of industrial policy, can be used to<br />
promote the development of green goods and services globally as<br />
well as domestically. South Africa’s trade balance for green goods<br />
could be materially improved, notably by promoting imports<br />
substitution. Imports are roughly double the size of exports.<br />
RECOMMENDATIONS<br />
Building on this analysis, recommendations to foster green<br />
industrial development in South Africa can be formulated. They<br />
are split into four complementary components: capacity building;<br />
policy mainstreaming; information/data systems; and transition<br />
planning. Developing a green industrial policy in South Africa is<br />
conditioned on building the capability of the State in designing and<br />
implementing it.<br />
<strong>Green</strong> industrial policy is, by definition, cross-cutting, complex<br />
and challenging of the status quo. Efforts should be directed towards<br />
building internal capacity on sustainability transitions within the<br />
departments of the ESEID Cluster. Sustainability issues must notably<br />
be mainstreamed into all sector divisions of the dti. The use of the<br />
SEIAS should be further leveraged to improve the understanding of<br />
cross-cutting issues through the public sector, including politicians.<br />
The Climate Change Bill [2022]<br />
Re-Imagining our Industrial Strategy to Boost Inclusion and<br />
Private Investment [2019]<br />
A double mainstreaming of sustainability in industrial policy<br />
and development in environmental policy should take place. This<br />
should prelude the full alignment of environmental and industrial<br />
development policies. Sustainability objectives should become<br />
an integral pillar of South Africa’s industrial policy, including the<br />
Master Plans. The integration of sustainability into industrial policy<br />
should ultimately lead to greening the programmes which form<br />
industrial policy.<br />
Support to key industrial value chains should be strategic, timebound<br />
and conditional to green performance improvements.<br />
Measures incompatible with the transition should be progressively<br />
phased out. Complementarily, policy and regulatory bottlenecks<br />
for industries to move towards a sustainable development pathway<br />
should be identified and unlocked. Measures to stimulate market<br />
demand, particularly from the private sector, should be prioritised.<br />
Further collaboration between entities is required on technology<br />
development and commercialisation to bridge the “valley of death”<br />
preventing innovation to reach the market. Efforts are required<br />
to develop the green skill base in the country, through awareness<br />
raising, establishing professional bodies and the mainstreaming<br />
of green skills in education programmes. Both capacity building<br />
and policy mainstreaming interventions, to be successful and longstanding,<br />
need to rely on up-to-date, accurate data. A just transition<br />
to green industrial development cannot occur without evidencebased<br />
policymaking.<br />
Establishing a central, robust and extensive information base<br />
should be prioritised. Economic data and information should be<br />
further disseminated and understood, notably by non-economic<br />
departments and stakeholders. A one-stop-shop platform dealing<br />
with the interplay of sustainability and industrial development<br />
should be established.<br />
Systems for the co-development of policy (in its broad sense) by<br />
government, the private sector, labour and communities should be<br />
established. In addition to all policy interventions aimed at fostering<br />
South Africa’s sustainability transition, further attention should be paid<br />
to managing the transition process within a just transition framework.<br />
A long-term vision aligned with the country’s sustainability objectives<br />
should be developed.<br />
Leveraging the Master Plan process, sectoral roadmaps should<br />
accompany the vision to flesh out the implications for each economic<br />
activity. The development of sectoral roadmaps should be informed<br />
by a clear understanding of the risks and opportunities associated<br />
with the transition. Resilience plans should be systematically crafted<br />
to ensure a just transition in favour of workers, small businesses and<br />
low-income communities. Institutionally, due to the far-reaching<br />
nature of this work, social dialogue and co-development by a set of<br />
multi-disciplinary stakeholders, under the guidance of the PCCCC,<br />
should drive this process.<br />
CONCLUSION<br />
Vast opportunities exist for aligning industrial development and<br />
green economy policies in South Africa and embarking on a just<br />
transition to green industrial development. The current development<br />
of the Master Plans offers a unique opportunity to initiate the<br />
transition to green industrial development in the country. Considering<br />
the transition to a green economy should be a requirement for every<br />
Master Plan. Such work will provide an impetus to further bridge<br />
existing knowledge gaps and trigger implementation.<br />
Rethinking hazardous waste management<br />
The 11-million elephants in the room<br />
Research shows that 92.7% of hazardous waste is landfilled in South Africa. That is a staggering<br />
48-million tons of hazardous waste or the equivalent of 11-million elephants. Eleven-million<br />
elephants stacked on top of each other would create a tower that is 36 410km high – almost long<br />
enough to reach around the entire earth.<br />
According to the South Africa State of Waste Report 2018,<br />
South Africa generates more than 107.7-million tons of<br />
waste annually. Of this, 48% or 52-million tons, is classified<br />
as hazardous waste that may have a detrimental impact on health<br />
and the environment. A total of 92.7% of this is landfilled every year.<br />
To compound matters, South Africa’s dumping grounds are filling<br />
up at an alarming rate with some large sites having less than three<br />
years of airspace available, says Leon Grobbelaar, the president of<br />
the Institute of Waste Management of Southern Africa. Engineering<br />
News has recently reported that Johannesburg, Tshwane and Cape<br />
Town each have less than 10 years of landfill life left.<br />
Legislators have identified this as a fundamental issue that needs<br />
to be resolved, and as such the South Africa Waste Management<br />
Strategy 2020 states: “Prevent waste, and where waste cannot be<br />
prevented, ensure 40% of waste is diverted from landfill within five<br />
years; 55% within 10 years; and at least 70% within 15 years leading<br />
to zero waste going to landfill”. A tall order, but a crucial one for our<br />
country and environment.<br />
Waste that is not taken to landfill poses possible environmental and<br />
human health risks and disasters – the tragic tailings dam failure in<br />
Jagersfontein (2022) is an example. In a recent Reuters report, it is noted<br />
that South Africa has the highest number of high-risk tailings dams (79)<br />
in the 10 countries that were profiled. Quartz Africa asserts that “there<br />
are growing calls for the cleaning up of high-risk tailings dams so that<br />
the waste can be re-processed and used to fill up mined out operations,<br />
thereby reducing environmental hazards.” Mariette Liefferink from<br />
Federation for a Sustainable Environment (FSE) warns that in terms of<br />
ecological risk, the issue of mining waste is widely recognised as second<br />
only to global warming and stratospheric ozone depletion.<br />
A high degree of effort is required to mitigate environmental risks<br />
posed by hazardous waste, no matter where that waste currently<br />
exists. For this to be achieved requires industry to pursue zero<br />
Johannesburg, Tshwane and<br />
Cape Town each have less than 10 years<br />
of landfill life left.<br />
waste aggressively with landfill technologies from both sides of the<br />
buyer-supplier relationship.<br />
TREATMENT OF HAZARDOUS WASTE<br />
There are various ways of treating different types of hazardous waste<br />
including but not limited to biological, physical/chemical, thermal or<br />
disposal. The type of treatment depends highly on the contaminant<br />
and the desired result, as not all waste streams are susceptible to<br />
all treatment methods. Other factors that influence the choice of<br />
treatment method include the conditions of contamination and<br />
surroundings, type of remediation required (destruction, separation<br />
or containment), operational intensity, capital requirements, relative<br />
costs, reliability of outcome and the time window.<br />
Treating hazardous waste is by no means an easy feat, and much<br />
more work is needed to develop solutions for waste streams that<br />
currently have no treatment options. Combining +50-year-old principles<br />
with innovative product technology, Bemical delivers solutions to<br />
hazardous waste streams that are based on the most efficient methods<br />
in biological and physical/chemical treatment. Waste stream examples<br />
that have been managed via these treatment methods include<br />
hydrocarbons, volatile organic compounds (VOC), heavy metals such<br />
as lead, arsenic and chromium, polycyclic aromatic hydrocarbons (PAH),<br />
manufactured gas plant waste (including cyanide, naphthalene, total<br />
petroleum hydrocarbons, arsenic), chromium ore process residual,<br />
asbestos as well as platinum group metal tailings and sewage.<br />
Bemical’s leadership team includes a head of technical and project<br />
operations, an expert with over 20 years of global remediation<br />
experience, as well as a chief science officer serving as an associate<br />
professor with a distinguished academic track record in chemical<br />
and environmental engineering. Bemical has partnered with the<br />
Department of Engineering at the University of Pretoria to conduct<br />
further research into industry-leading remediation products to better<br />
serve the variety of waste streams available.<br />
Contact Jaco Nel at admin@bemical.com or +27 83 363 0315.<br />
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32<br />
33
ENERGY<br />
ENERGY<br />
NMISA SAVES ENERGY FOR SA<br />
NMISA services in support of<br />
energy-saving efforts for the<br />
South African economy<br />
Electrical parameters<br />
• RMS current/voltage<br />
• Power factor<br />
• Total harmonic distortion (THD)<br />
• Luminous efficacy<br />
Temporal light modulations and artefacts<br />
• Waveform, frequency, flicker index, percent flicker<br />
• Short-term flicker index and voltage fluctuation immunity<br />
• Stroboscopic visibility measure<br />
• Perceptual modulation<br />
Photobiological safety<br />
• Actinic UV and near-UV hazard<br />
• Blue light hazard<br />
• Retinal thermal hazard<br />
• Infrared eye hazard<br />
• Thermal skin hazard<br />
UV APPLICATIONS<br />
UV radiation falls outside the visible part of the electromagnetic<br />
spectrum. UV-C radiation with wavelengths between 200 nm and 280 nm<br />
is an important tool in medical applications. It has disinfection<br />
properties and is used in UV Germicidal Irradiation (UVGI) devices to<br />
An integrating sphere, which is used to measure the flux of a lamp.<br />
prevent the spread of infectious diseases via air, water and surfaces but<br />
also has inherent risks.<br />
NMISA disseminates traceability to the National Measurement<br />
Standards, which are linked to the international system of units<br />
(SI) through calibration of measuring equipment. Traceability to<br />
SI allows weights and measures in South Africa to be comparable<br />
to weights and measures in other parts of the world. In the field<br />
of electromagnetic radiation, it is NMISA’s responsibility to<br />
maintain the SI unit for luminous intensity (the candela) and to<br />
perform traceable photometric and radiometric measurements<br />
and calibrations in support of industry.<br />
The equipment used for LED measurement and calibration can also be<br />
used to accurately measure the UV content of lighting products and<br />
ensure that UVGI devices provide both effective disinfection and a safe<br />
environment for room occupants.<br />
UV LEDs have also become an environmentally friendly option to<br />
replace mercury lamps in certain applications such as curing and<br />
disinfection. NMISA can provide the measurement of UV LED devices<br />
to determine their performance and safety, as well as calibration of<br />
UV radiometers which are used to measure these types of devices in<br />
the field.<br />
The science of photometry and radiometry addresses the<br />
measurement of electromagnetic radiation. Photometry<br />
concerns the measurement of light (the visible part of the<br />
electromagnetic spectrum) and measurements consider the<br />
response of the human eye. Radiometry, relates to the measurement<br />
of electromagnetic radiation in the wider spectral region ranging<br />
from the ultraviolet (UV) to the infrared part of the spectrum.<br />
The measurement and calibration services offered at NMISA are<br />
categorised according to:<br />
• Photometry e.g. lux and luminance meter calibrations<br />
• Properties of detectors e.g. UV radiometer and laser meter calibrations<br />
• Spectral emission properties of sources e.g. spectral distribution of<br />
lamps/light emitting diodes (LEDs)<br />
• Spectral properties of materials e.g. transmittance, absorbance of filters<br />
• Spectrally integrated measurements for sources e.g. correlated<br />
colour temperature, colour rendering index of lamps/LEDs<br />
• Colour and other spectrally integrated measurements of materials<br />
e.g. gloss, luminance factor<br />
ENERGY EFFICIENCY<br />
NMISA develops measurement capabilities for LED products that serve<br />
as energy-efficient light sources. The move toward LED lighting is<br />
propelled by its high efficacy which provides savings. To support the local<br />
lighting industry, accurate LED measurement methods and standards<br />
must be developed to ensure that the performance and safety of these<br />
light sources can be assessed correctly. NMISA measures the following<br />
properties of small to medium-sized (e.g. A-type lamps) LED products:<br />
Photometric, colorimetric and radiometric parameters<br />
• Spectral power distribution<br />
• Spectral radiant/luminous flux<br />
• Radiant/luminous flux<br />
• Chromaticity coordinates<br />
• Correlated colour temperature<br />
• Colour rendering index<br />
• Luminous intensity<br />
• Averaged LED luminous intensity<br />
• Irradiance/illuminance<br />
• Radiance/luminance<br />
• Peak/centroid/dominant wavelength<br />
• Purity, full width at half maximum (FWHM)<br />
The National Metrology Institute of South Africa (NMISA) is<br />
mandated by the Measurement Units and Measurement Standards<br />
Act, 2006 (Act No. 18 of 2006) to provide for the accuracy and<br />
international recognition of local measurement results to provide<br />
for the use of measurement units of the International System of<br />
Units and certain other measurement units; to provide for the<br />
designation of national measurement units and standards; to<br />
provide for the keeping and maintenance of national measurement<br />
standards and units; and to provide for the establishment and<br />
functions of the National Metrology Institute.<br />
HOW TO GET IN TOUCH WITH NMISA ONLINE<br />
Website: www.nmisa.org<br />
Online Shop: https://store.nmisa.org/<br />
Facebook: National Metrology Institute of South Africa<br />
Twitter: @NMISouthAfrica<br />
Instagram: @nmisouthafrica<br />
LinkedIn: National Metrology Institute of South Africa (NMISA)<br />
YouTube: National Metrology Institute of South Africa NMISA<br />
For a detailed list of accredited measurement and calibration<br />
services, refer to the Photometry and Radiometry<br />
Laboratory’s South African National Accreditation System<br />
(SANAS) scope of accreditation. The laboratory also offers<br />
custom and non-accredited services, which may be discussed<br />
upon request. To learn more about these services contact<br />
pr@nmisa.org or +27 12 947 2782/2800<br />
34<br />
35
ENERGY<br />
ENERGY<br />
THE FUTURE IS BRIGHT<br />
FOR PEROVSKITE PV<br />
Perovskite PV is an exciting new solar power technology. In 2009, the first report of a<br />
perovskite solar cell was published with an efficiency of just 3.9%. Given the novelty of the<br />
technology, the rapid gains in efficiency are impressive; however, high efficiency is not the<br />
only promising attribute.<br />
BY DR ISABEL AL-DHAHIR<br />
CUBE3D Graphic<br />
Additionally, perovskite PV does not use toxic or rare materials and the<br />
manufacturing is well-suited to scalable solution-based deposition<br />
methods. This gives perovskite PV an edge over the existing dominant<br />
thin film alternatives such as cadmium telluride (CdTe) and copper<br />
indium gallium selenide (CIGS), which suffer from expensive synthesis<br />
and material scarcity.<br />
Despite the demonstration of high efficiency perovskite solar<br />
cells, commercial adoption is limited by concerns over long-term<br />
stability. Perovskites are well-known to degrade following exposure<br />
to environmental factors such as heat, air, humidity and UV light.<br />
Encapsulation techniques and material engineering are crucial to<br />
prevent degradation of the perovskite film – solving these high-value<br />
problems is a compelling commercial opportunity.<br />
EMERGING APPLICATIONS<br />
Perovskite PV is very versatile. It is used in mainstream applications<br />
such as in solar farms and rooftops. Since the weight of a perovskite<br />
module is at least 90% lighter than a silicon module, it is particularly<br />
well-suited to novel applications as well such as vertical building<br />
integration and structures with low weight tolerance. These are<br />
applications that mainstream silicon-based PV is not compatible with<br />
and therefore provide a niche opportunity for perovskite PV.<br />
Flexible solar modules are another exciting recent development<br />
in photovoltaics. Thin film perovskite PV is naturally cut out for<br />
flexible designs. Conformality allows for greater practicality and<br />
aesthetic control when integrating into building façades as well as<br />
electronic devices.<br />
Internet of Things (IoT) devices promise to enable a world of smart,<br />
connected objects, with their number expected to rapidly accelerate<br />
to billions by 2030. However, small electronic devices typically rely on<br />
batteries that require frequent recharging or replacement every few<br />
years, leading to high material as well as unwanted waste. Powering<br />
Perovskite PV can provide<br />
similarly high-power density as<br />
silicon PV at lower cost.<br />
IDTechEx<br />
IoT devices in a cheap, sustainable fashion is crucial to achieve the<br />
promised vision of a connected world. Small, low-cost thin film solar<br />
cells, optimised to work with diffuse indoor light, solve to this dilemma.<br />
Employing low-cost PV powered devices with lifespans of 10 years<br />
could be far more economical. There is already very early-stage<br />
commercialisation of self-powered electronics using organic PV. This<br />
market is still very small and there is plenty of room for new entrants.<br />
Perovskite PV promises higher efficiencies and simpler synthesis than<br />
organics, and potentially longer lifespans.<br />
INDOOR ENERGY HARVESTING<br />
A connected world comes with the burden of batteries and unsightly<br />
extensive wiring. As more technologies are adopted into homes and<br />
businesses, the chaotic clutter of wires and the dwindling count of<br />
nearby power sockets become an increasing nuisance.<br />
The use of batteries is an environmentally unfriendly solution and<br />
replacing them on a mass scale every three to four years is expensive<br />
and labour intensive. The integration of a thin film solar module<br />
within smoke alarms, motion sensors, smaller electronic displays and<br />
other gadgets means that there is no need for batteries or external<br />
wiring and so the device can be placed anywhere that has sufficient<br />
light exposure.<br />
Perovskite PV provides similarly high-power density as silicon PV at<br />
a lower cost, a fraction of the weight and with a simpler manufacturing<br />
process. Perovskite solar cells can maintain relatively high efficiencies<br />
even under low intensity or diffuse light, making them compatible to<br />
both indoor and outdoor energy harvesting.<br />
This is a key advantage over the conventional silicon technology<br />
that suffers poor efficiencies under indoor light. Since the perovskite<br />
material applies like an ink, the solar cells are very lightweight, flexible<br />
and unobtrusive. They can easily be integrated into small electronic<br />
devices and used to power them directly.<br />
The silicon photovoltaic (PV) market is accelerating every year.<br />
There are global initiatives to move towards renewable<br />
energy sources and public consciousness of sustainability<br />
is increasing. As such there is plenty of opportunity for new PV<br />
technologies to enter the mix and meet gaps in demand.<br />
Perovskites refer to a family of materials with a specific material<br />
structure. Those used in photovoltaics have a unique combination<br />
of electronic and optical properties that are extremely well-suited to<br />
this application. Perovskite PV is not expected to imminently replace<br />
silicon PV as the dominant technology; however, there is substantial<br />
motivation for its adoption.<br />
Perovskite PV can provide similarly high-power density as silicon<br />
PV at lower cost, a fraction of the weight, and with a simpler<br />
manufacturing process. It can also be combined with silicon to<br />
create tandem cell architectures that can surpass the efficiency<br />
limits of single junction solar cells. Several companies are working<br />
on developing single junction perovskite and tandem PV, some of<br />
which have pilot lines and trials in progress with plans to launch<br />
commercially within the next year or two.<br />
Janak Thapa and Dr Armi Tiihonen<br />
EFFICIENCY GAINS<br />
Perovskite PV research took off in 2009. Since then, research into<br />
the field has catapulted. Record efficiencies are already on par with<br />
those of silicon PV, a technology with decades of research behind it.<br />
(Above) Perovskite photovoltaics can be utilised in either a thin film (left) or<br />
tandem perovskite-on-silicon architecture, targeting applications such as<br />
indoor energy harvesting or rooftop PV respectively. (Top image) Perovskite<br />
photovoltaics in the background with individual perovskite crystals shown<br />
as the colourful units.<br />
(Above) Perovskite PV could be a cost-effective method to power everyday<br />
electronics. (Left) Researchers have developed a new way to test longlasting<br />
perovskite formulations that could be used for solar cells. The highthroughput<br />
automated degradation test system monitors the breakdown of<br />
the material through its changes in colour as it darkens.<br />
36<br />
37
ENERGY<br />
ACUVIM II SERIES<br />
POWER & ENERGY METERS<br />
Ken Richardson<br />
Solar cells made of perovskite have great promise, in part because they can easily be made on flexible substrates, like this experimental cell.<br />
COST TRUMPS EFFICIENCY<br />
For a lot of household and consumer electronics, high power is not a<br />
strict requirement. For example, powering headphones, sensors, and<br />
lights does not require state-of-the-art solar technology. Solar cells<br />
with an efficiency of 10% to 15% could be sufficient to operate most<br />
small and portable electronics.<br />
Durability is another typically important criterion that can be<br />
relaxed since many electronics are intended for short-term use, with<br />
consumers frequently updating their devices for newer models. The<br />
need for 25-year lifespans, as is typical for rooftop solar panels, is no<br />
longer the standard to measure by.<br />
The key metric for the successful deployment of solar cells in<br />
consumer and retail electronics is cost. Given the increasingly high<br />
volume of consumer and retail electronics, energy solutions need to<br />
be economical. Additionally, solar technology will be competing with<br />
well-established and relatively inexpensive batteries. Solar could move<br />
into a competitive position with batteries if it were to demonstrate<br />
lower costs and greater practicality.<br />
OUTLOOK<br />
The future appears optimistic for perovskite PV, since the technology<br />
has advanced much more rapidly than any other photovoltaic<br />
technology. Unlike CdTe and CIGS active layers, perovskites do not<br />
require rare or expensive raw materials. The synthesis is straight-<br />
forward, and deposition can be carried out without the need for a<br />
vacuum or high temperatures.<br />
The possibility of creating flexible devices also opens new<br />
applications that mainstream silicon PV cannot target due to their<br />
bulk, weight and rigidity. Despite the promising advantages, concerns<br />
surrounding the lifespan of perovskite solar cells remain at the forefront<br />
of the discussion.<br />
Perovskite PV is not expected to<br />
imminently replace silicon PV as the<br />
dominant technology; however,<br />
there is substantial motivation<br />
for its adoption.<br />
ROUTE TO COMMERCIALISATION<br />
Resolving perovskite PV stability issues is challenging, with<br />
many strategies bringing performance trade-offs or extra costs.<br />
Nevertheless, the field has come a long way in its understanding<br />
of degradation mechanisms and substantial progress has been<br />
made. Advancements in stabilising perovskite cells have helped to<br />
transition the technology from academia to industry.<br />
Smarter. Faster. Better.<br />
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38<br />
The article is an excerpt from the IDTechEx report Perovskite Photovoltaics 2023-2033.<br />
marketing@accuenergy.com<br />
Castle Walk Corporate Park,<br />
Block B, Cnr. Nossob & Swakop Street,<br />
Erasmuskloof, Pretoria, 0181 South Africa<br />
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Certified<br />
www.accuenergy.com
ENERGY<br />
ENERGY<br />
IDTechEx<br />
Thin film PV could enable ubiquitous solar powered<br />
technology. New applications of thin film applications<br />
include building integrated PV where the panels are<br />
attached to the sides of buildings (right).<br />
GOING BEYOND<br />
SILICON’S LIMITATIONS<br />
The rise of thin film photovoltaics<br />
In the shadows of a silicon-dominated field, other photovoltaic technologies have been edging<br />
closer to the spotlight. Emerging photovoltaic applications, such as indoor energy harvesting<br />
and building integrated photovoltaic, have specific requirements that will enable “thin film”<br />
alternatives to flourish.<br />
BY IDTechEx<br />
CIGS technology, on the other hand, has been plagued by<br />
commercial failures, with the largest manufacturer having exited<br />
the market in June 2022. It is expected that CIGS will be surpassed<br />
in the coming years by perovskite PV – a very young and exciting<br />
technology that has shown remarkable efficiency gains in just a few<br />
years, with record efficiencies already on par with those of silicon<br />
PV, a technology with decades of research behind it. Perovskite PV<br />
is well-suited to both outdoor high power density applications as well<br />
as indoor energy harvesting and powering small electronics.<br />
Organic PV and dye-sensitised solar cells are contenders that are<br />
commercial on a small scale in both outdoor and indoor applications.<br />
Given their short lifespans of five years, organic and dye-sensitised solar<br />
cells are better suited to powering short-term use electronics rather than<br />
large area outdoor energy harvesting units that are expected to last >15<br />
years. For this reason, the application range is limited.<br />
OUTLOOK<br />
Decarbonisation of global energy sources is being catapulted<br />
forward as both nations and industries race to achieve net zero.<br />
While silicon PV is affordable to consumers and delivers high<br />
efficiencies, its application range is limited by its weight, size and<br />
rigidity, as well as a complicated manufacturing process. Thin film<br />
alternatives present numerous advantages to overcome these<br />
limitations and cater to emerging applications such as buildingintegrated<br />
PV and indoor energy harvesting.<br />
The Massachusetts Institute of Technology team have achieved the thinnest<br />
and lightest complete solar cells ever made, they say. To demonstrate just<br />
how thin and lightweight the cells are, the researchers draped a working cell<br />
on top of a soap bubble, without popping the bubble.<br />
Thin film photovoltaic (PV) can deliver several unique advantages<br />
such as lighter weight, better indoor light conversion efficiency,<br />
simpler manufacturing and potentially lower costs than<br />
conventional silicon PV. A particularly exciting opportunity is the<br />
role of thin film photovoltaics in powering Internet of Things devices<br />
– a market expected to reach billions following the increasing<br />
smartification of home and retail electronics.<br />
EMERGING MARKETS<br />
Thin film PV is expected to gain traction in the coming years, with the<br />
market set to grow to US$6.1-billion by 2033. Substantial strides have<br />
been made within the thin film sector, with efficiencies increasing and<br />
manufacturing processes becoming cheaper and more streamlined.<br />
New applications are being developed that conventional silicon<br />
PV is not suitable for due to its rigidity, bulk and weight. These<br />
applications include building integrated PV where the panels are<br />
attached to the sides of buildings. Some types of thin film PV can<br />
be made semi-transparent and very lightweight, which makes<br />
them less aesthetically obtrusive and ideally suited to deployment<br />
on windows.<br />
Other emerging applications belong to the self-powered electronics<br />
and IoT sector, which is expected to grow substantially in the coming<br />
years as “smart” electronics become more prevalent. Lightweight thin<br />
film minimodules can be used to power such devices and could serve<br />
as a cheaper and more long-lasting alternative to batteries.<br />
What will dominate the thin film market?<br />
Currently, the thin film market is dominated by cadmium telluride<br />
(CdTe), followed in second place by copper indium gallium selenide<br />
(CIGS). CdTe is best known in the USA, where it is used for 40% of<br />
all utility-scale PV power. Despite concerns over the use of the scarce<br />
element tellurium, the CdTe market is expected to keep its position<br />
following strong investment and the creation of recycling initiatives<br />
that are at present already operative.<br />
A particularly exciting opportunity<br />
is the role of thin film photovoltaics in<br />
powering Internet of Things devices.<br />
This article is an excerpt from the research report BEYOND SILICON: THIN FILM PHOTOVOLTAICS 2023-2033 | IDTechEx | [2022]<br />
Joel Jean and Anna Osherov<br />
40<br />
41
WASTE<br />
A SUCCESSFUL CLEAN-UP<br />
AND RECYCLE SA WEEK 2022<br />
South Africans can celebrate another successful Clean-Up and Recycle Week as thousands of<br />
kilograms of waste were removed from our natural spaces.<br />
(Top left) Underwater clean-up diver Mia Vorster of ScubaXcursion collects waste at Scottsburgh (Fern Reef). (Top right) Beach clean-up at Scottsburgh.<br />
According to Douw Steyn, sustainability director at Plastics<br />
SA, literally hundreds of clean-up events took place around<br />
South Africa to keep our environment clean, with many<br />
more initiatives continuing to take place over the coming weeks.<br />
“Clean-Up and Recycle Week 2022 was action-packed and it was<br />
wonderful to see the large number of volunteers signing up for cleanups<br />
at beaches, rivers and streams and in communities around the<br />
country. Our sincere gratitude goes out to all the coordinators who<br />
worked tirelessly to ensure that everything ran smoothly on the<br />
day; the many sponsors who contributed either financially or with<br />
products to this year’s clean-up efforts, and every South African<br />
who willingly gave of their time and energy to make a difference, by<br />
removing visible litter from the environment,” he says.<br />
Highlights of this year’s Clean-Up & Recycle SA Week included<br />
River Clean-Up Day, which took place on 14 September, National<br />
Recycling Day, which took place on 16 September, as well as<br />
International Coastal Clean-Up and World Clean-up Days both falling<br />
on 17 September. These incredible days united over 180 countries<br />
across the world for a cleaner planet as volunteers and organisations<br />
took to cleaning every space imaginable – including divers who<br />
went deep-sea litter hunting.<br />
Douw especially thanked Plastics SA’s sustainability manager, John<br />
Kieser, who has been the Cape Province’s coordinator and one of the<br />
founder members of the South African International Coastal Clean-Up<br />
for the past 27 years.<br />
Plastics SA’s work is not finished yet, as the completed audit sheets<br />
now need to be compiled, processed and analysed to produce a final<br />
report about South Africa’s participation in this year’s events, as well<br />
as a snapshot of the waste found on our beaches and waterways.<br />
“We want to encourage communities to continue with their<br />
Shark dissection at Scottburgh beach cleanup by Steven Mabugana<br />
(AquaAmazing) educating about marine pollution.<br />
Hundreds of clean-up events<br />
took place around South Africa to keep<br />
our environment clean.<br />
efforts to keep their communities clean. Every South African can<br />
make a difference every day by picking up litter and ensuring that<br />
they recycle. Small, consistent efforts make a huge difference if<br />
everybody does it. Together we can turn the tide on litter in our<br />
country,” Douw concludes.<br />
43
WASTE<br />
WASTE<br />
PLASTIC DEMAND GROWS<br />
BIOPLASTICS 2023-2033: TECHNOLOGY, MARKET, PLAYERS<br />
AND FORECASTS<br />
Plastic demand continues to grow even as<br />
we become increasingly aware of the threat<br />
that plastics pose to our environment. Global<br />
consumption of plastics will double by 2050. To<br />
combat the impact of plastic on environment<br />
and climate change, the industry is transitioning<br />
towards a circular economy.<br />
BY ANDY KO, IDTechEx<br />
Yet, even if all the plastic produced every year was 100%<br />
recycled, there would still be a need for virgin feedstock to<br />
meet growing consumption. Bioplastics – plastics which are<br />
synthesised from biobased feedstocks – can replace incumbent<br />
fossil-based plastics here. Given their biobased origin, these plastics<br />
are a lower carbon footprint and sustainable option to incumbent<br />
fossil-based plastics.<br />
The bioplastics industry began decades ago, but during the 2010s<br />
the industry fell deep into the valley of death, indicated by a string of<br />
bankruptcies and business repositioning away from the space. This<br />
slump was driven by recoil from bullish initial investment in the space,<br />
and a significant bottleneck when it came to scaling production to<br />
commercial level. Furthermore, the high relative cost of bioplastics<br />
compared with a substantial drop in the price of Brent crude made<br />
bioplastics poor competition against conventional plastics, reinforcing<br />
the decline.<br />
Technology readiness level of bioplastics by types.<br />
A bioplastic is a plastic made from plant resources, such as corn, wheat<br />
or algae.<br />
IDTechEx<br />
However, recent changes have turned the tide in the bioplastics<br />
industry, revitalising its growth mode. Foremost, there has been a<br />
shift towards sustainability demand from brand-owners themselves.<br />
This is driven from both sides: by consumer pull that continues to<br />
strengthen, and by legislation changes (plus anticipation for future<br />
changes) towards sustainability – such as single-use fossil-based<br />
plastics bans. The cornerstone COP26 conference, supported by the<br />
IPCC report, fuelled brand-owner commitments to decarbonisation,<br />
too. This surplus demand is pushing manufacturers to expand their<br />
capacities faster, with many brand-owners forming partnerships to<br />
accelerate the scaling-up process.<br />
Many companies are beginning to overcome the commercial<br />
scale bottleneck and as technology develops bioplastics are being<br />
produced for lower costs. Additionally, consumers are more willing<br />
now to pay the premium for sustainable bioplastics. Overall, these<br />
factors are driving bioplastics towards being more affordable and<br />
competitive against conventional plastics. This is supported by a<br />
spike in Brent crude prices recently, which make bioplastics a more<br />
attractive alternative.<br />
DROP-IN DISRUPTORS<br />
A major factor for bioplastic adoption to disrupt the plastics industry<br />
is the drop-in materials. These are biobased feedstocks or building<br />
blocks that can be a direct substitute for incumbent feedstocks.<br />
By substituting with drop-ins, manufacturers can easily facilitate<br />
the transition from fossil to biobased. The same processes can be<br />
used, rather than establishing entirely new plants, and end-product<br />
properties are unchanged.<br />
This also means that the well-established end-of-life options of<br />
incumbent plastic products can be used, particularly recycling<br />
streams which massively improve the sustainability of a plastic<br />
product. Using drop-ins, the biobased material can be traced<br />
with chain-of-custody models like mass balance, which create<br />
transparency and trust throughout the value chain regarding<br />
sustainable material origins and processes. Overall, the plastics<br />
market will more readily adopt drop-in bioplastics which have a<br />
strong advantage over other bioplastics.<br />
CHALLENGES FOR BIOPLASTICS<br />
Yet, there are still many challenges for several bioplastic types to<br />
overcome. To be truly sustainable and become part of the circular<br />
economy, bioplastics must be designed for end-of-life processing.<br />
For example, polylactide (PLA), the most widely produced 100%<br />
biobased plastic material can be industrially composted, however<br />
this provides no value to the compost so there are few off-takers<br />
in the industry. Meanwhile, recycling PLA, unlike drop-in biobased<br />
polyethylene terephthalate (PET), requires dedicated infrastructure<br />
that is uncommon and very expensive to adopt. Instead, most PLA is<br />
mismanaged or goes to landfill.<br />
The largest groups of plastics worldwide, polypropylene (PP) and<br />
polythene (PE), remain without a major bioplastic solution. Bionaphtha<br />
is used to make biobased PP and polyphenylene ether (PPE),<br />
but synthesis of bio-naphtha from bio-alcohols and oxygenates is<br />
inefficient (because of waste oxygen in the process). Furthermore,<br />
this puts chemical manufacturers into competition for feedstock<br />
with biofuel and bioenergy. On the other hand, bio-naphtha can be<br />
made from plant oils, however these raw materials suffer from price<br />
fluctuations resulting from geopolitical instability.<br />
Younger bioplastic types that are still in demonstration or<br />
pilot scale show promising properties. However, they have yet to<br />
develop a significant range of applications, critical to developing<br />
demand for the materials. Companies in these niches need to form<br />
partnerships with brand-owners and formulators to expand their<br />
application portfolios.<br />
ORDER REPORT<br />
THOUGHT [ECO]NOMY<br />
greeneconomy/report recycle<br />
This article is an excerpt from the research report<br />
BIOPLASTICS 2023-2033: TECHNOLOGY, MARKET,<br />
PLAYERS AND FORECASTS | IDTechEx | [2022]<br />
As bioplastic materials transition from being a “nice-to-have” to<br />
materials with a very strong, viable business case, manufacturers<br />
are racing to keep up with demand. Brand-owners, striving to hit<br />
their decarbonisation targets by taking the initiative to transition to<br />
bioplastics, are generating a stronger brand-owner pull than ever<br />
before. This demand is further exacerbated by legislators around the<br />
world, who are cutting down on fossil-based plastic use with single-use<br />
plastic bans.<br />
Together, these major factors are pressurising players across the<br />
bioplastics industry to commercialise their materials and ramp up<br />
production. With all this activity, IDTechEx forecasts global annual<br />
bioplastics production capacity to grow at a CAGR of 10.1% over the<br />
next ten years.<br />
IDTechEx’s report evaluates the technologies and trends that bring<br />
more sustainable biobased materials to the plastic industry.<br />
44<br />
45
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46<br />
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MOBILITY<br />
MOBILITY<br />
A ROLLING START<br />
for EV manufacturing plans<br />
South Africa is at risk of losing export markets as major trade partners ditch gas-guzzlers. Our<br />
biggest markets are banning imports and sales of ICE vehicles within less than eight years and yet<br />
South Africa has hardly started producing new energy vehicles.<br />
BY GEORGINA CROUTH<br />
They’re dirty and soon no one will want them. Traditional<br />
internal combustion engines (ICEs) are being phased out in<br />
South Africa’s biggest markets – Britain and the EU – and if the<br />
local automotive sector does not switch gears from ICE production<br />
to new energy vehicles (NEVs), it might as well close up shop.<br />
Britain and the EU have set aggressive targets to phase out<br />
ICE vehicles: by 2030 neither will allow sales and imports of such<br />
vehicles and they are planning to introduce heavy carbon taxes<br />
on imports.<br />
That’s less than eight years away and South Africa’s motor industry<br />
has not rolled a single electric vehicle (EV) off the factory floor, and only<br />
a few manufacturers, including Toyota, Mercedes-Benz and BMW, are<br />
producing hybrids, which are classified as NEVs.<br />
The motor industry’s anxiety over the issue has been stepping up<br />
for years, as it raised concerns that the market for ICEs was getting<br />
progressively smaller while the government’s promised EV roadmap to<br />
speed up sales and production progressed at a snail’s pace.<br />
In 2021, the dtic published the <strong>Green</strong> Paper on Advancement of<br />
New Energy Vehicles (NEVs), after extensive industry consultations<br />
and with an undertaking to issue a White Paper by the end of the year.<br />
The <strong>Green</strong> Paper explores levels of support and infrastructure<br />
investment needed to encourage electric vehicle uptake, within the<br />
context of wider economic recovery efforts through market stimulus<br />
and supply chain support measures.<br />
It looks at an investment and tax system to build a resilient raw<br />
material supply chain to support the country’s efforts to be a global<br />
player in NEV manufacturing as well as how to retain preferential<br />
access to major trading partners to allow the country to maintain<br />
global competitiveness and foster innovation.<br />
There’s still no White Paper [at time of going to print].<br />
48<br />
But the Automotive Business Council, also known as Naamsa, is<br />
bullish about developments after Trade, Industry and Competition<br />
Minister Ebrahim Patel released details of a “working document” at<br />
the Presidential Climate Commission, making a “compelling” case<br />
for South Africa’s shift to NEVs. Patel insists the NEV roadmap is<br />
taking shape.<br />
This is significant because the current market for NEVs in South<br />
Africa is almost non-existent due to lack of demand – mainly because<br />
of the eye-watering cost of these vehicles, which are imported for the<br />
premium market. Also, there are plans for carbon taxes on imports.<br />
Patel reportedly told the commission: “We have not closed our eyes<br />
to the other options; we have looked at them and have concluded that<br />
it would be in South Africa’s best interest to move to EVs.”<br />
Finance Minister Enoch Godongwana met the automotive sector to<br />
discuss the Treasury’s approach to NEV production.<br />
There is a huge tax burden on all new vehicles produced in South<br />
Africa – in total, the Treasury lumps 42% in taxes on every vehicle sold,<br />
including 15% VAT, ad valorem tax (because vehicles are deemed to be<br />
luxury items) and carbon emissions taxes.<br />
Patel recognised the need for a support framework. Not creating<br />
it would put a lot of the GDP at risk. He said the government intended<br />
to go for a production-led model, rather than a consumption led<br />
strategy advocated by some stakeholders, whereby growth in domestic<br />
demand, supported by lower tariff barriers, triggers investment.<br />
Mike Mabasa, CEO at Naamsa said not releasing the White Paper<br />
created significant uncertainty in the market. But Naamsa is aware<br />
that government officials have been working behind the scenes on<br />
options and, based on the discussion and feedback, the organisation<br />
and others are comfortable that the department will “get us to the<br />
finish line”.<br />
Article courtesy of Daily Maverick<br />
READ REPORT<br />
There is a huge tax burden on all new<br />
vehicles produced in South Africa.<br />
“We are hopeful that before the end of this year South Africa will<br />
certainly be able to announce very firmly the direction we are taking.”<br />
URGENCY<br />
Motoring expert Mark Smyth says, though there has been delay, there<br />
is now a realisation that something needs to be done urgently. Time<br />
is of the essence. South Africa’s biggest markets have already decided<br />
to ban imports of ICE vehicles within less than eight years and the<br />
average lifecycle of a new model car is between five and seven years<br />
in terms of development time.<br />
Smyth says most manufacturers have already invested in new<br />
plants, with other plants coming remarkably close to ending their<br />
tenure and being at risk if they fail to switch quickly.<br />
The industry has become reliant on ICE and South Africa has been<br />
able to supply raw materials such as platinum catalytic converters used<br />
THOUGHT [ECO]NOMY<br />
greeneconomy/report recycle<br />
Changing<br />
the VAT<br />
in petrol and diesel vehicles, but it has none of the<br />
raw materials that are required for switching to<br />
electric vehicles.<br />
The manufacturers have invested significant<br />
amounts of money and resources in creating new<br />
facilities for EVs to be able to meet the demand, says<br />
Smyth, but there are already shortages worldwide,<br />
including chips and wiring harnesses from Ukraine.<br />
It is furthermore uncertain whether the South<br />
African government will stump up financial support.<br />
The automotive sector is a critical pillar of the South<br />
African economy – one of the country’s largest<br />
economic sectors by revenue with 4.3% to GDP<br />
(2.4% manufacturing and 1.9% retail). It accounts<br />
for 17.3% of manufacturing output and 18.1% of<br />
total exports. A total of 298 020 vehicles, worth<br />
R138.3-billion, and R69.2-billion in automotive parts,<br />
were exported in 2021.<br />
At least 110 000 people are directly employed in the sector and the<br />
livelihoods of more than half-a-million more people depend on it. In<br />
October last year, Mabasa warned that by 2030 40% of all vehicle sales<br />
in Europe may be EVs, and that his association believes the number<br />
could increase to 80% by 2040.<br />
“It is clear that we cannot ignore EVs if we want to continue doing<br />
business with Europe. It will have a huge impact on the country if we<br />
lose R201-billion in export earnings a year.<br />
“We don’t want our main export markets to say that they are no<br />
longer interested in ICEs because of their emission targets, and that<br />
they are taking their business elsewhere. We need to remain relevant.<br />
“The change in our industry is going to be driven by how we<br />
redefine mobility, the convergence of connectivity, electrification and<br />
changing customer needs – not just for our local consumption needs,<br />
but for other markets around the world as well.”<br />
HARNESSING ELECTRIC VEHICLES FOR INDUSTRIAL DEVELOPMENT IN SOUTH AFRICA<br />
| Tips Research Report for Department of Trade, Industry and Competition | National<br />
Association of Automobile Manufacturers of South Africa | [2020]<br />
The world of mobility is rapidly evolving worldwide. Technological developments are notably<br />
enabling the diversification of drivetrains, away from traditional internal combustion engines<br />
towards electric and other alternative motors.<br />
While EVs still account for a marginal share of global vehicle sales, the shift is evident in leading markets.<br />
All forecasts point to an exponential growth of EVs in the coming decades. Heightened environmental<br />
regulations, linked to climate change mitigation and air quality improvement, have initiated the transition<br />
to cleaner forms of transportation.<br />
Policy impetus, such as support programmes and tight environmental targets, are now driving the<br />
market globally. In addition, favourable economics, which see EVs being increasingly cheaper to own than<br />
petroleum-based cars over their lifetime, and consumer experience, linked to the connectivity, reactivity<br />
and usage experience of the vehicles, are supporting the transformation.<br />
South Africa lags behind this global trend. EVs remain extremely marginal, be it from an offer, demand<br />
or manufacturing perspective. As heralded by government and industry alike, it is, however, the ambition<br />
of the country to rapidly enter this space. While a coherent policy environment is lacking, the country’s<br />
<strong>Green</strong> Transport Strategy sets out government’s vision to radically grow the uptake of EVs in South Africa.<br />
As with every transition, the emergence of EVs brings disruptions, calling for the need to adequately<br />
manage the transition. In the short term, this requires supporting the development of the sector, both from<br />
a market development and manufacturing perspective, through a coherent policy framework consistent<br />
with South Africa’s domestic context.<br />
45 50 109 115 138<br />
Public<br />
transport<br />
Value<br />
chains<br />
Battery<br />
production<br />
Mineral<br />
beneficiation<br />
49
AGRICULTURE<br />
AGRICULTURE<br />
Opportunities for<br />
BUILDING RESILIENCE OF AFRICAN<br />
FARMING SYSTEMS<br />
Increasing agricultural production to feed the growing world population is a key sustainability<br />
challenge and one that is most crucial for Sub-Saharan Africa where most of the expected rise in<br />
world population by 2050 will occur. It is estimated that agricultural production will need to rise<br />
by between 60% and 80% to meet the projected rise in food demand.<br />
92% of forest cover lost in Africa between 2001 and 2015 was due<br />
to agricultural expansion by smallholder farmers, compared to about<br />
51% loss in forest cover at the global level during that period.<br />
It has been projected that an additional 430-million hectares will be<br />
cleared for food production in SSA by 2060 with dire environmental<br />
and biodiversity costs. Agriculture-led habitat loss is responsible<br />
for about 80% of all threatened terrestrial birds and mammals. The<br />
Intergovernmental Science-Policy Platform on Biodiversity and<br />
Ecosystem Services (IPBES) estimates that 25% of plants and animals<br />
assessed, or about one-million species, are threatened with extinction<br />
and that agriculture expansion is the most common form of land<br />
use change.<br />
Much of the agricultural system in SSA is characterised by low-input<br />
and low-technology production, rainfed production, many small and<br />
declining farm sizes as well as underdeveloped infrastructure and<br />
markets, which interact in many ways to hamper significant yield<br />
improvement. This trend must be reversed to build resilience. Building<br />
the resilience of African farming systems is closely associated with<br />
shifting from extensification to intensification mainly by increasing<br />
crop yields including on previously fallowed land.<br />
Changing climatic conditions will<br />
necessitate a change in cropping<br />
patterns across the continent.<br />
CHALLENGES TO RESILIENT FARMING<br />
The sustainability of African farming systems is limited by several<br />
factors. The main ones, many of which are related to farmer behaviour,<br />
include: acute land scarcity; degradation of land; variable weather<br />
conditions; and challenges in creating an enabling policy environment<br />
that encourages private investment in food systems.<br />
Increasing rural population<br />
Africa’s rural population is projected to increase by 305-million to<br />
reach 810-million by 2050. A decade ago, the population density<br />
on the continent averaged 117 persons/km 2 of cropland with the<br />
average at 172 persons/km 2 in areas of high density. Almost 74% of<br />
the rural population in SSA is clustered in densely populated areas<br />
operating on 20% of arable land that receives good rainfall.<br />
The projected increase in rural population poses two important<br />
challenges. First, it implies mounting pressure on cropland and<br />
increasing land fragmentation. Second, given the land pressures,<br />
agricultural growth will have to rely on intensification as the longterm<br />
sustainable path.<br />
Yet, evidence indicates that at very high levels of population<br />
density, the positive relationship of agricultural growth with<br />
Boserupian land intensification breaks down. This implies that<br />
yield improvements on existing land will need to be based on<br />
sustainable intensification practices for agricultural growth.<br />
BOSERUPIAN LAND INTENSIFICATION<br />
Economist Ester Boserup’s theory of agricultural intensification<br />
explains how human populations continue to grow despite visible<br />
environmental limits. Boserup posits that humans adopt more<br />
industrious technologies as they continue to grow. She argues<br />
that when people need to sustain themselves, they do whatever is<br />
necessary to survive.<br />
The rising food demand in Africa can be met by any combination<br />
of the following pathways: (1) increased importation of food;<br />
(2) increased agricultural output due to expansion of area<br />
under food production; (3) reducing food waste and loss, which<br />
currently accounts for about 30% of agricultural output; and/or<br />
(4) producing a greater quantity of agricultural output on existing<br />
farmland, ie a productivity-led approach to agricultural growth.<br />
Sub-Saharan Africa (SSA) has achieved the highest rate of growth<br />
in agricultural production value of any region in the world since 2000,<br />
expanding by 4.3% per year in inflation-adjusted US dollars between<br />
2000 and 2018, roughly double that of the prior three decades.<br />
The world average over the same period was 2.7% per year. Roughly<br />
75% of SSA’s crop production growth came from the expansion of<br />
area under cultivation and only 25% from improvements in crop yield.<br />
The region’s average cereal grain yield at the start of the 21st Century<br />
was about 1t/ha (ton per hectare), while yields averaged 3t/ha in Latin<br />
America and South and Southeast Asia, 5t/ha in China and more than<br />
10t/ha in North America, Europe and Japan.<br />
The main biophysical reason for SSA's poor results were due to the<br />
depletion of soil fertility on smallholder farms because they could<br />
not replenish the nutrients removed by harvest with enough mineral<br />
fertilisers and organic inputs. Empirical evidence from on-farm<br />
experiments suggests that cereal yields in SSA can increase 3t/ha<br />
using current widely available technologies. By 2019, SSA’s average<br />
cereal yields increased to about 1.5t/ha, indicating that there is scope<br />
for significant further improvements in yields.<br />
Due to environmental concerns including biodiversity conservation<br />
and destruction of natural vegetation, continued reliance on area<br />
expansion as the main source of agricultural growth is not a viable<br />
option. In some communities, all potential farmland is already under<br />
cultivation, meaning an increasing population will further limit access<br />
to quality land for the youth, potentially triggering social conflicts.<br />
Cropland expansion is a major cause of deforestation, which<br />
engenders climate variability by raising temperatures. For example,<br />
in Zambia, smallholder cropland expansion accounts for about 60%<br />
of the 250 000 hectares of forest lost annually. It is estimated that<br />
Cropland expansion is a major<br />
cause of deforestation, which<br />
engenders climate variability<br />
by raising temperatures.<br />
50<br />
51
AGRICULTURE<br />
Land degradation<br />
Land degradation constitutes the loss of production capacity due to<br />
reduction in soil fertility and the loss of biodiversity. Africa is the second<br />
most affected by land degradation after Asia, with some 73% of land<br />
(10.5-million km 2 ) in dry areas degraded. About 157.2-million people<br />
(38% of rural population) in SSA were living off degraded agricultural<br />
land by 2010, up from 32% in 2000.<br />
With rising land pressures in SSA, there is risk of accelerated<br />
degradation of existing arable agricultural land and population<br />
encroachment onto degraded lands that are unsuitable for<br />
agricultural production. Loss of soil fertility is a major source of<br />
land degradation that has significantly affected crop yields in SSA.<br />
Soils in SSA have undergone nutrient depletion over the years,<br />
rendering them less fertile for agriculture and thus jeopardising<br />
the region’s food security.<br />
Roughly 10% to 40% of smallholder fields in a wide range of countries<br />
and conditions across Africa have been found to be non-responsive<br />
to inorganic fertiliser applications. Mounting evidence indicates that<br />
smallholder resource constraints and soil fertility deficiencies need<br />
to be addressed holistically for smallholders to achieve a higher yield<br />
response to inorganic fertilisers and to increase the profitability and<br />
demand for fertilisers.<br />
A more holistic approach to increasing soil fertility that includes<br />
increased mineral fertiliser use as well as other organic nutrient<br />
resources will improve efficiencies and profitability of fertiliser use<br />
in SSA.<br />
Climate change<br />
Climate change is one of the most important challenges to the<br />
resilience of agriculture globally. This is more so in developing countries<br />
that have limited resources to mitigate the effects of climate shocks.<br />
In Africa, rising temperatures and increased rainfall variability have<br />
been observed in the past and predicted into the future with negative<br />
implications for agricultural production.<br />
Changing climatic conditions will necessitate a change in cropping<br />
patterns across the continent. It is estimated that by 2050, SSA will<br />
experience a decrease in the yield of a range of staple crops, specifically<br />
for maize (22%); millet (17%); sorghum (17%); groundnuts (18%);<br />
and cassava (8%). These predictions paint a picture of high-level<br />
Agriculture-led habitat loss is<br />
responsible for about 80% of all threatened<br />
terrestrial birds and mammals.<br />
vulnerability for a large section of SSA’s smallholder farmers who are<br />
dependent on rainfed agricultural production with low levels of inputs<br />
and limited access to basic services such as improved infrastructure<br />
and information.<br />
Human pandemics<br />
Covid-19 put a further strain on Africa’s agricultural sector, which was<br />
already under pressure from other challenges. Given that about 70%<br />
of the African population is engaged in agriculture, the outbreak of<br />
this pandemic threatened production systems that are predominantly<br />
labour-intensive. Restrictions on movement contributed to increased<br />
food losses for highly perishable agricultural products. The situation<br />
was worsened by limited investments in cold chain systems and<br />
value addition. Transport restrictions resulted in logistical challenges<br />
including scaling down of international shipments, which impacted<br />
supply chains of farm inputs such as seed, pesticides, fertiliser and<br />
other agrochemicals. This increased the prices of inputs especially in<br />
countries that depend on imports.<br />
The devastating effects of Covid-19 revealed the limited capacity<br />
of African farming systems to cope with pandemics and associated<br />
economic shocks. This suggests a need for building resilience to such<br />
shocks at the primary level of the food systems.<br />
BUILDING RESILIENCE<br />
Improved farming practices that help restore and maintain soil heath<br />
and raise productivity are necessary for building resilience. Although<br />
the exact mix of practices will differ spatially, climate-smart agriculture<br />
– broadly defined as farming practices that aim to raise productivity<br />
and household income, build adaptation capacity and resilience to<br />
climate change as well as reduce greenhouse gas – is considered an<br />
integral component.<br />
Battery energy<br />
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READ REPORT<br />
THOUGHT [ECO]NOMY<br />
greeneconomy/report recycle<br />
This article is an excerpt from the Africa Agriculture Status Report A DECADE OF ACTION:<br />
BUILDING SUSTAINABLE AND RESILIENT FOOD SYSTEMS IN AFRICA | Alliance for a<br />
<strong>Green</strong> Revolution in Africa (AGRA) | [2021]<br />
If we do not transform our food systems, we will hardly attain the Sustainable Development Goals<br />
(SDGs), particularly ending hunger. In this decade, Africa will need to chart clear pathways and<br />
identify concrete actions that can build sustainable and resilient food systems.<br />
Food systems that can deliver sufficient and nutritious food to feed the 256-million food insecure people<br />
on the continent. Food systems that are environmentally sustainable and can reverse the trend in deforestation<br />
and soil degradation. Food systems that create dignified jobs and shared prosperity for African youth now<br />
entering the labor market at a rate of 11-million per year with only 25% getting employed.<br />
*Authors: Regis Chikowo, Plant Soil Microbial Sciences, Michigan State University; John Olwande, Tegemeo Institute, Egerton University; Maria Wanzala, African Fertilizer and Agribusiness Partnership (AFAP);<br />
Mary Lubungu, Indaba Agricultural Policy Research Institute (IAPRI); Hambulo Ngoma, International Maize and Wheat Improvement Center (CIMMYT); Pedro Sanchez, University of Florida.<br />
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Development Partner – Southern Africa<br />
52
ENQUIRIES<br />
Contact Alexis Knipe: alexis@greeneconomy.media<br />
www.greeneconomy.media