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<strong>Economy</strong><br />

G R E E N<br />

journal<br />

ISSUE <strong>48</strong> | 2021<br />

BUILDING RESILIENCE<br />

Food Systems<br />

and Future Shocks<br />

CORPORATE SUSTAINABILITY: Putting it in practice<br />

FUNDING THE SUN: PPA vs Cash<br />

SHEDDING THE LOAD: SA residential energy use


PUBLISHER’S NOTE<br />

Dear Reader,<br />

News this past week, ending Friday 10 September:<br />

• RMIPPPP financial close date extended again<br />

• DNG litigation postponement granted<br />

• New litigation launched by local solar panel assembler<br />

complaining of decisions by the DMRE and dtic resulting in an<br />

unfair outcome.<br />

We are so close to triggering these massive investments into<br />

renewables, storage, and gas – and yet so far.<br />

The key question is can projects, other than Karpowership’s<br />

three projects that are named specifically as a respondent in the<br />

DNG application, close in the presence of the DNG application not<br />

having been resolved? Surely, the answer will be yes. Because if<br />

they lose no one is affected, and if they win, it’s up to the DMRE and<br />

Karpowership to appeal or act in accordance with the order. Why<br />

should the other bidders be affected?<br />

Meanwhile, the new Suntec matter is opening somewhat of a<br />

pandora’s box for the DMRE and dtic. Preferred bidder IPPs would<br />

all rather procure 100% Chinese-produced panels, because they<br />

are cheaper than locally assembled panels.<br />

As its widely accepted that the South African assemblers simply<br />

cannot meet the full demand for solar panels under the RMIPPPP,<br />

IPPs are staring each other down, to see who buckles first and places<br />

orders with the expensive South African suppliers, and thereby use<br />

up the full available capacity.<br />

They are hoping that once local capacity is fully booked by others,<br />

they will be allowed to go ahead and order from China.<br />

Some people have argued that the DMRE should step in to<br />

facilitate a solution. After all, it was their own government’s halt on<br />

the REIPPPP that led to many local panel assemblers closing and<br />

leaving the country, thus leading to a shortage on local capacity.<br />

Suntec Solar now seeks the intervention of the courts, to address<br />

what it alleges are unlawful exemptions giving rise to unfair and<br />

uncompetitive outcomes between solar panel suppliers.<br />

Gordon Brown, Publisher<br />

EDITOR’S NOTE<br />

Commentators are focusing on how governments go about<br />

rebuilding their economies once the world has passed through<br />

the Covid Crisis. Llewellyn van Wyk tells us The Economist analysts<br />

caution that to focus on the quantitative changes only misses<br />

something crucial, which is that there are important qualitative<br />

changes underway in how policymakers manage the economy. On<br />

these measures, the analysts note, the world is in the early stages of<br />

a “revolution in economic policymaking” (page 8).<br />

Sustainable finance is essential for inclusive growth, as it<br />

encompasses both the concepts of green and socially focused<br />

finance. Locally, at an intergovernmental level, the Treasury<br />

approach is to integrate climate responsiveness into provincial<br />

and municipal planning. Read Financing a Sustainable <strong>Economy</strong><br />

(page 12) and on page 14, we help to make sense of what<br />

sustainability should mean in practice.<br />

With the adoption of solar PV by businesses now mainstream, a<br />

significant consideration for these companies is selecting the most<br />

appropriate funding option for their solar project. See page 38 for a<br />

comparison on PPAs and cash purchases for solar systems – and the<br />

article will lead you to a good read on how solar PV affects the value<br />

of your home. Please enter our Read Report boxes to find a wealth<br />

of sustaining knowledge streams.<br />

Enjoy!<br />

Alexis Knipe, Editor<br />

G R E E N<br />

<strong>Economy</strong><br />

journal<br />

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PUBLICATION DATE: September 2021<br />

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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 />

are not necessarily those of the Publisher or the Editor. All editorial and advertising contributions<br />

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by or on behalf of any organisations or products. Please address any concerns in this regard to<br />

the Publisher.<br />

G R E E N<br />

<strong>Economy</strong><br />

journal<br />

4<br />

6<br />

8<br />

NEWS & SNIPPETS<br />

MOBILITY<br />

Toyota RAV-4<br />

goes Hybrid<br />

THOUGHT<br />

LEADERSHIP<br />

How to put it back<br />

together again<br />

12 RESPONSIBLE<br />

INVESTING<br />

Financing a sustainable<br />

economy<br />

14<br />

16<br />

18<br />

20<br />

Making sense<br />

of sustainability<br />

SMART CITIES<br />

Lanseria Airport: set<br />

for new heights<br />

Smart cities promote<br />

best practice in<br />

sustainability<br />

Smart solutions<br />

for people and<br />

planet by Veolia<br />

Services<br />

22 WATER<br />

Dams: half full or<br />

half empty?<br />

25 ENERGY<br />

The role of women<br />

in SA’s energy space<br />

26 PRODUCTION<br />

Meet NCPC excellence<br />

in resource efficiency<br />

28 AGRI-FOOD<br />

Food security in SA:<br />

people, plants and<br />

planet<br />

31<br />

32<br />

34<br />

Swartland: use wood<br />

and save trees<br />

Quality testing for the<br />

agricultural industry by<br />

the Southern African<br />

Grain Laboratory NPC<br />

SMART MINING<br />

To be ORE not to be<br />

To path to being better<br />

stewards of the earth<br />

36<br />

by SRK Consulting<br />

38 ENERGY<br />

Funding the sun<br />

40<br />

From bits to watts<br />

41 POWER<br />

Residential electricity<br />

consumption in SA<br />

42 CIRCULARITY<br />

Waste heat to<br />

electricity<br />

44 WASTE<br />

The road to<br />

sustainability<br />

46<br />

SA prepares for<br />

Clean-up and<br />

Recycling SA Week<br />

with Plastics SA<br />

06<br />

14<br />

26<br />

38<br />

2 3


NEWS & SNIPPETS<br />

NEWS & SNIPPETS<br />

RIP NTOMBIFUTHI NTULI<br />

SAWEA and the sector, at large, mourns the<br />

loss of Princess Ntombifuthi Ntuli, CEO of<br />

SAWEA. Fondly known as Ntombi, she leaves<br />

behind two young children and an extended<br />

family who will no doubt feel the full extent of<br />

this loss.<br />

Ntombifuthi has steered the wind power<br />

sector in her leadership role. During this time,<br />

she drew on her depth of knowledge and<br />

talents, and crafted over more than 15 years in<br />

the energy and related sectors.<br />

Ntombifuthi’s leadership was defined by<br />

her charismatic yet gentle nature, resilience<br />

and determination to successfully steer the<br />

industry towards playing a central role in<br />

South Africa’s energy transition, while being a<br />

uniting force.<br />

She built strong bridges throughout the<br />

energy sector, founded on her sound logic<br />

JO JOs FOR JOZI<br />

Joburg Water says its system is under severe<br />

pressure, with water demand consistently<br />

exceeding supply. Reservoirs are affected<br />

across the Gauteng region. Spokesperson,<br />

Eleanor Mavimbela, said that the intermittent<br />

water supply would continue indefinitely.<br />

“Citizens of the City of Johannesburg are<br />

urged to use water sparingly as the city is still<br />

under level one water restrictions.”<br />

Courtesy: Eye Witness News<br />

CITY CALLS CITIZENS TO CLIMATE ACTION<br />

Cape Town has encouraged residents and businesses to join their climate action movement<br />

following their recently released Climate Change Strategy. This is to adapt to the impacts of<br />

climate change, mitigate climate change, significantly reduce carbon emissions and harness<br />

opportunities of the green economy. A few of their mitigation efforts to reduce carbon emissions<br />

include driving energy efficiency in municipal operations, moving towards net-zero carbon<br />

buildings, procuring energy from Independent Power Producers (IPPs), reducing and diverting<br />

waste and building an efficient transport network.<br />

Courtesy: Cape Argus<br />

THE BEST MEGAWATT<br />

and ability to see the bigger picture. Her<br />

lobbying efforts for the country’s transition<br />

to cleaner power were underpinned by<br />

supportive government policy and smooth<br />

procurement, which will help to ensure the<br />

sector’s exponential growth for years to come.<br />

Her legacy will live on not only through her<br />

successes, but also in the hearts of the people<br />

that make up this industry.<br />

“Ntombi changed the face of the wind<br />

industry in our country. She made the industry<br />

relatable with her ability to engage with the<br />

most stubborn naysayer, helping them to see<br />

her point of view and winning everyone over<br />

with her charming smile and her calm strength,”<br />

said Mercia Grimbeek, Chair of SAWEA.<br />

<strong>Green</strong> <strong>Economy</strong> <strong>Journal</strong> extends our heartfelt<br />

condolences to Ntombifuthi Ntuli’s friends<br />

and family.<br />

BY BARRY BREDENKAMP, SANEDI<br />

As the country focuses on improved energy capacity, energy savings must not be forgotten. The IEA<br />

regards energy efficiency as the “first fuel”, and we should strive to save every possible kWh before<br />

adding new generating capacity. Companies must prioritise energy savings, not just self-generation.<br />

While I agree that the new 100MW threshold is great news for the stability of supply and our<br />

economic potential, I would like to see every installation targeting a baseline load of 110MW. My take<br />

is that there is at least 10% energy savings potential on the demand side of the meter at virtually all<br />

proposed installations, before adding additional supply-side capacity.<br />

The more energy (consumption) we avoid or save, the smaller the size of the load required to<br />

operate those end-use technologies. We urge project developers not to lose focus on first exploring<br />

the energy efficiency potential, by setting an “internal” target to save 10MW of electricity for every<br />

100MW of renewable power generation capacity installed.<br />

All new build projects come with an environmental cost. Even clean energy projects come with<br />

a carbon footprint. If you consider the manufacture and transport of every component required for<br />

a solar farm, you can understand how this will add up when companies across the country adopt<br />

generation plants.<br />

Added to that, it is cheaper to save energy than to generate it. Building new generation capacity is a<br />

big investment, regardless of the energy source. There are additional cost and environmental savings<br />

to be gained by including energy efficiency in the overall mix. Regardless of how and where power is<br />

generated, someone still pays for the megawatt consumed, whereas the avoided megawatt is “free”. In<br />

my opinion, the best megawatt is the megawatt not used.<br />

CO2 LEVELS AFFECT<br />

DUNG BEETLES<br />

A new study led by Wits University postdoctoral<br />

researcher, Dr Claudia Tocco,<br />

provides evidence that elevated CO2<br />

levels directly affects the development<br />

and survival of tunnelling dung beetles.<br />

The study, published in the international<br />

journal, Global Change Biology, presents a<br />

possible explanation for the current “insect<br />

apocalypse” – a global decline in insect<br />

populations that is still not well understood.<br />

“When raised under CO2 levels predicted<br />

for the year 2070, a third fewer beetles<br />

emerged and were 14% smaller in size when<br />

compared to pre-industrial CO2 levels,” says<br />

Tocco. Courtesy: Wits University<br />

UCT AND SASOL: CATALYSTS FOR GREEN JET FUEL<br />

THE BIG 4 ACCOUNTING FIRMS BALANCE ESG<br />

The UCT and Sasol have made advancements in the use of commercial iron catalyst, produced<br />

cheaply and at large scale at Sasol’s Secunda plant, which would enable conversion of unavoidable<br />

or biogenically-derived CO₂ and green hydrogen directly to a variety of green chemicals.<br />

The companies said in a statement that the collaboration had revealed that Sasol’s iron catalyst<br />

could achieve CO₂ conversions greater than 40%, producing ethylene and light olefins, which could<br />

be used as chemical feedstocks, and significant quantities of kerosene-range hydrocarbons (jet fuel).<br />

“Conversion of green hydrogen together with CO₂, a process called CO₂ hydrogenation, is gaining<br />

significant interest worldwide and is a promising way to produce sustainable aviation fuels and<br />

chemicals which have a significantly lower carbon footprint,” says Dr Cathy Dwyer, the vice president:<br />

Science Research at Sasol Research and Technology.<br />

Courtesy: Business Report<br />

PwC put the demand for ESG advice at the heart of a $12-billion investment plan it recently<br />

announced that involves adding 100 000 employees and launching “trust institutes” to train clients<br />

in ethics. Deloitte announced a “climate learning programme” for its 330 000 employees. KPMG’s<br />

ESG work has included helping Ikea to analyse social and environmental risks linked to the Swedish<br />

furniture retailer’s raw materials and advising on the first green bond issued in India. Alongside EY,<br />

all four have been at the table as business groups try to thrash out new international standards for<br />

measuring sustainability.<br />

Courtesy: Financial Times<br />

WHEN I GROW UP<br />

This is a book about 21 people who are working<br />

in clean energy; what they all have in common<br />

is that they are passionate about their job, and<br />

work on tackling the climate crisis. Meet Swarna<br />

who studies the wind to put her turbines in the<br />

best locations; Nicolas who flies drones to check<br />

for cracks in the blades; and Jos who builds<br />

playgrounds from old wind turbines. There are<br />

people from all continents who will tell you<br />

about their clean energy jobs, what subjects they<br />

studied and the skills they needed to be able to<br />

do what they do now.<br />

SAWEA Chair, Mercia Grimbeek has contributed to<br />

@WindEurope’s latest children’s book.<br />

RENEWABLE POWER<br />

The City of Cape Town is looking at options<br />

to develop Athlone Power Station. Mayco<br />

member for Energy and Climate Change,<br />

Phindile Maxiti, said the site was considered<br />

unsuitable for mixed-use residential purposes,<br />

so the emphasis had shifted to looking at<br />

uses in line with its existing permit, including<br />

for energy and/or industrial use, particularly<br />

considering the emerging energy crisis.<br />

The power station was decommissioned<br />

in 2003 as it was no longer economically<br />

viable. Finance and Economic Opportunities<br />

MEC David Maynier said the department was<br />

collaborating with the City and welcomed its<br />

announcement of a Request For Information<br />

(RFI) for funding and financing instrument<br />

solutions for its Renewable Energy Programme.<br />

“This RFI is aimed at development banks and<br />

multilateral development funds for projects<br />

that the City will own and operate, located on<br />

city-owned land and buildings (typically within<br />

the City distribution grid), ranging in size from<br />

less than 1MW to 100MW per project, with<br />

the potential to explore larger-scale projects<br />

connected to Eskom’s network.”<br />

Courtesy: Shakirah Thebus, Cape Argus<br />

4<br />

5


MOBILITY<br />

MOBILITY<br />

This revolutionary powertrain technology debuted in 1997 in the<br />

Toyota Prius. While the Prius has undoubtedly been the poster<br />

child for Hybrid, Toyota has recognised the need to expand this<br />

new energy technology to other mainstream model ranges – in pursuit<br />

of greater Hybrid adoption and wider market appeal.<br />

Recent developments in the global motoring arena have placed a far<br />

greater emphasis on New Energy Vehicles (NEV) and alternative propulsion<br />

technologies. With the continued development of new energy alternatives<br />

and further advancements of battery technology, customers are seeking<br />

more advanced drivetrain options and greater levels of efficiency without<br />

compromising on their core vehicle requirements.<br />

This is where Toyota’s NEV roadmap kicks in. Branded “Towards Carbon<br />

Neutral”, this all-encompassing environmental strategy has as its goal, to<br />

get to zero emissions by 2050, but with several intermediate milestones in<br />

between. And here we’re not just talking emissions produced by a vehicle,<br />

Toyota plans to be emission-free throughout the production process (not<br />

just for Toyota but our suppliers as well).<br />

To this end Toyota South Africa has an initial plan to roll out Hybrid<br />

variants on most of its mainstream model ranges. The big news will be<br />

the introduction of the locally produced Corolla Cross (in petrol and<br />

Hybrid) as from November this year. This, however, is just the start of the<br />

electrification programme – the full spectrum of NEVs will be launched<br />

when there is sufficient demand and when the infrastructure can support<br />

their introduction (watch this space).<br />

The Hybrid pays dividends at the fuel pump too, as the model’s<br />

fuel consumption index is listed at mere 4.7 l/100km with CO 2<br />

emissions registering 107g/km. A remarkable consumption figure for<br />

a 5-seater SUV.<br />

One grade, one spec<br />

The RAV4 Hybrid is offered in tweaked GX trim – which strikes a balance<br />

between core convenience spec, value for money and luxury convenience.<br />

The RAV4 Hybrid boasts LED head and taillamps complete with DRLs up<br />

front, rain-sensing wipers, heated and power-operated side mirrors and<br />

keyless entry. Occupants are well catered for with dual-zone climate<br />

control, three 12-volt power outlets and multiple cupholders.<br />

Driver convenience is boosted Cruise Control, an auto-dimming<br />

rear-view mirror, multi-information display and a tilt and telescopic<br />

steering wheel finished in leather and incorporating steering switches.<br />

The infotainment system centres around Toyota’s touchscreen interface,<br />

delivering sound output through six speakers while interfacing via three<br />

USB inputs, Bluetooth and Apple CarPlay/Android Auto mediums.<br />

Driver support systems include Park Distance Control (PDC), ABS, EBD,<br />

VSC, Trailer Sway Control (TSC), Hill Assist Control (HAC) and Drive Mode<br />

Select (Eco/Normal/Power). A full complement of airbags is present,<br />

including side and curtain variants, as well as an anti-theft system.<br />

The RAV4 Hybrid rides on 17-inch alloy wheels with 225-65-R17<br />

rubber joined by a full-size spare wheel. Roof rails, a rear spoiler, blue<br />

RAV4<br />

Goes Hybrid<br />

Hybrid: noun [hy·brid] a term introduced<br />

to the automotive world<br />

by Toyota to identify a dual-source<br />

powertrain combining a traditional<br />

internal combustion petrol engine<br />

with a high-current electric motor.<br />

Making Hybrid mainstream<br />

With this change in customer behaviour, we are excited to introduce<br />

Hybrid variants of two of our most popular passenger cars – Corolla<br />

and RAV4. Both Corolla and RAV4 Hybrid are a first for South Africa and<br />

combine all the virtues of their conventional namesakes with the added<br />

performance and fuel efficiency of Toyota’s proven Hybrid system.<br />

The RAV4 Hybrid<br />

Based on Toyota’s angular fifth-generation sport utility, the RAV4 Hybrid<br />

combines a punchy 2.5-litre Hybrid powertrain with the popular TNGAbased<br />

5-seater SUV. The A25A-FXS engine is shared with other global<br />

Toyota and Lexus stablemates, such as the Lexus ES and NX300h and the<br />

acclaimed Camry Hybrid.<br />

It boasts many of the same technologies shared by the Corolla Hybrid,<br />

in a larger displacement four-cylinder offering. Featuring an “undersquare”<br />

design with Toyota D-4S port and direct-injection, the Atkinson cycle<br />

engine generates 131kW and 221Nm in “ICE” state.<br />

The electric motor punches out 88kW and 202Nm (at maximum state of<br />

charge) to deliver a total system output of 160kW. Power is transmitted to<br />

the front wheels via a CVT transmission, which seamlessly integrates the<br />

two drive sources – and delivers an ultra-refined drive. Smooth punchy<br />

acceleration, low NVH levels and superb refinement, are some of the<br />

standout features of the RAV4 Hybrid.<br />

Toyota insignia, Hybrid badging and mud guards also form part of the<br />

standard repertoire.<br />

Colours and coverings<br />

A total of eight exterior hues are available: Glacier White, Pearl White,<br />

Chromium Silver, Graphite Grey, Caribbean Blue, Cinnabar Red, Urban<br />

Khaki and Moonlight Ocean metallic. The interior is finished off in a<br />

textured-black textile trim.<br />

Pricing package<br />

RAV4 GX Hybrid CVT: R555 300<br />

The pricing has been set at a very competitive level in anticipation of future<br />

government support on New Energy Vehicles (NEV). Toyota South Africa<br />

Motors’ strategy is to make Hybrid models attainable and offer customers an<br />

attractive product package – leveraging the benefits of Hybrid technology –<br />

without paying significant premiums in order to experience it.<br />

Peace of mind<br />

A six-services or 90 000km service plan is standard with service intervals<br />

pegged at 15 000km/12-months. Toyota’s standard three-year/100 000km<br />

warranty is included and customers have the additional peace of mind of an<br />

eight-year/195 000km Hybrid battery warranty. Service and warranty plan<br />

extensions can also be purchased from any Toyota dealer (220 outlets).<br />

6<br />

7


THOUGHT LEADERSHIP<br />

THOUGHT LEADERSHIP<br />

How To Put It<br />

BACK TOGETHER AGAIN<br />

Humpty Dumpty sat on a wall,<br />

Humpty Dumpty had a great fall.<br />

Four-score Men and Four-score more,<br />

Could not make Humpty Dumpty where he was before<br />

Samuel Arnold Juveline Amusements, 1797 1<br />

BY LLEWELLYN VAN WYK, B. ARCH; MSC. (APPLIED), URBAN ANALYST<br />

the world is in the early stages of a “revolution in economic policymaking”.<br />

Central banks have in effect pledged to print as much money as<br />

necessary to keep down government-borrowing costs. The European<br />

Central Bank is promising to buy everything that governments might<br />

issue thereby reducing the gap in borrowing costs between weaker<br />

and stronger euro-zone members, which widened in the early days of<br />

the pandemic.<br />

Main Street assistance programme in the history of the United States”,<br />

comparing it favourably with Wall Street bailouts a decade ago.<br />

To that end the analysts note that governments across the rich world<br />

are channelling vast sums to firms, providing them with grants and cheap<br />

loans to preserve jobs and keep their doors open. In some cases, the<br />

government is paying the wages of people who cannot work safely: the<br />

EU has embraced this policy, while the British state will pay up to 80% of<br />

the wages of furloughed workers. The American package includes loans to<br />

small businesses that will be forgiven if workers are not laid off. Households<br />

across the rich world are being given temporary relief on mortgages, other<br />

debts, rent and utility bills. In America people will also be sent cheques<br />

worth up to $1 200.<br />

Most economists support these measures. Nominally they are<br />

temporary, designed to hold the economy in an induced coma until the<br />

pandemic passes, at which point the world is supposed to revert to the<br />

status quo ante. But history suggests that a return to pre-Covid-19 days<br />

is unlikely.<br />

Humpty Dumpty is a character in an English nursery rhyme,<br />

probably originally a riddle and one of the best known in<br />

the English-speaking world. He is typically portrayed as an<br />

anthropomorphic egg, though he is not explicitly described as such.<br />

Its origins are obscure, and several theories have been advanced to<br />

suggest original meanings. I thought it particularly appropriate to<br />

describe the following article – what are the impacts of Covid on the<br />

global economy and how does it recover.<br />

Impact and Response<br />

Many commentators and economists are focusing on how governments<br />

go about rebuilding their national and city economies once the world has<br />

passed through what Christopher Joye calls the Global Virus Crisis (GVC). 2<br />

According to The Economist, policy response has generally been swift and<br />

decisive. 3 Globally central banks have cut interest rates since January 2020<br />

and have launched new and substantial quantitative-easing schemes<br />

(creating money to buy bonds) while politicians are opening the fiscal taps<br />

to support the economy.<br />

In the US, America’s Congress passed a bill that boosts spending by<br />

twice as much as President Barack Obama’s package in 2009. Britain,<br />

France, and other countries have made credit guarantees worth as much<br />

as 15% of GDP, seeking to prevent a cascade of defaults. On the most<br />

conservative measure, the global stimulus from government spending<br />

this year will exceed 2% of global GDP, a much bigger push than was seen<br />

in 2007-09. Even Germany, whose fiscal rectitude is a cultural cliché, is<br />

spending more. 4<br />

The analysts at The Economist caution though that to focus just on the<br />

quantitative changes misses something crucial which is that there are<br />

important qualitative changes under way in how policymakers manage<br />

the economy – the responsibilities they have assumed for themselves,<br />

what is seen as a legitimate action and what is not, and the criteria used<br />

to judge policy success or failure. On these measures, the analysts note,<br />

The analysts note that politicians, too, are ripping up the rulebook. In<br />

past recessions enterprises could go bankrupt and people too become<br />

unemployed. Even in normal economic times, roughly 8% of businesses in<br />

OECD countries go under each year, while 10% or so of the workforce lose a<br />

job. Now governments hope to stop this from happening entirely. President<br />

Emmanuel Macron reflects the view of many when he vows that no firm will<br />

“face the risk of bankruptcy” because of the pandemic. Boris Johnson, Britain’s<br />

prime minister, contrasts his government’s response with the one during the<br />

last financial crisis: “Everybody said we bailed out the banks and we didn’t look<br />

after the people who really suffered”. Larry Kudlow, the director of America’s<br />

National Economic Council, calls America’s fiscal stimulus “the single largest<br />

8<br />

9


THOUGHT LEADERSHIP<br />

THOUGHT LEADERSHIP<br />

Two lessons stand out. The first lesson is that governmental control<br />

over the economy takes a large step-up during periods of crisis. The<br />

second is that the forces encouraging governments to retain and expand<br />

economic control are stronger than the forces encouraging them to<br />

relinquish it, meaning that a “temporary” expansion of state power tends<br />

to become permanent. 5<br />

Road to Recovery<br />

The extent of the economic damage and the time it will take for the<br />

economy to recover is subject to a high degree of speculation, and new<br />

models have been created to project a recovery trajectory. For example,<br />

the recovery can be V-shaped (after the downward fall the recovery will<br />

follow a straight line back to the original growth trajectory); U-shaped<br />

recovery (like V-shaped but with a longer turnaround period); VU shaped<br />

recovery (an initial pop, or sugar hit (the V), which is then superseded by a<br />

second, much slower growth phase (the U) due to a huge increase in debt<br />

repayment burdens and big creative destruction-induced output gaps<br />

(or excess productive capacity) as the virus forces the global economy<br />

to effectively rewire itself); Z-shaped (recovery follows the V-shaped<br />

trajectory but overshoots the original trajectory due to pent-up demand<br />

before falling back to the original trajectory); W-shaped (recovery begins<br />

buts fall back before climbing back up again); and L-shaped (growth<br />

recovers but ends up lower than that of the pre-C-19 economic growth).<br />

In a survey of 106 economists and real estate experts conducted by<br />

Pulsenomics and Zillow, 41% of panellists expect the US recovery to<br />

follow a “U” shape, with the recession lasting several quarters before<br />

returning to growth. 6 This prediction is in line with how the experts<br />

expect the US economy to recover overall. Forty-one percent said<br />

they think economic recovery will follow a “U” shape, and 33% say it<br />

will be a bumpy, multi-year return to trend growth. Both patterns are<br />

characterised first by a sharp decline and then match how experts see<br />

transaction volume recovering, with the consensus generally being a<br />

more gradual journey back to normal.<br />

Whatever the final shape may turn out to be, Eswar Prasad and Ethan<br />

Wu, writing for the Brookings Institution, warns, “The world economy is<br />

on the precipice of its worst crisis since World War II. As the newly updated<br />

Brookings-FT TIGER (Tracking Indexes for the Global Economic Recovery)<br />

makes clear, economic activity, financial markets, and private-sector<br />

confidence are all cratering. And if international cooperation remains at its<br />

current level, a far more severe collapse is yet to come.” 7<br />

A wide variety of economic and survey data suggest that the economy<br />

will recover slowly even after the government begins to ease limits on<br />

public gatherings and allow certain shuttered restaurants and shops<br />

to reopen. Many economists and business owners say there will be no<br />

rapid economic rebound until people feel confident that their risks of<br />

contracting the coronavirus have fallen, either through widespread<br />

testing or a vaccine. 8<br />

Prasad and Wu argue that while the current extraordinarily sharp<br />

downturn could prove to be relatively brief, with economic activity<br />

snapping back to previous levels once the Covid-19 contagion curve<br />

is flattened, there is good reason to worry that the world economy is<br />

heading into a deep, protracted recession. In their view much will depend<br />

on the pandemic’s trajectory and whether policymakers’ responses are<br />

sufficient to contain the damage while rebuilding consumer and business<br />

confidence. They do not believe that a rapid recovery is likely due to<br />

ravaged demand, extensive disruptions to manufacturing supply chains,<br />

and a financial crisis already underway.<br />

They, like many other commentators, draw a distinction between<br />

the 2008-09 crash, and Covid-19. Unlike the 2008-09 crash, which was<br />

triggered by liquidity shortages in financial markets, they point out that<br />

the Covid-19 crisis involves fundamental solvency issues for firms and<br />

industries well beyond the financial sector. In addition, they note, the<br />

current shock is simultaneous and universal. During and immediately<br />

following the 2008 crisis, some emerging markets, not least China, and<br />

India, continued to register strong growth, pulling the rest of the world<br />

economy along. But this time, no economy is immune, and no country will<br />

be able to lead an export-driven recovery. Today’s collapse has increased<br />

deflationary and financial risks in the advanced economies and struck a<br />

significant blow to commodity exporters.<br />

On top of it all, oil prices are plunging even more than they otherwise<br />

would, due in large part to Saudi Arabia and Russia flooding the market.<br />

In their view all told, the economic and financial carnage wrought by the<br />

coronavirus could leave deep, lasting scars on the global economy. While<br />

they recognise that central banks are stepping up to the challenge, they<br />

point out that central banks cannot offset the fall in consumer demand<br />

or stimulate investment by themselves. With both conventional and<br />

unconventional monetary-policy tools already stretched to the limit, fiscal<br />

policymakers will have to do more.<br />

They suggest that well-targeted fiscal measures can soften the blow to<br />

consumers and businesses-especially small and medium-size enterprises,<br />

which typically have minimal financial buffers-thereby helping to sustain<br />

employment and demand. In these desperate times, such measures<br />

should be fully embraced by all governments that currently benefit from<br />

low borrowing costs, even if they already have high levels of public debt.<br />

They also emphasise that low- and middle-income countries who<br />

have inadequate health systems will need substantial support from the<br />

international community, potentially including concessionary debt relief.<br />

But there is an elephant in the room: unfortunately, the world’s inability<br />

so far to forge a common front attest to the erosion of international<br />

cooperation, which is further damaging business and consumer<br />

confidence. They too, like many other commentators, call for this to<br />

change. The world urgently needs honest and transparent informationsharing<br />

by national leaders, coupled with aggressive steps to contain<br />

the pandemic, extensive stimulus to mitigate the economic fallout, and<br />

a carefully calibrated strategy to restart economic activity as soon as it is<br />

safe to do so.<br />

The embedding of Zoom, or cheap video<br />

conference technology, may dissipate<br />

the value of face-to-face meetings and<br />

result in a permanent decrease in the<br />

demand for expensive business-related<br />

travel and accommodation.<br />

Christopher Joye agrees with the sentiments expressed by Prasad and<br />

Wu. Joye sees the global economy being burdened by a great deal more<br />

public and private debt because of the enormous fiscal policy responses,<br />

which will need to be serviced through tax revenue and corporate/<br />

household earnings. This he argues will drag on future global growth<br />

after the initial pop in activity as businesses restart and the working-age<br />

population gets back into their day-jobs.<br />

On the matter of whether this precipitates a sovereign debt crisis he<br />

believes that ultimately the central banks can cauterise this problem by<br />

continuing to do what they are currently doing: i.e., funding their domestic<br />

treasuries by buying government bonds via quantitative easing (QE). After<br />

all, he notes, central banks were originally created to fund governments<br />

during times of war (that term again), and that is arguably where the world<br />

finds itself now in terms of response.<br />

On the question of inflationary shock, he expects the deflationary<br />

impulse of the GVC via the huge sudden increase in labour supply to<br />

overwhelm the inflationary impulse of the crisis over the short-to-medium<br />

term (i.e., in the next year or two) noting that the near-term inflation<br />

pressures obviously come through supply-chain rigidities as labour is<br />

taken temporarily offline.<br />

He does foresee a key consequence of the GVC as compelling much<br />

greater internalisation of supply-chains, especially those that service<br />

critical infrastructure and security-sensitive goods and services. In terms of<br />

changes, it is suggested that the GVC will result in a permanent economic<br />

damage akin to a form of creative destruction where the virus kills off<br />

weak companies as well as unproductive employees. This he suggests is<br />

because many businesses will come back looking different, shedding low<br />

quality workers, and closing unprofitable activities/subsidiaries.<br />

Some industries will be permanently changed in both positive and<br />

negative ways, for example, entire communities are being forced to get<br />

much more comfortable with online shopping and the associated delivery<br />

process, reducing at the margin the demand for traditional retailing. The<br />

cinema industry will be irreversibly damaged as consumption shifts away<br />

from theatres to on-demand digital platforms like Apple and Netflix, which<br />

will turn allow these distributors to capture more of the value-chain in the<br />

same way Amazon did with bricks and mortar retailing.<br />

The commercial property sector is also likely to feel this change as there<br />

is a possibility of a permanent decrease in the demand for both office and<br />

retail space. Many companies may conclude they can save overhead by<br />

remaining disaggregated (i.e., not renting office space). This will result in a<br />

decline in the value of commercial properties, and the risk associated with<br />

commercial property debt could increase sharply. Commercial property<br />

lenders’ LVRs might suddenly jump because of this. Indeed, he argues that<br />

a lot of distress in commercial property debt portfolios can be expected<br />

over the next 12 months.<br />

The embedding of Zoom, or cheap video conference technology, may<br />

dissipate the value of face-to-face meetings and result in a permanent<br />

decrease in the demand for expensive business-related travel and<br />

accommodation, adversely impacting airlines and hotels, as companies<br />

seek to enhance their operating efficiencies. All this creative destruction<br />

could result in unemployment rates not returning any time soon to<br />

their pre-GVC levels which will, in turn, place downward pressure on<br />

wages. Ultimately, he concludes that this will result in a battle between<br />

the shock of the new – a virus that derails life as we knew it – and the<br />

opportunities presented by the gigantic stimulus afforded by fiscal and<br />

monetary policy. 9<br />

As the world tries to deal with the ongoing challenges of Covid-19, it is worth reminding<br />

ourselves that infrastructure investment and climate action are both urgently need,<br />

and that with the right approach, both goals can be achieved simultaneously. This<br />

article provides some indications of what the right approach may be.<br />

CLICK HERE TO CONTINUE READING ARTICLE<br />

REFERENCES<br />

1 Opie, J. and Opie, P., ed. (1997) [1951]. The Oxford Dictionary of Nursery Rhymes (2nd ed.). Oxford: Oxford University Press. p. 254. ISBN 978-0-19-860088-6.<br />

2 Joye, C. 2020. “Calling a ‘VU’ shaped recovery: and creative destruction induced by GVC.” Coolabah Capital Investments, 7 April 2020. .<br />

3 Briefing, 2020. “Rich countries try radical economic policies to counter covid-19.” The Economist, Mar 26, 2020. .<br />

4 Briefing, 2020. “Rich countries try radical economic policies to counter covid-19.” The Economist, May 26, 2020. .<br />

5 Briefing, 2020. “Rich countries try radical economic policies to counter COVID-19.” The Economist, March 26, 2020. .<br />

6 Olsen, S. 2020. “Experts: Spring’s missing home sales will be added in coming years. Zillow, June 3, 2020. .<br />

7 Prasad, E. and Wu, E., 2020. “Anatomy of the coronavirus collapse.” The Brookings Institution, Monday, April 13, 2020. .<br />

8 Tankersley, J. 2020. “Economic pain will persist long after lockdowns end.” The New York Times, 13 April 2020. .<br />

9 Joye, C. 2020. “Calling a ‘VU’ shaped recovery and creative destruction induced by GVC.” Coolabah Capital Investments, 7 April 2020. .<br />

10<br />

11


RESPONSIBLE INVESTING<br />

RESPONSIBLE INVESTING<br />

Financing a<br />

SUSTAINABLE ECONOMY<br />

Sustainable finance plays a pivotal role in enabling environmentally appropriate social<br />

development and creating new economic opportunities in the green economy.<br />

Treasury seeks to protect the economy and unlock opportunities that will<br />

enhance the country’s adaptability to the rapidly changing climate and<br />

realise socio-economic benefits from the transition to a lower carbon, greener<br />

economy and build resilience to create a safer financial sector that better<br />

serves South Africa. It is pursuing policies to ensure all financial institutions<br />

embed and improve their capability for identifying, managing and disclosing<br />

the environmental and social risks in their portfolios through strengthening<br />

the regulatory framework and encouraging the uptake of leading practice.<br />

Treasury capital appraisal guidelines, which are under review, will<br />

incorporate climate resilience. Fiscal allocations to support ecologically<br />

sustainable development through the Department of Environmental<br />

Affairs, Forestry and Fisheries are complemented with funding for public<br />

transport, clean energy and energy efficiency, water conservation and<br />

demand management.<br />

At an intergovernmental level, the Treasury approach is to integrate<br />

climate responsiveness into provincial and municipal planning. This<br />

includes ensuring climate change responsive budgeting through<br />

guidelines for provincial medium-term expenditure frameworks and<br />

built environment performance plans for metropolitan municipalities.<br />

Through a progressive integration and system reform, provinces and<br />

municipalities can create an intergovernmental project pipeline.<br />

Accelerating the implementation of the 2015 Paris Climate Agreement<br />

requires clear financing strategies that work to mobilise resources<br />

from both public and private sectors. Treasury is working with local<br />

and international partners to leverage climate change funding. The<br />

Department of Agriculture and Treasury is working closely with the local<br />

insurance industry on an agricultural insurance product.<br />

*Excerpt from Financing a Sustainable <strong>Economy</strong> report<br />

The South African national greenhouse gas inventory highlights<br />

that electricity generation from fossil fuels contributes some 45%<br />

of South African emissions. It follows, therefore, that to address<br />

climate-related risks in the country it is essential to reduce electricityrelated<br />

emissions. The scale and reach of this problem is multifaceted<br />

and requires financial resources, structural and socio-economic reforms.<br />

Sustainable finance is essential for balanced and inclusive growth,<br />

based on the identification and mitigation of risks as well as the search<br />

for economic opportunities that are socially, environmentally and<br />

economically beneficial. It encompasses both the concepts of green- and<br />

socially-focused finance.<br />

The Intergovernmental Panel on Climate Change, the OECD and others<br />

have estimated that trillions of new dollars will be needed each year, up to<br />

2030, for investments in energy, transport, water and telecommunications<br />

infrastructure to sustain growth and mitigate climate effects. An additional<br />

USD600bn a year would likely be needed to make these investments<br />

compatible with holding the average global warming to 2°C.<br />

The Climate Policy Initiative1 has estimated the South African economic<br />

transition risks at an aggregated R2tn (of which 60% has already been<br />

incurred) 2 . A further R362bn may result from infrastructure investments<br />

currently being contemplated that may not be economically viable in a<br />

low-carbon transition. Many of the transition risks identified result from<br />

transitions in the global economy and cannot be prevented by any national<br />

government but require rapid adaptation by all players public and private.<br />

In 2017, the Task Force on Climate-related Financial Disclosures3 published<br />

recommendations to increase understanding of the financial risks related<br />

to climate change. It recommended to the G20 that for financial disclosure,<br />

global warming scenarios should be used to model the potential risks to<br />

economic systems. Systematic and credible disclosure is needed to enable<br />

improved pricing and risk distribution and the identification of economic<br />

opportunities associated with climate risk mitigation and adaptation.<br />

TREASURY APPROACH<br />

Addressing both climate change and South Africa’s development agenda<br />

will require the reallocation of capital, the mobilisation of new financial<br />

resources and the strategic realignment of existing resources (public and<br />

private) over the short, medium and long term.<br />

Government has recognised the need for a just transition4 and<br />

various government agencies and departments, including Treasury and<br />

the National Planning Commission, are working to understand what<br />

is needed and stimulate the creation of new jobs. By mobilising private<br />

sector funding of new and more sustainable projects, such as through the<br />

Renewable Energy Independent Power Producer Programme (REIPPP),<br />

Treasury facilitates the shifting of green infrastructure investment off the<br />

national balance sheet into the private sector.5<br />

The Climate Policy Initiative<br />

has estimated the South African<br />

economic transition risks at<br />

an aggregated R2tn.<br />

READ REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

Environmental<br />

and social<br />

risks and<br />

opportunities<br />

FINANCING A SUSTAINABLE ECONOMY | National Treasury<br />

Technical Report [2020]<br />

This paper sets out the research and resultant recommendations of a process to establish<br />

minimum practice and standards about climate change as well as emerging environmental<br />

and social risks. The study focuses on the need for South Africa to mobilise the financial<br />

resources now to address this challenge, both for the benefit of its citizens and to meet its<br />

global obligations.<br />

REPORT RECOMMENDATIONS<br />

To adopt the following definition of sustainable finance in South Africa:<br />

Sustainable finance encompasses financial models, products, markets and ethical<br />

practices to deliver resilience and long-term value in each of the economic,<br />

environmental and social aspects and thereby contribute to the delivery of the<br />

sustainable development goals and climate resilience.<br />

This can be achieved by:<br />

• Evaluating portfolio as well as transaction-level environmental and social risk exposure and<br />

opportunities, using science-based methodologies and best-practice norms<br />

• Linking these to products, activities and capital allocations<br />

• Maximising opportunities to mitigate risk and achieve benefits in each of the social and<br />

environmental and economic aspects<br />

• Contributing to the delivery of the sustainable development goals.<br />

08 09 11 16 49<br />

SA’s climate<br />

change<br />

response<br />

Barriers to<br />

sustainable<br />

finance<br />

Defining<br />

sustainable<br />

finance<br />

Conclusion<br />

of report<br />

WATCH NOW<br />

12<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/watch<br />

DEVELOPMENT DIALOGUE | A Trade<br />

& Industrial Policy Strategies seminaar on<br />

the key priorities and challenges for a just<br />

transition in Emalaheni and Steve Tshwete –<br />

What does mining closure mean for workers,<br />

their jobs and livelihoods? [August 2021]<br />

REFERENCES<br />

1 Climate Policy Initiative: https://climatepolicyinitiative.org<br />

2 USD125bn at January 2019 exchange rates<br />

3 Established by the Financial Stability Board at the request of the G20 finance ministers and central banks<br />

4 Just transition accommodates the needs of communities, which may be negatively affected through the loss of jobs or activities because of a move to a lower carbon economy<br />

5 Eskom power purchase agreements are an exception<br />

SOUTH AFRICA’S GREENEST BONDS<br />

The earliest green bonds issued in South Africa were for clean energy infrastructure and local government initiatives:<br />

2012 The Industrial Development Corporation issued a R5bn bond for investment in clean energy infrastructure.<br />

2014 The City of Johannesburg was the first local municipality to list a green bond on the JSE – a R1.46bn issuance to finance initiatives, such<br />

as biogas-to-energy and the Solar Geyser Initiative. The City of Cape Town’s R1bn <strong>Green</strong> Bond will fund projects aligned with the City’s<br />

Climate Change Strategy, including measures to secure long-term water availability.<br />

2017 The Johannesburg Stock Exchange opened a <strong>Green</strong> Bond segment on the exchange. The first bond issuance, by Growthpoint, was a<br />

R1.1bn bond for five, seven or 10 years.<br />

2019 Nedbank became the first bank to list a green bond on the JSE, with proceeds ring-fenced for renewable energy. It attracted R5.5bn in bids<br />

and increased the size of the issue from R1bn to R1.7bn.<br />

2020 Standard Bank sold a 10-year USD200m green bond to the International Finance Corporation via the London Stock Exchange.<br />

13


RESPONSIBLE INVESTING<br />

RESPONSIBLE INVESTING<br />

WATCH NOW<br />

Making sense of<br />

SUSTAINABILITY<br />

The “sustainability” term remains amorphous, so even after agreeing to address it,<br />

innovative leaders still need to decide what it means and then set strategy for it.<br />

BY LUX RESEARCH<br />

Sustainable development is growth that meets the needs of the<br />

present without compromising the ability of future generations to<br />

meet their own needs. To help make sense of what sustainability<br />

should mean in practice, we address three of the most common<br />

questions on the topic. Asking and answering these questions lays the<br />

groundwork for developing a sustainability strategy.<br />

1. SHOULD YOU BOTHER WITH SUSTAINABILITY AT ALL?<br />

Some company leaders do still wonder if the term is more a marketing<br />

buzzword than a real strategic priority. The answer here is clear: Over<br />

the past few years, numerous stakeholders have begun to demand<br />

sustainability, showing that this trend will last and is not a passing fad.<br />

Investors have shown increased interest in environmental and social<br />

impact. In a presentation on quantifying megatrends, Director Cosmin<br />

Laslau notes that “climate and sustainability” has become arguably the<br />

most important trend for shareholders. Companies with the highest<br />

environmental, social, and governance (ESG) scores have seen aboveaverage<br />

growth over the previous five years. Even more telling was<br />

State Street Global Advisors calling out three companies for poor ESG<br />

performance. With shareholders making these moves, business leaders<br />

need to respond.<br />

Consumer preferences have shifted from wanting sustainability<br />

to demanding it, and these preferences have had major impacts on<br />

established businesses. Fast fashion brand Forever 21 filed for bankruptcy,<br />

in part due to its poor response to customers’ concerns about the waste<br />

produced from “fast fashion.” Entire products can be upended – plastic<br />

straws have been removed from many establishments after a video of a<br />

plastic straw stuck in a turtle’s nose went viral in 2018. These issues matter<br />

to consumers and are driving product choices, so many consumer-facing<br />

brands are committing to sustainability goals – and pushing their suppliers<br />

to do the same.<br />

Employees now strive to work for more environmentally friendly<br />

companies and are increasingly taking action to improve their workplaces<br />

– amicably or not. Failure to hold to important values can lead to significant<br />

backlash from employees – more than 300 Amazon employees protested<br />

greeneconomy.tv<br />

Amazon’s climate and social practices, even with a warning that they could<br />

be fired for doing so. Attracting and retaining top talent requires taking<br />

values like impact and inclusion seriously.<br />

2. HOW DO YOU SET THE RIGHT GOALS?<br />

Here, the answer is different for each organisation – ranging from the Ellen<br />

MacArthur Foundation’s New Plastic <strong>Economy</strong> to utilities striving to reduce<br />

methane emissions, to governments aiming to become leaders in Li-ion<br />

battery and EV manufacturing. To determine your targets, consider these<br />

key approaches:<br />

• Use fewer resources. Cutting down on resource inputs, from water<br />

to energy to raw materials, is a clear way to reduce impact. For instance,<br />

while companies are taking a myriad of approaches to achieve sustainable<br />

packaging goals, a simple strategy is to merely reduce packaging used.<br />

Unilever, for example, aims to reduce its virgin plastic packaging used by<br />

50% by 2025, targeting multiuse packs and “no plastic” products.<br />

• Reduce emissions. Cutting back on releases of harmful by-products,<br />

most notably CO2 and other greenhouse gases, is another objective.<br />

Emission reduction can manifest in numerous ways: Light-weighting<br />

results in fewer emissions from transportation; switching to renewable<br />

sources makes energy use greener, and reusing materials or products<br />

curtails the impact of manufacturing. However, sometimes changing the<br />

process entirely moves the needle the most. Current ammonia production<br />

is as energy-efficient as possible, but there is significant interest in altering<br />

the traditional Haber-Bosch process, including adding carbon capture,<br />

using green hydrogen, or switching entirely to electrochemical synthesis,<br />

with big impacts on emissions.<br />

• Reduce waste. Even with a reduction in resources used, there will<br />

always be waste, which can have its own negative effects. Companies<br />

can focus on reducing waste and developing a “circular economy” –<br />

from increasing recycling rates for plastic packaging to using food waste<br />

as a feedstock for feed and fertilising. However, the efforts to develop a<br />

circular economy extend beyond consumer-produced waste like food and<br />

packaging to addressing end-of-life issues with energy technologies, such<br />

as lithium-ion batteries and wind turbine blades.<br />

GET SWITCHED ON | The Circular <strong>Economy</strong> Show<br />

Every Wednesday @ 1:00pm<br />

Watch Gordon Brown, <strong>Green</strong><strong>Economy</strong>.Media with Chris Whyte, African<br />

Circular <strong>Economy</strong> Network uncover the circular economy.<br />

Enable human connection<br />

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<strong>Green</strong><strong>Economy</strong>.tv delivers intelligent conversation about the conservation<br />

of people, planet, and power.<br />

3. HOW DO YOU INCORPORATE SUSTAINABILITY INTO<br />

YOUR STRATEGY?<br />

Taking action is important, but there still needs to be a business case for<br />

the specific moves you make toward your goals. To develop a strategy<br />

that aligns with overall business goals, consider the following options to<br />

identify a value proposition.<br />

• Make your operations more sustainable. All companies can work to<br />

manage the impact of their factories, offices, and logistics, often finding<br />

financial benefits in doing so. Much of the focus here is on reduced<br />

emissions – can you use a low-carbon fuel, can you electrify, can you use<br />

less material to reduce energy needs? Global delivery service company,<br />

UPS recently announced plans to invest $450-million in deploying 6 000<br />

natural gas vehicles (NGVs), reducing its carbon footprint through an<br />

economically viable approach. The business value proposition here is in<br />

cutting the operational cost associated with energy usage (and potentially<br />

saving on a carbon tax bill).<br />

• Help your customers become more sustainable. Another strategy is<br />

less in operations and more in product development – more sustainable<br />

solutions for customers that allow them to improve their operations<br />

and products (for businesses) or reduce their own personal impact (for<br />

consumers). Examples include offering bio-based and recycled materials<br />

or selling consumer products in reusable packaging. The value proposition<br />

here is to protect or grow market share – or even gain first-mover advantage<br />

– as downstream demand shifts to prioritise sustainability.<br />

• Tap into new business opportunities created by the sustainability<br />

trend. Apart from improving existing products for existing customers,<br />

there are opportunities to develop products for new markets that are<br />

emerging due to the sustainability trend. These targets can range from<br />

new battery materials for energy storage to alternative proteins that offer a<br />

lower environmental footprint than meat.<br />

READ REPORT<br />

READ<br />

REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

Source: Lux Executive Summit Global 2019<br />

Why address<br />

sustainability?<br />

Appeasing<br />

investors<br />

Serving<br />

consumers<br />

Attracting and<br />

retaining employees<br />

What sustainability<br />

goals?<br />

Using fewer<br />

resources<br />

Reducing<br />

emissions<br />

Minimising<br />

waste<br />

For this strategy, the value proposition is in the new top-line growth<br />

opportunities it can generate. All told, this three-step process of assessing<br />

the drivers of sustainability, selecting the relevant goals, and aligning to<br />

business strategy provides a roadmap for companies looking to get their<br />

heads around what sustainability means for their business – and focusing<br />

on the substance of what it means for strategy.<br />

The exact answers will be different for each organisation but asking the<br />

right questions and taking a structured approach can place your team on<br />

a solid path.<br />

S&P 500’s growth from 2014 to 2019.<br />

This article is an excerpt from MAKING SENSE OF “SUSTAINABILITY” Report by Lux Research<br />

Lux Research uniquely combines technical expertise and business insights with a proprietary platform, using<br />

advanced analytics and data science to surface true leading indicators.<br />

CORPORATE GOVERNANCE, INTEGRATED REPORTING AND<br />

ENVIRONMENTAL DISCLOSURE: Evidence from the South African<br />

Context | a Sustainability article by MDPI [June 2020]<br />

Which sustainability<br />

strategies?<br />

Improving<br />

operations<br />

Helping<br />

customers<br />

Finding new<br />

business targets<br />

This research aims to investigate the influence of sustainability-related issues of a sample<br />

of South African listed companies on the JSE regarding environmental disclosure, after the<br />

mandatory preparation of integrated reporting.<br />

Integrated reporting (IR) can be identified as an innovative form of corporate reporting<br />

that seeks to combine financial, social, and environmental information. The movement of IR<br />

is strongly linked to sustainability issues, as it can represent how an organisation creates and<br />

sustains value and to bring together economic, social, and environmental factors in response to<br />

the recent needs related to the global financial downturn, environmental goals, and the call for<br />

greater transparency of corporate reporting.<br />

In addition to sustainability reporting, IR promises to radically change the management<br />

approach to business strategy and value creation.<br />

14<br />

15


SMART CITIES<br />

Connecting the North-West<br />

to the nation.<br />

Get to the good part faster.<br />

LANSERIA INTERNATIONAL<br />

AIRPORT: set for new heights<br />

Lanseria is set to be converted into one of Gauteng’s first smart cities. The project will<br />

include a business gateway, a three-tower precinct and a corporate estate. In addition to<br />

new Gautrain routes connecting to Joburg CBD and OR Tambo International, state-of-theart,<br />

multi-use smart facilities will stretch from Lanseria in Gauteng to Hartbeespoort Dam<br />

in the North West.<br />

(meetings, incentives, conventions and exhibitions or events) with smallscale<br />

conferencing and wedding venues being common; and mining/<br />

quarrying operations. Lanseria Airport has embarked on a strategy<br />

of positioning itself as the future green international airport fit for a<br />

smart city.<br />

C<br />

M<br />

Y<br />

CM<br />

MY<br />

CY<br />

CMY<br />

K<br />

GREEN INITIATIVES<br />

We have a strong sense of community responsibility and believe we<br />

are who we are because of the community that surrounds us. We have<br />

developed a strong programme of community investment and play an<br />

active role in developing the communities that surround us. Our focus is<br />

primarily on health care and education with infrastructure development<br />

as the main driver.<br />

Our aim is to invest in young people, and we believe that a firm<br />

foundation is needed for the future leaders and workforce that will take<br />

the country forward. We have invested a sizeable amount of funds in early<br />

childhood development programs (ECD) and primary schools.<br />

At Lanseria International Airport, our upgraded facilities always ensure<br />

a smooth trip. It’s why our convenient location puts you right at the<br />

gateway of the North-West and The Cradle of Humankind, so you can<br />

spend less time taking your trip and more time enjoying the destination.<br />

Fly from Lanseria International Airport.<br />

Joburg’s most convenient airport.<br />

www.lanseria.co.za<br />

With additional investment in road and freight infrastructure<br />

development, the Lanseria International Airport Mega City<br />

is set to become a manufacturing, logistics, and business<br />

hub. Significant development over the past decade at Lanseria airport<br />

– initially an executive airstrip for corporate travellers and now hosts<br />

flights to Cape Town and Durban on a daily basis – has seen a marked<br />

increase in industrial activity in the area in recent years.<br />

Its near proximity to the country’s economic epicentre and the planned<br />

mega smart city development, sets Lanseria on the path to being a<br />

noteworthy and desired industrial and entrepreneurial node, with the<br />

planned multipurpose residential development affording residents true<br />

work-life balance with less time spent commuting.<br />

A Regional Node ‘Provincial Area of Focus’ is identified for the<br />

Lanseria Airport. This demonstrates the will for integrated economic<br />

development and spatial restructuring at Lanseria, which includes the<br />

addition of a future Gautrain station, BRT lines and the PWV5 as a road,<br />

freight and public transport route.<br />

The West Rand District Municipality will create new industries, new<br />

economic nodes and a new city will be anchored around the Lanseria<br />

Airport and the Maropeng World Heritage Site. It was precisely for this<br />

reason that the wider Lanseria Airport area was ear-marked as a potential<br />

nodal project that should be prioritised as a basis for creating more urban<br />

prospect for these marginalised communities.<br />

At present, the main economic drivers within the Greater Lanseria area<br />

are Lanseria Airport; a widespread but uncoordinated agricultural sector;<br />

a tourism and leisure industry based on the Cradle of Humankind, MICE<br />

Water<br />

Lanseria Airport appointed a service provider to abstract treated water<br />

from the Waste Water Treatment Works (WWTW) for irrigating its gardens.<br />

A tanker is used for abstracting water from the WWTW for irrigation of the<br />

garden at the fire department, security complex and parking areas.<br />

Lanseria has a car wash for car rentals that uses recycled water. The<br />

airport has installed a filtration system that recycles water for daily<br />

car washes.<br />

Worm farming<br />

Lanseria Airport has embarked on a zero-waste to landfill policy. While<br />

striving to archive this goal, we have introduced worm farming and we<br />

also sort waste at source. Our food outlets are encouraged to separate<br />

food waste from the rest of the waste streams to avoid contamination of<br />

the worm feeds. The worm farm diet is raw vegetables, fruit peels, tea bags<br />

and eggshells. The feedstock should not contain any acidic foods. We have<br />

recently extended our worm farm from 4.5m to 6m long.<br />

The Lanseria Airport worm farm has the following properties:<br />

• Size: 6m long and 1.45m wide<br />

• Fed on average 21.07 kg of food every week<br />

• Feeding process takes an average of two hours every week<br />

• The worm farm produces 5.55 litres of worm tea on a weekly basis<br />

• The tea is used as a fertilizer<br />

17


SMART CITIES<br />

SMART CITIES<br />

SMART CITIES<br />

promote best practice in<br />

URBAN SUSTAINABILITY<br />

like centralising commercial areas, and even the concept of what a CBD<br />

looks like. This might have a profound impact on what cities look like in<br />

the future.<br />

Another impact of Covid-19 has been the disruption of global supply<br />

chains. What will be interesting to see in the long term is if governments<br />

around the world – who anticipate more severe pandemics in future – shift<br />

towards self-reliance rather than global imports. Therefore, governments<br />

might consider reigniting primary and secondary economic sectors such<br />

as mining, agriculture and manufacturing. “Should this happen, we could<br />

expect shifts in urban migration that could impact planning requirements,”<br />

predicts Talip.<br />

A smart city is much more than a city that is digitally enabled and brimming with<br />

technology. It is a city that leverages innovation to achieve its desired outcomes –<br />

and here innovation does not necessarily mean only technology.<br />

THOUGHT [ECO]NOMY<br />

This is the view of Carshif Talip, expertise leader, urban planning<br />

and land infrastructure at Zutari. “A smart city is a city where<br />

opportunity, amenity, safety, resilience, inclusivity and prosperity<br />

are imperatives, and innovation across financing, design, construction,<br />

operations and governance is embraced by all stakeholders to achieve<br />

these imperatives.”<br />

President Ramaphosa announced in his 2021 State of the Nation<br />

Address that the masterplan for the proposed Lanseria Smart City<br />

had been completed in November last year. The project is a joint<br />

initiative of the Presidency, the Office of the Gauteng Premier, Tshwane,<br />

Johannesburg and Mogale. It is based on best practice in urban<br />

sustainability and the principles underpinning the smart city concept.<br />

The fact that innovation is such an integral part of smart cities makes<br />

for a natural fit between smart cities and sustainability. The emphasis on<br />

digital platforms also enables data collection, and the availability of large<br />

data sets is one of the first steps towards optimisation.<br />

Proper planning is the answer to rapid urbanisation, inadequate<br />

infrastructure and polarised development. Equally important is an<br />

integrated approach, as with the Lanseria Smart City. “A siloed approach,<br />

whether that be across the various spheres of government, the private<br />

and public sectors or even within a municipal entity itself, needs to be<br />

eliminated if we are to be successful,” urges Talip.<br />

Each stakeholder needs to have their role and contribution clearly<br />

defined and have the necessary resources to deliver. Finally, a measure<br />

of agility and fluidity needs to be built in. “Planning, in essence, is<br />

designing a path based on a predicted future. If that future changes, and<br />

one just has to look at how unpredictable 2020 was due to the Covid-<br />

19 pandemic, the plan needs to be sufficiently adaptable to respond to<br />

change,” stresses Talip.<br />

In terms of the impact of Covid-19 on future urban planning<br />

requirements, one positive outcome has been that flexible working<br />

arrangements are now possible. “The need for large swathes of office<br />

space will certainly be challenged, and tenants will demand more flexible<br />

arrangements from their landlords,” notes Talip. While there will always be<br />

a brick-and-mortar component to retail, there is certainly a move towards<br />

online retail. These two phenomena could challenge planning concepts<br />

READ REPORT<br />

greeneconomy/report recycle<br />

THE GREATER LANSERIA MASTERPLAN | Tomorrow’s sustainable city today<br />

The brief for the Greater Lanseria Masterplan is to be a truly post-apartheid city based on best practice in terms of urban sustainability<br />

and the principles underpinning the smart city. It is to be inclusive of the broadly defined South African socio-economic spectrum and<br />

must stimulate a vibrant, mixed-urban economy.<br />

Activity zones should be compact in their spatial extent; they must also be complex in their mix of urban uses. Living at higher residential<br />

densities within patterns of more intense urbanity make it possible to achieve far higher levels of efficiency in terms of infrastructural services<br />

and public transport systems. It increases the evenness and efficacy with which social services and amenities are provided.<br />

The design of the inclusionary city starts with the importance of the public environment and the way a “responsive architecture” defines<br />

the natural surveillance of that environment: the tenets of safe city design apply and a people-first, rather than a car-first mentality leads the<br />

design process. Highly permeable, safe pedestrian and cycle systems need to be augmented with a comprehensive, street system defined less<br />

by class of traffic function and more by networked connectivity that is future-proofed as urban mobility rapidly reinvents itself.<br />

An important aspect of the city economy is its infrastructural investment, not simply in how it is funded but also the inclusion of myriad<br />

upstream and downstream aspects of its economic chain. Much of the contemporary thinking regarding urban sustainability recognises this<br />

as well as the more obvious aspects of energy-efficiency and the striving for carbon-neutral systems.<br />

The inclusionary economy<br />

It is necessary to see the design of the public environment as one of the most important generators for spawning economic cross-over. This means<br />

embracing inclusion rather than simplistic models of separation and specialisation as has been the case. How the energies of one investment<br />

into the urban system are harnessed through careful urban design to spawn other opportunities is a vital aspect of the layout and enablement of<br />

activity zones, be this at the city-scale of, for example, an airport or a logistics hub, or the more localised scale of an open-air market.<br />

While incremental delivery of service delivery must be paced according to residential demand, early-warning systems must be put in place<br />

to ensure “just-in-time” delivery of comprehensively managed facilities.<br />

An open-ended approach<br />

An interdisciplinary planning approach proposes a group of new utilities to undertake:<br />

• Waste-to-energy using pyrolysis<br />

• Regional waste-sorting and recycling<br />

• Biogas production<br />

• Smart-grid power<br />

• Instituting district cooling as a utility<br />

• Harvesting fertiliser value from waste treatment<br />

• Water treatment and polishing<br />

• Waterless/less-water-based sewer systems<br />

• Harvesting water at scale<br />

• Replenishment of the ground-water system<br />

• Augmenting energy production with water-pumping systems<br />

• Instituting a variety of green industries<br />

• <strong>Green</strong> building<br />

• Renewable energy<br />

18<br />

19


SMART CITIES<br />

SMART CITIES:<br />

WHEN DIGITAL TECHNOLOGY<br />

MAKES URBAN AREAS MORE<br />

ATTRACTIVE AND COMPETITIVE.<br />

SMARTER SOLUTIONS<br />

for people and planet<br />

The pressure of ensuring that cities remain attractive and liveable for citizens, while adhering<br />

to sustainability principles, is creating considerable stumbling blocks for those in charge.<br />

BY VEOLIA SERVICES SOUTHERN AFRICA<br />

Relying on its worldwide expertise in water, waste and energy<br />

management, Veolia utilizes cutting-edge technologies to<br />

bring utilities to the next level.<br />

www.veolia.co.za<br />

info.southafrica@veolia.com<br />

011 663 3600<br />

The challenge of delivering acceptable levels of public services is<br />

becoming increasingly difficult in Southern Africa with increased<br />

urbanisation, a lack of clean water and decent sanitation, aging<br />

infrastructure, and the spiralling costs of energy production (not to<br />

mention its harmful effects on the environment). The current way of<br />

existing in businesses, homes and cities is largely unsustainable and<br />

indicates a recipe for disaster if it continues in this way.<br />

The move toward a smart city aims to find solutions to increasingly<br />

scarce resources while at the same time, addressing sustainability. At the<br />

heart of the smart city is its users; citizens, businesses, local governments<br />

and decisionmakers, who must be armed with the necessary digital tools<br />

and innovation to create more sustainable cities.<br />

As a partner to cities, governments and other civil organisations, Veolia<br />

aims to assist with addressing these challenges through the provision of<br />

innovative solutions. It is our belief that the use of technology and data<br />

is an opportunity to make informed decisions about city resources and<br />

ultimately, deliver a better quality of life for its citizens.<br />

A smart city means smarter networks. Veolia’s solutions aim to address<br />

the above challenges and simultaneously support the transformation<br />

toward smart cities through infrastructure upgrades, technological<br />

advancement and digital systems. Veolia can help on three levels of<br />

integration in the move toward smart cities:<br />

• Smart operations<br />

• Smart services<br />

• Smart ecosystem<br />

With the African continent facing major water shortages, the re-use of<br />

wastewater seems to be the most sensible and under-utilised solution that<br />

will aid cities in becoming smarter. This means improving water efficiency<br />

for the benefit of the city and its residents, using data and technologies<br />

as enablers, increasing efficiency of potable water networks and irrigation<br />

networks, to enhance the reuse of water, allow deferred investments<br />

in water production plants and optimisation in pipe renewal, as well as<br />

preserve resources (energy and water) by improving leakage management<br />

and enabling demand response programmes.<br />

With more than 350 proprietary technologies covering every key<br />

stage in the water treatment process, Veolia is a globally recognised<br />

player in the field. Furthermore, we’ve adopted a digital approach to<br />

improving operational performance and customer satisfaction. We<br />

have the capacity to measure, simulate and communicate in real-time<br />

to ensure continued efficiencies, helping to contribute toward quality of<br />

life and further development of the smart city through the delivery of<br />

smart services.<br />

Another smart solution that requires no introduction but is vital<br />

for sustainability is energy optimisation. As with our water audits, we<br />

have developed tools to conduct energy assessments as well. First, a<br />

comprehensive energy audit will be conducted to determine any potential<br />

savings in, for example, a large corporate building. A baseline will also be<br />

determined and through these, the implementation of the actions will<br />

occur. Veolia can assist with onsite operations and maintenance as well as<br />

monitoring to ensure that set targets are achieved.<br />

A clean city is a smart city, and Veolia’s waste expertise can assist<br />

with sustainable changes in waste management. Responsible waste<br />

management not only means adhering to the principles of the circular<br />

economy – reducing, reusing and recycling, but providing services<br />

that turn waste into value. Our solutions range from recycling services,<br />

through to the safe treatment and disposal of hazardous waste. In recent<br />

years, waste disposal has become a contentious issue for many large<br />

corporations and Veolia has made it our business to assist with beneficial<br />

reuse solutions and to maximise valuable by-product recovery from waste.<br />

The implementation of smart solutions in the drive toward a smart<br />

city may seem daunting, not to mention a seemingly expensive exercise.<br />

It also requires the buy-in of all stakeholders to ensure its success.<br />

Veolia’s unmatched knowledge, expertise and digital capabilities offers<br />

value-added solutions that can protect both people and the planet.<br />

21


WATER<br />

WATER<br />

DAMS<br />

HALF FULL<br />

OR HALF EMPTY<br />

Unlocking water security in South Africa<br />

SAVING FOR A RAINY DAY<br />

The system’s capacity is already used to its limit but that is not generally<br />

understood. When asked whether water supply is sufficient, most people’s<br />

attention focuses on dam levels. But dam levels simply tell you how<br />

much water is stored, not how long it will last. In this sense, dams are like<br />

a household’s bank account. If wages are paid into the account once a<br />

month, when the flow of money reduces, so too must the expenditures.<br />

The water deposited in the reservoir is like the wages paid into the bank<br />

– users must make sure that it doesn’t flow out so fast that there’s none left<br />

before the next rains arrive. Enough must be kept in reserve in case there<br />

is a dry year.<br />

Two factors must be considered together to avoid water crises: technical<br />

matters like rainfall, river flow and infrastructure; and human factors such<br />

as the behaviour of water managers and users. South Africa’s climate is<br />

relatively well-documented. The priority for water planners is to manage<br />

the fact that rainfall is highly variable.<br />

Planners work with hydrologists and climate scientists to estimate the<br />

risk that there will be a succession of dry years. They calculate how low river<br />

flows will go and how much storage is needed to keep supplies running.<br />

That kind of information, used to plan the infrastructure of the Integrated<br />

Vaal River System, has kept the region water secure for almost 40 years. It<br />

also flagged the need to build the next phase of the Lesotho project.<br />

That’s where the human factors intervene.<br />

To meet the water needs of populations and economies, planned<br />

investments must be made on time. And until additional supply is<br />

available, water use must be kept within safe limits. This requires water<br />

users to change their behaviour.<br />

HUMAN BEHAVIOUR<br />

Since the Gauteng population is growing at about 3% per year and supply<br />

is fixed, consumption will have to decrease by 3% a year if the region is to<br />

stay water secure.<br />

The priority for water<br />

planners is to manage<br />

the fact that rainfall is<br />

highly variable.<br />

But if people see full dams, can they be persuaded to reduce their<br />

water use? Some efforts are already being made. Rand Water, the bulk<br />

water provider, has a critical role to play. It takes water from the Vaal<br />

River system, purifies it and supplies across the region. Rand Water has<br />

reached the limit of what it is allowed to take from the system and is now<br />

rationing available water between its different users. Consumption targets<br />

have been set for individual municipalities and Rand Water is restricting<br />

supplies to those that don’t use their water efficiently.<br />

Consumption per person in the region is around 300 litres per day – well<br />

above global averages – so there is room for improvement. And almost<br />

40% of the water supplied to municipalities is “non-revenue water” – either<br />

lost through leaks or not billed and paid for and thus often wasted. At the<br />

root of these problems is poor management and maintenance.<br />

To cope with supply restrictions, municipalities face difficult choices.<br />

Most are trying to reduce their “non-revenue water”. Some are delaying<br />

new housing and industrial developments. Others are cutting supply to<br />

selected suburbs for days at a time when they reach their allocated limit.<br />

The region’s citizens have not yet been told the hard truth that for the<br />

next six years, this supply squeeze will get tighter. Yet this information is<br />

essential if communities and households are to play their part. People will<br />

not change their behaviour unless they’re told what’s happening and how<br />

to avoid a crisis.<br />

Whether it was Sydney and Melbourne in Australia, Chennai in India,<br />

Barcelona in Spain or São Paulo in Brazil, we have seen that, too often,<br />

water crises occur because societies don’t take action until it is already<br />

too late.<br />

BY MIKE MULLER, WISA*<br />

South Africa had that experience with its Day Zero crisis in Cape<br />

Town. In the Eastern Cape, Nelson Mandela Bay provides more<br />

evidence. Despite being advised for more than a decade that its<br />

supply infrastructure was inadequate, the municipality did not act. Now<br />

the dams are almost empty.<br />

The immediate question is whether the Gauteng province and surrounds<br />

can avoid the same experience. The region gets its water from the Integrated<br />

Vaal River System, of which the Lesotho Highlands Water Project is an<br />

important part. Completion of Phase 2 of this project, which will increase<br />

available supplies, is already nearly a decade late and water use is growing<br />

steadily. Tenders to build the dam and tunnel for the second phase have not<br />

yet been awarded. The earliest that they will provide additional water is 2027.<br />

Department of Water and Sanitation<br />

The study<br />

area for the<br />

reconciliation<br />

strategy for<br />

the Integrated<br />

Vaal River<br />

System –<br />

Phase 2.<br />

22<br />

23


WATER<br />

ENERGY<br />

Watershed<br />

boundaries of<br />

the GCR<br />

Click here for schematic<br />

cross section<br />

Watershed between<br />

Vaal River and Limpopo<br />

tributaries<br />

Watershed between<br />

Crocodile West Marico<br />

and Olifants Rivers<br />

Provinces<br />

Rivers<br />

Wetlands and dams<br />

Urban areas<br />

Schematic cross section of the<br />

Witwatersrand Watershed in Johannesburg<br />

The Witwatersrand watershed<br />

Gauteng City-Region Observatory<br />

WOMEN in SA’s<br />

ENERGYspace<br />

Mercia Grimbeek, Chair of SAWEA<br />

Our national renewable energy sector recently called for the establishment of a Gender<br />

Diversity Charter. The response was sector-wide.<br />

BY SAWEA<br />

The role of<br />

The map depicts the different ways in which water systems serve as barriers within an urban system. Rivers are visible barriers in the landscape<br />

and are often shown on a map as a boundary between two properties. Watersheds are a less visible kind of boundary but are important in<br />

dividing one drainage system from another.<br />

GOING WITH THE FLOW<br />

A lesson from Cape Town’s Day Zero experience was that when people were<br />

told about the problems, and about how the city and their neighbourhood<br />

were performing, they reduced their water use. Cape Town showed that<br />

people will take difficult actions when there’s a problem they can see<br />

and understand. It has been suggested that Rand Water should publish<br />

monthly reports on the progress made to achieve municipal savings<br />

targets. That is politically delicate since national ministers are reluctant to<br />

expose their local counterparts to criticism.<br />

So, the technical dimension of ensuring reliable water supply –<br />

READ REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

managing the dams, treatment works, pumps and pipes – is difficult. But<br />

even more challenging is the task of motivating human interventions,<br />

from ministers down to households.<br />

The measure of success or failure is whether the water comes out of<br />

the taps when needed. And too often, it’s human behaviour rather than<br />

infrastructure that fails us.<br />

*Mike Muller is an advisor to the Minister of Water and Sanitation, Lindiwe Sisulu. He is board member<br />

and technical director of Water Institute of Southern Africa (WISA) and an active member of other<br />

professional associations including the South African Institution of Civil Engineers and the South African<br />

Academy of Engineers.<br />

Water Security Perspective for the Gauteng City Region. A report<br />

prepared for Gauteng Provincial Government by Gauteng City-Region<br />

Observatory. [August 2019]<br />

Gauteng will only be water secure once there is affordable access to safe and reliable water<br />

supplies as well as to safely managed and dignified sanitation services. This will not be<br />

achieved by action in the water sector alone. Informal settlements present a particularly<br />

difficult challenge.<br />

The report outlines the sources of the province’s water and the systems on which it depends<br />

(page 10). It considers how the province’s wastes are managed and the implications for the<br />

surrounding region. It then reviews the current performance of the key institutions in the sector<br />

(page 14) and identifies the emerging challenges that face Gauteng if it is to achieve and then<br />

sustain its water security (page 16).<br />

The Conversation/ Under Creative License<br />

charter is intended as a framework with which the<br />

industry measures itself and its commitments. But it is<br />

“The<br />

more personal than just a mechanism for impact, as this<br />

Charter is being pursued by many of our members as a legacy for<br />

our late CEO, Ntombifuthi Ntuli,” explained Mercia Grimbeek, Chair<br />

of SAWEA. Hosted by the sector’s Gender Diversity Working Group,<br />

this is a joint initiative between SAWEA and SAPVIA, the industry’s<br />

leading associations.<br />

Mercia Grimbeek outlines the industry’s vision<br />

Why is there a need for a Gender Diversity Charter?<br />

Gender diversity has become very topical in recent times, and we have<br />

witnessed concerted efforts by many local companies in the sector<br />

to address the gender gap. While this is commendable and certainly<br />

encouraged, as an association we felt that assessing progress and impact<br />

was rather subjective and not easily measurable or such that it could be<br />

easily monitored. We have also witnessed the ravages of Covid-19 on our<br />

industry and our economy, and this has further negatively impacted on<br />

the work already done and future initiatives to progress gender diversity<br />

within the industry.<br />

As a Working Group we have heard so many examples in areas such as<br />

recruitment, executive management and equal pay, to name a few, where<br />

gender inequality is still rampant in our industry. We understand that this<br />

is a global challenge, but it is time to find our local voice and facilitate<br />

meaningful and impactful change.<br />

What are the key objectives for the implementation of the Charter?<br />

The aim is to launch the commitment statements on the anniversary<br />

of the Working Group, which coincides with International Women’s<br />

Day. This is after an extensive consultative process with leaders from<br />

our member organisations. Due to their involvement, there is a shared<br />

vision and ownership of the commitments to be made.<br />

The key objectives will look at issues of representation, inclusivity, flow<br />

of opportunity and support and accountability. We are looking forward to<br />

the DMRE’s work with the newly launched Energy Sector Gender Ministerial<br />

Advisory Council, which will inform the direction our charter takes.<br />

How does gender diversity fit into the energy transformation agenda?<br />

Gender diversity is a critical component of the agenda. The energy sector<br />

remains one of the least gender diverse sectors, especially at decisionmaking<br />

level. We are also mindful that the transition will require innovative<br />

solutions and business models. Closing the gender gap will bring with it the<br />

benefits of inclusive solutions as more women become decision-makers.<br />

How important is it that the board reflects gender equality?<br />

Robust discussions about industry challenges require deep insight,<br />

multiple angles to be considered and collective experiences. A SAWEA<br />

Board that is gender-balanced can harness these attributes to guide and<br />

advise the CEO. When governance is good, it benefits the CEO as well as<br />

the members of the association.<br />

Hence, it is very important to me that the SAWEA Board reflects<br />

gender equality. The Board represents the industry and is reflective of<br />

industry goals and aspirations. Good governance calls for diversity in<br />

the boardroom and in my opinion, this brings strength to the SAWEA<br />

Board. A gender-balanced board brings with it different perspectives and<br />

approaches to decision-making.<br />

You were part of the Global Wind Energy Council women leadership<br />

programme two years ago. Did it make a difference to your career?<br />

The Women in Leadership programme was instrumental to my career<br />

development. I was exposed to a plethora of strong, confident women<br />

who shared knowledge and experiences. The programme allowed me to<br />

take my learnings and implement them in guiding an industry association<br />

and nurturing young talent emerging into the industry. Ultimately, it<br />

encouraged me to take up a place in industry and become an ambassador<br />

for the growth of the industry in our country.<br />

06 18 20 36 <strong>48</strong><br />

SA’s national<br />

water and<br />

sanitation plan<br />

Current<br />

performance<br />

and emerging<br />

challenges<br />

Bulk supply:<br />

availability,<br />

restrictions, climate<br />

change and other risks<br />

Strategic<br />

responses<br />

to emerging<br />

challenges<br />

Action<br />

plan<br />

and way<br />

forward<br />

It is time to find our local voice<br />

and facilitate meaningful and<br />

impactful change.<br />

What advice do you have for other women in the industry?<br />

Be honest and vulnerable about where you are and acknowledge your<br />

part. Don’t see vulnerability as a weakness. Seek a mentor. There is always<br />

someone older and wiser that is willing to share their knowledge. Learn to<br />

step back and gain perspective when things get tough. Remember what<br />

your goal is and reframe how you want to achieve it. Believe in yourself.<br />

24<br />

25


PRODUCTION<br />

Meet excellence in<br />

RESOURCE EFFICIENCY<br />

Excellent Meat is reaping significant financial and sustainability rewards from<br />

industrial energy and water efficiency interventions, implemented with assistance<br />

from the National Cleaner Production Centre of South Africa’s Resource Efficiency<br />

and Cleaner Production Programme.<br />

Supporting industry<br />

to return to<br />

business unusual<br />

There is no better time to implement<br />

changes that can make your operations<br />

more efficient and sustainable.<br />

As industry gears up, the National Cleaner<br />

Production Centre South Africa (NCPC-SA)<br />

is there to help and advise.<br />

The 51-year-old family-owned supplier of quality Halaal products<br />

to customers such as Woolworths, Pick n Pay, McDonalds,<br />

KFC, Spur, Burger King, and Ethiopian Airlines, among others,<br />

accrued monetary savings to the tune of R2 904 312 and energy savings<br />

of 1 653 835kWh between 2018 and 2020. It reduced greenhouse gas<br />

emissions by 1 654-ton CO2.<br />

Excellent Meat invested R75 000 in electricity management initiatives,<br />

which saved it more than R709 400 and 412 470kWh in electricity<br />

consumption at two of its four sites. An investment of R360 958 in<br />

water-saving initiatives effected total water cost savings between 2018<br />

and 2020 of R1 500 312; water consumption savings of 29 931kL at<br />

a total value of R809 346 and wastewater savings of 28 435kL with a<br />

value of R690 967.<br />

“The National Cleaner Production Centre of South Africa (NCPC-SA), on<br />

behalf of the Department of Trade, Industry and Competition, has over<br />

the past three years supported Excellent Meat to explore infrastructure<br />

opportunities that will enable continuous improvement projects within<br />

its business. The company is committed to responsible production –<br />

especially in the light of the severe drought conditions that have plagued<br />

the Western Cape since 2015 – and has partnered with the City of Cape<br />

Town, the Provincial Government of the Western Cape, and <strong>Green</strong>Cape to<br />

address its resource and environmental challenges. In 2017, <strong>Green</strong>Cape<br />

suggested that the NCPC-SA, hosted by the CSIR, gets involved,” explains<br />

Andre Page of the NCPC-SA.<br />

A Waterwise Workshop with other stakeholders followed, during which a<br />

presentation was given on the Resource Efficiency and Cleaner Production<br />

(RECP) Programme of the NCPC-SA. Excellent Meat immediately expressed<br />

interest and thus, in March 2018, a water assessment commenced and was<br />

followed by an energy assessment in parallel with a lifecycle management<br />

capability maturity model assessment by two independent service providers.<br />

Page says, “The company implemented more than 14 projects, which<br />

included identifying water leaks. Finding a leak under a 4 000sqm factory<br />

proved a challenge, but once located, consumption was reduced by<br />

almost 50%. Excellent Meat also invested in tracking tools such as watersmart<br />

meters and electricity-tracking tools, and learnt how to set realistic<br />

water consumption targets, considering the prevailing water situation<br />

as well as the reality of a food processing facility’s stringent water-reliant<br />

hygiene standards.”<br />

The energy assessment recommended a change of electricity tariff.<br />

It found that the operating hours of Excellent Meat aligned better with<br />

a time-of-use tariff that has a lower maximum demand charge. In six<br />

months during 2020, this effected a saving of R351 000.<br />

“Excellent Meat is an RECP champion and a responsible corporate<br />

citizen of which to be proud,” Page adds.<br />

“Besides what it has already achieved, it continues its work with<br />

<strong>Green</strong>Cape to assess green technology options targeting water<br />

conservation. It has also established a sustainability team to monitor,<br />

review and implement energy, water and waste policies and interventions,<br />

while promoting greater awareness among all its suppliers and other<br />

stakeholders by sharing information regarding its resource consumption,<br />

corresponding greenhouse gas emissions, and improvement actions.<br />

“The company’s commitment to continually improve its sustainability<br />

performance, including optimising the use of materials and resources at<br />

its sites and offices, and considering the entire life cycle of activities, will<br />

stand it in good stead and is an example worth following.”<br />

View the Excellent Meat Sustainability <strong>Journal</strong> on<br />

Through the implementation of resource efficient and cleaner<br />

production (RECP), companies can increase efficiencies and<br />

lower utility costs. Assessing your operations or production<br />

processes can lead to much-needed improvements:<br />

• RECP stimulates innovation i.e. new solutions that have<br />

substantive benefits<br />

• Resource savings translate directly into a reduction in<br />

production costs<br />

• Sustainability initiatives open up new markets<br />

• Quality and safety can be improved through systems such<br />

as an ISO 50001 energy management system<br />

• RECP implementation creates an opportunity to<br />

streamline processes<br />

If you are ready to embrace a new normal, contact us to take<br />

the first step. Services are subsidised and advice costs nothing.<br />

We are currently not all in the office so please email us on ncpc@csir.co.za<br />

For more information, visit www.ncpc.co.za<br />

The NCPC-SA is a programme that promotes the uptake and<br />

implementation of resource efficient and cleaner production (RECP),<br />

funded by the dtic and hoisted by the CSIR.<br />

Industrial Energy Efficiency Project<br />

AEE Energy Project of the Year 2020<br />

the dtic<br />

Department:<br />

Trade, Industry and Competition<br />

REPUBLIC OF SOUTH AFRICA<br />

26<br />

THA 31-2020


AGRI-FOOD<br />

AGRI-FOOD<br />

FOOD SECURITY IN SOUTH AFRICA<br />

PEOPLE, PLANTS<br />

AND PLANET<br />

READ REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

Covid-19 and the Food Safety/Environment Dilemma<br />

Tetra Pak Index 2020<br />

Covid-19 is the number one concern for consumers worldwide, evidenced in recent global<br />

research. Against this backdrop, economic worries have seen a sharp upturn, reflecting<br />

widespread uncertainty about the impact of the pandemic on the economy.<br />

Food safety has quickly moved up the list of consumer priorities and is now seen as a major<br />

issue for society. Consumers believe that improving food safety is not only the responsibility<br />

of manufacturers, it needs to be their priority. Consumers are looking for transparency and<br />

reassurance that this priority is being addressed. Many want to know everything they can<br />

about a product’s provenance and production process – highlighting a communication<br />

opportunity for brands.<br />

Concern for the environment remains strikingly powerful. More than two-thirds of consumers<br />

believe that we must change our habits quickly to mitigate further environmental impact. In this<br />

context, sustainable packaging remains key, rated a top expectation from manufacturers.<br />

[Excerpt from foreword]<br />

08 19 30 35 39<br />

The changing<br />

interplay between<br />

food safety and<br />

environment<br />

Food waste is<br />

rising up the<br />

agenda<br />

Sustainable<br />

packaging<br />

matters<br />

Convergence<br />

is on the<br />

increase<br />

Factors<br />

influencing<br />

the future of<br />

packaging<br />

Our country is grappling with the challenge of how to enhance the resilience of food<br />

systems to deal with sudden shocks like the pandemic and ongoing stresses like climate<br />

change. Meanwhile, hunger persists despite high agricultural productivity that should<br />

support every citizen’s nutritional needs.<br />

THE CREAM OF THE CROP: Agriculture economy<br />

BY MELISSA MOORE, FUTUREGROWTH ASSET MANAGEMENT<br />

South Africa has a highly diversified, market-oriented agricultural<br />

sector that extends across various product ranges. Overall<br />

agricultural GDP growth is 13.1% year-on-year (relative to a<br />

7% economic contraction for the country as a whole). This<br />

outperformance is underpinned by high levels of agricultural output<br />

following favourable production conditions; high commodity prices;<br />

strong export demand and a favourable rand exchange rate.<br />

FUNDAMENTAL FACETS<br />

1. VOLATILITY. Instability influenced by climate and social change.<br />

• Variable weather conditions and climate change cause a fluctuation<br />

in yields, which impacts the local and global supply dynamics. This<br />

creates volatility in volumes and crop prices.<br />

• Geopolitical influences and government actions:<br />

o Global supply and demand pressures emerge when governments<br />

take actions to subsidise production or when they ban exports due<br />

to concerns about domestic supplies. The US-China trade tensions<br />

were a source of volatility for certain agricultural commodities.<br />

o Locally, policy uncertainty around land expropriation has had an<br />

impact on the ability to access capital investment in the sector.<br />

o Changing consumer preferences.<br />

2. COMPLEXITY. Agriculture is not homogenous. There are different<br />

crops and food types, each with their unique and fragmented<br />

28<br />

supply chains. There is diversity within each crop, in terms of how,<br />

where and by who it is produced. The complexity is intensified by<br />

environmental factors that influence regional and yearly production.<br />

3. SCRUTINY. Role players in the agriculture and food value chain are<br />

under pressure to improve the traceability of the food we eat.<br />

Agriculture that prioritises maximum<br />

productivity by exploiting natural<br />

resources will prevent us from meeting<br />

our growing demand for food and fibre<br />

on a sustainable basis.<br />

Notwithstanding these complexities, agriculture is widely anticipated to<br />

be a vital driver of economic growth worldwide. Within a troubled global<br />

economy, the agri-food value chain sectors remain a strong outlier, driven<br />

by population growth, urbanisation and the rise of the middle class.<br />

EXPORTS ON THE UP<br />

The South African agricultural sector remains a net exporter, with<br />

exportable volumes of various commodities growing annually. In 2020,<br />

South Africa’s agricultural exports hit $10.2-billion, a 3% increase from<br />

the prior year and the second largest level on record. Simultaneously,<br />

agricultural imports fell 8%, leading to a 26% annual increase in the<br />

agricultural trade surplus, which widened to $4.3-billion in 2020.<br />

Citrus, as a sub-sector, experienced a notable increase in demand due<br />

to the pandemic-related demand for vitamin C. Citrus exports hit a record<br />

high in 2020, with South Africa cementing its position as the secondlargest<br />

exporter of fresh citrus in the world, after Spain. This follows a<br />

period of citrus production growth in response to a spike in global demand<br />

and the attractive investment returns and profit margins – expected to be<br />

sustained beyond 2021.<br />

THE MOMENTUM CONTINUES<br />

Higher yields expected<br />

• Favourable weather has resulted in increased summer crop plantings.<br />

The country could export an estimated 2.8-million tons of maize in<br />

2021/2022, the largest volume since 1994/1995.<br />

• Wine grape production is expected to be larger than in 2020.<br />

• The South African citrus industry should break all previous export<br />

season records with an estimated 158.7-million cartons in 2021, up from<br />

146-million cartons in 2020.<br />

The high yields for the sector should curtail food and overall consumer<br />

inflation – and enhance the sector’s contribution to GDP.<br />

The logistics industry<br />

The anticipated growth in agricultural exports will place pressure on<br />

infrastructure, from handling facilities to transport and the shipping ports.<br />

Industry players are concerned over the country’s logistics systems, after<br />

struggling with port congestion and a shortage of refrigeration equipment<br />

in recent years. The long-term prospects for this significant sector require<br />

that we overcome current operational inefficiencies. We need an efficient<br />

and cost-effective logistics industry that can facilitate the movement of<br />

commodities, not only between provinces, but also to export markets. This<br />

presents an opportunity for infrastructure investment in the sector.<br />

OPPORTUNITIES ABOUND<br />

In line with global trends to meet the rising food demand driven by<br />

population growth, local agricultural research and development (R&D)<br />

could contribute towards higher yields and lower post-harvest losses.<br />

Many regions globally have reached their agricultural land expansion<br />

frontiers, such that increasing agricultural output requires increased<br />

productivity. Optimising yields through intensive input use, new cultivars<br />

and better production practices will hopefully increase agricultural<br />

sustainability and resilience in the longer term.<br />

A growing focal area for R&D, according to agricultural economist Dr<br />

Thulasizwe Mkhabela, relates to zoonotic diseases, food-borne pathogens,<br />

and vaccine development for livestock diseases. There is scope for the<br />

development of agri-tech, particularly those that address the needs of<br />

smallholder farmers.<br />

WATCH NOW<br />

THREATS TO BIOSECURITY<br />

Plant health is intrinsically linked to the survival of our planet and<br />

all that live on it. If we care about the eradication of poverty, the<br />

critical nature of food security, and the importance of nutrition,<br />

then we care about plant health.<br />

Watch The National Science and Technology Discussion<br />

Forum on plant health in SA.<br />

29


AGRI-FOOD<br />

THE ESSENCE IS ESG<br />

If unchecked, the negative impacts of agricultural development that<br />

prioritises maximum productivity by exploiting natural resources while<br />

disregarding the complex hidden costs (financial and otherwise) of food<br />

production, will prevent us from meeting our growing demand for food<br />

and fibre on a sustainable basis.<br />

The long-term health of the agricultural sector relies heavily on the<br />

sustainability of farming methods. Farming practices must not only ensure<br />

profitable yields but also the wellbeing of the factors of production:<br />

environment, workers and surrounding communities.<br />

LAND REFORM<br />

The general perception is that government’s execution of land reform<br />

strategies has been poor, resulting in various failures. Without a clear land<br />

reform policy framework that is well-executed, the inequalities of the<br />

A more hands-on approach<br />

can advance food justice in the<br />

face of climate change.<br />

past will continue to increase – and we run the risk that the core of the<br />

commercial agricultural sector, a key driving force of the economy and<br />

food security in the country, will collapse.<br />

Robust and transparent criteria for awarding land is critical to create<br />

confidence in a corruption-free process. For emerging farmers to access<br />

capital to develop land, blended finance models need to be developed<br />

between government and the private sector now. Strong public-private<br />

partnerships will be crucial to the success of the reform initiatives.<br />

THOUGHT [ECO]NOMY<br />

Urban lockdown lessons for South Africa: INSIGHTS AND OPPORTUNITIES<br />

FOR EQUITABLE FOOD SYSTEMS | Published by WWF – World Wide Fund for Nature. [2020]<br />

READ REPORT<br />

Covid-19 has brought the fragility of urban food systems into sharp focus. South Africa<br />

presents an important case study to demonstrate the role of urban food systems in supporting<br />

a more equitable global food system.<br />

South Africa’s local government sphere has no discrete formal mandate to address foodsecurity<br />

issues. The research provides a snapshot of the difficulties that come with this “absent<br />

greeneconomy/report recycle<br />

policy mandate” for urban responses towards the current and future impact of global climate<br />

change on these systems (page 5).<br />

Starting at city level is a good place to initiate a dialogue on food-system transformation. City<br />

impacts are significant due to high poverty rates and burdens of chronic, non-communicable<br />

diseases. The pandemic has shown that an inability to withstand stresses in the food system<br />

is due to on-the-ground social inequality, no access to resources, poverty, poor infrastructure,<br />

lack of representation, and inadequate systems of social security, early warning and planning.<br />

If cities and towns are to develop in ways that are sustainable, climate resilient and equitable,<br />

capacities and mechanisms are needed that will deliver information into complex technical and<br />

political urban decision-making processes. The disruption of food systems due to Covid-19 has<br />

foreshadowed the future impacts of climate change (page 15).<br />

The innovative work in some of the large cities in South Africa showcases how adaptation<br />

to climate change has been prioritised. The City of Cape Town, eThekwini Metropolitan<br />

Municipality and City of Johannesburg metros have included food-system resilience in their<br />

Climate Strategies and Action Plans. Although there is recognition of climate change by many smaller municipalities, evidence of action is<br />

limited (page 27).<br />

While being affected by environmental and economic externalities, the urban food system is also a driver of environmental change through<br />

waste, emissions and ecosystem degradation linked to food production and input extraction. If unchecked, these feedback loops further<br />

reinforce food-system instability and vulnerability to shocks (page 18).<br />

Recommendations in the report address six fundamental challenges: food trade, value chains, health and the built environment, informality,<br />

and climate change (page 20).<br />

© Text 2020 WWF South Africa<br />

07 13 18 20<br />

considerations<br />

Equity in<br />

a climatecompromised<br />

world<br />

Features of<br />

the urban<br />

geography<br />

READ MORE REPORTS<br />

Food-system<br />

governance<br />

Report<br />

Run by the universities of Stellenbosch, Cape Town and Witwatersrand, the National Income Dynamics Study<br />

Coronavirus Rapid Mobile Survey (NIDS-CRAM) surveys the impacts of Covid-19 in South Africa. Click this<br />

box to download presentations.<br />

USE WOOD, AND SAVE TREES.<br />

The more wood we use, the more forests we will save. It might seem responsibly managed forests, where harvesting is strictly controlled.<br />

contradictory, but it’s simple economics. Greater demand for wood Managed this way, forests become a renewable resource, and you<br />

makes it more valuable to local communities, and less likely that<br />

can choose our wooden windows, doors, garage doors and COL<br />

whole forests will be cleared to make way for other crops,<br />

products secure in the knowledge that the next generation<br />

or other, potentially damaging activities, such as mining.<br />

would be able to do the same. And if you take into account<br />

As a leading building materials manufacturer, we have<br />

the energy-saving benefits of wood, it’s simply the natural<br />

a responsibility to monitor our environmental impact.<br />

choice if you care about the environment. For more<br />

That’s why we prefer to source our wood from<br />

info call 086 110 2425 or visit www.swartland.co.za<br />

30


AGRI-FOOD<br />

QUALITY TESTING FOR THE<br />

AGRICULTURAL INDUSTRY:<br />

AN IMPORTANT LINK IN THE VALUE CHAIN<br />

Informed business, economic and social decisions in the food and feed value are based<br />

on information on the quality of the commodities being used as raw materials and that<br />

of the final products. The quality can only be assessed when accurate measurements are<br />

available that also ensure food safety, and finally support trade.<br />

BY WIANA LOUW, SAGL*<br />

The Southern African Grain Laboratory (SAGL) NPC, established<br />

in 1997, has a Crop Quality and a Crop Protection division. Both<br />

divisions are accredited under the international ISO/IEC 17025<br />

standard and the crop protection division also complies with the OECD<br />

Principles of Good Laboratory Practice (OECD GLP).<br />

To confidently provide accurate, reliable, and comparable measurement<br />

results, testing laboratories can implement a range of measures including,<br />

but not limited to compliance with quality standards such as ISO/IEC<br />

17025 for testing laboratories.<br />

Globally, there is an increased emphasis on food security and food<br />

safety with growing population numbers putting pressure on natural<br />

resources to provide enough safe food and feed. As a result, the spotlight<br />

also moved to reliable testing results as an integral part of improved<br />

production, management, and early warning systems.<br />

The South African National Accreditation System (SANAS) conducts<br />

surveillance audits at regular intervals to confirm the laboratory’s<br />

compliance and during these assessments, new methods and technical<br />

signatories are also evaluated to be added to the scope of accreditation.<br />

Since 1999, the SAGL complies with this international standard<br />

and received accreditation from SANAS. The SAGL uses measurement<br />

standards or reference materials as prescribed in the standard to confirm<br />

technical competence and to ensure international comparability and<br />

demonstrates continued method performance through participation in<br />

relevant proficiency testing schemes and the use of appropriate quality<br />

control materials.<br />

The Crop Quality Division performs national crop quality surveys<br />

on wheat, maize, soybeans, sunflower and grain sorghum and offers<br />

specialised analyses on food, feed and related products. Results of these<br />

surveys can, for example, be used when recommendations need to be<br />

made with regards to changes to regulations, such as grading regulations.<br />

Globally, there is an increased<br />

emphasis on food security and<br />

food safety with growing population<br />

numbers putting pressure on natural<br />

resources to provide enough safe<br />

food and feed.<br />

It can also be used when value chain studies, with the purpose of<br />

implementing improvements, are conducted.<br />

The division’s scope includes grading of grains and oilseeds, nutritional<br />

analyses, dough quality and baking tests on wheat flour, multi-mycotoxin<br />

analysis (using LC-MS/MS), vitamin and mineral analysis and amino<br />

acid analyses. The division also offers research support to industry for<br />

product and method development, training courses covering theoretical<br />

and practical laboratory training and proficiency schemes to local and<br />

international participants. The grain and oilseed industry use reliable<br />

quality data on agricultural commodities when marketing these products<br />

locally, but even more importantly, to prospect customers in the rest of<br />

the world.<br />

Customers submit samples to the laboratory to support their internal<br />

quality control processes and make use of calibration samples prepared at<br />

the SAGL to evaluate the accuracy of their equipment and the competency<br />

of their employees. They also participate in the proficiency schemes<br />

offered by the SAGL.<br />

The Crop Protection division analyses agricultural formulations and<br />

technical material (5-batches) for registration and conduct quality control<br />

analyses of plant protection products according to international standards.<br />

The concentrations of the active ingredients and impurities are determined<br />

using either Gas Chromatography (FID)/(MSD) or High-Performance Liquid<br />

Chromatography (DAD). Other tests include water content, particle size<br />

using laser diffraction, density, viscosity, pH and flash point.<br />

An important goal of the SAGL is to continuously improve the<br />

quality of the testing while increasing the sample throughput with the<br />

implementation of new technology, training of the laboratory staff and<br />

improved quality systems. We conduct investigative and research studies<br />

to find solutions or suggest alternatives to current processes.<br />

To access quality data on soybeans, sunflower, grain sorghum, wheat,<br />

and maize, please visit the website or contact the SAGL where our friendly<br />

staff will gladly assist you.<br />

www.sagl.co.za<br />

The Southern African Grain Laboratory NPC is an<br />

independent ISO/IEC 17025 accredited laboratory, acting<br />

as reference Laboratory for the South African Grain<br />

Industry.<br />

The Crop Quality Division focusses on grain and oilseed<br />

quality analysis:<br />

• Grading & Milling<br />

• Nutritional analyses<br />

• Rheology & Baking<br />

• Vitamins, Minerals & Amino Acids<br />

• Mycotoxins<br />

The SAGL also have a Crop Protection Division with ISO/<br />

IEC 17025 accreditation and OECD GLP Compliance for<br />

analyses on plant protection products:<br />

• 5-batch testing<br />

• shelf-life testing<br />

• treated seed<br />

Grain Building – Agri-Hub Office Park<br />

477 Witherite Street<br />

The Willows<br />

0040<br />

Tel: +27 (0) 12 807 4019<br />

E-mail: info@sagl.co.za<br />

Celebrating 25 Years of<br />

Excellence<br />

*Wiana Louw is general manager at Southern African Grain Laboratory<br />

32


SMART MINING<br />

SMART MINING<br />

To be<br />

ORE<br />

not to be<br />

A low-carbon future will be mineral intensive<br />

as clean energy technology needs more<br />

materials than fossil-fuel-based generation<br />

technologies. Ambition on climate change<br />

goals requires more of these technologies<br />

and will lead to a larger material footprint.<br />

READ REPORT<br />

Minerals by their production (how they are extracted) and by<br />

their consumption (their wide use in everyday life) can have<br />

both positive and negative impacts on different aspects of<br />

sustainability. The negative impacts make it imperative that these<br />

materials be responsibly sourced, to meet the wider sustainability agenda.<br />

Raw materials are an important element of the sustainability debate.<br />

According to the OECD’s Global Material Resources Outlook to 2060, the use<br />

of material resources grew form 27-billion tons in 1970 to 89-billion tons<br />

in 2017. The OECD forecasts that in the absence of new policies, material<br />

resource use could reach 167-billion tons in 2060, with the largest increase<br />

seen for metallic ores, followed by non-metallic minerals.<br />

The mining sector accounts for approximately 2-11% of total global<br />

energy consumption, while 70% of mining operations from the six largest<br />

mining companies are in water-stressed countries (IFC and ICCM, 2017).<br />

Adopting climate-smart mining practices would further reduce the overall<br />

sector’s carbon and environmental footprints.<br />

Low-carbon technologies<br />

Solar photovoltaic (PV), wind, and geothermal are more mineral intensive<br />

relative to fossil fuel technologies. About 3 000 solar panels are needed for<br />

1MW of capacity of solar PV. A 200MW solar project could be as big as 550<br />

American football fields (Mathis and Eckhouse, 2020).<br />

Production of graphite, lithium, and cobalt will need to be significantly<br />

ramped up by more than 450% by 2050 to meet demand from energy<br />

storage technologies. Production figures for base minerals, like aluminium<br />

and copper, are significant, at 103-million tons and 29-million tons by<br />

2050, respectively. Projections do not include the associated infrastructure<br />

needed to support the deployment of these technologies (transmission<br />

lines) or the physical parts (the chassis of newly-built EVs).<br />

Demand risks<br />

Cross-cutting minerals (copper, chromium, and molybdenum) are used<br />

across a wide variety of energy and storage technologies and have stable<br />

demand conditions. Molybdenum and copper are used in more than eight<br />

technologies. Even with technological improvements, costs reductions,<br />

and deployment of emerging technologies, there would be little impact<br />

on their overall demand.<br />

For copper, the greatest share of demand comes from solar PV and<br />

wind, but demand may be underestimated as it does not include the<br />

transmission infrastructure needed to connect these technologies to<br />

electricity grids.<br />

Concentrated minerals (lithium, graphite, and cobalt) are needed only<br />

for one or two technologies. Technological disruption and deployment<br />

could significantly impact their demand. These minerals are primarily used<br />

in energy storage and have the highest demand figures.<br />

Storage has the highest level of uncertainty post-2030 given the number<br />

of sub-technologies currently at the R&D and pilot stages, as well as different<br />

policy choices and market forces. Concentrated minerals have the highest<br />

level of demand risk, particularly for producers of these minerals.<br />

Certain minerals face higher levels of changes in demand from the shift<br />

to a low-carbon future. Graphite and lithium demand are so high that<br />

current production would need to ramp up by nearly 500% by 2050 to<br />

meet demand.<br />

READ REPORT<br />

Demand for aluminium for 2050, makes up 9% of current production<br />

levels, but aluminium is used across a broad range of technologies, making<br />

it less susceptible to changes in deployment.<br />

Understanding these demand risks is crucial for mining and energy<br />

industries that must be adaptive to rapidly evolving energy technologies.<br />

Demand shifts<br />

Solar PV will account for most of the aluminium demand from energy<br />

technologies (87%), while wind and geothermal will account for most<br />

zinc and titanium demand, at 98% and 64%, respectively. Solar and wind,<br />

combined, account for 74.2% of all copper demand, while battery storage<br />

accounts for all graphite and lithium demand.<br />

Substitution effects, such as efficiency improvements, could have<br />

strong impacts on the demand for individual minerals, like indium, based<br />

on which sub-technology ends up being most widely deployed up to<br />

2050. Factors that drive substitution effects include market dynamics,<br />

availability of minerals, technological improvements, and costs.<br />

New technologies such as offshore wind, green hydrogen, or solid-state<br />

batteries may change the shape of the future. These technologies require<br />

different minerals and carry different demand implications but given that<br />

they are generally more material intensive than their fossil-fuel-based<br />

counterparts, overall demand for minerals will still increase. Their carbon<br />

and material footprints cannot be overlooked.<br />

While increasing the share of renewable energy is one of the most<br />

effective ways of decarbonising the electricity sector, countries who have<br />

committed to the Paris Agreement need to address the mineral intensity<br />

of clean energy technologies. Emissions from the operation of renewable<br />

energy and storage technologies are just 6% of coal and gas generation.<br />

They account for 16 gigatons of carbon dioxide equivalent (GtCO2e)<br />

emissions up to 2050.<br />

Aluminium, graphite, and nickel production for energy technologies<br />

account for a cumulative 1.4GtCO2e up to 2050, nearly equivalent to the<br />

total 2018 C02 emissions from France, Germany, and the UK combined.<br />

<strong>Green</strong>ing the power sector and battery production requires that upstream<br />

and downstream emissions-related challenges from renewable energy<br />

technologies be meaningfully addressed through policy.<br />

The RE-SOURCING Project aims to build a global stakeholder platform for responsible sourcing in mineral value chains. The project addresses the<br />

challenges that businesses, NGOs, and policymakers are facing in a rapidly evolving ecological, social, business and regulatory world.<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

The International Responsible Sourcing Agenda: STATE-OF-PLAY<br />

[April 2020]<br />

This working paper provides an overview of the current state of responsible sourcing<br />

practices related to the extraction of minerals and their processing (page 10). The report<br />

outlines the challenges that have been identified in the economic, social and environmental<br />

spheres and analyses the approaches to responsible sourcing that are attempting to address<br />

these (page 11). It considers the role that key actors play in the uptake of responsible<br />

sourcing practices (page 16).<br />

In the second half of the document, the focus shifts to issues for responsible sourcing<br />

in three key sectors: renewable energy (page 27), mobility (page 29) and the electric and<br />

electronic equipment sector (page 33).<br />

34<br />

Excerpt from MINERALS FOR CLIMATE ACTION: The Mineral<br />

Intensity of the Clean Energy Transition<br />

LINK FOR ABOVE PLEASE<br />

07 13 18 37 39<br />

Sustainability,<br />

raw materials<br />

and resourcing<br />

Global value<br />

chains<br />

Current<br />

approaches<br />

to responsible<br />

sourcing<br />

Resources<br />

and circular<br />

economy<br />

Summary<br />

of report


The path to BEING BETTER<br />

SMART MINING<br />

STEWARDS OF THE EARTH<br />

European countries are working towards sourcing their<br />

future minerals supply in a more responsible way, but the<br />

challenge is to ensure that vulnerable stakeholders along<br />

the value chain are not left out of the conversation.<br />

BY SRK CONSULTING<br />

The RE-SOURCING Project aims to promote responsible sourcing<br />

through creating roadmaps for the renewable energy, mobility<br />

and electronics sectors in the EU. Funded by the European<br />

Commission under the Horizon 2020 project, RE-SOURCING is pursuing<br />

its goal by building a responsible sourcing community among a range<br />

of global stakeholders.<br />

“On the strength of our historical involvement in the mining sector, SRK<br />

Consulting has been drawn into the RE-SOURCING process, where our role<br />

includes facilitating the engagement of stakeholders in Africa and Asia,”<br />

says Andrew van Zyl, partner and principal consultant at SRK Consulting.<br />

These zones, along with South America, are key mineral-supply regions<br />

whose input to the consultation process is vital, adds Van Zyl, noting<br />

that the areas have wrestled with a range of ESG issues that relate to<br />

responsible mineral sourcing, such as artisanal mining and community<br />

engagement. “A significant amount of mining best practice is in fact<br />

emerging from developing countries that host mining sectors, which is<br />

what we are looking to feed into the RE-SOURCING process,” he explains.<br />

Key among the concerns of the responsible sourcing agenda is<br />

environmental degradation, carbon emissions and climate change. The<br />

recent United Nations IPCC report on climate change – which confirms<br />

the severity of global environmental impacts – certainly raises the<br />

urgency around the achievement of concerted world-wide action to<br />

reduce global warming.<br />

With most of the mining – that is, upstream activities in the mineral<br />

value chain – conducted in emerging economies, and a significant portion<br />

of downstream beneficiation and manufacturing occurring in wellestablished<br />

economies, the stakeholders on different sides of this divide<br />

can often have differing interpretations of “responsibility” in the sourcing<br />

process. According to SRK principal consultant ESG Lisl Pullinger, this<br />

means that charting an optimal path to the future requires the voices not<br />

just of the primary mineral consumers but among the producing regions.<br />

“A representative spread of stakeholder voices will help ensure future<br />

policies do not unintentionally remove value along the value chain of<br />

mineral production,” says Pullinger, “Especially where livelihoods may be<br />

more vulnerable to changes introduced by new standards or hurdles to<br />

market participation.”<br />

Mindful of the complexity of finding common ground for progress,<br />

RE-SOURCING is a multi-year process that works towards harmonising of<br />

concepts in search of a global definition of responsible sourcing. This will<br />

involve joint learning from innovative business cases around the world.<br />

Bjanka Korb, senior engineer at SRK Consulting, highlights that hearing<br />

different perspectives was an essential aspect of the current process – so<br />

that all the implications of future responsible sourcing frameworks are well<br />

considered before decisions are made and plans rolled out.<br />

“There is undoubtedly a resounding call for action on global threats<br />

like climate change and any proposed actions need careful thought in<br />

Above, Lisl Pullinger.<br />

Left, Andrew van<br />

Zyl and Bjanka Korb<br />

from SRK Consulting.<br />

terms of their impact on vulnerable groups,” said Korb. The danger that the<br />

RE-SOURCING process is working to avoid, is the development of a path<br />

towards a green economy at the cost of those in the mineral supply chain<br />

who are most vulnerable, says Pullinger.<br />

“The terrain of the responsible sourcing discussion includes a range<br />

of complexities around historical economic development trajectories,<br />

making many stakeholders weary about who will benefit most from the<br />

policy outcomes,” she says. “It is, however, a necessary engagement if we<br />

are to find shared solutions to global challenges like climate change and<br />

economic inequality.”<br />

The current reality of environmental degradation, says Van Zyl, results in<br />

large part from many countries “consuming cheaply” in the past – shifting<br />

the externalised costs onto future generations. “That bill has now come<br />

due, and the cost of the externalities needs to be addressed – which<br />

includes becoming better stewards of our planet going forward,” he adds.<br />

Among the planned events of the RE-SOURCING initiative is a Roadmap<br />

Workshop on the Mobility Sector, to be held virtually in October this year;<br />

Roadmap 2050 focuses on the key value chain steps of the Li-ion battery:<br />

mining, cell production and recycling.<br />

RE-SOURCING Virtual Conference: ON THE ROAD TO RESPONSIBLE<br />

RESOURCING – How to achieve lasting impact<br />

8-10 NOVEMBER 2021<br />

The conference will provide you with the latest on responsible<br />

sourcing through a mix of expert presentations and panel discussions.<br />

REGISTER FOR EVENT HERE<br />

37


ENERGY<br />

ENERGY<br />

As years of mismanagement at energy utility Eskom results in continued power outages<br />

and<br />

industrial<br />

energy tariff increases<br />

and<br />

across<br />

commercial<br />

South Africa’s industrial and<br />

businesses<br />

manufacturing sectors;<br />

domestic businesses are increasingly looking to renewable energy alternatives to power<br />

their commercial operations.<br />

38<br />

FUNDING THE SUN<br />

Solar PV financing options for<br />

Rooftop solar PV systems are progressively being considered the<br />

most readily accessible off-grid energy solution in South Africa.<br />

According to the DFFE, South Africa’s solar resource is one of the<br />

highest in the world, with an annual 24-hour global solar radiation<br />

average of about 220W/m2. When this is considered alongside the 300%<br />

increase in domestic electricity prices over the last thirteen years, the<br />

growing trend towards solar for businesses appears inevitable.<br />

According to renewable industry organisation <strong>Green</strong>Cape, rooftop<br />

small-scale embedded solar generation systems remain the dominant<br />

renewable energy technology in South Africa due to price, technical<br />

maturity and ease of implementation. The installed capacity of solar PV<br />

rooftop systems in South Africa has increased from 387MWp in 2017 to<br />

approximately 1.35GW in 2020/21.<br />

On the back of such significant market growth, numerous financial<br />

mechanisms to fund larger commercial and industrial solar PV installations<br />

and operations have emerged in recent years, including Power Purchase<br />

Agreements (PPAs), fixed-roof rentals, lease or rental agreements, upfront<br />

capital investment, and bank financing options.<br />

With the adoption of solar PV systems by commercial and industrial<br />

businesses now mainstream, a significant consideration for these companies<br />

is selecting the most appropriate funding option for their solar project.<br />

POWER PURCHASE AGREEMENTS<br />

PPAs are a popular choice among commercial and industrial consumers,<br />

since the installation, operations and maintenance of the system are<br />

fully covered by the solar services provider. Most often, this funding<br />

mechanism includes insurance and performance guarantees, with the<br />

biggest advantage being reduced electricity costs from day one. This<br />

allows business owners to enjoy the benefits of clean energy from a solar<br />

PV system installed at their premises, at no upfront cost.<br />

“A PPA includes the installation of a fully operating solar system but<br />

removes the hassle of having to maintain, monitor, operate and clean the<br />

system for years to come. Business owners can now enjoy solar energy<br />

and the savings it will generate with zero capital expenditure or operating<br />

risks,” explains SolarAfrica chief investment officer, Charl Alheit.<br />

Following the signing of a long-term agreement, a solar tariff is billed<br />

monthly, based solely on the amount of energy the business produces.<br />

This tariff increases annually at a fixed escalation, allowing businesses to<br />

accurately predict future energy costs. “This tariff is up to 40% cheaper<br />

than the national grid, providing significant savings each month and<br />

over the lifetime of the agreement,” Alheit adds. Businesses that use large<br />

amounts of daytime power and operate five to seven days a week are likely<br />

to generate the highest savings from this funding model.<br />

While ownership of the solar system will remain with the service<br />

provider until the end of the agreement, business owners have the option<br />

to purchase the system during the term of the agreement. Various exit<br />

options are available should a business owner wish to end the agreement<br />

earlier, while any damage to the solar system will be fully covered<br />

by insurance.<br />

FIXED ROOF RENTAL<br />

Fixed roof rentals have become a favoured choice for the owners of<br />

commercial shopping centres and strip malls, as a long-term roof rental<br />

agreement monetises their previously unused roof space. The solar<br />

services provider pays a fixed monthly payment to the property owner for<br />

the use of the building’s roof space, which also produces solar energy for<br />

the property.<br />

The property owner pays the solar services provider for the energy used<br />

based on Nersa or municipal rates, while all other costs, such as system<br />

maintenance, operations and insurance, remain with the services provider.<br />

EQUIPMENT RENTAL<br />

Under a solar lease agreement, also known as an equipment rental, the<br />

installation, maintenance and management of the solar panel and its<br />

components is paid for by the solar PV provider, while the business pays a<br />

fixed monthly lease payment for the duration of the lease term.<br />

The monthly payment is determined based on the estimated annual<br />

production of the solar system.<br />

A lease agreement is unlike a PPA in that the consumer pays a fixed<br />

monthly amount rather than agreeing to purchase the power generated<br />

READ REPORT<br />

Comparison of costs between a PPA and a solar system cash purchase.<br />

by the system at a set price per kilowatt-hour. “Your monthly solar lease<br />

agreement payments remain the same throughout the year, and the risk<br />

associated with the volume of solar energy produced and consumed<br />

resides with the property owner,” says Alheit.<br />

UPFRONT CAPITAL INVESTMENT<br />

Companies able to fund their solar PV project from existing cash reserves<br />

may find the upfront costs startling but the benefits appealing. A mediumsized<br />

commercial system of 200kWp currently costs between R1.9-million<br />

and R2.1-million, excluding battery costs. Benefits to cash-funded systems<br />

include VAT deductions, as well as Section 12b tax benefits and carbon<br />

credits, which can result in additional cost savings of up to 28%.<br />

“However, the business is also solely responsible for all ongoing annual<br />

costs, such as installation, insurance, performance monitoring and<br />

management, which can amount to a minimum of R88 500 per year, along<br />

with exposure to the performance risk of the system,” explains Alheit.<br />

BANK FINANCING<br />

Responding to increased interest by industrial and manufacturing energy<br />

consumers in solar PV solutions, several local banks have structured<br />

innovative finance agreements. Absa, Nedbank, Standard Bank and FNB<br />

all offer loans for solar PV installations, with primary instruments being<br />

term loans, instalment sales agreements, asset and property finance,<br />

mortgage-backed business loans and access bonds. The lending period<br />

for commercial installations ranges between five and 10 years, while the<br />

collateral requirement for the debt funding is often taken against the<br />

underlying property and the system.<br />

“The challenge with receiving finance from the banking sector is that<br />

since they don’t specialise in solar PV ownership, the solar production<br />

risk will remain with you and your monthly repayments will be fixed,<br />

irrespective of the system’s performance. Further, you could be using up<br />

valuable credit lines with the bank,” concludes Alheit.<br />

SOLAR PV AND THE VALUE OF YOUR HOME<br />

Read this article for a new perspective on the potential long-term<br />

value that you can create by installing a solar PV system in your home.<br />

KEY TAKE-OUTS<br />

- Why the reliability, affordability and sustainability of solar PV makes it<br />

a viable and valuable addition to your home<br />

- Trends in the South African residential property market<br />

- Current challenges caused by Eskom’s service<br />

- Saleability and sales premium of adding a PV system to your home<br />

39


ENERGY<br />

POWER<br />

FROM BITS TO WATTS<br />

According to The Global Carbon Atlas, South Africa is the 12th biggest emitter of greenhouse<br />

gases on the planet. It is clear that the country needs to reduce its carbon emissions and<br />

accelerate the growth of renewable energy across the region to ensure an affordable and<br />

reliable energy supply.<br />

RESIDENTIAL ELECTRICITY<br />

CONSUMPTION IN SA<br />

DMRE, SANEDI and UCT recently published a ground-breaking report on residential energy<br />

use. The study assesses the impact of energy efficient appliances on electrical energy<br />

consumption in South Africa.<br />

“In sub-Saharan Africa, more than 50% of the population still<br />

don’t have access to electricity,” said Huang Su, CEO of South<br />

Africa Digital Energy Business, Huawei. “Beyond that, thousands<br />

of hospitals and schools don’t have a stable power supply. This can<br />

easily become disastrous.”<br />

While South Africa is the leading power on the continent when it comes<br />

to power generation, Su points out that it’s currently unable to meet all its<br />

electricity demands all the time. “There is still a massive gap to be bridged,”<br />

he says, “We have to ensure we provide sufficient electricity to every<br />

African household.”<br />

To achieve this, Huawei is backing renewable energy coupled with<br />

technology-driven data and intelligence. As Su points out, renewable energy<br />

is much cheaper than fossil-fuel-based options, with a kilowatt-hour of solar<br />

power costing less than a rand in South Africa. It is clear then, that solar power<br />

should – and likely will – play a large role in the world’s future power mix.<br />

That is just one of the reasons why Huawei has invested heavily in<br />

smart photovoltaic (PV) solutions. By integrating AI and Cloud, Huawei<br />

has incorporated its ICT expertise with PV for optimal power generation.<br />

This allows for the construction of highly efficient, safe, and reliable solar<br />

power plants with smart O&M and grid supporting capabilities.<br />

“Huawei is already a household name in the ICT world,” Su says. “All<br />

ICT requires power supply and Huawei has always provided that to<br />

one degree or another. Our efforts in the solar PV space are simply an<br />

extension of that.”<br />

“Over time, Huawei will deploy more and more scalable power stations,”<br />

he adds. “These power stations can be managed and maintained online,<br />

further reducing their carbon footprint.”<br />

“We are uniquely positioned to bring electricity, power supply, and data<br />

management together,” he concludes. “The journey from bits to watts is<br />

accelerating and we plan on leading it.”<br />

On a global basis, the residential sector consumes one fifth<br />

of the world’s energy (IEA 2018:2) and has a large untapped<br />

potential to benefit from the multiple positive economic and<br />

social impacts of energy efficiency. These benefits include increased<br />

disposable income, poverty alleviation, improved health and wellbeing,<br />

better energy security and macro-economic benefits.<br />

Improved energy efficiency means that less energy is used while<br />

maintaining the same level of service or increasing service levels<br />

while maintaining energy use. In the residential context, efficiency<br />

improvements may be affected both by investments in technical<br />

interventions and by changes in behaviour.<br />

According to StatsSA, the residential sector in South Africa comprised of<br />

approximately 16.9-million households in 2016, of which about 86% were<br />

electrified. Electrified households consume roughly 17% of the country’s<br />

total grid electrical energy to provide energy services (DOE 2018:47), the<br />

most significant of which is resistive water heating. During peak periods, the<br />

residential sector accounts for up to 35% of national electricity demand.<br />

South African households are heterogeneous, and electricity use is<br />

not well characterised by averages. Appliance ownership, age, utilisation<br />

patterns and monthly spend on electricity all varies with household<br />

income. Poverty remains high and limits household electricity and<br />

appliance purchases. Almost 55.5% of the population were living below<br />

the Upper-Bound Poverty Line.<br />

The study found that South Africa’s Standards and Labelling<br />

(S&L) Programme was effective in achieving meaningful savings in<br />

appliance energy consumption between 2015 and 2020. The S&L<br />

Programme provides information about an appliance’s energy efficiency<br />

with an easy-to-read label displayed on the front of the appliance.<br />

The initiative will continue to provide energy savings into the future as<br />

appliances reach their end of life, and consumers purchase newer, more<br />

modern and energy efficient appliances. The highest energy savings were<br />

seen in refrigeration by a hefty margin, especially in low- and middleincome<br />

homes.<br />

In 2018, Berkeley Lab developed the South Africa Energy Demand<br />

Resource (EDR) model in The Low Emissions Analysis Platform (LEAP), in<br />

collaboration with the DMRE, SANEDI and the UNDP. The EDR provides a<br />

comprehensive forecast of the energy savings and emissions reductions<br />

that could result from the implementation of minimum energy<br />

performance standards.<br />

DEBATE BUSTERS<br />

• While dishwashers are likely to be more energy efficient than<br />

handwashing, this is only true for a fully-loaded dishwasher.<br />

• Induction stoves often consume large amounts of standby power and<br />

ultimately may consume more energy than an equivalent thermal plate.<br />

• A washing machine’s energy efficiency is typically measured based on<br />

energy used during its longer cycles, which is rarely used in practice.<br />

The more popular shorter and convenient cycle times tend to be less<br />

energy efficient.<br />

READ REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

TOP 10 TRENDS OF DIGITAL POWER | Power Digitalisation, Creating New<br />

Values | Whitepaper released by Digital Power Industry Work Group, Huawei Technologies<br />

With the rapid development of the digital world, the number of data centers and sites are<br />

increasing rapidly. Digital and intelligent technologies can effectively improve power generation,<br />

maintenance, and energy efficiency, helping to achieve the goal of carbon neutrality.<br />

In the coming decade, digital power will be a vital component in the evolution and upgrade of vast<br />

domains from ICT to electrical vehicles and solar power. Digital power modernisation will be at the<br />

foundation and will be applicable to large diaspora from rural, suburban, and diverse industries<br />

such as mining and smart factories.<br />

In December 2020, a number of authoritative experts and scholars in the digital power industry<br />

established a workgroup to discuss the energy digital transformation, and jointly released the<br />

Whitepaper on “Top 10 Trends of Digital Power” to provide strategic reference for the transformation<br />

and upgrade of the digital power industry.<br />

09<br />

READ REPORT<br />

[ECO]NOMIC THOUGHT<br />

greeneconomy/the upshot<br />

RESIDENTIAL ELECTRICITY CONSUMPTION IN SOUTH AFRICA<br />

Research Project Report by SANEDI, DMRE and UCT [May 2021]<br />

In this study the electrical energy consumption of low-, middle- and high-income households<br />

is characterised within a South African Residential Sector LEAP model. Within each of these<br />

income groups, appliance penetration rates together with appliance average annual energy<br />

consumption estimates are used to approximate the national annual electricity consumption<br />

of the sector.<br />

The disaggregation of energy services and appliances within the model, expands upon those of<br />

the EDR model, and includes lighting, cooking, refrigeration, dishwashers, washing machines,<br />

tumble dryers, water heating, space heating, televisions, pool pumps, air conditioning and other<br />

plug loads.<br />

28 61 63<br />

Survey<br />

findings<br />

LEAP<br />

model<br />

structure<br />

Assessment<br />

of the S&L<br />

programme<br />

Key<br />

recommendations<br />

40<br />

41


CIRCULARITY<br />

CIRCULARITY<br />

Circular <strong>Economy</strong> in Energy:<br />

WASTE HEAT TO<br />

ELECTRICITY<br />

In this article we highlight the opportunities in a waste stream<br />

often overlooked – waste heat. While not a traditional commodity<br />

we would think of under the waste label, it is nonetheless just<br />

as important to recycle and perhaps even more economically<br />

viable to implement.<br />

BY CHRIS WHYTE, ACEN*<br />

This waste stream is found in multiple sectors like water,<br />

energy, manufacturing and agriculture. Waste heat is a vast,<br />

underutilised, and sustainable source of energy that has been<br />

largely overlooked in the past due to technological constraints and<br />

financial barriers. Heat sources can vary from waste heat escaping up<br />

flue stacks from coal-fired boilers through to hot water or steam from<br />

diesel engines in ships, mining applications, steel furnaces, boilers, and<br />

manufacturing industries.<br />

Heat is an essential ingredient to many processes and the key<br />

industries contributing the greatest emissions and carbon footprint are<br />

those associated with the bulk of our electricity from burning coal, the<br />

petrochemical industries, steel manufacture, cement production and<br />

other manufacturing industries. Huge energy reserves are used to create<br />

the heat required for these processes, so it simply makes sense to catch the<br />

waste heat off the end of the process and get it back into the grid.<br />

The latest technological innovations and systems are extremely efficient.<br />

When we think of the extremes of waste heat production one visualises<br />

the old ’80s movies of mid-western steel workers in the USA sweating over<br />

furnaces of molten steel. The reality now is that escape temperatures as<br />

low as 70°C can be harvested for conversion back to energy and this would<br />

service most conventional manufacturing facilities.<br />

Also, recent innovation and development in the application of organic<br />

Rankine cycle (ORC) and axial turbine systems allows for smaller-scale<br />

systems that can have modular energy outputs of anything from 75kW to<br />

500kW with a return on investment at 36-<strong>48</strong> months producing energy<br />

cheaper than current coal-based electricity. Benefits are that this energy<br />

is more reliable than renewables (the sun does not always shine, and the<br />

wind does not always blow) and provides reliable base load electricity.<br />

Companies looking for clean<br />

affordable power that have a<br />

waste-heat source should consider<br />

implementing these systems for their<br />

power generation.<br />

The additional extension of this technology is that one can integrate<br />

these systems with your own heat source from incineration of problematic<br />

waste streams such as agricultural and forestry residues, plastics, and tyre<br />

waste. ORC systems can be used as small-scale concentrated solar power<br />

plants thus dramatically reducing the capital expenditure of the larger<br />

systems conventionally deployed globally.<br />

Simply put, the organic Rankine cycle and axial turbine systems capture<br />

waste-heat from different manufacturing processes and like a steam turbine<br />

turn this energy into electricity. As the ORC system uses a refrigerant gas<br />

that boils and expands at very low temperatures, the system will operate at<br />

temperatures between 70 and 150°C, which is a fraction of the heat required<br />

for conventional Rankine cycle and steam turbine systems.<br />

Another great feature is that this is a closed loop system so no<br />

contaminants can enter the system, and this extends the life of the<br />

plant. ORC systems produce emission-free clean power from waste-heat<br />

– it’s as simple as that. The waste-heat-to-energy market is set to exceed<br />

$30-billion by 2025 and yet the uptake is still low. This is largely due to a<br />

lack of knowledge of available technologies and the incorrect perception<br />

that this is only applicable to large-scale waste heat applications like steel<br />

manufacturing and coal power.<br />

The Rankine cycle is a thermodynamic cycle that converts heat into work.<br />

The heat is supplied to a closed loop, which typically uses water as a working<br />

Energy efficiency will always<br />

play a role in combatting climate<br />

change because no matter the process,<br />

the more efficient it is, the less impact<br />

it has on the planet.<br />

fluid. The Rankine cycle based on water provides approximately 85% of<br />

worldwide electricity production. Steam-to-electricity has been around<br />

since modern industrialisation, but even ORC systems have been around for<br />

over 100 years. However, the latter have only really been deployed at any<br />

scale since the turn of the century.<br />

A resurgence of interest in the research and development of ORC as a<br />

viable small-scale solution for electrical production developed after the<br />

successful completion of the 1MW APS Saguaro PT plant in Arizona, USA<br />

in 2006. Since then, our 21st century engineering skills have continued to<br />

refine and develop these systems to the current applications where we can<br />

harvest low-volume, low-heat outputs with compact modular units with a<br />

footprint as small as 4m2 and outputs of up to 75kW.<br />

As the ORC and axial turbine systems use this waste-heat, it adds to the<br />

cooling of the hot water or air, and this helps the industries where they<br />

need to cool processes and less heat will go into the atmosphere. Coolingto-power<br />

is an effective means of increasing energy efficiency due to these<br />

systems consuming the waste heat as fuel, which significantly reduces the<br />

cooling load (70-100%). This means, in addition to generating emissionfree<br />

power, the parasitic cooling load also is reduced or even eliminated,<br />

further reducing costs and increasing efficiency.<br />

Companies looking for clean affordable power that have a waste-heat<br />

source should consider implementing these systems for their power<br />

generation. Being modular, this decreases financial risk and allows for<br />

scaling. Some companies that I work with will provide free evaluations<br />

and even financing options allowing the customer to avoid any initial<br />

capital cost with the ability to buy the power from their own waste heat at<br />

cheaper rates than grid-based options.<br />

Increasing energy efficiency is the single easiest step in pursuing a<br />

carbon-neutral future. Using an existing resource – heat – to provide<br />

power and cooling reduces fossil fuel consumption and reliance on the<br />

grid. ORC and axial turbine power generation is a sustainable technology<br />

that reduces the amount of energy consumed (fuel) and energy wasted<br />

(heat). Energy efficiency will always play a role in combatting climate<br />

change because no matter the process, the more efficient it is, the less<br />

impact it has on the planet.<br />

With the reliability and cost-effectiveness of modern systems, wasteheat<br />

recovery solutions such as cooling-to-power are both profitable and<br />

practical. With the world eyeing ways to shift toward clean energy and with<br />

the help of incentives promoting sustainability like the local Carbon Tax<br />

(Act 15 of 2019), cooling-to-power is primed to be a disruptive technology<br />

in the energy efficiency and commercial cooling market – effectively<br />

changing the way corporations see and use waste-heat.<br />

Don’t miss The Circular <strong>Economy</strong> Show every Wednesday at<br />

1:00pm. Chris Whyte discusses all things circular with Gordon<br />

Brown and guests. Each episode provides an in-depth discussion<br />

based on sectoral topics.<br />

* African Circular <strong>Economy</strong> Network<br />

42<br />

43


WASTE<br />

WASTE<br />

THE ROAD TO<br />

SUSTAINABILITY<br />

The use of waste materials in<br />

South African road construction<br />

The Council for Scientific and Industrial Research has recently been<br />

involved in several new research initiatives geared towards providing<br />

alternative waste material products, specifically to be used by the<br />

asphalt pavement industry in South Africa.<br />

The research focus of the CSIR has been centred around creating<br />

a more inclusive and sustainable approach to future road<br />

construction, particularly through increasing the potential for job<br />

creation, increasing economic benefits, producing better performing<br />

roads and trying to resolve South Africa’s environmental challenges.<br />

One of the CSIR’s recent successes has been around the adoption of<br />

locally produced waste alternatives (opposed to importing costly<br />

conventional road and waste products).<br />

CASE STUDY ON THE SUSTAINABLE USE<br />

OF RECYCLED TYRES<br />

Construction of a road section in Roodepoort, Gauteng<br />

In 2019, the CSIR in collaboration with Much Asphalt (Pty) Ltd successfully<br />

constructed a road trial section in Roodepoort using locally available<br />

micro-fillers and recycled tyres. The project came to fruition when both<br />

products under development were successfully paved into a controlled<br />

road trial section, after a year of combined laboratory development and<br />

rigorous evaluation.<br />

The 200m long trial section includes a 60mm modified enrobés à<br />

module élevé (EME) base layer and a 40mm modified bitumen-rubber<br />

asphalt layer that was constructed over a cleaned gravel base. This layer<br />

was treated with a SS60 tack-coat prior to paving. The location of the<br />

trial section specifically allows for continual performance monitoring,<br />

which includes up-to-date details on the distribution and volume of<br />

traffic that moves across the section.<br />

Georges Mturi, CSIR’s project manager speaking on the success<br />

of the project: “During both the development and trial phase, several<br />

performance characteristics were evaluated as predictors of in-situ<br />

performance, which served as the baseline for the performance<br />

evaluation that were set to run on a three-month basis for a period of<br />

one year after construction.” In this regard, he adds “The evaluations<br />

and visual inspections have shown that after nine months of traffic and<br />

environmental exposure, the layers are performing as expected.”<br />

44<br />

Construction of road trial section made<br />

from recycled tyres.<br />

To date, no edge breaking is present where heavy vehicles are moving<br />

onto and off the surfacing, no permanent deformation is present on the<br />

surfacing (particularly at stopping locations and where regular vehicle<br />

turning takes place) and, lastly, there are no signs of any deflection or<br />

temperature-induced crack formations taking place.<br />

Joanne Muller, regional laboratory manager at Much Asphalt says, “The<br />

developed and trialled technologies aimed at improving the performance<br />

properties of standard 10/20 based EME, while also acting as a viable<br />

replacement product for standard styrene-butadiene styrene (SBS)<br />

modified A-E2 binder, without detracting from pavement performance.<br />

These are deemed effective as they can assist industry practitioners in<br />

their endeavour to provide long-lasting pavements to society.”<br />

Overall, the project is aimed at assisting bitumen users, asphalt<br />

manufacturers and other intermediary bitumen suppliers. It is expected<br />

that the technology will enable the correction of poor bitumen to<br />

pass performance specifications. Additionally, the technology may<br />

also improve the performance of standard bitumen from one grade to<br />

another, especially in the event of national bitumen shortages. It is also<br />

important to highlight that a major benefit of this invention would be an<br />

increase in the recycling rates of waste tyres in South Africa, which will<br />

ultimately lead to better-performing roads and a greener environment.<br />

CASE STUDY ON THE USE OF WASTE PLASTIC<br />

Construction of road sections on Road P159/1 (R80) in City of Tshwane, Gauteng<br />

The CSIR, along with the Department of Science and Innovation (DSI),<br />

as well as the plastics and roads industry, have recently worked on a<br />

demonstration project in South Africa to evaluate the feasibility of using<br />

waste plastic in road construction. The project aimed to identify lowvalue<br />

plastic types and evaluate their potential usage in asphalt road<br />

surfacing in accordance with South African road design standards and<br />

environmental conditions.<br />

The culmination point for the project was the construction of<br />

Gauteng’s first “waste plastic” road trial section, currently located on<br />

Construction of road trial section<br />

made from waste plastic.<br />

the R80. This trial section was used by the CSIR’s Smart Mobility Cluster<br />

for proof-testing plastic-road technology in South Africa. The CSIR<br />

has to date successfully completed a full-scale research investigation<br />

and laboratory programme that was validated through Heavy Vehicle<br />

Simulator (HVS) testing.<br />

The project’s sponsors and key stakeholders from the DSI, Roadmac<br />

Surfacing (Pty) Ltd (Raubex Group) and Much Asphalt were crucial in<br />

supporting the CSIR’s project team throughout construction.<br />

Although technical findings from the project are still currently being<br />

published, the CSIR’s project team stated: “The project has successfully<br />

showed potential in using specified waste plastic materials to design<br />

rut resistant asphalt mixes without compromising on other asphalt<br />

performance requirements. The approach requires the adoption of<br />

necessary criteria to establish a consistent source of waste plastic.”<br />

The research project highlights the need to understand the<br />

mechanism that improves rut resistance to ensure that this benefit<br />

is realised through controlling performance criteria and handling of<br />

the asphalt mix. The research identified requirements for measuring<br />

additional asphalt properties that would quantify the contribution of<br />

the asphalt layer to safety, health and environmental sustainability.<br />

Project team included: Georges AJ Mturi, Johan S O’Connell, Imraan<br />

Akhalwaya, Theresa George, Vincent O Ojijo, Tladi Mofokeng, Nonzwakazi<br />

Ncolosi, Michandre Smit and Linda Godfrey.<br />

The end of the road<br />

Feedback from these case studies is aimed at encouraging government<br />

and road industry stakeholders to adopt the use of waste materials for<br />

environmental benefits, as well as for the improved performance of road<br />

surfaces. The technologies will require the development of application<br />

guidelines to promote a better understanding of the suitability of waste<br />

materials for road projects and therefore lower the risk of premature<br />

failure of roads.<br />

45


WASTE<br />

SA PREPARES FOR<br />

CLEAN-UP & RECYCLING SA WEEK<br />

Plastics SA is calling on South Africans to participate in the annual Clean-Up & Recycle SA week from<br />

13 to 18 September. Highlights of this week will be River Clean-Up Day (15 September), National<br />

Recycling Day (17 September) and the International Coastal Clean-Up Day (18 September)<br />

BY PLASTICS SA<br />

Apart from raising awareness and supporting clean-up initiatives<br />

by donating refuse bags, gloves and other equipment needed,<br />

this will also be the 25th year that Plastics SA will be coordinating<br />

South Africa’s participation in the International Coastal Clean-Up Day –<br />

the world’s biggest volunteer effort for ocean health.<br />

“Clean-Up & Recycle SA Week has become a highlight on our country’s<br />

environmental calendar. This annual public awareness week is supported<br />

by all the packaging streams in South Africa and encourages citizens,<br />

corporates and municipalities to help remove all visible litter from our<br />

country’s neighbourhoods and streets, rivers, streams, beaches and<br />

oceans,” explains Douw Steyn, Plastics SA’s sustainability director.<br />

Plastics SA is hoping that this year will see a repeat of the huge success of<br />

last year’s Clean-Up & Recycle SA Week. Even though Covid-19 restrictions<br />

prohibited the large groups at public clean-ups and gatherings that have<br />

become synonymous with this public awareness and volunteer effort, the<br />

spirit of camaraderie, positivity and willingness to make a difference in our<br />

environment, definitely made this one of the most memorable years.<br />

“Like last year, we are once again advocating that South Africans be<br />

eco-warriors in their own neighbourhoods by picking up any litter on our<br />

beaches or strewn in streets, rivers, streams or canals. Where community<br />

clean-ups are planned, we urge the organisers to adhere to safety<br />

protocols by limiting the numbers of volunteers participating, ensuring<br />

that participants wear their masks, checking that they maintain social<br />

distancing and that enough sanitising stations are in place,” says Steyn.<br />

Highlights of the 2020 Clean-Up & Recycle SA Week included the launch<br />

of the Inkwazi Isu (Fish Eagle Project) by the KwaZulu-Natal Marine Waste<br />

Network South Coast and the participation of Barbara Creecy, Minister<br />

of the Department of Forestry, Fisheries and the Environment (DFFE) in a<br />

beach clean-up at Dakota beach, Umbogintwini in KwaZulu-Natal, where<br />

697 bags were collected with a weight of over 2.4 tons.<br />

In the Cape provinces, several hundreds of kilometres of the country’s<br />

coastline were cleaned in more than 72 audited clean-ups, while several<br />

more non-audited, informal clean-ups took place during the week. Fifteen<br />

4x4 clubs hosted their clean-ups, as did several diving groups who hosted<br />

underwater clean-ups. In the Cape provinces, twenty tons of litter were<br />

removed, separated and sent for recycling on International Coastal<br />

Clean-Up Day.<br />

“South Africa and the rest of the world continues to go through a very<br />

difficult period in our history as we are still trying to beat the ravaging<br />

effects of the Covid-19 pandemic, lockdowns, riots and public disturbances.<br />

However, each year the Clean-Up & Recycle SA week manages to restore<br />

hope as South Africans of all ages and walks of life unite their efforts and<br />

volunteer their time and energy to help make South Africa a brighter,<br />

cleaner place for all,” Steyn concludes.<br />

Like last year, we are once<br />

again advocating that South<br />

Africans be eco-warriors in their own<br />

neighbourhoods by picking up any litter<br />

on our beaches or strewn in streets,<br />

rivers, streams or canals.<br />

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For more information about Clean-Up & Recycle SA week and where organised clean-ups will take place during<br />

September 2021, visit www.cleanupandrecycle.co.za or www.plasticsinfo.co.za<br />

46


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