Issue 28 R29.00 incl VAT 9 772410 645003
Pele Green Energy transforming rural agriculture Water the age of recycling and reinvention Energy Efficiency servicing growth in the sector 11025
GEJ 28 cdc.indd 47
Technology 3D printingâ&#x20AC;&#x2122;s impact on logistics Innovation a plastic compound to reduce waste 2017/11/09 12:21 PM
GEJ 28 cdc.indd 48
2017/11/09 12:21 PM
EDITOR: Melissa Baird CONTRIBUTOR: Greg Penfold Anthony Turton Hugh Tyrell Margareta Merke Lisa Reynolds PROOF READER: Narike Lintvelt LAYOUT AND DESIGN: CDC Design ARTWORK COORDINATOR: Linda Tom PROJECT MANAGER: Vania Reyneke SALES: Farai Maunga, Louna Rae PRINTING: FA Print DISTRIBUTION: Edward MacDonald WEB: www.alive2green.com/ publications/green-economy-journal/ DISTRIBUTION AND COPY SALES ENQUIRIES: firstname.lastname@example.org ENQUIRIES: email@example.com ADVERTISING ENQUIRIES: firstname.lastname@example.org EDITORIAL PROPOSALS: email@example.com PUBLISHER: Gordon Brown, Alive2Green Projects PHYSICAL ADDRESS: 1st Floor Cape Media House 28 Main Road Rondebosch 7700 Cape Town TEL: 021 447 4733 FAX: 086 694 7443 REG NUMBER: 2005/003854/07 VAT Number: 4750243448 ISSN NUMBER: 2410-6453 PUBLICATION DATE: November 2017
Green Economy Journal is audited by ABC Issue 28 R29.00 incl VAT 9 772410 645003
Pele Green enerGy transforming rural agriculture Water the age of recycling and reinvention enerGy efficiency servicing growth in the sector 11025
technoloGy 3D printing’s impact on logistics innovation a plastic compound to reduce waste
Cover image courtesy Pele Energy
All Rights Reserved. No part of this publication may be reproduced or transmitted in any way or in any form without the prior written permission of the Publisher. The opinions expressed herein are not necessarily those of the Publisher or the Editor. All editorial and advertising contributions are accepted on the understanding that the contributor either owns or has obtained all necessary copyrights and permissions. The Publisher does not endorse any claims made in the publication by or on behalf of any organizations or products. Please address any concerns in this regard to the Editor. The Green Economy Journal is printed on Hi-Q Titan plus paper, manufactured by Evergreen Hansol a leading afforestation member acknowledged by FOA. Hi-Q has Chain of Custody certification, is totally chlorine free, and is PEFC, ISO 14001, ISO 9001 accredited. This paper is FSC certified.
GEJ 28 cdc.indd 1
“There were rumours… there were rumours...” words from the song “I’m Amazed” by the Pixies has been playing in my head, but not in the context of field hockey players – rather about the people who are our leaders and their decision-making capabilities. My ears have been burning with the information I have been given access to from independent sustainability consultants who have been battling long to get through to certain decision makers and offer them solutions that can help solve not only Cape Town’s water crisis, but also the disaster that is the failure of water infrastructure playing out in other parts of the country. These practitioners are not being paid for work underway and are having their contracts withheld. Those championing the technical innovations that offer new hope for water recycling and management have been blocked due to political ideology that serves no purpose in a country on the brink of social and economic meltdown if the water crisis is not addressed immediately. Outmoded tender processes are slow and restrictive, preventing smaller operators from participating in offering answers to the big question: “What happens when Day Zero is reached”? A highly successful businessman I know said to me, “We don’t have a water problem, we have a water management problem.”I have also heard that many of his peers are planning to move out of Cape Town as the crisis deepens. More than five years ago, while I was working on creating an energy efficiency strategy, I asked certain city leaders about their plan for managing the impending water crisis. Back then load shedding was the catastrophe that would bring Cape Town to its knees. I was reassured that water was “on the agenda”, but it became clear to me that it was low on the priority list and calls to “pray for rain” replaced the action needed when it didn’t. Hope is not a strategy, and prayer is comforting in times of crisis – but I have also heard that one should pray while rowing for the shore – in other words, do something. It is difficult to remain optimistic with all this noise in my head, but then I engaged with our country’s leading water specialist and his hope based on fact: We can manage and recycle the resource that is most fundamental to the stability of our society, economy and life – water! There are other strong reasons to be hopeful when it comes to waste – a new compound (in its beta phase) has the potential to reduce plastic waste. And in the agricultural sector, renewable energy is bringing power to rural farmers and increasing their chances of financial success and crop yield. GEJ brings you these stories and they are renewing my faith.
Melissa Baird PS I must offer a sincere apology to Boipelo Moloabi, Group Marketing Director for Pele Energy Group, for the misspelling of his name in our previous edition, and indeed for crediting him in the first place, that interview was in fact with Pele Energy Group Managing Director, Mr Gqi Raoleka.
1 2017/11/09 12:21 PM
Futurecon_J15875 - Green Economy Journal_Futurecon Advert_210275_PR.pdf
GEJ 28 cdc.indd 2
2017/11/09 12:21 PM
GEJ 28 cdc.indd 3
News and updates Mega water projects, Eco Logic awards, electric cars, Robben Island goes solar
Interview Boipelo Moloabi – Group Marketing Director for Pele Energy Group discusses solar power for emerging farmers
Water Despite the massive crises facing the country Professor Anthony Turton highlights the opportunities for refreshed water management
Interview Lisa Reynolds – Head of the South African Energy Efficiency Association speaks about the role of Energy Services Companies in accelerating growth in the sector
Green Buildings How to increase productivity in the work place? Just add a dose of what we all need to thrive…
Waste The consumer society, tracking its conception and impact on modern living
Innovation New plastic compound that can reduce packaging waste
Technology How 3 D printing is changing logistics and manufacturing
3 2017/11/09 12:21 PM
News and Updates
Western Cape water crises initiative A new water crisis initiative has been launched to identify and push through three multi-billion rand projects to restore water security to Cape Town. The aim is to move the agenda from a focus on water scarcity to one of abundance. The Water Leapathon Advisory Board is a strategy forum that brings together representatives of business, academia, government, labour and concerned citizens. “We have two areas of focus,” says Cape Messenger CEO Martin Humphries, who chaired the forum. “In the short term we will help with getting the message across and help mobilise businesses and individuals to take steps to cut water consumption. We are also convinced that there needs to be more thought about the long term.” For that, three mega-projects will be identified and driven to completion. Seeking public-private partnerships, they are not tied to any strategy: if water treatment or re-use is the best and cheapest way to go, they will follow that path. Similarly, large-scale desalination options would be investigated. It is not just about the water people consume, Martin adds. One unit of water consumed in tourism creates more jobs than one drop used in mining. A Water Leapathon emergency summit is being held in Cape Town at the end of November to advance the agenda. For more information, call Martin Humphries on 083 282 3874.
Cyber security: Password savvy The most popular password of 2016, making up 17% of the 10 million passwords analysed by Keeper Security, was “123456”. According to AO.com, an online electrical retailer, generic passwords like these take less than one second to crack. Choosing a password with three random words like “teabrowncup” would take 35 000 years to crack, and adding a number increases it to 227 million years. Adding both a number and a symbol means your password will be safe for 4 trillion years. Source: Eighty20.co.za/fact-a-day-archive
Wasted on the way
Calling all eco-heroes
According to the Food and Agriculture Organization of the United Nations, roughly one third of the annual food produced for human consumption every year (1.3 billion tons) gets lost or wasted. European and North American consumers waste 95-115 kg of food per capita each year, while consumers in sub-Saharan Africa and South and South-Eastern Asia each throw away only 6-11 kg of food per capita per year. Source: Eighty20.co.za/fact-a-day-archive
The 2018 Eco-Logic Awards nominations have opened and the call is for interested people, organisations and influencers to submit their entry recommendations for South Africa’s top social, environmental and economic players. Archbishop Emeritus Desmond Tutu has expressed his support for the Eco-Logic Awards by stating, “Eco-Logic represents a mind-set and value system that I fully support”. Winners and finalists of previoua Eco-Logic Awards report that they have derived very real and measurably material benefits from their participation, and more awareness and action has been generated due to the showcase the award platform offers. Categories include biodiversity, climate change, eco-innovation, energy efficiency, recycling, waste management, transport, water conservation, green economy, municipalities, eco-community, eco-angel and eco-warrior. Entries are accepted until 31 January 2018. To find out more and download an entry form, visit www.eco-logicawards.com.
The end of the internal combustion engine Electric vehicles (EVs) no longer seem like a futuristic dream, but they remain a rarity on South African roads: currently only 300 vehicles out of 7 million are electric. Yet, when future auto historians look back, they may pinpoint 2017 as the year electric vehicles went from a promising progressive fad to an industry-wide inevitability. The tipping point, experts say, follows three developments, each rippling outward with economic and cultural consequences. First there is “China’s flexing” – in addition to setting aggressive production quotas for EVs, China plans to scrap internal combustion engines entirely as soon as 2030. By taking a lead role in the shift to plug-ins, the world’s largest auto market is forcing the rest of the international community to follow in its footsteps. Second is the debut of Tesla’s Model 3, the company’s first mass-market vehicle. Slick in its design, it costs only $35 000. The third key factor is that major automakers are announcing plans for an “all-electric” future. General Motors finished 2016 as the world’s third-largest automaker, meaning its decision to create 20 new electric vehicles by 2023 is bound to have an impact on the global marketplace. Volvo, Volkswagen, Mercedes-Benz, Audi, BMW and Ford have also announced EV plans in recent months. Source: Climateneutralgroup.co.za
4 GEJ 28 cdc.indd 4
Cars by numbers 0 - The number of petrol and diesel cars to be sold in the UK and France after 2040 13 - The percentage of South Africa’s total GHG emissions that come from the transport sector 43 – The percentage of travellers willing to pay more to reduce the ecological footprint of their travels 300 – The number of electric cars on SA roads 260 000 – The number of cars the Cape Town CBD has to absorb every day – the highest in SA 7 million – The number of conventional vehicles on SA roads
2017/11/09 12:21 PM
News and Updates
Saving water with each load Business partners Tony Soares and Pierre Cillie launched Green Planet Laundry after identifying the need for a more waterwise approach as water scarcity in the Western Cape fast reaches emergency status. The laundry operation uses purified borehole water combined with pioneering ozone technology to optimise efficiency and drastically reduce the vast water consumption of traditional laundry methods. Although water restrictions are currently in place, household water consumption in the Western Cape taps into the limited potable water supply, with laundry using as much as 50 litres per cycle. Green Planet Laundry uses a water source that does not draw from the valuable municipal water supply and a water reclamation system whereby greywater is recycled through a filtration process and approximately 50% is reused. This entire process is powered by an on-site solar energy system that generates double the amount of power required. Source: Greenplanetlaundry.com
Big business and government join hands for water security The third annual Water Stewardship summit, held in Johannesburg in October, kicked off with calls for the financial sector to look introspectively at ways to support efforts to close the water services infrastructure funding gap amounting to around R30 billion per annum in support of the coming National Water and Sanitation Master Plan. The Department of Water and Sanitation (DWS) is currently in the process of drafting the country’s new National Water and Sanitation Master Plan, with completion expected by March 2018. Outlining the goals of the plan, Trevor Balzer, DWS Deputy Director General of Strategic and Emergency Projects, echoed sentiments made earlier this year by his Deputy Minister Pamela Tshwete, who at the first dialogue on the Water and Sanitation Master Plan in May, called on big businesses to assist in funding sustainable development projects. The summit, organised by the Strategic Water Partners Network, the National Business Initiative (NBI) and the Royal Danish Embassy, provided an often neglected opportunity for public and private financiers to become involved in the initial planning and project conceptualisation stage of the new National Water and Sanitation Master Plan. Source: Nbi.org.za
Powered by the sun SOLA Future Energy has succeeded in designing and constructing a solar energy microgrid for Robben Island. The system, situated on the World Heritage Site, consists of a solar PV farm combined with a lithium-ion battery storage facility and smart controllers to ensure a seamless electricity supply while significantly reducing the island’s fossil fuel consumption. Robben Island has an energy usage profile that comprises residential needs, desalination, harbour and offices. In total, the island uses almost 2M kWh of electricity annually. Commissioned by the Department of Tourism, the solar PV project will produce almost 1M kWh of electricity annually, significantly reducing costs of buying diesel and transporting it to the island. The island is also embarking on a drive to reduce its own electrical consumption. The microgrid consists of three power production elements. The solar PV farm has 1 960 mono-crystalline modules with a total of 666.4 kW power supply. The battery bank, with its 2 420 lithium-ion battery cells, is able to store 837 kWh and output a maximum of 500 kVA. The third power production element is the diesel generators, which are used when no solar or battery storage is available. Multiple controllers between these power production elements balance the power supply and create a smart microgrid, ensuring a seamless supply of power. The microgrid on Robben Island is the largest combined solar and lithium-ion storage microgrid system in South Africa and will reduce its fossil fuel consumption by 235 000 litres of diesel per annum, or 50% of previous usage. Source: Solafuture.co.za http://www.solafuture.co.za/news/ robben-island-solar-microgrid-power-of-solarpv-and-batteries https://youtu.be/c-ULxbjDnuA
Waterwise fruit farmers Stone fruit farmers are tackling the Western Cape drought with optimism and positivity, believing that the dire situation can be managed. The silver lining in the drought’s cloud for fruit farmers is that the quality of fruit grown under water scarce conditions is usually very good with high sugar levels and great taste. HORTGRO, the body that represents the South African Stone Fruit Producers’ Association, recently presented an irrigation seminar to equip producers with tools and strategies to alleviate the drought impact. These strategies involve ranking and allocating water to orchards according to profitability, resulting in optimal irrigation of highly profitable orchards and the removal of unproductive orchards. Fruit producers are resilient and have recently been using technology much more actively and effectively in managing their water, irrigation systems and orchards. Water has always been a limited resource and the experience of past seasons has helped to hone the growers’ skills to make every drop count. For more information, email HORTGRO marketing manager Jacques du Preez: Jacques@hortgro.co.za.
GEJ 28 cdc.indd 5
5 2017/11/09 12:21 PM
Solar power solutions Gordon Brown interviews Boipelo Moloabi, Group Marketing Director for Pele Energy Group about their latest success story in providing renewable power to a farming collective that has enabled it to thrive.
GB: What was the brief or mandate from the client? BM: The brief from the client was for Pele Green Energy to provide a solar power solution for a farming co-operative in Ndumo in northern KwaZuluNatal. We were required to design, engineer, procure and construct a 4 kW solar irrigation system and a 50 kW ground mount solar solution to power a packhouse. GB: What is the business model – engineering, procurement and constructions (EPC), lease or power purchase agreement (PPA)? BM: The business model that was used as a requirement from the client was an EPC model. GB: Define the business case established in terms of the projected levelised cost of electricity (LCOE ), payback period and internal rate of return (IRR)? BM: The client had looked at the project in two parts – as community development and part business education. On the one hand the client would own the power plant and train the co-operative on its operation and maintenance over time. The model developed by the client was built to account for the learning phase where the famers could fully understand the operations of the plant. Following this phase, the farmers would then be charged an affordable tariff that fits their operating business model.
6 GEJ 28 cdc.indd 6
GB: Is there scope for further phases on this site or other sites with this client? BM: Following the construction of the plants, we were tasked with operating and maintaining it for a year. This was mainly to train and develop a local person over the period who would then take over the work. This was aligned with the client’s model of transferring skills to the people in the community. The project was a pilot that will be replicated along farms in the same area and other regions on the African continent. GB: Do you see the agri sector as a key growth area for renewable energy (RE)? BM: The agricultural sector is a key growth area for RE. If we look at the above project, the farming co-operative is in one of the areas in South Africa that has not had access to electricity. There are a number of these areas around the country with this deficit, and implementing this project allowed us to see the immediate difference access to power has on the business operating model of the farmer as well as social benefits. For example, farmers can store their crops for longer periods during harvest time with refrigeration, something they were unable to do previously. In the case of implementing a solar irrigation system and replacing the manual one, the farmers’ time was freed for them to focus on other aspects of the business. As the agri sector is usually operates in remote areas, there are opportunities to implement microgrids that will enable farmers to operate their business more efficiently. It also allows them to have power security at an affordable price. www.alive2green.com/publications/green-economy-journal/
2017/11/09 12:21 PM
Green power for
KZN farmers Pele Green Energy is part of the Pele Energy Group, whose slogan is “Through knowledge and power”. This is borne out by their recent project of providing renewable energy to a farming collective in KwaZulu-Natal. Here we unpack the tech behind solar energy.
outh Africa has committed itself to reducing carbon emission, as envisaged in the Integrated Resource Plan (IRP), which serves to provide a framework by which the country’s energy mix can be accomplished. The benefits of renewable energy include: • A decrease in carbon emissions and the overall carbon footprint of the area. • A reduction in energy consumption, which in turn leads to the preservation of our scarce and non-renewable resources. Farmers in northern KZN’s uMkhanyakude District Municipality are now harnessing solar energy to boost their agricultural production. The initiative for developing this project in the municipality’s Ndumo area stemmed from the project partners’ Connectivity, Electricity and Education (CE3) programme which aims to strengthen existing businesses, create employment and build new businesses through the provision of clean, affordable electricity. The directive was to enable farmers to cover their operating expenses, including the cost of maintaining the solar-powered microgrid infrastructure.
Project location and site uMkhanyakude is the northernmost of the 11 districts of KwaZulu-Natal. It is a very rural district, the largest town being Mtubatuba in the south, with Hluhluwe, Mkuze, Jozini, Kwangwanase and Ingwavuma further to the north. uMkhanyakude is named after the yellow-barked fever tree, literally meaning “seen from afar”. One of the many villages in the province without adequate access to water and electricity is Ndumo. But through the advent of renewables, it has become possible for farmers to get off the electrical grid or access electricity. Management of electricity becomes much easier when it is handled onsite through the power of the sun rather than far away in the city. One solar-powered microgrid could provide farmers with the power needed to drive their irrigation equipment. A second, larger solar facility
GEJ 28 cdc.indd 7
could power a packhouse where the farmers can consolidate their yields, process and package their crops, and then send them out to markets. Another efficient application for farmers is solar-powered water pumps: an off-grid, ground-mounted installation consisting of a series of threephase AC submersible pumps operated directly from an array of solar PV panels.
The technology Solar PV Solar electricity is produced by changing sunlight to electricity using the photovoltaic (PV) effect. This causes an electrical current to flow through a solar cell when exposed to sunlight. Solar cells can power everything from calculators and remote highway signs to homes, commercial buildings and large power plants. In a solar PV system, solar modules are connected in arrays and mounted on a fixed tilt or tracker structures, with their optimum energy output controlled by a central inverter or a set of inverters. An inverter converts the direct current (DC) to alternating current (AC) electricity, which can be utilised in a packhouse. Technical options analysis In South Africa, the commercial and industrial PV market segment predominantly uses crystalline PV modules. The use of thin-film in commercial and industrial applications is very limited. Although there are some benefits of using thin-film PV technology over poly-or monocrystalline PV modules in certain applications, a combination of factors have limited the wide-scale adoption of thin-film PV technology in commercial and industrial applications in South Africa. Solar energy can be harnessed in a number of ways, including the basic PV effect using PV modules. Another method includes concentrated photovoltaic (CPV) systems. In general terms, CPV uses the same material as PV panels, but with layers of lenses. Solar radiation is concentrated onto the PV material using these lenses. In essence, it is using a magnifying glass to heat up the solar cells. This allows for more electricity to be produced.
7 2017/11/09 12:21 PM
CASE STUDY Concentrated solar power (CSP) generally uses mirrors to concentrate a large area of sunlight onto a small area. The types of CSP include troughs (a pipe or receiver tube connected to multiple mirrors), towers, and dishes (like satellite dish). The concentrated sunlight is used to heat a fluid, usually molten salt, which heats water to make steam. Molten salt stores heat efficiently, so can be stored for days before being converted to energy. This allows for additional power during peak periods, cloudy days, and the hours after sunset. To make a choice between the number of solar technologies, the following parameters are considered: • Technological capability • Financial viability • Economic rationale
Photovoltaic system Compared with other energy sources, solar power systems have been recognised as being economical, affordable, compatible with other technologies, able to reduce pollution, technically reliable and capable of producing energy savings. A high-level equipment operating curve schedule and PV system curve give an indication of the system capability to meet demands during any time of operation. Globally, solar power is highly attractive because of its ability to reduce carbon emissions, create sustainable new livelihoods, cut down electricity demand, help the growth of the green business sector and provide access to modern and affordable services to households while helping to meet renewable energy targets.
Table 1: Relative GHI and PV system production per location Durban
8 GEJ 28 cdc.indd 8
2017/11/09 12:21 PM
The KwaZulu-Natal coastal area exhibits lower irradiation levels than the inland provinces surrounding it. In parts of the country South Africaâ&#x20AC;&#x2122;s solar access is more than 2 500 hours a year, among the highest in the world, making solar energy its most readily accessible resource. In fact, in any instance solar is a viable source of energy in any part of SA. The 50kWp system installed in Ndumo has the capability to generate over 1 000 MWh/year. The battery system allows for the system to run during the night and supplement power consumption after sunset. A smaller 4kWp system drives the irrigation equipment, which allows for easy-tooperate irrigation at the farmerâ&#x20AC;&#x2122;s convenience, with a maximum flow rate of 43 m3/h. Adequate training was provided to a local person to maintain the system and ensure proper operation.
Credit: Thulani Ndaba
GEJ 28 cdc.indd 9
Pele Energy Group + 27 11 262 0515 www.peleenergygroup.com
9 2017/11/09 12:21 PM
Hydraulic hybrids are the future of
Ducere Holdings is the owner of MISER hydraulic hybrid transmission technology, the technology for transport in the future.
ur current major project and focus, The MISER Hydraulic Hybrid Transmission System, keeps us involved at the forefront of today’s automotive hybrid technology – and that’s where we like to be,” says André Reyneke, managing director. Their first product onto the market is MISER-HKS, a retrofit hydraulic hybrid transmission, specific for heavy-duty vehicles. “The MISER technology is a revolutionary new approach to kinetic energy recovery, engine optimisation, and storage and reapplication for any form of vehicle. The system complements various other technologies aimed at
dramatically improving fuel consumption, vehicle performance and total cost of ownership – while simultaneously reducing carbon emissions.” Reyneke says the technology enables more efficient energy recovery and engine optimisation than any competing technology. “MISER achieves this with a hydraulic solution using a combination of braking-energy recovery, engine optimisation and various modes such as torque summing, regenerative braking and launch assist. This provides an efficient medium for the fast storing and release of energy, while at the same time optimising engine performance by keeping the engine on the ideal Brake Specific Fuel Consumption line.
The pilot Miser installation was tested on this International truck.
10 GEJ 28 cdc.indd 10
2017/11/09 12:21 PM
The Miser hybrid hydraulic transmission installed in the International truck.
Miser pilot installation showing hydraulic storage.
Ducere Holdings director of technology and engineering Norman Grant and managing director André Reyneke in front of the truck with the pilot Miser installation.
“The MISER transmission is a hydraulic and mechanical, inﬁnitely variable dual-path energy-transfer system with a sophisticated microprocessor control system. It has fewer energy-ﬂow paths, fewer valves and fewer parasitic losses, such as charge pumps, than any existing hydraulic hybrid systems.” He says MISER is an enabler of electric vehicles. “The best electric vehicles are electric-hydraulic hybrids due to its more efficient regenerative-braking abilities along with the launch-assist, reducing peak battery loads.” The MISER transmission is a compound-type hybrid drive. In some modes it is a series system (where the engine can charge the storage system with energy for later use) and in other modes it is a parallel system (where the energy is delivered from the engine, or the storage system, or a combination of both). This depends on which of the 13 possible modes the control system selects for the MISER-HTS version. The MISER system can be installed in one of two ways. The ﬁrst option (recently made available to the marketplace) is the Hybrid Kinetic Energy Recovery System, or HKS for short. It involves the ﬁtment of the energyrecovery components only. Benefits are both regenerative braking and engine optimisation. The second installation involves the replacement of the vehicle’s original gearbox as well as the ﬁtment of the Hybrid Kinetic Energy Recovery system. This is called the Hybrid Transmission System – HTS. Several additional advantages include savings specifically advantageous in highway-type driving cycles.
GEJ 28 cdc.indd 11
“Our pilot project at a long-haul transport client using a heavy-duty truck delivered excellent results with MISER-HKS, showing fuel savings in certain drive cycles in excess of 40%. “The Gerotek Test Facility performed independent tests on the same truck and their results have confirmed ours, proving the efficiency of our technology. “We have also started our new project that uses a combination of our hydraulic version and other power sources, specifically aimed at smaller passenger vehicles. We expect the first few vehicles on the road in 2018. We believe that this will be a game changer as it incorporates a new way of thinking!” Reyneke says they see the immediate market potential of MISER as being aftermarket sales, followed by the new transmission and energyrecovery technology universally ﬁtted to all forms of motorised vehicles and transportation systems over the next eight to ten years. “Unlike electrical systems, that cannot scale due to technology constraints, MISER can comfortably be ﬁtted to a range of vehicles – from a small car up to very large excavator. This gives us a distinct advantage as we can participate in a far wider range of sectors. “Recent studies have shown that electric vehicles will benefit significantly from using hydraulic hybrids to improve current draw and improve battery charge cycles. While the world’s focus is on pure electric and electric-hybrid vehicles, there is very limited attention on the hydraulic hybrid solution. And this is the ﬁeld in which MISER aims to be the leader,” says Reyneke.
11 2017/11/09 12:21 PM
Next generation algae farm in Australia where high value biotechnology products are produced from nutrients found in contaminated irrigation water.
Heralding a fresh start for water Water expert Anthony Turton has been in the news often recently with the water crisis gripping Cape Town and other parts of the country. He is the man being called upon to tell the truth about why the water infrastructure and management is in the state it is in, and offer hope to a country that is in water debt. Here he discusses the available solutions and explains why we need a new discourse on water.
hen working on the Sovereignty Panel at the World Water Forum, chaired by Mikhail Gorbachev and the late Sir Ketumile Masire, I had many engagements with advisors to these former heads of state. One day, while having coffee in the Kyoto Starbucks in Japan, one of General Secretary Gorbachev’s advisors told me something that literally took my breath away. Rabbi Awraham Soetendorp, a Holocaust survivor, said, ‘A man can live for weeks without food, days without water, but not for a moment without hope’. It is hope that prevents us from succumbing to the malignant machinations of despair. South Africa is in a state of despair, which is why we need to inject a healthy dose of hope. The fountain of this despair is a failing state, driven by the theft of resources on an unimaginable scale by a greedy and seemingly untouchable elite. Nowhere is this more evident than in the water sector, with multiple failures now occurring simultaneously as dominoes fall in logical succession.
12 GEJ 28 cdc.indd 12
Water under siege Three of these failures deserve special mention: Cape Town has water in its dams only until March 2018. This is called Day Zero and must be avoided at all costs. KZN is generally in poor condition, but the Ugu District Municipality seated in Port Shepstone is particularly bad. Criminal gangs are sabotaging infrastructure and the ruling party has simply lost control. Assassination is commonplace as factions squabble over access to the feeding trough. Murchison Hospital has had no water for weeks on end, and could become the next Life Esidimeni. Gauteng has lost its water security because political elites have hijacked Phase 2 of the Lesotho Highlands Water Project as a vehicle of patronage. This means that Gauteng will increasingly be water constrained, at least until 2025, all things being equal. All of this bad news elicits a blame-seeking response by the public. This in turn triggers a blame-avoidance or blame-deflection defence, but this ping-pong game takes us nowhere fast. It erodes confidence and chases away investors, hastening our trajectory into a truly failed state. We therefore www.alive2green.com/publications/green-economy-journal/
2017/11/09 12:22 PM
WATER need a solution-seeking paradigm that creates convergence in a bipartisan way. This must bring the majority on board and it must be centered on policy reform that deals with the New Normal.
Our New Normal is about living within an economy that is fundamentally resource constrained.
“ I call it Business Unusual, in which new rules need to be invented, because all the assumptions of the past are no longer relevant. Business Unusual is a vibrant place filled with opportunities for all, so let’s unpack the three essential elements.
Three solutions The first element is about recovering water from waste. South Africa has over 50 million people and each produces around 100 litres of sewage waste daily. Our sewage works are mostly in a state of disrepair, so Step One is about upgrading those works and recovering the 5 000 megaliters per day – that’s 5 billion litres of water currently lost every day, but easily recoverable if we get smart.
The second element is about desalinating seawater for all our coastal cities. There is likely to be long-term migration to the coast as fundamental constraints inhibit growth in the hinterland, so this needs to be acknowledged, understood and anticipated. However, desalinating seawater uses a similar technology to recovering water from waste, so we have the power of synergy. The third element is to increasingly use groundwater, but in a very smart way. If we don’t replenish what we remove, aquifers will simply fail over time. There is an emerging technology known as aquifer storage and recovery (ASR), also known as managed aquifer recharge (MAR), now being implemented in Australia, Namibia, the US and elsewhere. This stores water for decades if need be, safe from the ravages of evaporation. But here is the beauty of the solution. Desalination is costly, so many smaller package plants are not the most effective way to go. Instead, a few well-placed but larger plants, capable of desalinating seawater while also recovering water from processed waste, gives sufficient throughput to bring the unit cost down to affordable levels. Surplus desalinated water is simply stored in aquifers for later use as needed, preventing the need to shut them down when rainfall is abundant. This is sustainable, but more importantly, it means that we will successfully navigate the transition from being resource constrained to becoming innovatively abundant.
Next generation desalination process using cryotechnology to recover fresh water from highly saline brine in a mine water desalination plant. www.alive2green.com/publications/green-economy-journal/
GEJ 28 cdc.indd 13
13 2017/11/09 12:22 PM
Water is a flux moving in time and space. It is therefore a renewable resource, theoretically capable of infinite cycles of re-use.
GEJ 28 cdc.indd 14
This transition takes us from a place where we will increasingly only survive to a place where we can truly thrive. Now is not the time to blame leaders for current failures, because that merely destroys the solution-seeking frame of mind needed. We must unite across the barriers that typically divide us – race, ideology and wealth – because we are all equally co-dependent on water. Let us create a new movement for change that conveys a message of hope.
2017/11/09 12:22 PM
A passion for energy management Energy services companies (ESCos) are driving energy efficiency in South Africa through innovative business models. We asked Lisa Reynolds, President of the Southern African Energy Efficiency Confederation (SAEE) Confederation, to tell us more.
As President of the SAEE Confederation and with the ESCo Association South Africa (EASA) being one of the divisions, you have an informed view. Do you see ESCos as playing a growing role in advancing the uptake of energy efficiency (EE) related projects in SA? EASA was formed in response to a need expressed by stakeholders in the energy, energy efficiency and renewable energy market. EASA represents the common interests of people and organisations that share our passion for energy management. Our members and newly elected chair Moses Motaung have the commitment and expertise to deliver energy solutions and services of the highest quality. I see the motivation for EE projects from two causes: 1. Energy price increases are in the double digit percentage range and will be for the foreseeable future. 2. South Africa has signed the Paris Climate Accord and has committed to carbon reduction. Reliable ESCos are the vehicle by which these targets can be met, as shown in this excerpt from EASA’s draft strategic document: EASA promotes the interests of our members by: • advocating for the adoption of industry best practices in energy efficiency, energy management and renewable energy. • providing support for capacity building and development of local energy services companies. • stimulating the growth of our industry through development of new markets for energy efficiency services. • collaborating with public and private sector to address national energy efficiency priorities. There is some uncertainty about precisely what ESCos do. Please define the most fundamental services they offer? ESCos assist their clients in identifying potential energy savings and implementing projects that leads to the savings being actualised. The services could be auditing, metering, costing, pay-back calculation, installation of energy savings measures or equipment, and implementation. You could say ESCos are EE project developers, using a variety of business models to access third party funding to cover the upfront capital expenditure (CapEx) typically required for energy related projects. What are the key contracts under which ESCos are able to finance energy projects?
GEJ 28 cdc.indd 15
ESCos were originally founded by the Eskom Demand Side Management (DSM) department, and the projects were subsidised by Eskom. However, when energy security improved the subsidies dried up. Because EE projects make good business sense, in most other countries they are not subsidised or funded by third parties. In South Africa, because of its history, it is expected that ESCos find and access third party funding for the upfront CapEx – and sometimes for the total project. The financial models could cover some shared saving contracts, skills development and/or job creation, or straight project payment. For example, the Department of Energy launched an ESCo registration that is managed by the South African National Energy Development Institute (SANEDI). The municipalities will access Division of Revenue Act (DORA) funding for the identified EE projects in their areas, and this is a municipality-specific model. Are financiers such as commercial banks sufficiently open to finance ESCo contracts, or do you believe there is scope to improve the level of accessibility to finance these contracts? The South African banking institutions are risk averse. Hence, even though most of them have “green funding”, they do not always seem to have the mechanisms by which such funds can be accessed. There are many hoops to jump, which the ESCos – especially the smaller ones – are not equipped for. Other sources of funding are more accessible, but there is often emphasis on other aspects, such as job creation, to access these funds. There is huge scope to improve this. The finance institutes need to understand how this sector works and adapt different procedures for mitigating the risk. Thus opportunities lie with the SAEEC and EASA to educate them. What are your key objectives for empowering ESCos and accelerating the number of EE projects in South Africa? We are in the early days of the formation of EASA and our main focus at the moment is to encourage potential members to join. We are looking at special rates for emerging ESCos and a different approach to projects by which they can receive coaching. I have requested that ESCos record the total energy and total carbon saved by their collective projects. These numbers will be communicated to demonstrate the contribution that EASA can make to government imperatives.
15 2017/11/09 12:22 PM
Agri and Manufacturing Investment
African agriculture is headed for the stars
16 GEJ 28 cdc.indd 16
2017/11/09 12:22 PM
Agri and Manufacturing Investment
lanet Earth has the capacity to feed the growing world population nutritiously for many years to come, but this is not happening. On the contrary, one billion people are undernourished, while two billion are struggling with obesity. This is a problem that economies of scale, monoculture and liberalization have not been able to change. Instead, the current food system, built as it is on large-scale mono cropping of maize, wheat and rice, is accelerating climate change, depleting natural resources and letting countless plant and animal species become extinct. Reversing this untenable situation will take a global effort. By moving away from the pursuit of profit maximization and opting for diversity, robustness and transparency, citizens, businesses and organisations can stop the loss of species and produce more varied and healthier food. Small-scale farmers are part of the solution, especially in Africa – but they need a helping hand. This is where impact investors like ALTVEST Africa come in. ALTVEST Africa is a private equity and venture capital firm and impact investment fund focused on the export-oriented development of smallholder farmers in Sub-Saharan Africa as well as related value chains. The fund integrates all actors in the value chain in order to profitably produce and deliver produce from small-holder farmers to international supermarket chains in the UK, South Africa and Middle East, markets where ALTVEST already has strong commitments. Rather than purchasing land in the manner of a controlling agro-industrial giant, ALTVEST focuses on making a viable and sustainable impact on small-holder farmers, engaging directly with individual farmers and helping them with certain key aspects of business in order to increase their output and profitability where previously there may have been none. Based in Harare, Zimbabwe, with additional offices in London, United Kingdom and Lusaka, Zambia, ALTVEST considers the entire agribusiness
value chain, from the farm right through to sales. Within agribusiness, the focus is on making growth investments in medium- to large-sized input providers and extension services, packaging facilities, logistics and cold chain, and trading; early stage and growth investments in any sized processing facility and small/ medium commercial farm; and seed and early stage investments in small-holders. The firm typically invests in small to medium producers in the subSaharan region, with a focus on Malawi, Mozambique, Tanzania, Zambia, and Zimbabwe. The preferred investment level, or deal size, is size is between 0.5 and 3 million US dollars (from venture capital to growth stage) across the agriculture value-chain (from the farm to fork). The firm seeks to make the first exit via the sale of a minority stake and the final exit via a trade-sale, initial public offering, contribution into a holding company for floatation, or setup of a special-purpose acquisition company (SPAC). Currently sourcing and executing deals with various capital partners, ALTVEST’s medium-term objective is to operate a group of companies that generate competitive risk-adjusted returns. Founding director Tichaona Seremani comments, “Our investment thesis sits on two strong megatrends: agriculture and Africa. Why agriculture? The global population is continually rising and food demand is increasing. Food production is restricted due to limits in arable land and low production yield. Prices of agricultural commodities are rising and expected to continue within the next decades. ALTVEST has identified an immense growth potential for small and medium producers in sub-Saharan Africa. We see robust growth dynamics arising due to improved political and macro-economic stability. Why Africa? As food security is globally a risk, productive land use will have to increase by 70%. Most of this land must come from Africa, which possesses about 60% of uncultivated arable land worldwide. This means that ALTVEST’s reference market will grow from $280bn a year today to $500bn in 2020 and $880bn in 2030.”
The ALTVEST team Tichaona Seremani, Founding Director An economist with 10 years experience in international business gained from advising high-growth companies in Europe, Asia and Africa. Tichaona has experience identifying acquisitions, investors and markets as well as advising business leaders and entrepreneurs. He holds a Bachelors in Economics, a Masters in Logistics and Transportation Management and is currently in an International Executive MBA program.
Theophilus Kudya, Chief Financial Officer Previously an Audit Senior with Deloitte where he was responsible for a considerable number of agricultural related assignment both listed and unlisted. He was Financial Director at Sara Lee, Zimbabwe for 7 years and was head of Finance at Selby Enterprises, an agricultural entity involved in the agricultural chain for 2 years. He hold a Bachelors in Accounting Science Hon from UNISA and ZCTA from the Insitute of Chartered accountants Zimbabwe.
Francois Molife, Senior Associat
Altvest +263 4444 005/6 www.altvest.com www.alive2green.com/publications/green-economy-journal/
GEJ 28 cdc.indd 17
Background in Treasury Management, Investment Management, SME Development and Financing in South Africa, Malawi and England. He worked for the IFC’s African Management Services Company (AMSCO), Kingdom Bank where he rose to the position of Managing Director, FMB, SEF Prospero Capital. Francois holds a bachelors degree in Banking and Finance, Master of Business (University of Zimbabwe) and operates a trade finance company.
17 2017/11/09 12:22 PM
Agri and Manufacturing Investment
A mutual benefit approach What makes ALTVEST stand out from the crowd is the way it works in partnership with its portfolio companies. By providing portfolio companies with expertise that they may otherwise not have, the firm creates a close working relationship with the management teams of its portfolio companies. For the most part, the firm does not involve itself directly in the day-to-day operations of portfolio companies. Instead, the firm typically seeks to create value by collaborating with management in identifying and executing financial, operating, and strategic priorities, and providing expertise in these tasks that the management team may not have. In addition, Altvest typically will have seats on the company’s Board of Directors or Advisory Board. Through these seats, the firm can actively and directly influence the operational and strategic decision making of the company. Also on offer are monitoring and reporting, comprising active postinvestment monitoring of management accounts and financial reporting, active post-investment monitoring of the financial and operating control environment and frameworks, ongoing monitoring of and mitigation against identified financial, operational and other risks, and ongoing monitoring of compliance with environmental and legal requirements. This level of expertise really makes it much easier for farmers to concentrate on what they do best without having to worry about technicalities beyond the capacity of most small and medium companies. Investment performance valuation is also taken care of, in the form of board representation, measurement of identified Key Performance Indicators (KPIs), assessment of identified KPIs against industry competitors, assessment of KPIs against management forecasts, and constant assessment of KPIs against investor short and medium term targets and goals. At the end of the day, the name of the game is to grow African agriculture. As Seremani comments, “We make it our business to contribute to the development of African small-holder agriculture. Our aim is to combine sustainable returns for our investors with a long-term positive impact on society. We strive to support African small-holder farmers by providing financial support, technical know-how, market expertise and market access in collaboration with local producers and international buyers. Our mutual benefit approach delivers excellent performance to our investors and contributes sustainably to poverty eradication and food security in sub-Saharan Africa.”
18 GEJ 28 cdc.indd 18
High social impact The wellbeing of the community is at the heart of everything ALTVEST does. This means that in addition to analysing the likely financial profitability of a new investment, the social impact is also carefully considered. By way of example, a recent analysis of a seed distributing company looked at job creation, food security and drought resistance. The findings provide excellent insight into the fine-grained detail that ALTVEST considers: “Financing this company will create 155 new jobs within the company and more than 750 new jobs on farms for production of seed foundation, grandparent seed, parent seed and finally certified seeds. This will produce a better lifestyle for economically disadvantaged people around the neighbouring communities. “Current average yield for maize production per hectare is between 0.7 and 3.6 tons. This company’s maize seed varieties have a potential average yield of up to 15 tons per hectare. During the 2013/14 season, Zimbabwe imported 465 000 tons of maize. Funding this company will increase food security since the seed variety it produces has high yield per hectare. “The seed variety is also drought resistant, and will increase community resilience. More than 50% of areas in Zimbabwe are classified are drought prone (i.e. regions III, IV, and V) where rainfall is less than 800m. Three out of four Zimbabweans are living in poverty and heavily populated drought-prone regions.”
2017/11/09 12:22 PM
Agri and Manufacturing Investment
Scalability is key, Seremani adds: “No opportunity is too small if it can be scaled quickly, efficiently and sustainably. We identify targets with very strong fundamentals such as small-holder base, visionary entrepreneur, strong market dynamics, etc, that we can then complement them. What we bring to the table is a window of opportunity for growth and an international perspective that can make a local raw gem into a regional star.” Under this strategy, the region has a bright future: “Together with Zimbabwe, Zambia constitutes the core of our target investments. Not only does our team have extensive expertise on the ground, but we believe the region has the highest potential for growth and impact over the coming decade. Other countries that we target include: Malawi, Mozambique and Tanzania. We will consider ventures from across the region if we see a strong strategic fit. Ultimately, we strive to work with as many small-holder farmers as possible. We aim to realize their potential, impact livelihoods and communities while providing a sustainable return for our investors.”
Investment case study ALTVEST, the most active institution for small-holder farmers in the subSaharan region, and Yambeeji Honey & Rice Products were brought together by the VC4Africa (Venture Capital For Africa) Booster program, which supports a select number of VC4Africa listed ventures and helps prepare them for investment. In line with Alternative Investments Africa (ALTVEST) long-term strategy, ALTVEST acquired a majority stake in YamBEEji Honey & Rice Products Private Limited Zambia (YamBEEji). The agreement was signed on 1 May 2012 in Lusaka by ALTVEST’s Tichaona Seremani and Chibbonta Chilala (CEO of YamBEEji). After running his farm for several years, Chilala was looking for expansion capital. ALTVEST’s investment enabled him to integrate 5 000 farmers and 30 000 hectares of farmland, positioning YamBEEji as a major rice producer in Zambia. Thanks to ALTVEST’s network of distributors as well, YamBEEji was able to not only scale up production but also increase its market access. www.alive2green.com/publications/green-economy-journal/
GEJ 28 cdc.indd 19
According to fund manager Stefano Benedikter, speaking to Venture Capital for Africa, there is a very strong element of human synergy at play between investor and portfolio company: “From the day we started our conversation with YamBEEji we were convinced we would do it. There is an incredible fit between the local assets, especially human capital, at YamBEEji and the platform that ALTVEST has brought to the table. Chibbonta is a visionary with very strong management skills. Through ALTVEST he will be able to take the organisation to the next level, become a centre of gravitas for rice producers in the region, and potentially start playing an international role very soon.” Commenting on the type of assistance that ALTVEST was able to provide, Benedikter said, “Financing is the most obvious and apparent contribution; sound financial management, operational synergies, market access, branding and international channels are the most important contribution that ALTVEST is making. We aim to be very active in all our portfolio companies; we understand that execution is key and announcing an investment is just the initial whistle that kicks-off the game. ALTVEST and its team are set to contribute majorly in the development of YamBEEji.” As a result of ALTVEST’s intervention, YamBEEji was able to implement a new strategy that significantly increased farmer-level productivity and therefore production processing plant through-put. Building on its already formidable reputation with consumers because of the aroma and flavour of its rice, the company was able to strengthen its out-grower base throughout the north-western province of Zambia while meeting the previously unmet demand for rice within Zambia and other SADC countries. Through ALTVEST’s material investment, comprising fresh equity capital, working capital financing, machinery for further mechanisation and management support, YamBEEji has been able to integrate 5 000 farmers and manage 30 000 hectares of farmland, advancing to become the centre of gravity for rice production in Zambia.
19 2017/11/09 12:22 PM
GEJ 28 cdc.indd 20
2017/11/09 12:22 PM
Air + Sunlight + Water =
Productivity By Gillian Gernetzky
Only 53% of wage earners think their place of work helps their productivity. And with good reason. The broad and ongoing Leesman Index* joins the dots between Maslow’s hierarchy of needs and the most common employee complaints about their surroundings.
his is according to Workplace Strategies and Change Manager Nigel Oseland, addressing the Green Building Convention 2017 hosted by the Green Building Council South Africa (GBCSA) in Cape Town in October. “Only once we meet our lowest level of needs can we go on to achieve our potential. It’s got to do with health at the bottom of the pyramid – so air, light and water,” he explained. A quantified relationship between productivity and air quality, noise and temperature, established by more than 200 studies, shows the average 5-7% increase in employee productivity easily covers any cost premiums of working in a healthy space that assists attention and concentration, Oseland added. Advantages to each element of office space “Deep buildings with windowless workspaces must disappear,” Concurred Professor Vivian Loftness of the Carnegie Mellon University School of Architecture in Pittsburgh, Pennsylvania. “These buildings, by definition, lock in a chemical soup of materials and occupant activities with serious consequences for human health. From asthma to skin and eye irritations to reproductive health and cancer. They do this by locking out the natural conditioning resources of passive solar heating, daylight, ventilation and passive cooling.”
by more than 30 minutes in six-year-old learners. In a separate study, poorperforming learners slept 25 minutes less and went to bed 40 minutes later on school nights than good performers. Natural air flow brings better concentration In 2015, a double-blind office study on increased outdoor air ventilation rates and controlled volatile organic compounds (VOCs) identified a 42% increase in average cognitive scores when working in a green building, and 51% increase when in a “deep green” building, versus a conventional building. “Besides increased worker performance, natural ventilation saves 20- 40% of cooling and 70% of ventilation costs. Net-zero buildings will be designed for natural ventilation as the dominant ventilation and cooling strategy for every possible hour, enhancing productivity, human health and community,” she predicted. Typical improvements brought about a financial return of 756%. Views from desks help focus “Call centre agents had a 6- 7% improvement in handling time simply by having seated access to views through larger windows with vegetation content, amounting to a return on investment (ROI) of 299%,” Prof Loftness added, citing a study explaining why a visual connection to nature is important.
Shorter hospital stays in sunny rooms “Nature’s renewables are at the centre of human health and environmental resiliency,” she continued. “As humans we have a natural affinity to nature, known as biophilia. We will rediscover the engineering and art of effective daylight design, and not only because studies show that if you are in a sunny hospital room you’ll have a 26% reduction in length of stay, but because it can displace 30- 75% of lighting needs and 25- 75% of heating demands. We should not have to turn on lights in the daytime.”
Market’s growing demand for green It’s beyond dispute that people with access to the natural environment are healthier and that it facilitates productivity. It is expected that future tenanting requirements will include above-ground views, window and outdoor access, operable windows, natural ventilation, mixed-mode conditioning, daylight and indoor plants. “And considering associated productivity gains, the payback period is sometimes measured in months,” concluded Loftness.
Daylight restores sleep cycles “Our brains are stimulated by daylight,” Prof Loftness continued, citing research linking exposure to morning sunlight to an improved sleep time
*Leesman Index: Since its launch in 2010, data from corporate workplaces in 67 different countries has been gathered. Today, the Leesman Index is the largest independent collection of workplace effectiveness data in the world.
GEJ 28 cdc.indd 21
21 2017/11/09 12:22 PM
Hugh Tyrrell, a pro-environmental behaviour change and communication consultant with more than 20 yearsâ&#x20AC;&#x2122; experience in the recycling and waste management field, traces the abundance of waste to the origins of consumerism and states the case to revise economic thinking and systems to create a circular economy in which waste is re-used and ultimately designed out of the production and consumption process.
22 GEJ 28 cdc.indd 22
2017/11/09 12:22 PM
he massive burden of waste generated around the world is topping up landfills, clogging waterways and spilling out into the oceans. South Africa alone produces some 60 million tons of general waste a year, only a tenth of which is recycled (DEA, 2013). Waste management remains largely “end of pipe” focused, rarely challenging the reasons why there is so much of it in the first place.
Where does waste come from? Its origins go back to the creation of the “mass consumer society” in the 1950s. In the period just before that, during the Second World War (19391945) people had to be very sparing in the way they lived. All over England, people grew food in their backyards and allotments or so-called “victory gardens”. In the US people were not allowed to buy new cars during the war, as all metals had to go into planes and tanks and other weaponry. Being frugal and re-using everything as much as possible was a patriotic duty and everyone did it. But once the war was over, factories that had been producing armaments so efficiently stood empty and soldiers coming back in their thousands needed jobs.
The US government called its economic experts together. Their advice was to retool the factories for mass production of fridges, stoves, appliances, cars and all the other conveniences of daily life we now take for granted. Marketing and advertising became mainstream business practices during that time, urging people to consume – and consume they did. The result was a better standard of living for millions, but also increasing amounts of waste. The book The Waste Makers by Vance Packard (Penguin, 1960) details the birth of planned obsolescence and many other sales techniques used to urge people to buy a lot more than they needed. Consumer society is therefore not, as many believe, a natural progression of Western society’s development. It was mainly the outcome of economic policy decisions after World War 2, promoted by the US and thereafter UK and European governments, and readily taken up by commerce and industry.
Throw-away society Since then, banks continue to give loans on good terms to industrial companies to enable them to buy machines to make more and more products that the companies must then sell – hence the need to keep people buying “new” products and the importance of marketing. Debtbased money creation by banks has provided easy credit for people to consume (while putting many in debt), helping to lead to the “throw-away society” and massive volumes of waste. This is perfectly illustrated in the animated video The Story of Stuff by Annie Leonard. Downloaded more than 750 million times, it is a classic and highly recommended viewing for anyone who wants to know the bigpicture issues around waste production and prevention in simple terms. It also highlights the need to shift economic thinking and systems to a more circular state where waste is either re-used or designed out of the production and consumption process. As this does not seek to oppose but instead reform our industrial economic system, it is gaining acceptance among companies worldwide. One of the organisations leading this is the Ellen MacArthur Foundation. Economists who have championed “steady state” economics include Herman Daly, among others.
A circular economy The shift to eliminating waste from the consumer cycle is also advocated in the recent UN Sustainable Development Goals (No. 12: Sustainable Consumption and Production). In South Africa, circular economy thinking and practice is gaining ground too, particularly among waste and recycling industry players, as it acts as a positive overarching framework for their operations. Interested sector leaders in South Africa are engaging on the LinkedIn group African Circular Economy Network (ACEN), which encourages collaboration and discussion on the opportunities and challenges ahead. On a finite planet like ours, any ideology, programme or practice that encourages ways to optimise resource use and reduce waste is to be welcomed. Read the Circular Economy article published in GEJ 26 on ISSUU.COM.
GEJ 28 cdc.indd 23
23 2017/11/09 12:22 PM
GEJ 28 cdc.indd 24
2017/11/09 12:22 PM
Greening the economy One crate at a time By Nomathemba Mhlanga Global supply chains are changing. According to Ernest & Young, they are becoming more resilient to fluctuating market conditions, while steadily adapting to externalities such as climate change and raw material shortages. These changes bring with it the need for a shift in conventional supply chain management, demanding of supply chain solutions providers to develop shared commitments with suppliers and customers that enable all parties to achieve their sustainability and other strategic goals.
owering carbon emissions and reducing food waste are just some of the principled business practices that supply chain solutions provider, CHEP is focused on. Speaking to Nomathemba Mhlanga, Senior Sustainability Manager for CHEP, she explains that the company has built its business model on the notion that profit and planet need not be a compromise. “Through the successful combination of our circular ‘share and reuse’ business model, our global scale of approximately 590 million reusable pallets, crates and containers, as well as our supplychain expertise, we have been able to decouple our growth from natural resource consumption. We’ve done this by providing sustainable supply chain solutions that focus on maximising the use or our equipment, while minimising the impact on the environment.”
The case of CHEP and Pick n Pay A real world example of how CHEP is helping its customers to achieve their sustainability goals is found in the migration of Pick n Pay onto CHEP’s foldable Reusable Plastic Crates (RPCs). This compact solution enabled the retailer to fit 5120 more crates onto each of their trucks during the return leg of their trips. It translates to a 285 percent increase in truck utilisation as well as a drastic reduction in CO2 emissions and transport costs.
The diagram illustrates the CHEP share and reuse model
The role of RPCs in the prevention of food waste The use of RPCs further enables Pick n Pay to reduce package related food waste. According to National Geographic magazine, ‘if food waste were a country, it would be the world’s third largest emitter of greenhouse gases, behind the U.S. and China’. This is because food decomposition generates methane gas - a greenhouse gas 21 times more harmful than carbon dioxide. Pick n Pay CEO, Richard Brasher, recently stated that a staggering third of all food produced in South Africa is wasted, at a cost of R60-billion a year. This is a figure that is equal to 2% of the country’s Gross Domestic Product (GDP) and can be attributed to various reasons, amongst which are inefficiencies in supply chains in moving goods from producers to consumers. Highlighting the fact that local distribution processes, in particular, are in desperate need of greater efficiencies to reduce the amount of food ending up in landfill sites. A 2013 study conducted by Fraunhofer Institute for Material Flow and Logistics and the Cold-Chain Management Working Group at the University of Bonn finds that 8% more produce arrives damaged in disposable packaging compared to reusable packaging. Thus, for 1.8 billion pounds of fresh produce shipped annually, approximately 14.4 million pounds of fresh produce food waste caused by physical damage in transit can be prevented by using RPCs.
Investing in Food Banks
PICK N PAY PALLETS
GEJ 28 cdc.indd 25
CHEP provides standardised pallets, crates and containers to customers from its service centres as and when the customers requires.
Customers use this equipment and CHEP’s support services to transport goods through the supply chain.
Customers either arrange for the equipment’s return to CHEP or transfer it to another participant for re-use.
Another key sustainability initiative CHEP supports is food banks, such as FoodForward SA. This organisation collects edible surplus food from manufacturers, wholesalers and retailers, and redistributes this food to verified Non-Profit Organisations that collectively feed thousands of hungry people. “In celebration of Mandela Day 2017, CHEP partnered with FoodForward SA and Pick n Pay, providing them with the equipment needed to move donated food from point of donation to point of need,” explains Mhlanga. Foodforward SA estimates that about 6000 tons of food is saved every year through such efforts. This translates into 18 - 20 million meals per year, contributing significantly to food security in South Africa. Says Mhlanga. “Our collaboration with Pick n Pay shows that it is possible to transition towards more efficient, sustainable and long lasting supply chains through adopting holistic approaches towards the delivery of goods. “ For more information contact Nomathemba Mhlanga on (011) 842 4556 or e-mail her at firstname.lastname@example.org. www.chep.com
25 2017/11/09 12:22 PM
Keeping it one sided By Margareta Merke, founder of Boostani
Boostani is part of the Brightlands Innovation Factory, one of the biggest startup ecosystems in Europe. They enable big ideas to be formulated into solid business models. Their support of Boostani could significantly increase the network and interest in monolayer packaging and help save 30 % of plastic material used at the outset.
he long-term consequences of plastic waste (250 million tons per annum) is one of the biggest challenges of the century. Annually the amount of plastic waste increases dramatically with an increasing middle class who have a high demands for goods. After visiting east Africa and southern Europe where I observed plastic bottles and fishing nets washed ashore daily, I asked we can reduce this waste. I studied plastic material processing at RWTH Aachen University in Germany and founded the startup company Boostani because I am convinced that there is a long-term solution to plastic waste. Boostani develops material solutions that simplify recycling while keeping the unique properties of plastics, such as creating barriers against bacteria (useful in fresh food packaging) and its low weight (offering energy savings in transport). Cleaning the ocean of plastic waste is like treating the symptom of a disease and not the cause, which is why Boostani aims to reduce the amount of plastic materials already in the production line. Plastic converting companies could reduce their costs for material by up to 30% if they used Boostani material, and it is easily recycled.
26 GEJ 28 cdc.indd 26
Turning multi into mono After conducting numerous interviews with companies from the plastic industry, I developed a compound that can eliminate the main difficulties in the recycling of plastic-based packaging. Plastic packaging often consists of more than one material because different properties such as barriers, printability, and durability must be achieved. Different plastic materials are put in layers on top of each other, creating multilayer packaging which is difficult to recycle because the different layers must be separated. This process consumes a lot of energy and not all layers are easily separated. Furthermore, the multilayer technology dramatically increases the amount of plastic material needed. The Boostani compound can be processed into monolayer packaging, thereby offering advantages over current solutions for both plastic producers and the environment. It can also be produced using bio-based polymers instead of petrochemical polymers. The costs for material are the biggest factor when producing plastic packaging. Monolayer packaging saves material and is more sustainable and affordable, meaning long-term value for plastic producers. The first prototype by Boostani will be completed in early 2018 and sales to potential customers are scheduled thereafter. www.boostani.com
2017/11/09 12:22 PM
Outside the box By Kamogelo Mmutlana, CEO of Barloworld Logistics
Over 70% of potential savings and service enhancements in a supply chain come from the re-engineering and integration of logistics processes. Here’s how 3D printing is transforming global supply chains and creating strategic advantage for companies and brands by integrating their logistics processes and information flows, thereby radically reducing their costs and increasing their service levels.
s part of its SupplyChainForesight2017 report, Barloworld Logistics investigated and identified the key technology tools and platforms shaping the world’s supply chains. With highly disruptive forces now coming into play in the corporate sphere, it is essential that leaders and decision makers plan for the close integration of certain technology tools and trends. Chief among the trends to emerge this year were 3D printing and its extension, “factory-in-a-box”-style production. It is clear that 3D printing is going to have a major impact on the supply chain, and as a company that enables smart supply chain management, we believe now is the time to investigate how and where this technology can be leveraged most effectively. Indeed, while it has been in an incubation stage for some time, 3D printing appears to be entering mainstream consciousness – in every sphere. Around the world, businesses, governments and educational institutions are embracing 3D printing technology.
According to the global Wohlers Report 2016, the 3D printing or additive manufacturing (AM) industry grew 25.9% in compound annual growth rate (CAGR) to reach $5.165 billion in 2015.
“ The report notes that industry growth consists of all AM products and services worldwide. Endless benefits and unlimited freedom Looking ahead, management consultancy McKinsey has forecasted that 3D-printing could have an economic impact of up to $550 billion a year by 2025. The benefits are endless, including unlimited freedom with regards to product design and manufacture, as well as lowered production costs. From medical implants and prosthetics produced in a day to low-cost housing, this technology will change our world. Major brands and corporates are already harnessing additive manufacturing to get ahead in competitive markets. For example, Nike is partnering with HP and using the HP Jet Fusion 3D printer to produce 3D-printed footwear at greater speeds than ever before, reaching a dizzying new height of customisation and innovation. www.alive2green.com/publications/green-economy-journal/
GEJ 28 cdc.indd 27
As The Economist reports, 3D-printed objects are increasingly being produced “as finished items, rather than as models or prototypes”. The publication cited a PricewaterhouseCoopers (PwC) report that concluded that “more than two thirds of American manufacturers are now using 3D-printing in some form or the other”. Notably, US corporate juggernaut General Electric (GE) has invested $50m in a 3D-printing facility at a plant in Alabama, designed to print up to 40 000 fuel nozzles a year for the new LEAP jet engine it is making in partnership with a French company. While 3D-printing or additive manufacturing has yet to make a significant impact in South Africa, business leaders need to start thinking about how this trend will impact the supply chain, and also where the risks to their own business lie. Ready for “factory-in-a-box”? With additive manufacturing firmly on the horizon, some analysts are predicting the rise of a “factory-in-a-box” scenario, in which we will no longer need multiple machines to make a single product. In the near future, each individual 3D printer could be able to print several different materials using multiple processes in multiple, decentralised locations. As a result, logistics and supply chain management could be drastically transformed. Instead of serving large, complex networks, we may soon be tasked with enabling nimble, innovative, garage-sized industries. Although the emergence of a “factory-in-a-box” era may seem too unlikely and perhaps too far away to even consider, the onus is on every leader to make calculated decisions that will protect existing businesses from such disruptive forces. Without doubt, the key is to move with the changes, not against them – which means thinking outside the proverbial box in every way. Visit Barloworld-logistics.com for more information.
27 2017/11/09 12:22 PM
BH Easy Motion e-Bikes • Powered by Bosch electric motors and Panasonic batteries • Pedal-assisted electric power Maximum speeds of up to 45 km/h with a range of up to 125 km • Battery lifespan of 30 000 km or 500 charges (20% max deterioration) • Choose between dual suspension or hard tail
GEJ 28 cdc.indd 28
2017/11/09 12:22 PM
www.bhsouthafrica.co.za CONTACT Email: email@example.com Tel: 021 715 7182 GEJ 28 cdc.indd 29
2017/11/09 12:22 PM
082 354 1269
Providing quality Solar Photovoltaic (PV) systems for domestic and commercial clients in South Africa since 2014.
PV systems range from small, rooftop mounted systems that supply power to an individual household, to large utility-scale power stations.
Offering grid tied systems connected to the electrical grid and off-grid systems with batteries storage to supply power after sunset.
We aim to keep solar simple.
In addition to Solar PV, we offer Smart Metering installations and conduct Energy Audits.
GEJ 28 cdc.indd 30
2017/11/09 12:22 PM