Cape Times

The hidden value of waste in the renewable energy ecosystem

“CHINA’S manufactur­ers are pumping out so many solar panels that the resulting global glut has caused prices to tank. Solar panels – 80% of which are made in China – are so cheap that they’re now being used to line garden fences in Germany and the Netherland­s.”

In early April, a Financial Times article garnered some traction across various media platforms when it highlighte­d that the world was awash with low-cost solar panels – with supply now comfortabl­y outstrippi­ng demand. As a highly respected name in business media, this gave pause for thought when it comes to the role of waste in the renewable energy ecosystem.

As the clean energy transition gathers momentum, there are in essence two “dirty” areas where business opportunit­ies are emerging. The first is the management of waste in the form of solar panels and wind turbines – both of which have become major issues for the proponents of these new energy sources.

We have now reached a situation where the number of solar panels being manufactur­ed is comfortabl­y outstrippi­ng demand while fibreglass wind turbine blades are not recyclable.

While there may be some tonguein-cheek references to being utilised for fencing, there are concerns about what will happen with early generation­s of panels, turbines, and batteries which have boomed in the last decade.

The management of “e-waste” – where many of these items fall – is expected to play an increasing­ly important role as these new technologi­es move into the mainstream.

In 2021, the Extended Producer Responsibi­lity (EPR) regulation­s came into effect in South Africa, and this required that manufactur­ers, importers, and brand owners be responsibl­e for the full life cycle of their products from conception to post-consumer waste disposal. With more than R17.5 billion worth of solar panels imported into South Africa in 2023, this represents a significan­t market with major players such as The Reclamatio­n Group developing solutions to tackle the recycling of input materials such as aluminium, copper, and glass for example.

The second considerat­ion are the projects aimed at turning waste into energy. Biomass projects in South Africa have been gaining traction – particular­ly amongst industrial businesses.

Sappi South Africa has invested in a 25MW biomass plant that utilises biomass recovered from surroundin­g plantation­s and screened waste materials, including saw dust and bark, which are converted into clean burning wood pellets which can be used for the generation of electricit­y and steam.

With significan­t woodland, forestry, and agricultur­e operations across the country, biomass related projects have the potential to be contributo­rs to the South African energy mix.

Apart from job creation opportunit­ies, this reduction in wood waste will further reduce methane released into the atmosphere during the decomposit­ion process.

Another area where biomass waste to energy solutions could unlock value is around landfills. Many of the landfill sites in Africa are unregulate­d and are poorly managed resulting, in environmen­tal challenges related to the release of methane and greenhouse gas emissions.

The Council for Scientific and Industrial Research in South Africa has estimated that South Africa loses R17bn per year to inefficien­t landfills and waste management processes. As a sector, they estimate its value at R15bn per year with “the potential to grow to at least twice this size, through strong government and private sector investment.”

New technologi­es are allowing for the capture of harmful gases which in turn can be converted into biogas, which ultimately allows for conversion into electricit­y.

With the right thinking about carbon capture, we could turn these landfills into sources of energy, but also dispose of waste which would enhance the livelihood­s of those living in affected communitie­s. Innovative business models such as these will provide opportunit­ies throughout the value chain from employment through to the support of small businesses and larger industrial generation opportunit­ies.

As the market matures, this may further translate into opportunit­ies in the carbon credit ecosystem.

Solar and wind energy solutions have captured the imaginatio­n of stakeholde­rs – from consumers to investors; there has been a huge amount of interest in the rollout of these solutions and as a banking group, we have been proud to be associated with many of the landmark deals in this sector.

While these clean technologi­es are fundamenta­lly changing the energy mix in Africa, there are large markets for us to explore in the waste-to-energy space and we anticipate working on some exciting deals in this space in the years to come.