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Why Africa’s best climate opportunities can be found in the unlikeliest places

Renewable energy is not limited to natural sources such as wind and solar. The continent’s cities produce plenty more… in the form of waste

Hello – one wag at the UN Environment Assembly in Nairobi this week succinctly observed: “The unsexy will inherit the earth.”

Few entrepreneurs & investors have noticed. Waste management is rarely the first choice of opportunity-seekers. Many are eyeballing “EV” or carbon credits.

But less sexy fruits often hang lower. Landfills contain climate-damaging methane… which happens to be an exploitable source of immense energy.

There are role models. The US waste industry turns over $700 billion a year with an average operating profit of 25%, while reducing emissions.

Today’s reading time: 4 mins

LOGISTICS UPDATE | Thursday 29 February

🌳 Countdown: The UN Environment Assembly is closing tomorrow

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🏆  Agenda: The Margaret Awards ceremony will take place on 7 March


🥬 Job: Apollo Agriculture seeks a product manager (Amst-Nbo)

🗃️  Other report: Showcasing sustainable business evolution by BIMG

Waste management is one of the largest unclaimed opportunities for green entrepreneurs in Africa.

  • The benefits were highlighted at the launch of UNEP's Global Waste Management Outlook at the UN Environment Assembly in Nairobi this week. 

The chance: Waste management strategies could inject an additional $8 billion annually into Africa's economy, fostering growth and jobs, says the UN. 

  • Building successful waste-tech companies is aided by a lack of competition. The sector is overlooked by most mainstream operators.

Power potential: The US already generates renewable energy from waste at more than 2,000 sites. 

  • At full scale, the sector’s benefit could eventually be equivalent to removing all American commuter vehicles from the roads. 

Why it matters: Landfills generate methane, which is 80 times worse per tonne for the climate than carbon. 

The pioneers: A few African startups in the waste sectors are pursuing the opportunity. 

  • Mr Green Africa targets the informal plastic recycling sector in East Africa.

  • Taka Taka Solutions manages 60 tons of Nairobi rubbish daily, recycling 95% of it.

  • Vicfold Recyclers, established in 2016 in Nigeria, works with university campuses.

  • Bekia, an Egyptian startup launched in 2017, exchanges household waste for points, redeemable for various goods and services.

The backers: Most progress is due to government support rather than private investment. 

  • Bans on single-use plastics in 30 African countries reduced pollution, setting a precedent for effective waste management policies. 

  • Senegal, Ghana and others have targeted sanitation and collection campaigns. 

  • Kenya introduced the concept of “producer responsibility”, holding manufacturers accountable for waste management.

Regulated industry: Every new government policy tends to create opportunities for someone to be paid to implement or comply with the rules.  

  • The African waste management market is estimated at $22 billion in 2024, projected to reach $28 billion by 2029.

  • Interested outside parties include the IKEA Foundation and the IFC.

Catch up quick: The underlying reason for tackling waste is climate change. Methane from human waste is equivalent to more than 10% of the continent's CO2 emissions.

  • Africa releases 4.7 million tonnes of methane annually from open dumps and landfills, equivalent to 160 million tonnes of CO2. 

  • Burning waste contributes another 1.2 million tonnes of black carbon emissions yearly, affecting air quality and climate patterns.

Between the lines: There are also immediate health benefits from tackling waste disposal. 

  • Improper landfills can contaminate water sources, such as at Ghana's Agbogbloshie site.

The solutions: No single technology can solve the waste problem. But the way forward is clear.

  • The World Bank says that embracing circular economy principles could reduce plastic waste by 40% to 50% by 2026.

  • Large-scale composting facilities and e-waste recycling plants offer avenues for organic waste utilisation and resource recovery. 

Zoom out: The amount of waste in Africa is already substantial. 

  • The average African generates 0.45 kg per day, lower than the global average at 0.75kg

The driver: Urbanisation and population growth lead to increasing waste piles in cities lacking infrastructure and investment. 

  • Large-scale recycling and recovery technology could cost up to $42 billion in the short term, says the UN.

What’s next: African waste volume is estimated to triple from 174 million tonnes per year in 2016 to around 516 million tonnes by 2050.

  • Only a combination of small-scale community-driven initiatives and large-scale public-private ventures can tackle waste effectively.

(i) Organic waste including food makes up at least 57% of the total and generates harmful methane gas in landfills.

(ii) Construction waste (10-20%), mostly debris, also ends up in landfills and creates dust pollution.

(iii) Plastic waste (13%) litters land and sea; only 4% is recycled currently. 

(iv) E-waste (1-2%) results from discarded devices and can leach into rivers from ill-run scrapyards.

(v) Textile waste (<1%) up to four fifths of second-hand clothing imported into Africa is unusable and discarded rather than sold. 

(vi) Vehicle waste (<1%) is less of a problem than many assume since even the oldest cars tend to be cannibalised to exhaustion rather than dumped.

…is by how much Africa’s GDP will fall every year in the long term as a result of climate change, according to a new study. Also projected is a 30% fall in revenue from crops and resulting hunger for 200 million people. Developing countries will feel the main impact of a warming world.

4. Network corner

E3 Capital and 4DX Ventures lead Hohm Energy's $8m seed round to grow a platform that connects customers to solar suppliers.

Go Electric Ltd, the Kenyan electric vehicle dealer, unveils new electric and solar vehicle models in Rwanda.

d.light and Chapel Hill Denham have closed $7.4 million in securitised financing to fund off-grid solar expansion in Nigeria.

Hetal Patel is Director of Investments for Mercy Corps Ventures, an impact fund invested in 47 early-stage companies and more than $440 million raised in follow-on capital. Among the portfolio companies are Pula, Tolbi and Complete Farmer. 

Q: Why invest in climate ventures? A: With the adaptation market potentially reaching $2 trillion annually by 2026, there's a significant opportunity for the Global Majority/South to benefit, not only ethically but also economically.

Q: What’s your approach? A: We’re in adaptive agriculture and food systems, inclusive fintech, and climate-smart technologies. Many times we are the first institutional investor, and we utilise a variety of tools: capital, post-investment platform, labs, and board level advisory.

Q: ⁠What role does data have to play in climate investing? A: Despite not being silver bullets for confronting the climate crisis, data is crucial for advancing sectors like insurance and agritech, especially in Africa.

Q: ⁠What will the climate investment space look like in five or ten years? A: Advancements in technologies will expand the scope of climate solutions that founders can develop. Demonstrating successful pipelines will be crucial for investors and builders to highlight the potential of climate adaptation investing.

  • Forest help: Bezos Earth Fund allocates $5m for conservation in the Congo Basin.

  • Fill the gap: Tanzania’s $2.9 billion mega hydro project aims to plug regional electricity gaps.

  • Wind acquisition: BlackRock acquires a 12.5% stake in Lake Turkana Wind Power.

  • Risky gamble: Italian oil giant Eni’s African biofuel plans fall short.

  • Clean sheet: NGO aims to generate carbon credits from green housing in West Africa.

Don’t have time to read 100+ media sources every day? We’ve done the reading for you. Check out our full media monitoring here.

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Thanks to the Green Rising team for putting this together.

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