The Joburg Landfill Gas to Energy Project
: City of Johannesburg

A. Problem Analysis

 1. What was the problem before the implementation of the initiative?
The Joburg Landfill Gas to Energy Project (hereafter, the “Project”) developed by Ener-G Systems Joburg (Pty) Ltd (hereafter referred to as the “Project Developer”) is a landfill gas (LFG) collection and utilisation project at the Johannesburg landfill sites located in Johannesburg, The objective of the project is to collect and destruct/utilise the landfill gas (LFG) generated at the Johannesburg landfill sites. The project activities consist of two distinct stages. In the first stage, LFG will be captured and destroyed by using a LFG flare, while in the second stage the captured LFG will be fed to the LFG flare and a modular electricity generation plant. The purpose of LFG flaring is to dispose of the flammable constituents, particularly methane, safely and to control odour nuisance, health risks and adverse environmental impacts. Hence this will involve investing in a highly efficient gas collection system as well as flaring equipment. The generator would combust the methane in the LFG to produce electricity for export to a local power purchaser. Excess LFG, and all gas collected during periods when electricity is not produced, will be flared. Landfill gas is created when organic waste in solid waste landfill decomposes. Most landfill gas is composed of roughly 50% methane, 50% carbon dioxide and a very small amount of other organic compounds, some of which are hazardous. Both methane and carbon dioxide are greenhouse gases. Methane is 21 times more harmful to the environment then carbon dioxide. This means reducing landfill gas is important to help reduce greenhouse gases that impact on the environment. Managing landfill gases has additional implications in terms of environmental pollution, compliance with operating licence conditions, and health and safety factors. Odours caused by high gas concentration are unpleasant for neighbouring areas. Methane is highly combustible, making high concentrations a fire hazard. Keeping these gases under control and well managed is part of the operational issues faced by all landfills.

B. Strategic Approach

 2. What was the solution?
The City of Johannesburg is committed to transitioning to a low-carbon economy in pursuit of a healthy urban environment and environmental sustainability – where this is considered a critical step in ensuring the well-being of all Johannesburg’s residents, and those who work and play in the city. Other factors of the GDS that influence this project are the commitments to proactive delivery, innovation, and creation of sustainable interventions that can assist in improving the quality of life for the citizens of Johannesburg. Additional key policy documents influencing this landfill gas project include the National Environmental Management: Waste Management Bill 2000, various policies under provincial management pertaining to the maintenance and care of landfill sites and their emissions, and the municipal Development of Integrated Waste Management Plan strategies for Integrated Development Plans. The main aim of the City of Johannesburg LFG to Energy CDM Project is to mitigate the harmful greenhouse gases emitted from the landfills. The key benefits of this are as follows: • To extract and eliminate harmful gases that are currently causing bad odours, especially to communities surrounding the landfill sites; improve the environment; and reduce health and safety risks • To extract and destroy these gases in such a way that provides the City with an opportunity to receive revenue from the generation of Certified Emission Reduction certificates (CERs) through the United Nations Framework Convention on Climate Change (UNFCCC) CDM process, and from the generation of renewable energy • To ensure environmental compliance with national and provincial regulations and move towards the Joburg 2040: Growth and Development Strategy through shifting to a low-carbon economy. The CDM projects have been running in around the world and in South Africa, However, for the City of Johannesburg the dialogue for this project started as early as 2004, the actual construction of the equipment took place in 2011. The norm in the LFG industry for service provider partnerships around the world is five to eight years, which adds further complexity to projects. Over time, the changing legislative framework and shifting energy dynamics become critical variables which impact on the viability of LFG projects. In 2006 Themba Camane, the former Executive Director of the Infrastructure and Services Department (ISD), started a process of seeking out a private partner that would be awarded a long-term contract to design, develop and implement the system. A feasibility study was done, a tender issued, and a contractor was appointed in 2009. Over time, there were intense negotiations with the service provider, EnerG Systems Consortium, while the project managers and team members engaged in due diligence, and putting the legislative and financial requirements in place to get the project off the ground. In February 2011 construction of the first project began at the Robinson Deep landfill site, where pipelines were laid and the ‘flaring’ or burning off of methane gases commenced in May 2011.

 3. How did the initiative solve the problem and improve people’s lives?
The landfill gas project relates to new innovative technologies which allow the City the ability to develop green projects out of what is generally considered waste/nuisance: landfills, and new income streams through the sale of carbon credits, and generating new energy and selling that electricity through the grid. The project is unique and innovative to the City of Johannesburg in a way that it provides answers to several environmental challenges in one go. It has two key components; the first is a general method to manage landfill gases emitted as a result of the decomposition of waste at the landfill, which impact on the environment with health and safety hazards at the landfill sites and in surrounding areas, more effectively. Compliance with national and provincial legislation is important to these issues. The second component is the development of a CDM to comply with the Kyoto Protocol requirements and allow for additional revenue streams for the City, as well as meeting the City’s long-term strategic goal of shifting to a low-carbon economy as detailed in the Joburg 2040: Growth and Development Strategy. Two landfill sites accumulated 90 000 carbon credits with the burning off of harmful methane gases. Plans are under way to sell the electricity generated from the landfill sites. The project will cover six landfill sites and already qualitative air studies show that the project is reducing harmful chemical emissions and landfill odors in the area. The most exciting potential of the project is that, it offers exciting new options in alternative fuels in that it can provide a source of household gas. The gas can be bottled and for sale to customers. Yet, new innovative approaches like the Gas to Energy Clean development mechanism also come with challenges. The complexity of the negotiations, the finalization of the power purchase agreements (PPAs) and finding buyers for the electricity have not been without hurdles. However, with Pikitup driving the process at landfill sites, and Environment and Infrastructure services department working closely with the service provider on the legal processes, the City is embarking on its goal to develop energy from renewable resources and to create a cleaner environment for the future generations.

C. Execution and Implementation

 4. In which ways is the initiative creative and innovative?
Implementation Timelines Quarterly air quality monitoring studies are conducted to monitor the concentration of gases. The flare system was also installed to calculate the amount of gases extracted on each sites and the environmental committee meetings are held quarterly with the surrounding landowners to understand the concern emanating from the landfill sites. Below is Chronology of how the project was initiated: Pikitup began investigating in 2001, and the project was kick-started with discussions in 2005. The first contract was signed in 2009, and the actual equipment was constructed in 2011. 2001 – 2005 • Pikitup seeks ways to finance an LFG project 2005 – 2007 • Infrastructure Services Department Executive Director decides to seek service provider for LFG project • City of Joburg awards tender to private party in 2007 2008 – 2009 • Negotiations and due diligence carried out leading to final contract with EnerG Systems being signed in 2009, following viability study that reduces landfill sites from eight to five • New Environmental Waste Act comes into effect, resulting in application having to go through new process for submission • In 2009 the National Energy Regulator of South Africa (NERSA) invites IPPs to tender for renewable energies 2010 – 2011 • Environmental Impact Assessment (EIA) conducted in 2008; however, authorisation only received in 2010. • Negotiations initiated for the PPA • In 2010 the NERSA process is taken over by the Department of Energy; one category is LFG energy, for what is known as REBID, or renewable energy tariffs, and the tender is issued in 2011 • The process begins in 2010 to register the five landfill CDMs with UNFCCC to allow the sale of carbon credits • Construction begins at Robinson Deep in February 2011 and is completed by May 2011, with flaring and gathering of VERs beginning 29 May 2012 2012 • Final registration under way for five CDMs with UNFCCC by no later than end of 2012, when the Kyoto Protocol expires • Discussions under way for the PPA with Eskom and Wheeling Agreement with City Power to allow gas to be piped to their electrical grid • Construction completed at Marie Louise for gas wells and 28 gas extraction pipes, and flaring begins 2013 • The City awarded a tender by the Government to Sell Electricity generated from the Site to Eskom.

 5. Who implemented the initiative and what is the size of the population affected by this initiative?
The mandate of the City of Johannesburg’s Environment Infrastructure and Service Department is to create favourable surroundings for living, business and recreation by managing air, water, land and noise pollution, and implementing measures to moderate pollutants. The infrastructure and services section is positioned to work together with directorates such as Energy, Water, and Legal Compliance to assist entities such as Pikitup with strategic initiatives. Pikitup was created in 2001 as a municipal-owned entity to service the City of Johannesburg’s 1 625 km2 area, with its 3.8 million people and 787 000 dwellings. It is the biggest waste management company in Africa, handling 1.6 million tonnes of waste annually and overseeing eight landfill sites. These two departments, along with service provider EnerG Systems and City Power, Environment, Finance, and Legal and Compliance, became part of a multi-departmental steering committee that met quarterly to oversee the project. Under the steering committee was a technical team made up of members from EISD, Pikitup’s Landfill Operations Team and EnerG systems. EnerG systems was awarded the tender in 2007 and, after a feasibility study on the landfills, signed a contract with the City in 2009. They brought to the table their expertise on gas extraction from landfills throughout the world, and the capital and funding to purchase the equipment for the wells, gas extraction, gas flaring and the future linkages to the electrical grid. Initial due diligence into the City of Johannesburg’s landfills indicated that only five of the initial eight originally targeted for the project were viable, as some would have generated less than 1MW. In the early stages of the project, the focus was primarily on generating electricity. These first five were identified as Robinson Deep, Marie Louise, Linbro Park, Goutkoppies, and Ennerdale. Four of the five were active, with Linbro Park closed due to lack of space. The original thinking was to start with Linbro Park, but the higher levels of gas, as well as specific issues to do with land usage at Linbro, led the project team to select Robinson Deep as the first roll-out location.
 6. How was the strategy implemented and what resources were mobilized?
Public-Private Partnership brought in the funding and expertise. While other municipalities have sponsored their own projects, the city took a risk-averse process and has a private party come in to develop and invest in the project at no cost to the city. At a cost of R250 million to initiate one LFG project, the City had other priorities than this project on its own. The tender process brought several potential service providers, but EnerG Systems had put in systems in various places around the world, including South Africa, and had the capability, expertise and acumen with LFG extraction projects to add value to the City of Johannesburg’s systems. One of the riskier aspects of LFG projects is the funding and income streams. While finding the funding is the service provider’s responsibility, without external capital the service provider might have difficulty in fully executing its contract. Since the project timespan covered several years, the viability of selling carbon credits alone as a revenue source was not enough to make the financing bankable. While a carbon credit price of €11 was secured and an overseas buyer for the credits was in place, this was also contingent on the registration of the project with the UNFCCC, which was due to be completed only by the end of 2012. The City began to hold the service provider to the agreed-upon timelines to execute the project. The bank that EnerG Systems was working with, Nedbank, required a PPA to be signed in order to release financing to the project. The PPA is contingent upon EnerG Systems winning the REBID tender, which will be announced, was announced in 2013. While the project was under way, the service provider had to find its own financing. However, future development will yiled results since REBID tender is awarded to the LFG project and the project will generate revenue from the sales of electricity.

 7. Who were the stakeholders involved in the design of the initiative and in its implementation?
The importances of political will, political champions and inter-governmental alignment. There has been measurable reduction in landfill odours and methane gas concentration as measured by the University of Witwatersrand team from the Department of Geography, Archaeology and Environmental Sciences. Compliance has been improved with regard to the National Environmental Management: Waste Act, Provincial Waste Management strategies and municipal Development of Integrated Waste Management Plan strategies for Integrated Development Plans. the project has seen several key accomplishments, which include: 1. The construction of the gas wells, 68 gas extraction wells and flare systems at Robinson Deep Landfill site has been completed, with gas extraction operational since May 2011. 2. Application is under way with the UNFCCC for registration of the CDM project for carbon credits under the Kyoto Protocol. Gas extraction since start-up can be accumulated as credits that can be sold on the open market once registered, so the City has accumulated a balance sheet of future revenue. 3. The contract with EnerG Systems was signed in 2009 to design, build and implement the LFG to Energy CDM with the service provider, bringing in the required expertise, capital and maintenance costs of the project. 4. A Tender has been awarded by the Department of Energy (DOE) to EnerG Systems as an Independent Power Producer (IPP) for sale of the electricity to meet their bid for 19MW of landfill gas energy. Nedbank has indicated its willingness to finance the project, pending the signing of a Power Purchasing Agreement (PPA). Wheeling agreements are under discussion with City Power for gas extraction pipes to connect their electrical grid for wheel/transport electricity to the possible buyer. 5. Construction began at Marie Louise Landfill site in February 2012, where 28 gas extraction pipes were installed and the site was commissioned in April 2012. 6. There has been measurable reduction in landfill odours and methane gas concentration as measured by the University of Witwatersrand team from the Department of Geography, Archaeology and Environmental Sciences. 7. Compliance has been improved with regard to the National Environmental Management: Waste Act, Provincial Waste Management strategies and municipal Development of Integrated Waste Management Plan strategies for Integrated Development Plans.

 8. What were the most successful outputs and why was the initiative effective?
Public-Private Partnership brought in the funding and expertise. While other municipalities have sponsored their own projects, the city took a risk-averse process and has a private party come in to develop and invest in the project at no cost to the city. At a cost of R250 million to initiate one LFG project, the City had other priorities than this project on its own. The tender process brought several potential service providers, but EnerG Systems had put in systems in various places around the world, including South Africa, and had the capability, expertise and acumen with LFG extraction projects to add value to the City of Johannesburg’s systems.

 9. What were the main obstacles encountered and how were they overcome?
9. What were the main obstacles encountered and how were they overcome? In no more than 300 words describe the main problems that were encountered during the implementation and how these were addressed and overcome. The First challenge encountered was related to balancing between landfill sites operations and development of the operational sites. The second challenge was the legislative compliance that the project had to adhere to which had a bearing on the project. The following are identified seven pieces of legislation document requirements and agreements that had bearing on the project: (1) Environmental Impact Assessments on each landfill site (2) Consent Use to implement the LFG projects at each site (3) Power Purchase Agreement between the DOE and service provider as an IPP for provision of electricity from the landfill gas (4) Wheeling Agreement with City Power for the consent to use their infrastructure to connect the electricity grid to the buyer (5) Connection Application for approval from City Power and Eskom to connect to their grids (6) Power of Attorney from Johannesburg Property Company for land use at Linbro Park (7) UNFCCC application for the project registration for permission to sell CERs, which has taken two and a half years to date, and is expected to be approved before end of 2012 An understanding of how each of these will impact timelines, outcomes, costs and results was critical. The third challenge was related to securing a buyer of electricity from the project at a price that was to make a project viable. This challenge was addressed recently when a power purchaising agreement was signed by Eskom to buy electricity from the project at a viable price.

D. Impact and Sustainability

 10. What were the key benefits resulting from this initiative?
The impact of the project will be seen on the environment, health and safety conditions, financial revenue streams, Kyoto Protocol requirement fulfilment, upscaling of teams and skills transfer, and meeting of the City’s key strategic objectives. With regard to the environment, the LFG project has the potential to remove harmful methane and other gases from the landfills and help reduce the impact of odours on surrounding businesses and residents in the area. This also ties in with safety, where the reduced gases will improve the safety of operations because there is less chance of fires due to combustible methane. With the large number of people, trucks and equipment on the site, the ramifications of a fire could be significant. With health, less gas will contribute to a better environment. Some of the less well-known gases present in small quantities, such as hydrogen sulphide, are known as volatile organic compounds (VOCs), and are lethal. Regarding financial revenue streams, the project has not yet generated revenue but it is anticipated that revenue will be generated when electricity is sold to the buyer and when carbon credits are sold. The revenue streams will be shared between EnerG Systems as the service provider and the City. For the fulfilment of the Kyoto Protocol requirement, the registration of the five landfills’ CDMs will assist South Africa with its obligations to maintain a role of environmental stewardship, following the commitments arising out of COP17 in Durban. As the requirement is filled, there is an expected upskilling of teams and transfer of knowledge from the service provider, as per their contract. Lastly, this project will greatly assist with meeting the City’s key strategic objective of shifting to a low-carbon economy and green city for the future.

 11. Did the initiative improve integrity and/or accountability in public service? (If applicable)
the national and/or international levels and/or how it could be replicated. The project is for now only flaring the gasses which are harvested mainly methane gas, however, the two developed sites are currently receiving waste from the refuse round collections from households which ensures that there is a constant generated. The daily disposal of waste in the operational landfill sites ensures the constant generation and concentration of methane gas which is critical in the sustainability of the project. Furthermore a feasibility study was conducted before the commencement of the project which proved that the available gas and daily disposal of waste can support the project for 15 to 20 years. The Project Manager from the City's side is currently being trained on how to operation the infrastructure on the two sites to ensure that one the contract with the service provider has lapse the City can run the project on its own. On the other hand the City through the public GDS consultation in 2011 undertook to ensure reduction of carbon emissions from its own operations through shifting to low carbon economy. The project is adaptable in a sense that the gas that is harvested can also be used as vehicle fuel, bottled and used for cooking as well as heating. This can be used by other organisations to improve service delivery for informal settlement as an alternative source of cooking where there is not electricity. Even the electricity generated can be used by an organisation to reduce their electricity bill. Organisations like Metro Bus, Pikitup and Joburg Water can use the gas to power their fleet which can save them a lot of money from ever increasing prices of petrol and diesel.

 12. Were special measures put in place to ensure that the initiative benefits women and girls and improves the situation of the poorest and most vulnerable? (If applicable)
The CDM Process is complex and expensive. The entire process of conversion of LFG to energy and carbon credits is a complex, expensive project that has a multitude of workstreams happening simultaneously over a number of years. Many workstreams and “go – no go” decisions are based on steps along the way. It is critical that these activities are synchronised and mapped out, and for that synchronisation to form part of the project. CDM projects of this nature require LFG experience and expertise, which is expensive. While the PPP allows for a private contractor to take on the actual capital and maintenance costs, the municipality must still pay for the consultants and experts to assist with the agreements and legal requirements. Tighter municipal budgets mean competition for scarce resources, and greater co-ordination is required between directorates such as waste and electricity for execution. Often the construction costs are significant and operating costs exceed most projections. A vertical well costs R212 000 per well with horizontal wells at R2 100 per metre. Civil flare compounds cost R741 890 and flares from R2.0 to R2.5 million. Electrical compounds range from R1.5 to R2.5 million. However, operating costs are estimated at 10% of capital cost per year and security alone is 3% of the contract value, and these need to feature in future budgets and financial projections for the project. Having the right partners and experts is critical. For the City of Johannesburg, a PPP was seen as the best option at time when the City did not want to invest in the capital costs of the project. This was beneficial due to other, more pressing service-delivery priorities. In addition, having external experts with specialised municipality LFG experience assisted in guiding the City through the complex processes. The right team with strong processes and management ensures participation and buy-in, and a strong contract ensures service provider management. The project steering committee and technical teams, especially during the earlier stages, were crucial in getting the project moving. Having members across various City departments provided critical input and time-saving to later processes. Team deliverables and communication were tightly managed by the Project Manager with detailed meeting minutes. When the timelines were drawn out by the banking approvals, the service provider was held to default dates that were built into the contract. It was felt that a strong contract, even if it took a year to negotiate, was critical in ensuring that the project stayed on track. Anticipate regulatory and legislative changes. While this is a difficult call, it is important to anticipate that there will be some changes in regulations and legislation when a project extends over a period longer than five years. In addition, the scenario in the energy world for carbon credits and other measures can change, which can have significant impacts on the project. It might be of value to assign one member of the team to follow regulatory and legislative changes. Municipal tenders take time. Since municipal tenders take time, one Project Manager’s advice is to plan for this and ensure that every legal shortcut is employed. In addition, DOE contracts must be managed to include incentives for making deadlines and penalties for failing to do so. One of the key learnings was that the appropriate consultation within the City, ie with City Power, had not been conducted prior to setting the tariffs. When sales of electricity into the electrical grid are part of the income stream, early dialogue.

Contact Information

Institution Name:   : City of Johannesburg
Institution Type:   Government Agency  
Contact Person:   Orapeleng Moremong
Title:   Mr  
Telephone/ Fax:   011 407 6761
Institution's / Project's Website:  
Address:   Po Box 1489…. 158 Civic Boulevards
Postal Code:  
City:   Braamfontein
State/Province:   Gauteng

          Go Back

Print friendly Page