Consultations on the Proposed TyreIndustry Waste Management Plans

May – June 2018

Purpose

• In terms of NEMA Waste Act, S28, Minister made a call for Industry Tyre Waste Management Plans with a deadline of 31 December 2017.

• Minister received 4 plans • The Minister’s notice published 7 May 2018 calling for public

hearings, accordingly the 4 plans were made public• Sessions arranged in 7 Provinces within the period of 30 days,

taking into account the geographic spread• The department is required to follow due process and thus the

sessions are recorded

Purpose of the sessions

Provide equal opportunity to all plan owners to present an overview of their submissions

Provide equal opportunity to all interested and affected parties to engage on the submitted plans

Provide a forum for open dialogue in order to clarify ambiguities and challenge plan owners on the sufficiency of the plan in line with overall national environmental strategy

To provide information from the Waste Bureau on the current network of tyre operations, infrastructure and participants with due compliance to PAIA and POPI

To give an overview of Extended Producer Responsibility in relation to Tyre Industry Plan

Plans received as follows

• SATRUCO - 31 December2017

• TWAMISA – 30 December 2017

• JPC ENERGY – 11 December 2017

• EVERGREEN ENERGY – 16 November 2017

Facilitators

• Session to be facilitated by:

– Tebogo Skwambane

– Lindiwe Gadd

– Thabi Kgaka

What this session is not

• This session is NOT a forum to raise grievances on REDISA, however we do welcome comparative views of the new plans vis-à-vis REDISA

• This session is NOT a forum for extended commentary on the merits/demerits of each plan but rather to seek clarification

• This session is NOT meant to discredit any individual

Our Role

Ensure objectivity and fairness in the consultation process

Ensure all interested and affected are afforded an equal opportunity to engage on the plans

Ensure accurate and fair recordings of the proceedings

House Rules

• Questions open to the floor shall be limited to ONE question per round, in order to get as many participants to voice their views

• When asking a question or presenting a statement, please state your name and organisation

• Times allotted to tea breaks and lunch shall be respected to maintain all objectives of the programme

• Please respect speakers and participants as they speak – allow them to make their point

DEA Presentations on Regulations and the S28 Notice, REDISA Litigation, EPR vision and

outlook for the Tyre Industry

9

SECTION 28 OF THE WASTE ACT, THE WASTE TYRE REGULATIONS AND THE S28 NOTICE

BACKGROUND

• The National Environmental Management: Waste Act No.59 of 2008 (NEMWA) regulates waste management inSouth Africa.

• S28(1) empowers the Minister to require a person orcategory of persons that generate waste to prepare andsubmit an industry waste tyre management plan.

• In terms of this section the Minister called on tyreproducers, any other person, category of persons orindustry that generates waste (and by implication personswho have the support base of generators waste) tosubmit waste tyre management plans.

BACKGROUND

• S32(5A) Consultation process on the plans

• S32(1) Minister may

approve a plan in writing on certain conditions and givedirections on the implementation of the plan.

require additional information to be submitted.

require amendments to be made to the plan.

may reject the plan with reasons and if it does not meet therequirements of the notice published in terms of section 28.

TRANSITIONAL ARRANGEMENTS

• Regulation 12 provides for transitional arrangements in the eventthat a waste tyre management plan expires, is withdrawn or isterminated and at the time there exists no other industry wastemanagement plan

• In this case, the Waste Management Bureau shall be responsible tofacilitate, supervise and control the management of waste tyres inthe interim until a new industry waste tyre management plan isapproved.

• The Bureau may issue instructions for the management of wastetyres, which instructions must be complied with within thetimeframe stated in such instruction.

• All participants that were registered with the previous waste tyremanagement plan shall in the interim register with the Bureau.

• All tyre producers must submit to the Bureau the same declarationsthat they submit to SARS in respect of the quantity of tyresproduced or imported, on a quarterly basis.

• The Bureau must establish a waste tyre forum with all affectedindustry to deal with governance and operational matterspertaining to the management of waste tyres during the interim,until a new industry waste tyre management plan is approved.

TRANSITIONAL ARRANGEMENTS

Presentation on litigation and

liquidation: REDISA

May 2018

• On 1 June 2017, the Minister brought an application to provisionally liquidate REDISA and on 8 June 2017, she

also brought an application to liquidate Kusaga Taka Consulting (KTC). Both companies were placed under

provisional liquidation on the respective dates.

• Furthermore, on 9 June 2017 the Minister obtained a provisional liquidation order against the Product Testing

Institute (PTI). The return date has been extended, by agreement, to 12 October 2018 pending the finalization of

the appeals lodged with the SCA on REDISA and KTC.

• On 15 September 2017 the High Court placed both REDISA and KTC under final liquidation.

1. Liquidation Applications

• REDISA and KTC applied for leave to appeal to the Supreme Court

of Appeal (SCA) against the entire judgement and order of Mr Justice

Henney.

• The SCA granted the leave to appeal on 14 February 2018. The

matter has not yet been allocated a date for hearing by the SCA.

2. Leave to Appeal to the Supreme Court of Appeal

The following performance information has been received from the provisional

liquidators:

ACTIVE PARTICIPANTS AS AT JUNE 2017

MICRO COLLECTORS 499

TRANSPORTERS 78

DEPOTS 20

PROCESSORS 15

3. Performance of Plan under Liquidators ~JUNE TO SEPTEMBER 2017

June July August September TOTAL

Tonnages

collected6386.78 7711.13 7978.35 7127.24 29 203,50

Tonnages

delivered for

processing

4936.11 4284.48 3852.98 3813.09 16 886,66

3. Performance of Plan under Liquidators ~JUNE TO SEPTEMBER 2017

3. Performance of Plan under Liquidators ~JUNE TO SEPTEMBER 2017

1 June 2017 30 September 2017

Cash resources R 178 547 943 R 82 451 332

Cash resources of REDISA at date of provisional liquidation and cessation of

operations (30/09/2017)

4. Liquidation Process

• All REDISA’s assets are securely stored, save for those which are

being utilized by the Waste Management Bureau as per the interim

arrangement.

• Provided the final liquidation order is upheld by the SCA, the

provisional liquidators will then commence disposal of assets and

finalising creditors’ claims.

• The provisional liquidators will, in due course, lodge a liquidation

and distribution account with the Master of the High Court in relation

to the administration of REDISA.

EXTENDED PRODUCER RESPONSIBILITY (EPR) VISION AND OUTLOOK

DEA Public Hearings on Tyre Industry Waste Management Plans

21 MAY 201822

23

• Vision Summary

• Circular Economy

• EPR Definition

• Global EPR Practices

• Sound Waste Management

• Legislative Basis and Rationale for IndWMPs

• National Pricing Strategy

• Process Flow

• Progress on Plans Received

PRESENTATION OUTLINE

VISION SUMMARY

Problem Statement: too much of waste going to waste, insufficient infrastructure and skills,

production/consumption, consumerism, underfunding, pervasive underpricing,unsafe, unhealthy,

undignified conditions

Value proposition: waste valorisation, waste/recycling economy, job creation, enterprise development, resource efficiency, waste to

energy, service delivery, governance, revenue

.

Desired Outcome: Less waste, waste diversion, jobs, recycling, circular economy, sound

material society, transformation, levelling the playing fields, streamlined regulatory

processes 24

EVOLUTION OF WASTE POLICY IN SA

2001

Polokwane Declaration

1999

National Waste Management Strategy

2000

Integrated Pollution and Waste Management Policy

2008

Waste Act

2014

National Environmental Management: Waste Amendment Act

2010

National Policy for the Provision of Basic Refuse Removal Services to the Indigents

2012

National Waste Management Strategy

National waste

Data baseline Report

1998

National Environmental Management Act

25

Currently, 111 megatonnes of waste is generated per annum, of which 75% ends up in landfills

0.62% contributionto GDP1

111 Mt of waste generated per annum

75% of waste disposed in landfill2

60,000 – 90,000 informal waste pickers

~110,000 formal jobsin chemical sector

~10% annual job growth in the private waste economy

~35,000 formal jobs in

the waste economy

SOURCE: 2012 National Waste Baseline, Stats SA, World Bank, DST South African Waste Sector 2012: An analysis of the formal private and public waste sector in South Africa. A National Waste RDI Roadmap for South Africa: Phase 1 Status Quo Assessment

1 In 2012 DST estimated the GDP contribution to be 0.62%, increase since then is estimated based on annual job numbers from Stats SA houshold surveys2 The remaining 25% are either recycled, beneficiated, including agriculture organic waste composted at source

The Chemicals and Waste Economy Phakisa aims to reduce negative impact on the environment, while growing the GDP contribution and creating jobs

Foster inclusive growth through positioning of South Africa as a globally competitive producer of sustainable products

Increase commercialisation of the circular economy and create value from resources currently discarded as waste

Key objectives▪ Grow the secondary resources economy

by increasing local utilization and beneficiation of waste resources by 50%-75% through creation of an enabling regulatory environment

▪ Generation of opportunities from chemical and waste resources for the creation of jobs/ opportunities in new / existing markets specifically through enabling SMMEs

▪ Invest in R&D innovation (including IP) and infrastructure to enhance the utilization of local waste resources for new products, substances and services that will create jobs, and enhance the production of environmentally friendly chemicals

▪ Reduce waste to landfill by 75% of industrial waste and 50% of municipal waste through education and awareness, compliant society, application of cleaner production

Phakisa Aspiration

Reduce the negative environmental and health impact of waste and risks posed by chemicals

Figure 4: A Diagram Showing How We Derive the Waste Plans from Legislation

LEGISLATIVE BASIS AND RATIONALE

28

NWMS

Goal 1: Promote waste minimisation, re-use,

recycling and recovery of waste

Goal 8: Establish effective compliance

with and enforcement of the

Waste Act.

Goal 7: Provide measures to remediate

contaminated land

Goal 6: Ensure sound budgeting

and financial management for waste services

Goal 5: Achieve integrated waste

management planning

Goal 4: Ensure that people are aware of the

impact of waste on their health, well-being and the environment

Goal 3: Grow the contribution of the waste sector to the

green economy

Goal 2: Ensure the effective and

efficient delivery of waste services

Industry Waste Management Plans …4National Waste Management Strategy Goals:

More interventionist measures

Reinforce IndWMPs and address gaps

Industry waste management plans

Main co-regulatory tool

Encourage voluntary plans and targets

Listing, impact assessment & licensing

Regulates waste management activities

WCMS, norms and standards

Foundation of regulatory system

LEGISLATIVE BASIS AND RATIONALE …2

Figure 5: A Diagram Showing A Regulatory Toolbox from the NWMS 30

BACKGROUND

REDISA plan approved for 5years

30 September

2017REDISA plan approval withdrawn

29 March 2017Published draft S28 Notice for public

comment

29 September

2017Waste Tyre regulations published for

implementation

2 October 2017 Waste Management Bureau

commenced managing waste tyres

in the interim

30 October 2017 Final S28 Notice published calling for

waste tyre plans

31 December

2017Due date for submission of waste tyre

plans

PROCESS FLOW

Receive plansDepartmental

Evaluation of PlansInterdepartmental evaluation of plans

Departmental consultation

process

Consolidation & Analysis of comments

and inputs

Recommendations to the Minister

Gazetting of the preferred plan/s

Ministerial decision on the

plans

Addressing public concerns

Figure 8: A Diagram Showing the Process Flow for Industry Waste Management Plans 32

CIRCULAR ECONOMY

• Circular economy is a response to the aspirations for sustainable growth in the context of thegrowing pressure of production and consumption on the world’s resources and environment.

• The economy has mainly operated on a ‘take-make-dispose’, replaces linear model andnotion of “end of life” and keep the added value in products for longer to eliminate waste.

• It keeps resources within the economy when a product has reached the end of its life, so thatthey can be productively used again and again and hence create further value. This transitionto a circular economy shifts the focus to reusing, repairing, refurbishing, re-purposing,recycling and upcycling.

• Business can redesign complete supply chains for resource efficiency and circularity. This can,in a way create new markets responding to shifts in consumption patterns away fromtraditional ownership towards using, reusing and sharing.

• Recycling rates are influenced by the quality of recovered materials and the economicviability of recycling operations.

33

Figure 6: A Diagram Showing Upstream and Downstream Economic Instruments for EPR

NATIONAL PRICING STRATEGY

35

Figure 7: A Diagram Showing Models for Government, Industry Managed EPR Plans and Revenue Collection

NATIONAL PRICING STRATEGY …2

36

EPR DEFINITION

“Extended Producer Responsibility (EPR), an

environmental policy approach in

which a producer’s responsibility for a product is extended

to the post-consumer stage of a product’s life”

OECD

37

EPR ROLE PLAYERS

38

Figure 1: A Diagram Showing Full Organizational Responsibility

GLOBAL EPR PRACTICES

• EPR is international recognised as a efficient means to manage the

waste management value chain.

• First developments in the early 1990s.

• EPR schemes have contributed to significant increases in recycling

rates and reductions of public spending on waste management in

many countries.

• Most OECD countries have now implemented EPR policies in key

sectors such as packaging, electronics, batteries and vehicles.

• Emerging economies in Asia, Africa and South America have also

started to develop EPR programmes in recent years. 39

GLOBAL EPR PRACTICES …2

EPR Adoption

• European countries, Germany, Sweden, and France were early adopters of EPR.

• Policy makers in Europe and emerging economies are now implementing EPR

policies as an efficient target-oriented environmental tool along with traditional

instruments and regulations.

40Figure 2: A Diagram Showing Cumulative Adoption of EPR Over Time

EPR ROLE PLAYERS

41

Product Responsibility Organisations (PRO)

• Individual collection and treatment schemes are mostly applied in business-to-

business contexts characterized by a limited number of actors.

• They are implemented though producers who organise and finance collective

Producer.

• Responsibility Organizations (PROs) that will carry out the collection and/or recycling

of end-of-life products on behalf of their members.

• Between 1998 and 2007, it is estimated that more than 260 PROs were established in

Europe.

• The number of PROs per sector varies a lot across countries.

• In France, 1 PRO is in charge of household packaging waste, compared to 29 PROs

in the UK for the same sector.

EPR ROLE PLAYERS …2

42

General Government / Regulator Responsibilities

• Policy makers have a key role to play in clearly defining the respective roles and responsibilities of

municipalities, PROs, producers, and consumers, and to ensure that these are enforced.

• Governments may establish mandatory EPR programme or promote voluntary agreements with the

industry instead of imposing legislation and mandatory requirements.

• Programmes under which producers operate voluntarily are often referred to as “Stewardship

programmes”.

• These can be initiated by manufacturers and encourage all stakeholders (manufacturers, retailers,

consumers, recyclers) to share responsibility for a product’s overall environmental and social impact.

• Most OECD countries and many emerging economies have EPR programmes and policies in place.

• Such programmes are also in the scoping stage in some developing countries in Asia, Africa and

South America.

• The specific features and outcomes of these measures vary significantly across regions, countries

and industries.

Presentations on the proposed Waste TyreManagement Plans

43

SOUTH AFRICAN WASTE TYRE REUSE COMPANY

INDUSTRY WASTE TYRE MANAGEMENT PLAN

Moving towards a resource efficient circular economy

Prepared by South African Tyre Reuse Company (NPC 2016/374705/08)

ABOUT SATRUCO AND THE SATRUCO PLAN

• The South African Tyre Reuse Company SATRUCO (NPC 2016/374705/08) was established in 2016 as a Non-Profit Company to address growing concerns relating specifically to the management of waste tyres in South Africa

• The SATRUCO plan is in direct response to inter alia, regulation 6 (3) of the Waste Tyre Regulations 2009, the subsequent amendments of the Waste Tyre Regulations 2009, published in the government gazette no. 40199 of August 2016, the Waste Tyre Regulations 2017 and the Section 28 Notice published on the 30 October 2017.

• The “People Centred and People Driven Development ”approach of this plan was widely consulted upon since its first iteration and amended from the original plan as per the comments and input suggested through the consultation process.

• This Plan has the support of among other strategic entities the CBO’s, Universities, Technology Innovation Agency, DTI, DST, Department of Basic Education, the SETAs, Urban and Rural Municipalities, Civic Movements, waste pickers association, UIF, Industry etc.

• It is a value chain focused plan, which will ensure South Africa’s ability to beneficiate and recycle tyres, export beneficiated products, provide innovative solutions for the waste tyre industry, create new employment opportunities thereby reducing unemployment and poverty whilst improving the quality of life and environment all South Africans.

The Plan will also:

• Reduce pollution of the environmental caused by the stock piling of waste tyres and prevent the indiscriminate dumping and burning of waste tyres;

• Reduce the number of poor families who are dependent on government social grants and free services in order to survive;

• Facilitate community participation in the process of building South Africa into becoming a developmental state

ABOUT SATRUCO AND THE SATRUCO PLAN - CONTINUED

THE GOVERNANCE MODEL TO IMPLEMENT PLAN

TREASURY

SARS

OUR VISION AND MISSION

VISION:

To achieve sustainable economic growth throughout the value chain by providing,

• a clean and healthy environment in line with international best practices,

• innovative solutions and global competitiveness through the efficient and effective management of Waste tyres for improved quality of life for all citizens of South Africa.

MISSION:

To make a critical contribution to waste tyre management in South Africa by:

• Encouraging a vibrant circular economy approach in the management of waste tyres.

• Ensuring a value chain model for the beneficiation of waste tyres by promoting the reuse, reduce, recycle modalities and the internationally acclaimed EPR methodology.

• Making waste tyre management a national priority.

• Giving SATRUCO visibility through its awareness raising programme and its CSI programmes and explicitly defining national interests in waste tyre management.

• Creating meaningful sustainable jobs through the fostering of SMME’s with a special

focus on BBBEE.

• Ensuring that resources are applied in ways that reflect these national interests and

priorities (radical economic transformation within a pro- poor framework).

• Ensuring the availability of skills, knowledge, and capacity to implement waste tyre

management programs effectively.

• Promoting social compacts in delivering the developmental state agenda, and

• Ensuring all of the above are achieved through benchmarking against international

standards and governance principles in a transparent manner.

OUR MISSION - CONTINUED

MORE SPECIFICALLY

THE SATRUCO PLAN IS COMMITTED TO:

• Focus on processing of waste tyres as opposed to collection and stockpiling, and adding value by turning waste tyres into a marketable commodity.

• The greening of the waste tyre management sector in South Africa and emphasizing the 4Rs (reduce, reuse, recycle, recover) in its operational plan.

• Focusing on social objectives of sustainable development, which will generate jobs, create new SMME’s and entrepreneurs, and contribute to economic growth whilst addressing environmental issues within a pro- poor framework.

• Ensuring cradle to cradle recycling/management of all types of tyres as listed in the Waste Tyre Regulations (2017), inclusive of OTR (Off the Road Tyres) .

• Delivering benefits to subsequent generations, by providing them with a more robust economy, a fairer and more inclusive society and a cleaner environment, through the reuse, recycling and recovery of materials from waste tyres, thereby facilitating intergenerational equity.

• Upholding the three “pillars” of sustainable development namely, environmental, economic and social development by aligning the Waste Tyre Management Plan to the objects set by the Department of Environmental Affairs and the targets set in the National Development Plan.

OPERATIONAL STRUCTURE OF SATRUCO

TRANSPARENCY AND CONTROLS IN THE SATRUCO GOVERNANCE MODEL

The SATRUCO Board will comprise of at least 7 Board Members, with 2 ex-officio members and 1 oversight member:

• Legal,

• Human Resources,

• Risk Management and Compliance,

• Industry representation,

• Finance,

• Technical,

• Communications,

• Including the CEO (ex Officio) and

• DTI representative (ex officio)

• A representative of Treasury with oversight input

WTF (Waste Tyre Forum):- (A non-profit entity of industry stakeholders)

The WTF will comprise elected and nominated members from Industry. The WTF will act as a consultative forum for exchange of industry related information. The Membership of the WTF will not exceed 12 Representatives. Representatives that will be invited includes the SATMC , NAAMSA, TIASA,RMI,DTI, and other interested stakeholders.

Waste Bureau:

Waste Bureau as per the NEMWA (2008)and the NEMWAA (2014) in respect of the SATRUCO Plan will assist the Satruco Plan as follows:

• Oversee the implementation of the Industry Waste Tyre Management Plan

• Management and the disbursement of revenue collected from waste tyre management levies.

• Manage and set up a database for all role players in the waste industry, which includes the Waste Tyre Industry role players ( 4 tiers of the SATRUCO Plan).

• Receive annual reports from SATRUCO during the funding cycle and will provide SATRUCO with the necessary reporting templates and obligations.

• Conduct a mid-term and final review/ evaluations of the SATRUCO Plan.

• Consider recommendations from the Waste Tyre Forum and SATRUCO during the 5-year cycle.

OTHER STRATEGIC PARTIES TO THE PLAN

FUNDING FLOW

PERCENTAGE ALLOCATION OF FUNDING TO CREATE SUSTAINABLE ENTERPRISES

COST ALLOCATION TOTAL

Waste Tyre Collection Co-operatives 10%

Short haul transport from fitment centres 10%

Long Haul Transport from pre-processing ops 12%

Historical Abatement Transport Costs 3%

Tyre Destruction Officers (TDO) 6%

Micro -transfer stations 5%

Depots 8%

Pre-processing Operations 8%

Recyclers and processor subsidies 8%

Transfer sites/depots 3%

Marketing 3%

Skills training 3%

Awareness raising and social responsibility 2%

Enterprise development 2%

Research & Development and 1 international conference 2.5%

Conference attendance and study visits 1%

Call centre 0.5%

Auditing and Compliance 3%

Administration Costs 10%

Total 100%

SPECIFIC OBJECTIVES OF THE PLAN

To:

• Manage waste tyres throughout the value chain (collection, reuse, recycling and energy recovery) responsibly in line with international best practices.

• Unlock the social and economic opportunities in waste tyres through promotion of reuse, reduce, recycle and recover model (circular economy).

• Minimise pollution and other environmental impacts of waste tyres.

Create a vibrant waste tyre recycling and processing economy that will:

• Promote skills development and job creation through partnerships with public and private entities;

• Promote SMME development,

• Create public awareness about opportunities in waste tyres.

• Encourage research and innovation in the area of waste tyres.

Eradicate poverty and inequality and thereby;

• Guarantee the protection of the freedom, rights and values as enshrined in the Constitution of the Republic of South Africa and Freedom Charter.

SATRUCO’S READINESS TO IMPLEMENT THE PLAN SATRUCO DECLARES ITS READINESS TO IMPLEMENT THE PLAN BASED ON THE FOLLOWING REASONS AND FACTS:

• This plan was a proactive outcome by SATRUCO over a two year period after reviewing deficiencies in the management of waste tyres and the Industries concerned therewith. Further having had some 10 years experience in the tyre industry and collectively over 100 years of experience through the members of SATRUCO and extensive consultation with all the relevant stakeholders, namely industry, communities, scientists locally and internationally, the plan came into being.

• Has the necessary high-level business acumen and capability, scientific team, training and development teams and partnerships, infrastructure, operations and sophisticated IT network, stakeholder commitment to commence with operations with immediate effect,

• Has identified potential processors, recyclers and investors who are committed to establish plants as soon as licensing (environmental/emissions) and compliance regulations will allow, to ensure beneficiation of tyres can commence abruptly.

• Has a database of businesses that can and will process legacy and other stockpiles that have been accumulating,

• A team of experienced Legal , finance, HR , Risk Managers, Environmentalists and negotiators who have developed a plan to absorb and honour all contracts/ agreements entered into by the Waste Bureau, after a compliance and a due diligence assessment has been completed,

• A team of Chartered accountants who will assess and absorb all existing operating businesses, their assets and liabilities with immediate effect subject to processes as detailed above.

• A qualified training team who have developed accredited curricula (NQF Level 1-5) in partnership with public Universities, TVET colleges and the SETAS,

• Partnerships and MOUs with Universities, SETAS, TVET colleges to implement accredited training and certification with immediate effect,

• A database and partnership with Community Based Organisations across the country to ensure a speedy set up of regional and provincial operations immediately,

• An enterprise development team to assist SMMEs with set up and implementation of their respective business plans, as well as to monitor and evaluate their operations .

• An internationally acclaimed marketing and branding team and a marketing and branding strategy to commence the public awareness programmes,

READINESS (CONTINUED)

• A bespoke IT plan developed, and tested by an expert international partner who have jointly developed the SATRUCO IT Management System (SIMS) aka “The Glue”.

• Is a registered as a member of the Chartered Institute of Waste Management CIWM (UK) a professional body for waste professionals which represents over 5,000 individuals and organizations across the world. SATRUCO has access to this international expertise at its disposal as and when required.

• The capacity, to commence with the regional stakeholder imbizos which will include representatives from the DTI, DST, TIA, DHET, DEA, Department of Basic education, CSIR, CBO’s, NEDLAC and Municipalities, (Municipal waste managers, all social media and national media operators).

• An interactive website to keep stakeholders informed of all matters relating to SATRUCO Network.

• Its own call-centre to field all queries in order to direct such queries for resolution to the relevant sector of SATRUCO (Call Centre no: 011 568 1455)

READINESS (CONTINUED)

INDICATORS TO MEASURE THE IMPACT OF THE PLAN

• Evidence of the targeted number of recyclers, processors, sustainable jobs, enterprise development and SMME development in the said period year on year.

• Evidence of its impact on reduction of the stock-piling of waste tyres and diversion from landfill sites.

• Evidence of its engagement with public and private entities namely, government departments and support services, business and industry, training institutes, the community development service providers, the civic movement and grass root communities in developing the tyre waste economy.

• Evidence of its ability to create the targeted number of sustainable downstream businesses, SMME’s and innovation.

• Evidence of the number of trained capacity developed to be employed in the tyre recycling, reuse and materials recovery industry.

• Its database of research and innovation conducted during its operational period.

• Showcasing its achievements through an electronic newsletter once a quarter.

• SATRUCO’s annual reports.

• SATRUCO’s International conference wherein its achievements will be showcased.

• SATRUCO’s real time data produced by its bespoke IT system

INDICATORS (CONTINUED)

IMPLEMENTATION OF THE PLAN

THE MODEL

STRUCTURE

FUNDING FLOWS

TARGETS

THE CURRENT SCENARIO FOR THE MANAGEMENT OF WASTE TYRES IN SOUTH AFRICA

CRUMBING / PYROLYSIS

THE WASTE HIERACHY

The implementation of the SATRUCO Plan is based on the principles aligned to the wastehierarchy, which is aimed at extracting the maximum practical benefits from products and togenerate the minimum amount of waste, whilst creating jobs and opportunities for SMMEdevelopment in South Africa.

Recycling Tonnage Availability - Nationally (Estimate)

Total Recyclable Passenger

Recyclable Truck &Bus

Total Truck & Passenger nationally

Recyclable Agric & Impl OTR & Mining

Total Agri/Impl/otr/mining Total Available

Gauteng 23 207 17 257 40 464 2 278 5335 7 613

Limpopo 4 777 3 553 8 330 469 9878 10 347

North West 4 436 3 299 7 735 436 10336 10 772

Mpumalanga 4 846 3 604 8 450 477 8336 8 813

Eastern Cape 7 078 4 108 11 186 648 83 731

Free state 4 152 2 870 7 022 610 3293 3 903

Northern Cape 1 726 1 200 2 926 255 2834 3 089

Kwazulu natal 13 041 8 994 22 035 1254 1417 2 671

Western Cape 10 325 6 350 16 675 1270 167 1 437

Total Nationally 73 588 51 235 124 823 7 697 41679 49 376 174 199

Tyre Dealers-Waste sorted and tyres

mutilated

ManufacturersReject tyres

Community collectionsAreas

Historical Stockpiles

Pre- Processing Operations (TDF manufacturing)

THE SATRUCO PLAN FOR MANAGEMENT OF WASTE TYRES

Energy recovery

Truck and Passenger Tyres

Pre Processing: Downsizing Process

before Recycling/Pyrolysis

NO BALING!

Pre- processing operations

Crumbing Operations

Pyrolysis Operations

Nylon/Radial Passenger tyres

Radial Truck Tyres

HFO

Carbon Char

Surplus exported as TDF commodity

Value added itemsTiles/Bricks etc.

Recyclers/ Processors

Energy recovery / Civil

Steel

Re Use

Ex Redisa Tyres Processing/Recycling

Dealers/Mines (Arising Tyres)

Mines Historical Stockpiles

SATRUCO

Storage sites/Pre-Processing sites

THE SATRUCO PLAN FOR MANAGEMENT OF WASTE TYRES

Processor/Recycler

Mining and OTR Tyres

Managed as per waste tyre regulations

Abatement managed as historical in plan

UPSTREAM AND DOWN STREAM BUSINESS/ SMMES TO BE ESTABLISHED

PROVINCIAL OPERATIONS

TARGETS FOR COLLECTION /PROCESSING

TIME FRAME APPROX.MASS (TONS)

Within 12 months of approval

69 600

Within 24 months of approval

87 000

Within 36 months of approval

121 800

Within 48 months of approval

156 600

Within 60 months of approval

174 000

YEARS PERCENTAGE OF

COLLECTED TYRES

2018-2019 50%

2019-2020 70%

2020-2021 80%

2021-2022 90%

2023-2024 100%

COLLECTIONPRE-

PROCESSING/PROCESSING/RECYCLING

NUMBER OF SMMES, ENTERPRISES TO BE ESTABLISHED AND JOBS TO BE CREATED AGAINST EXISTING INDUSTRIES

OPERATION EXISTING AS PER DEA

BUSINESS UNIT JOBS

Waste tyre processors 15 25 600Waste tyre destruction Officers (for approximately 2300 dealerships) 0 150 450

PRE-PROCESSING OPERATIONS: 1

1.Dismantling and separation SMME’s 0 54 5402. Shredding 0 46 460Micro collectors as per waste bureau and waste-pickers association 1500 160 (co-ops) 1600

Training and development 0 9 45Short Haul Transporters

Short Haul Transporters- legacy tyres

64

0

94

21

282

63Long haul transporters 10 10 100Micro Storage/ transfer station/ sites 23 45 340Depots 45 27 720New beneficiation businesses 0 25 125Research, innovation and development 0 1 25Awareness raising projects 0 9 90Marketing and branding 0 9 37ICT and MIS professionals 0 1+9=10 55Call centre 0 1 25SATRUCO 0 1+9 =10 75

TOTAL NUMBER OF POTENTIAL JOBS TO BE CREATED:5632

CONCLUSION

The SATRUCO plan responds equitably and responsibly to the requirements of legislation,Section28 of the Waste Management and related regulations and provides a cost effective,transparent model for recycling of waste that is a community focused, value chain model fortyre waste management benefits South Africans through the following:

• It adopts all principles of the circular economy in its operations and focus

• The establishment of a waste economy that supports new enterprises, the creation of skills, jobs and new Technologies.

• The implementation of a social compact model which ensures sustainability through public private partnerships, sustainable jobs, upskilling and reskilling of unemployed youth, women and designated groups etc.

• Supports Government’s goal towards reducing carbon emissions, climate change-related challenges and creating a safe and healthy environment for all citizens, which is in keeping with both the millennium development goals (MDG) and sustainable development goals (SDGs).

• Encourages innovation through its partnerships with scientific bodies in a bid to making South Africa globally competitive.

• Promotes investment in South Africa and the export of beneficiated products to international buyers through its partnerships with national and international investors and enterprises this promoting the waste recycling economy as resolved by the recent Phakisa Lab.

• It is a practical transaction of our Government’s motto of “together we can do more”.

• This plan may well form the benchmark for all other plans that address waste reduction.

THANK YOU.

CONCLUSION (CONTINUED)

Contact Details:Call Centre number: 011 568 1455Website: www.satruco.org.zaEmail Address: info@satruco.org.za

Copyright: This document is the intellectual property of TWAMISA (Pty) Ltd and must not be copied in part or in whole or given to third parties without the express permission in writing of the company.

TYRE WASTE ABATEMENT AND MINIMISATION INITIATIVE OF SOUTH AFRICA

INDUSTRY WASTE TYRE MANAGEMENT PLAN

Public hearings May/June 2018

TODAY’S HIGHLIGHTS

LINK BETWEEN PRE-TYRE LEVY AND POST-TYRE LEVY SECTORS

ENVIRONMENTAL AND FINANCIAL URGENCY TO DEAL WITH OTRs AT SCALE

TARGETS TWAMISA COMMITS TO

HOW WILL PLAN ACHIEVE MEANINGFUL TRANSFORMATION OF THE INDUSTRY

ADVANTAGES OF TWAMISA INDUSTRY STRUCTURE

HOW DOES PLAN ALIGN INDUSTRY STAKEHOLDER INTERESTS

HOW TWAMISA WILL REDUCE RELIANCE ON TYRE LEVY OVER TIME

CURRENT STATUS

This presentation is intended to serve as an overview of the TWAMISA IWTMP only. Please refer to the TWAMISA IWTMP and the public participation report on SAWIC website for more detailed information.

PLAN FOR LARGE OFF-THE-ROAD TYRES ONLY

Large OTR = unique characteristics upstream and downstream = unique Product Group

NEED FOR FOCUSED OTR WASTE MANAGEMENT

1. STOCKPILE OWNERS STALLING ON ABATEMENT PROJECTS

• Suitability and availability of sites in the mining areas is a challenge

• Too expensive for a single mine, difficulties valuing projects and assessing risk

• Previously no service provider willing or capable of providing an integrated solution

• Sustainability of infrastructure dependent mainly on DEA mandate for post Tyre Levy waste

2. ENVIRONMENTAL AND HEALTH RISKS ONLY GROWING

• Risk of fires, pest infestations

• Risk of rehabilitation provisions becoming inadequate, i.e. no rehabilitation

3. LEGISLATION

• Pre-2012 stockpiles abatement plans – behind schedule or still unregistered

• Post-2012 additions in contravention of Waste Tyre Regulations

4. BENEFITS OF AN ENTIRE VALUE CHAIN CURRENTLY LOST ON VULNERABLE COMMUNITIES

EVER GROWING FUNDING DEFICIT

FINANCIAL IMPACT AND URGENCY

FULLY COMPLIANT SHARED INFRASTRUCTURE FOR THE REGION

PROFITABLE AND SUSTAINABLE SUPPLY – DEMAND DYNAMICS

REPLICABLE AND SCALABLE WASTE MANAGEMENT SOLUTION

INTEGRATED DEPOTS = HOLISTIC SOLUTION FOR REMOTE AREAS

“CLOSE THE LOOP” LOCALLYBY LOCAL PEOPLE

DECENT JOBS AND LOCAL SMEs, SKILLS INDEPENDENT OF MINING

SUSTAINABLE SOLUTION

TWAMISA’s approach is designed around:

- Comprehensive service to the stockpile owners for all their waste tyres

- Comprehensive service to the DEA for all tyres arising in these areas (collaboration with the non-OTR industry Plan)

- Sustainability of jobs created

- Transferability of skills developed

- Phased or concurrent approach

TWAMISA PLAN NETWORK

Current WB offtake locations

OTR waste epicentres, ie. TWAMISA planned depot locations

LAND OWNERSHIP & DEVELOPMENT

STORAGE, COMPLIANCE & DEPOT MGMT

EQUIPMENT AND LOGISTICS

OTR WASTE TYRE SHREDDING (to 50 x 50 mm)

SCRAP METAL

OTR WASTE TYRE CRUMBING

From whole non-OTR tyres or OTR shred to mesh size as per client’s specifications

APPLICATIONS OF RUBBER CRUMB

PYROLYSIS

BLENDED FUELS

OTHER PRODUCTS

OPPORTUNITIES

Research & Development

Corporate Social Responsibility

(BBBEE)

Enterprise Development

(BBBEE)

Skills Development

(BBBEE)

Supply Chain Development

(BBBEE)

Reverse Logistics

SUSTAINABLE SMEs AT ALL LEVELS OF VALUE CHAIN • Formal employment

vs. informal sector for work-seekers

• Employee share schemes

• Access for existing black SMEs to capital intensive businesses beyond their individual financial ability

• Improved empowerment credentials for industry contributors

COLLECTION / DIVERSION TARGETS

Historical

stockpiles

post-Tyre

Levy backlogNew arising

Year 1 13% 20% 25%

Year 2 13% 20% 50%

Year 3 20% 20% 60%

Year 4 27% 20% 80%

Year 5 27% 20% 100%

Total 100% 100% 100%

Estimated total tons 50 000 120 000 100 000

Plan term

OTR tyres managed

RECYCLING TARGETS

Increase recycling rates through:

Incentives and R&D support to SMEs building local recycling capacity

Work with the municipalities, SANRAL, etc. to stimulate demand

Stimulate independent trading in the industry

(i.e. those who generate new and compliant offtake to profit from sale of material)

Plan termEnergy

RecoveryRe-use Recycling Total

Year 1 60% 0% 40% 100%

Year 2 50% 0% 50% 100%

Year 3 30% 10% 60% 100%

Year 4 20% 20% 60% 100%

Year 5 10% 30% 60% 100%

LOCAL SMEs and JOBS over 5 year term

Plan

Decent jobs Decent jobs Temporary Total jobs

Depots & infrastructure development 60 80 150 230

Transport & handling 25 45 105 150

Pre-processing 57 77 15 92

Recycling 25 90 130 220

Complementary activities 15 65 15 80

Reuse 35 46 50 96

NPC and Management company 25 25 15 40

Total 242 428 500 928

Jobs targets

Revised

SKILLS DEVELOPMENT

LEVEL PROGRAMME PARTNERS TARGET OUTCOMESTARGET NO. OF

PARTICIPANTS

Basic TWAMISA Plan

training

all new decent

jobs and relevant

existing SME staff

2 Ad-hoc specialised

training

Incubation partners, SETA

Accredited Services Providers

On-the-job training, upskilling and increasing employability

in the waste management sector

50

Universities

Colleges

4 University Graduate

Internship Program

Incubation partners, service

providers, industry at large

1 year internships for deserving graduates at the Plan

network participant businesses

10

5 Fast Track Management

Program

Incubation partners, service

providers, industry at large

Management level skills development for exceptionally

performing staff, interns and/or graduates at the Plan

network participant businesses

5

10

1 in-house Understanding of and compliance with the standards

applicable to the waste tyre management industry as a

whole. Standard operating procedures and internal controls

relating to all the relevant aspects of the TWAMISA Plan.

Includes H&S, Pest control, SHEQ, Depot Mgmt

3 Bursary Program Adding to skills pool of youth talent for the waste

management industry

OTR WASTE TYRES ABATEMENT TO BE ENABLED

AT SCALE AND NATIONWIDE

VIA A FOCUSED INDUSTRY PLAN.

1 EVENT TO UNLOCK THIS VALUE CHAIN !

PREVENTION OF POLLUTION AND ECOLOGICAL DEGRADATION

1. WASTE HIERARCHY

2. LEGISLATION

• As applicable to each party and business

3. ALL WASTE ACCOUNTED FOR

4. COMPETENT TRAINING AND OVERSIGHT

• TWAMISA • Incubation Partners

5. NATIONAL AWARENESS & CAMPAIGNS:

• OTR R^3• OTR Innovation Hub• Local OTR Service Hubs• OTR Partnership• Various relevant awareness campaigns

ADMINISTRATION

1. STRONG CORPORATE GOVERNANCE

2. SYSTEMS OF INTERNAL CONTROLS

3. SINGLE CENTRAL REGISTRATION SYSTEM

4. CONTRACT AWARD PROCESS / ADJUDICATION COMMITTEE

5. INDUSTRY STANDARDS

6. INCENTIVES

7. ALIGNMENT WITH WB INFORMATION SYSTEM

PLAN REVENUE SOURCES

1. DEA Tyre Levy allocation for TWAMISA Plan

2. Stockpile owners for historical stockpile abatement projects

3. Non-OTR Industry Manager for shared infrastructure

4. Sale of material to offtake

PLAN COSTSYear 1 Total % of Year 1

% of 5y

Total

Environmental impact 71 313 384 931 844 693 65% 78%

Service Providers 62 124 884 877 869 668 57% 74%

National Awareness, Programs and Campaigns 7 188 500 42 241 823 7% 4%

Research and Development 2 000 000 11 733 202 2% 1%

Economic impact 14 234 400 149 902 133 13% 13%

SME development 2 834 400 16 628 294 3% 1%

Processors (hierarchy-based incentives) 5 400 000 98 074 233 5% 8%

Innovation and other incentives 6 000 000 35 199 606 5% 3%

Social impact 3 833 200 22 487 855 4% 2%

Decent jobs and HDI integration 2 803 200 16 445 256 3% 1%

Skills development and training 330 000 1 935 979 ≤ 1% ≤ 1%

Social responsibility 700 000 4 106 621 1% ≤ 1%

89 380 984 1 104 234 680 82% 93%

Set-up & Administration 20 119 752 86 185 716 18% 7%

Set-up costs 6 686 400 7 377 600 6% 1%

Administration & management 13 433 352 78 808 116 12% 7%

Total 109 500 736 1 190 420 396 100% 100%

Plan costs allocation

Errata in Figure 4

PROPOSED INDUSTRY STRUCTURE and GOVERNANCE

PROS OF MULTIPLE MANAGERS FOR THE INDUSTRY

1. ACCELERATED ROLL OUT AND IMPACT

2. REDUCED COSTS IN THE LONG TERM

3. HEALTHY COMPETITIVENESS

4. REDUCED RISK OF MONOPOLISTIC BEHAVIOUR BY A SINGLE PRO

5. MULTIPLE KNOWLEDGE CONTRIBUTORS

6. NARROWER AND THUS MORE ACHIEVABLE FOCUS OF EACH MANAGER

7. SIMPLIFICATION OF DELIVERY AND PERFORMANCE EVALUATION

8. SPECIALISATION FOSTERS INNOVATION

NPC1. SINGLE PERPETUAL NPC FOR THE WASTE TYRE STREAM:

• 7 directors : 1-2 DEA/WB seat, 1 Manco representative per Manco, 3 non-execs

• By invitation: 3 Industry Committees

• Appointments to be agreed on collectively by WB and the approved Mancos

2. GOVERNED BY, as applicable:

• Companies Act

• King IV

• Code of Ethics

• DEA/WB specific requirements (Preferential Procurement Regulations, Government Accountability as

determined by National Treasury, PFMA, etc.)

• Tyre Producers specific requirements

3. TARGETING LEVEL 3 BEE RATING ON SPECIALISED GENERIC SCORECARD, AS NPO

4. Alternatives: TWAMISA’S OWN NPC or NO NPC with CG at Manco level and

frequent reporting to WB

MANCO

1. GOVERNED BY:• Companies Act• Management agreement with the NPC (alternatively with WB), including that all NPC business will

be managed in line with the governance requirements as applicable to the NPC• Delegated authority levels from NPC

2. INTERNAL CAPACITY FOR FULL ACCOUNTABILITY

3. DECENT JOBS

4. EMPLOYEE SHARE SCHEME - 10% EQUITY

5. STARTING AT BEE LEVEL 4 EME

6. TARGETING BEE LEVEL 3 ON GENERIC SCORECARD AS QSE

7. ESD AND CSI SPEND TOWARDS THE TWAMISA PROGRAMMES

REGULAR REPORTING TO ALL THE RELEVANT STAKEHOLDERS

1. MONTHLY• SMEs to Manco – service level KPIs ito contract (environmental, financial, etc.)

2. QUARTERLY

• SMEs to Manco - job numbers and capacity review• Manco to NPC – all KPIs in line with Plan targets, authority levels and DEA/WB requirements

(WB has a representative on the NPC Board and industry committees have access by invitation)

3. SEMI-ANNUALLY

• SMEs performance review against contract KPIs by Manco

4. ANNUALLY

• Independent external audit of NPC and Manco against Plan (SME normal financial audits)• SMEs – annual service provider review by Manco• Manco to WB - details of agreements reached with regard to historical stockpiles

5. AD-HOC

• SMEs - inspections conducted by Manco at pre-agreed times at the registered sites• Regular newsletter, Awareness campaigns by Manco to stakeholders

MEANINGFUL AND SUSTAINABLE TRANSFORMATION

1. BROAD-BASED TRANSFORMATION AT NPC, MANCO AND AT SERVICE PROVIDERS

2. ECONOMIC DEVELOPMENT / CONTRACT AWARD PROCESS

- remove barriers to entry for small businesses and HDIs

- support deserving projects and enterprises which share the TWAMISA Plan’s vision and values

2. SOCIAL IMPACT AND JOBS DEVELOPMENT:

• DECENT JOBS PROGRAM - Decent jobs and skills development opportunities for all

• SKILLS DEVELOPMENT AND TRAINING PROGRAM - Preferential opportunities for youth,

women and local people

• SME EQUITY AND DECISION-MAKING PARTICIPATION - mandatory for all service providers

• SOCIAL RESPONSIBILITY PROGRAM (CSI) – responsive to the needs of specific historically

disadvantaged communities affected by TWAMISA’s activities

REDUCING RELIANCE ON TYRE LEVY1. SMES SELF-SUSTAINABILITY:

• Plan provides gateway to both public sector (post-Tyre Levy) and private sector (stockpiles) contracts

• Access to private sector funding for future needs (ESD via co-funding platform or external finance)

• Marketability through service provider standing and demonstrable track record with TWAMISA

• Ability to benefit from incubation partners’ established market networks

• Reduced risk of failure for SMEs under incubation partnerships

• Profits from offtake, if fully compliant

2. TWAMISA PLAN REDUCES COST OF OTR WASTE MANAGEMENT BY:

• Abating at scale and nationwide NOW vs. LATER

• Sharing of infrastructure and admin costs between historical stockpile owners, OTR manager and non-

OTR manager (where appropriate)

• Assisting recyclers to develop high value offtake

CO-EXISTENCE WITH ANOTHER PLAN AND TRANSITION FROM WB

1. CORROBORATE ASSUMPTIONS WITH DEA AND NON-OTR PLAN:

• Definition of OTR tyres falling under the TWAMISA scope

• Estimates of annual waste volumes arising, in line with definition

2. INFRASTRUCTURE SHARING:

• On market-related terms (depots, transport, programs, new offtake, etc.)

• Existing offtake to be allocated to TWAMISA proportionately to tyre volumes under management

3. TRANSITIONAL ARRANGEMENTS WITH WB:

• 60-DAY handover period

• Existing contracts for OTR related services will be honoured on merit, i.e. in accordance with the

contract award provisions of the TWAMISA Plan set out in section 12.11 CONTRACT AWARD

PROCESS."

PARTIES TO THE PLAN

INDIVIDUAL PRODUCERS

SATMC – The South African Tyre Manufacturers Conference

TIASA – The Tyre Importers Association of South Africa

TDAFA - Tyre Dealers and Fitment Centre Association

IWMSA – Institute of Waste Management of Southern Africa

RMI – Retail Motor Industry

AIDC – Automotive Industry Development Corporation

NRCS – National Regulator of Compulsory Standards

CURRENT STATUS OF PLAN

1. PUBLIC PARTICIPATION 2017

• 167 OTR waste tyre segment stakeholders

• Detailed report on SAWIC website

• Overwhelming response in support of the separate management of OTRs

• Preliminary support for the TWAMISA Plan, subject to this PPP

2. SUBSEQUENT TO PLAN SUBMISSION

• Further feedback from producers

• Building capacity in the Northern Cape - engagement with relevant stakeholders and

council resolution in support of the programme and land allocation

ADVANTAGES OF THE TWAMISA PLAN

1. Simple governance model for ACCOUNTABILITY, TRANSPARENCY and SUSTAINABILITY

2. ACCELERATED DIVERSION OF WASTE and RECYCLING by the industry as a whole, from Day 1

3. COST EFFICIENCIES from abating at scale and nationwide NOW vs. LATER, for the benefit of

both OTR and non-OTR segments

4. ECONOMIES OF SCALE from integration of historical stockpiles, post-Tyre Levy backlog and

new waste, for the benefit of both government and the private sector

5. ACCELERATED TRANSFORMATION through reduced risk of SME failure

6. LOCALISATION of jobs and procurement in some of the most vulnerable communities

7. ATTRACTING PRIVATE INVESTMENT into the industry, via co-funding platform

8. ENABLING compliance with / enforcement of the approved stockpile abatement plans

9. REDUCED RISK of failure of the waste tyre EPR scheme through a multiple manager model

Q&A

CONTACT

WASTE TYRE

PROCESSING Waste Tire Beneficiation Plan

REG#K2016308357

Who are we?

Mix of professionals with technical

backgrounds and entrepreneurs

45 years of business and technical

management

Passion for people, environment and science

IT’S NOT WASTE, IT’S AN

OPPORTUNITY TO CHANGE OUR

COUNTRY

Vision

To retyre challenges faced by many South

Africans by treading the path to progress

Become the leading recycled raw material

company on the continent, by producing

high quality recycled raw material that

meet industry standards, supporting

research and development into new markets

and sustaining existing markets.

Mission Statement

Recycle waste tyres in an environmentally friendly manner, to help eliminate the mounting waste problem facing Our Country.

Provide industry with high quality recycled raw materials, so that the material can be absorbed by the market thereby turning a challenge into a solution.

Create and grow existing markets for recycled products, to ensure the continued consumption of recycled products.

Foster an environment that supports the creation of sustainable SME’s, and thus leads to more formal work for the communities.

Challenge…

Increasing waste

tyres

Environmental

Issues

Historical tyres

Imported tyres

Locally produced tyres

Proposal…

Increasing

waste tyres

Environmental

Issues

Historical tires

Imported tires

Locally produced tires

Solution

Challenge

Cause

Process waste

Recycle/Reuse

Produce quality raw materials

Transform lives of South Africans

Our approach..

Rate generating

of waste tires

100% Recycling into

sellable productsBalance

THE PROBLEM

Growing

mountains of

waste tyres ? Transforming

South Africa

PYROLYSIS

WHAT IS PYROLYSIS

A thermo-mechanical breakdown of the tyres into

smaller hydrocarbons (cracking)

Well established

WHAT IS PYROLYSIS

PRODUCTS

• 45-55% FUEL OIL

• 30-35 % CARBON BLACK

• 10-15% STEEL WIRE

• 8-10% GAS

Advantages

100% recycling of waste tyres through pyrolysis

Creating new markets for products (SiC, Bricks, fertilizer etc..)

Create sustainable jobs

A portion of the revenue is then used to create and sustain

various community upliftment initiatives (Bursaries, STEM

facilities, Skills development programs, Innovation centres etc)

We do not only want to grow the company, we want to grow

people

Solution

PROPOSED BUSINESS MODEL

Two 20T pyrolysis plant = recycle 14 400T per year

Plant 1 20T – OTR tyres

Plant 2 20T - passenger tyres

Plants in same area

Depot in proximity of plants

Delivery of OTR and normal vehicle tyres separate

“The pilot plant will be islands of excellence to be duplicated by other entrepreneurs”

•

SUPPLY OF TYRESComply with the approved waste tyre

management appointees for acquisitions

and logistics of the waste tyres.

Tyre at depot = 7 525 t (REDISA stats)

POTENTIAL SUPPLY OF TYRE IS 70000 T

per annum (Mpumalanga)

CAPACITY OF 40 T PLANT (2*20T

PLANT)

1 200T of tyres recycled in month

14 400T of tyres recycled in a year

72 000T of tyres recycled in 5 years

ADDITIONAL CAPACITY

The 40 T plants will process 20% of the estimated tonnage per annum

80% capacity available for other processing initiatives:

Replication of our business model by entrepreneurs

Rubber tile production

Rubber grounds

CONCLUSION

Evergreen has the necessary background

and expertise, to play it’s part in

transforming our country

#sendus

Waste Management Bureau Operations

138

Public Hearings on Waste Tyre Industry

Waste Management Plans

May – June 2018

Presentation Outline

Waste Tyre Management Process Flow

Overview of the Network: Dealers; Micro Collection, Transportation; Storage; Processing

Human Resources

Waste Bureau Performance

Expenditure

Waste Bureau Successes

IndWMP Monitoring Framework

140

WASTE TYRE MANAGEMENT PROCESS FLOW

Dealers, Bus/municipal

depots

Primary Transporter

DepotSecondary

Transporter

Processors

Secondary Industries

Illegally dumped, landfill sites

Micro collectors

Micro depots

WASTE TYRE SOURCES

TRANSPORTATIONSTORAGE

SORTING PRE-PROCESSING

TRANSPORTATION PROCESSING

Waste Tyre Management Process Flow

Overview of the network - Dealers

• Over 2000 collection points currently serviced, inherited from Redisa.

• Waste Bureau cannot service all due to inter alia limited capacity for collection, storage and processing capacity.

• There is ongoing registration of dealers.

10 Regional Co-ordinators

GP, 31

LIM, 19

MPU, 11

NC, 24

EC, 13

FS, 29

KZN, 69

NW, 9

WC, 20

NUMBER OF DEALERS REGISTERED WITH THE WASTE BUREAU (REGISTRATION FORM

COMPLETED)

Total Registered = 225

Overview of the network - Dealers

Province Number of Micro Collectors

Number of Micro Depots

Gauteng 185 17

Western Cape 16 4

North West 5 1

Eastern Cape 7 1

Total 213 23

Overview of the network – Micro Collection

Overview of the network – Micro Collection

Contacting of Waste Bureau

Role of Waste Bureau

• Townships, • Landfills and • Dumped

waste tyres

• Arrange transport for the collection of waste tyres

• Provision of Protective Clothing for micro collectors

• Micro collectors call the Waste Bureau when they have sufficient waste tyres that need collection

Waste Tyre Collection

1 2 3

Overview of the network – Micro Collection

Receive waste tyres from Microcollectors

Record received waste tyres

Submit records to Waste Bureau

Micro Depots

Micro Depots

1

3

2

Remuneration model of micro

depots

• R6 000.00 per month• Incentives

Remuneration model for micro

collectors

• R6.00 per tyre• Monthly threshold of 1000 tyres

per micro collector

Overview of the network – Micro Collection

2 Micro Collector

Specialists

Overview of the network - TransportationProvince PRIMARY

TRANSPORTERSSECONDARY

TRANSPORTERS

Gauteng 16 3

North West 2

Limpopo 9

Mpumalanga 5 2

Free State 2

Kwazulu-Natal 13 2

Northern Cape 3

Western Cape 14 2

Eastern Cape 4 1

TOTAL 67 10

Primary Transporter -overview

Primary Transporters get allocated collection points

Primary Transporters establish their own

collection routine based on the needs of the clients as well as the proximity of all their allocated collection

points.

Primary Transporter -rates

Primary Transporters have different rates based on the following:

• Average monthly distance travelled (based on the allocated collection points per transporter).

• Size of the vehicle

Primary Transporter -payments

Payment is made on the basis of the volumes transporters

(Rate x tonnages transported)

Primary Transporters communicate with the Waste Bureau when they experience challenges or when there is a complaint from a collection point.

Overview of the network - Transportation

Secondary Transporter -overview

Collectors orders are issued on a weekly basis to secondary

transporters

Secondary Transporter –issue of collection

orders:

Collection order are determined and issued on the basis of the

following:

i. Demand from Processors and Secondary Industries.

ii. Availability of the required stock from the depots.

iii. Space availability in depots (Needs to create space in

depots that service primary transporters.

Secondary Transporter – rates

0 – 20 km

21 – 100 km

101 – 200 km

201 – 300 km

301 – 600 km

601 – 1000 km

> 1000 km

Secondary Transporters rates are pre-determined on

the basis of distances as shown above

Overview of the network - Transportation

2 Transport logistics

Specialists

Overview of the network - Storage

Province No Town Number

Gauteng 7 Midrand 2

Pretoria 2

Westonaria 1

Springs 1

Randfontein 1

North West 1 Rustenburg 1

Mpumalanga 3 Nelspruit 1

Witbank 1

Belfast 1

Existing (Operational)

Overview of the network - Storage

Province Town Number

Northern Cape Upington 1

Free State Bloemfontein 1

Limpopo Polokwane 1

Western Cape Atlantis 1

Mosselbay 1

Eastern Cape Port Elizabeth 1

East London 1

Kwazulu-Natal Hammersdale 1

Ladysmith 1

Cato Ridge 1

Richards Bay 1

Existing (Operational)

Overview of the network - Storage

Province Town Number

Gauteng Krugersdorp 1

Springs 1

North West Hartebeespoort 1

Eastern Cape Mthatha 1

Ngcobo 1

Port Elizabeth 1

Planned (To be operational within the next 3 months)

Overview of the network - Storage

Standard Depots

• Servicing primary transporters on a daily basis

Holding Depots

• Depots that do not service primary transporters and are meant to store waste tyres while awaiting dispatch to processors

Overview of the network - Storage

• Depots have pre-determined approved monthly budgets which are determined on the basis of the following:

– Functions (activities) of the depot.

– Size of the depot.

1 Depot Specialist

Overview of the network - Storage• Government has no option but to service industry and

remove waste tyres from dealers

• Fire risks present huge liability for government

• Depots must be operated for receipt & dispatch of waste tyres – hence the waste bureau has contracted Depot Operators

• DEA has already acknowledged liability for managing waste tyres

Overview of Network - Processing

REGISTERED ACTIVE

Gauteng 5 3

North West 1 1

Limpopo, Mpumalanga, Free State

Kwazulu-Natal 3 3

Northern Cape

Western Cape 2 1

Eastern Cape 1 1

TOTAL 12 9

Overview of Network - Processing

Existing Pyrolysis plants are at demo scale

Poor Quality of Pyrolysis products, therefore limited markets

Re-use is currently limited

Processing Capacity Vs Waste Tyre Volumes generated: Disproportionately low

processing capacity Processing capacity unevenly distributed throughout the country

Collection capacity limited

More Storage is required.

Contracting with current & prospective processors is necessary

Future Industry Waste Management Plans will experience same

Contracts should be taken over if IndWMPapproved

Processing: Need to increase retreadingProposed Monthly

Reporting

Dealers will need to report

statistics on retreading

Increase retreading

rates

Sorting of tyres at dealers

WasteTyre Regulations, 2017

A tyre dealer must classify used tyres in his or her possession or control as either a part worn tyre or a retreadable casing, and any used tyre not falling into either of these categories must be classified as a waste tyre.

Automated Refano System – Dealer Registration

Automated Refano System – Dealer Registration

Automated Refano System

Testing of the system in 2-3 weeks

WASTE BUREAU HUMAN RESOURCES

163

STARTMONTH

NO OF STAFF

JOB TITLE

OCTOBER2017

4 • Transport Logistics Special (x 1)• Micro-Collectors and Micro Depots Specialists (x2)• Waste information Officer (x 1)

NOVEMBER2017

6 • Transport Logistics Specialist (x 1)• Depot Operation Specialist (x1)

DECEMBER2017

14 • Senior Executive Manager: Extended Producer Responsibility (x1)• Regional Coordinators (x6)• Call Centre Manager (x1)

JANUARY2018

22 • Executive Manager: Business Development & Knowledge Management (x1)• Executive Manager: Corporate Services and Governance (x1)• Senior Manager: Small Medium Macro Enterprise Development (x1)• Senior Manger: Financial Management (x1)• Senior Supply Chain Management Specialists (x 1)• Regional Coordinators (x3)

FEBRUARY2018

29 • Executive Manager: Extended Producer Responsibility (x 1)• Head: Risk Governance and Compliance (x1)• Head: Extended Producer Responsibility (x1)• Head: Financial Management (x1)• Head: Business Performance Management (x 1)• Head: Human Capital Management (x 1)• Regional Coordinator (x1)

MARCH2018

33 • Senior Manger: Storage and Processing (x 1)• Senior Financial Management Specialist (x 1)• Operation Admin Support (x 2)

WB Vs Redisa Operational Performance

164

Waste Tyre Collections (Tons) Oct17-Mar18

Tyres collected were mainly truck, passenger, 4x4, and OTR

Waste Bureau Vs Redisa

Waste Bureau collected 93.5kTons of waste tyre on an annualized basis compared to 92.6kTons for Redisa

11,8249,427

2,354

16,974

27

5,133

799 47 140

46,726

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000 Tyre Type Collected (Tons) Contribution %

Passenger 11 824 25%4x4 9 427 20%Light Commercial 2 354 5%Heavy Commercial 16 974 36%Motor Cycle 27 0%OTR 5 133 11%Agricultural 799 2%Aircraft 47 0%Industrial & Solid 140 0%

Total (Oct17-Mar18) 46 726 100%

Estimated waste tyres arising 170 226

Annualised 93 452Waste Bureau

Collections as % WT arising 55%8 Mth Performance (Dec16-Jul17) 61 715

REDISAAnnualised 92 573Collections as % WT arising 54%

Waste Bureau Operational Performance

165

Waste Tyre Delivered (Tons) Oct17-Mar18

About 22kTons were delivered for recycling – the main demand was for passenger and truck tyres; There was also demand for OTR shred and scrap tyres from pyrolysis plants

12,179

38 0

9,146

874 0 0 0 0 56

22,293

0

5,000

10,000

15,000

20,000

25,000

Waste Tyres Delivered for Recycling (Tons)

Waste Bureau Operational Performance

166

About 18.3kTons were recycled during the period, with tyre derived fuel (mainly cement kilns) and crumbing being the main contributing recycling technologies

Energy recovery and recycling were the main contributors in terms of the waste hierarchy categorization. Slower reporting by some recyclers also contributed to lower recycling volumes being reported

1,639

3,972

1,808

10,886

18,305

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Re-use Crumbing Pyrolysis TDF Total

Actual Waste TyresRecycled (Tons)

Re-use 1,6399%

Recycle 5,78032%

Recovery10,886 59%

Waste Tyres Recycling per Waste Hierachy

WB Vs Redisa Operational Performance

167

Waste Bureau Vs Redisa Comparison – Actual Waste Tyres Recycled (annualised)

Waste Bureau recycled about 36.6kTons of waste tyres on an annualized basis compared to 25.3kTons for Redisa(excluding exports); Waste Bureau also achieved much better re-use of waste tyres compared to Redisa, which is the main objective of the waste hierarchy

Oct17-Mar18 Annualised

Dec16-Jul17 Annualised

Recycled (Tons)

Category Waste Bureau Redisa

Re-use 3 277 78Crumbing 7 945 4 482Pyrolysis 3 616 6 357TDF 21 772 14 426Sub-Total (excl Exports) 36 610 25 343Exports 0 12 473Total incl Exports 36 610 37 816Estimated waste tyres arising 170 226Recycling as % waste tyres arising (excl exports) 21,5% 14,9%

OTR Recycling

168

• 5.1kT OTR collected - 3.8kT at Mogalakwena mine and 1.3kT in depots• OTR pre-processing at 2 sites – Mogalakwena and Ferrobank depot and converted to shred• 874 tons delivered for recycling at pyrolysis plants or 17% of OTR collected sent for recycling• New OTR pre-processing equipment procured to mitigate Redisa risk - delivery expected June,

July & Aug 2018• Currently OTR processed only at pyrolysis plants and is in decline• Potential use in TDF cement pre-calciner kilns to be explored

Collection (Tons)

Collection Makgalakwena Mine 3 791

Collection at Depots 1 342

Total Collections 5 133

Delivered for recycling 874

Recycling deliveries as % collection 17%

Description Quarter 03 (Oct-Dec 2017) Quarter 04 (Jan –March 2018)

April 2018 TOTAL TO DATE

Depot Lease Total 5 341 007 3 494 499 1 077 838,16 9 913 345

Depot Operator Fees Total 6 584 334 9 444 644 3 535 039,66 19 564 018

Transporter Costs Total 17 922 535 25 064 626 8 421 579,17 51 408 741

Micro Collectors & Micro Depots 1 257 744 2 205 845 1 073 288,00 4 536 877

Pre-Processors and Processors 2 396 906 3 299 372 624 892,68 6 321 171

Postbank Charges 18 720 23 910 9 360,00 51 990

Compensation of Employees (Oct 2017-April 2018) 8 556 506,78 8 556 506,78

TOTAL 33 521 247 43 532 897 23 298 504 100 352 648

Expenditure

Waste Bureau Successes in 6 months

170

Ensured that Waste tyre operations did not collapse from June 2017

On boarded existing participants within a short period and processed payments using a manual

system and within set deadlines

Achieved collection & recycling rates despite Full depots & prohibition of exports

Outperformed Redisa in collections & Recycling

Saved Jobs & SMME businesses

Fast Activation of new Depots

Contingency procurement of pre-processing equipment, done within compliance framework

Also working on other Waste Planning projects

Less Financial Resources: R210m

Less Human Resources: 34pp Vs 178 in Redisa

Legal Uncertainty

More Successes

IndWMP Monitoring Framework

• Determination of Baselines & Targets (Focus on Processing)

• Track Waste flows through Waste Hierarchy

• Labour intensity

• SMME Development

• Effectiveness & Impact of the plan

• Cost Efficiencies

• Levels of Regulatory Compliance for facilities / Operations

• Skills Development

• Financial Flows

• External Audited financial statements

• Annual External performance audit

• Annual Business Plans

• Monthly & Quarterly Reporting

Next steps – Process moving forward

172

Next Steps – The process moving forward

WE WOULD LIKE TO REMIND YOU THAT THIS IS A REGULATED PROCESS:

The Waste Bureau will provide the information in writing on the network, infrastructure and current participants in line with PAIA and POPI to the 4 Plan Proponents

Requests for clarity from Proponents:

Requests for clarity by plan owners must be made in writing to the department

Written requests will also be received and reviewed by the department

Please send an email to Mr Anben Pillay APillay@environment.gov.za for such requests

Written comments from interested and affected parties:

Written comments on the plans should be submitted to Ms Mamogala MusekeneMJMusekene@environment.gov.za; Environment House, 473 Steve Biko Street, Arcadia, Pretoria or Department of Environment Affairs, Private Bag X 447, Pretoria, 0001

Deadline for written comments 7 June 2018

Next Steps – The process moving forward

The DEA, Waste Bureau and other relevant government departments (DTI, Treasury, etc.) will convene a special meeting to interact with the plan owners for purposes of clarity after the last public hearing.

Special meeting will be held between the 5th and 7th June 2018

After receiving written comments by the closing date (7th June 2018), the department will consolidate all written comments, which will then be sent to the plan owners

Comments received will also be published on the DEA website

Plan owners will be expected to respond to comments by addressing, upgrading or re-adjusting their plans within a specified timeframe

Once plans are re-submitted to the minister, the department will analyse the responses and compile a register against written comments

A final adjudication/review of the plans will be undertaken

Based on all above inputs and processes, the Minister will make a decision and publish a notice in a gazette