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The foul waste-to-energy deal that could bankrupt Zimbabwe's capital

July 20, 2022
topics: Transparency and Corruption
by: Cyril Zenda
located in: Zimbabwe
tags: corruption, energy, recycle, waste, Zimbabwe

Controversial Netherlands-registered waste management firm Geogenix BV landed a murky $350 million waste-to-energy project deal in Zimbabwe that is now subject to political wrangling and a court challenge.

Residents of Zimbabwe’s capital Harare are protesting against a waste-to-energy (WtE) deal that President Emmerson Mnangagwa’s government is trying to foist on the opposition-controlled local authority - a deal they allege reeks of corruption.

In March, the government hand-picked Geogenix BV, a shadowy Dutch firm that is blacklisted in Europe, to 'partner' with the Harare City Council in the waste-to-energy deal that stakeholders say will result in the cash-strapped local authority - which already struggles to provide basic services - being plundered.

Geogenix BV is owned by Mirel Mërtiri, an Albanian national  notorious for corrupt waste management deals. His local partner, Danish Nguwaya, a close associate of the First Family through President Mnangagwa’s twin sons Collins and Sean, has in the past been linked to the looting of COVID-19 funds worth over $60 million. There are reports suggesting that Sean Mnangagwa and Nguwaya travelled to Albania to negotiate the contract with Mërtiri, Geogenix BV’s beneficial owner. 

The deal, which did not go tender and received no environmental approval, is now subject to a tug-of-war between various interest groups. President Mnangagwa’s government, which has granted the deal 'national project' status to shield it from public scrutiny, insists that the project is above board and irreversible, but opposition politicians who control the capital city have suspended it, claiming it is "grossly unreasonable and irrational and extremely detrimental to the interests of the residents, stakeholders and ratepayers of the City of Harare."

Deal Curious, Suspicious

The 30-year Build-Own-Operate-Transfer project that is meant to generate 22 megawatts of electricity by converting the city’s waste, which until now has been dumped at Pomona - a dumpsite on the outskirts of the city. A joint venture firm called Geo-Pomona Waste Management (Pvt) Ltd, was tapped to spearhead the project.

The deal was rushed through when unelected councillors from a faction of the opposition Movement for Democratic Change party, which works closely with President Mnangagwa’s ZANU-PF party, briefly seized control of the city council after a dubious court ruling resulted in the expulsion of elected councillors from the main opposition party.

The government regularly intervenes in the affairs of local authorities through the Minister of Local Government, who is part of the national government and therefore appointed by the president.

The primary gripe against the deal is the curious requirement that from now on the city should pay $40 for every tonne of waste that it delivers to its own dumpsite. Residents and city officials say it should be the other way around: the firm should pay the city for the waste (the raw material without which the project cannot run).

Under the contract, the city is obligated to supply a minimum of 550 tonnes per day and pay $22,000 per day in 2022. In 2023, the tonnage will increase to 650 per day - translating to a daily sum of $26,000 due to Geogenix. In 2024, the city is obliged to deliver 750 tonnes per day and pay Geogenix $30,000 daily. In 2025, the city would be expected to pay $34,000 for daily delivery of 850 tonnes of waste. The quantity would increase to 1000 tonnes daily in 2026, translating to daily income of 40,000 for Geogenix.

A separate clause in the contract prohibits contesting and disputing amounts payable to Geogenix by the city based on the actual daily minimum quantities of waste delivered. 

'Corruption on Viagra'

Harare Mayor Jacob Mafume, who was suspended from office at the time the deal was signed in March, described it as "energetic corruption," vowing not to pay a cent to Geo-Pomona for garbage deliveries to the city’s dumpsite. 

"There is no way such a deal can be legal," Mafume, an attorney by profession, told the media. "How do we, as a landlord, give someone a lease and we pay the rentals? It would be criminal to do so.

"This is corruption which has drunk an energy drink or taken Viagra. This deal is not legal, no one can legally execute it. It’s not worth the paper it’s written on. It is just not workable in any way, shape or fashion," Mafume added.

Allan Norman Markham, Harare North Member of Parliament, has approached the courts in a bid to have the contract cancelled.

In a High Court application filed in April, Markham argues that a council meeting held on 28 February, 2022, which passed a resolution to approve the Geogenix contract, was not properly constituted.

"The City of Harare does not have capacity to meet this obligation without falling deep into an intractable debt trap or resorting to other developmental funds," the legislator argued in court papers reviewed by FairPlanet. "The cost of the project is unsustainable."

"The contract creates serious financial obligations for the City of Harare in foreign currency for a period of 30 years," Markham further stated. "It is common cause that Harare’s waste collection costs are actually in the local currency and there is a huge disparity in the exchange rates of the local currency and the United States dollar."

Markham, a former Harare City councillor, said the city does not have capacity to meet the delivery of the minimum quantity of waste stipulated in the contract due of various reasons, chief among them is the critical shortage of refuse trucks, which have seen garbage piling up in most of the city’s suburbs.  

City residents not consulted

Harare Residents’ Trust director, Precious Shumba, told FairPlanet that their members were opposing the project as it is fraught with anomalies. 

"The Pomona Dumpsite waste-to-energy requires the City of Harare to pay $40 per tonne of waste to Geogenix BV in a deal done without consulting ratepayers," Shumba said.

"This project came to the City of Harare through the Cabinet, and subsequently through the Ministry of Local Government and Public Works, who directed the City of Harare to take up Geogenix BV without conducting a bankable feasibility study."

Shumba said the 2 June council decision to suspend and investigate the project was most welcome.

"The priority of ratepayers is to have a regular waste collection from households, industrial and central business district. Therefore, if Geogenix BV meant well they should have bought refuse collection vehicles and committed to the payment for the vehicle maintenance as well as construction of a weighbridge at Pomona dumpsite," the director added.  

"As it stands, the company established by Geogenix BV to run the project, Geo-Pomona Waste Management (Pvt) Ltd, is simply demanding payment for waste delivered but not weighed to quantify the amount of garbage delivered. Essentially, Geogenix BV wants money from the city of Harare without investing a cent into the project."

Hardlife Mudzingwa, national coordinator of the Community Water Alliance - a non-profit involved in the promotion of Water, Sanitation and Hygiene (WASH) services, told FairPlanet that there are many aspects of the Pomona deal they are displeased with.

"The city of Harare should not pay for waste delivered at Pomona. Waste is a raw material on the waste-to-energy project and it therefore does not make sense at all to have the provider of raw material paying for raw material," said Mudzingwa, adding that his organisation has been conducting community meetings with residents.

'Deal Benefits Political Elites'

The Harare Residents Association and Transparency International Zimbabwe (TIZ), working under the banner of the Harare Metropolitan Residents Forum, are also opposing the deal dubbed 'Wastegate' by the local media, saying is intended to benefit politically-connected elites. 

"We, the representatives of the Residents Associations and Civil Society Organisations advocating for good local governance, transparency, accountability, climate and debt justice condemn and reject the imposed shameful Pomona waste to energy project on the residents and ratepayers of Harare, and the metropolitan at large," residents and TIZ said in a statement.

"In our view, the contents of the Memorandum of Agreement signed between the City of Harare and Geogenix for the US$344 million Pomona Waste to Energy Project is a pure scandal, and a burden to the city meant to serve the best interests of the politically connected elites."

The forum pointed out that considering that waste incinerators have a lifespan of between 25-30 years, the plant would be handed over to the city of Harare when it is useless. 

"We reiterate that this scandal is a well-crafted and cunning plan designed to siphon resources and strip assets from the already cash-strapped and financially distressed local authority."

Environmental and health concerns also cited

Aside from the cost implications and alleged corruption, and while the project is being extolled as a game-changer in waste management by some, experts are critical of the project's prospective environmental impacts.

"While the Environmental Management Agency is promoting a reduce, recycle and reuse model of waste management as well as separation at the source/community level, this agreement wants to perpetuate the 'collect, transport and throw-away' approach to waste management, which has clear evidence of failure," pointed a report prepared by the Community Water Alliance and shared with FairPlanet.

The report highlighted that waste incineration is the most expensive and least efficient way to generate energy. It said that due to the low calorific value of waste, WtE plants convert less than 25 percent of material energy in garbage into marketed electricity - a percantage lower than other polluting systems: 35 percent for coal and 45 percent for natural-gas systems. 

"Incinerators are capital intensive. The general cost is twice the cost of coal-fired power plants. Operation and maintenance costs are also 10 times higher than coal," the report further reads. "Investing $150 million to $230 million in large, modern facilities designed by European companies might be lucrative for the companies, but not for the nearby communities or for the local government - the waste incineration industry has the highest negative economic impacts from air pollution compared to the financial value added by the industry."

It added that trash incineration emits large quantities of polluting substances, including nitrogen oxides (NOx), mercury, dioxins, and ultra-fine particles that can cause cardiovascular risks, premature death, reproductive harms and cancer, as well as respiratory diseases such as asthma. 

"Even the most advanced pollution control devices can’t eliminate toxins. About 30 percent of air pollutants still remain as fly ash, bottom ash, boiler ash, slag and wastewater treatment sludge, poisoning the soil and groundwater, deposited in landfills for generations to come.

"According to the US EPA, WtE facilities and landfills also release far higher levels of greenhouse gases such as CO2, Methane (CH4) and Nitrogen Dioxide (NO2) throughout their life cycles than source reduction, reuse and recycling of the same materials."

Image by The Basel Convention.

Article written by:
CZ Photo
Cyril Zenda
Author
Zimbabwe
The 30-year Build-Own-Operate-Transfer project is meant to generate 22 megawatts of electricity by converting Harare's waste.
© Armand Burger
The Pomona Dumpsite Waste-to-Energy requires the city of Harare to pay $40 per tonne of waste to Geogenix BV in a deal made without consulting ratepayers.
© Timothy Marks
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