Navigating E-Scrap Compensation as a Key Transition Step

A recent report by Footprints Africa proposed that introducing e-scrap compensation systems could bring about a significant transformation in global value chains.

Circular Goals in Africa

According to Footprints Africa, the implementation of an enhanced compensation system for e-scrap has the potential to foster a circular economy for electronics in Africa, although various obstacles still need to be addressed.

The report by the nonprofit organization is titled, “The electronics afterlife: Is e-waste compensation a stepping stone to a circular electronics sector in Africa?” It focuses on voluntary compensation initiatives such as those introduced by Closing the Loop from the Netherlands, shedding light on sustainable electronics practices.

With a mission to advance “sustainable, scalable and inclusive approaches to the development of local African economies and prove that business can be a force for good at scale,” Footprints Africa strives to embody these principles. The funding for the initiative was provided by the CTL Foundation, the non-profit branch of Closing the Loop.

The “Offset Model”

In the compensation, or offset model, customers in regions like Europe are charged an extra fee when buying a new electronic device. The amount is specifically calculated to fund the proper disposal of the device when it reaches the end of its lifespan, and to facilitate the collection of e-waste from nations currently lacking reliable recycling options.

Originating in 2014, Closing the Loop has successfully managed 5.6 million devices through various projects in over 10 African nations, focusing primarily on Ghana, Nigeria, and Cameroon. Noteworthy clients of Loop Closure include Vodafone and the Dutch Government.

The current system developed by Closing the Loop is equipped to manage phones, laptops, tablets, batteries, and computer screens. But, according to the report, “the scope is potentially much larger.”

“This raises the question of how the model might be expanded to other sectors for greater impact, commercial return and reduction of environmental harm,” the writers noted. “In turn that would mean working out a model for equipment that has a lower value to weight ratio than consumer electronics, in some instances.” 

A Possible Solution

In its analysis, it was highlighted that while there may not be a perfect remedy, the implementation of e-scrap compensation serves as a crucial stepping stone towards restructuring African value chains to follow circular principles.

According to the report, there is still a significant distance to cover in tackling “planned obsolescence, poor design decisions, inefficiencies in the value chain, and unaccounted for negative externalities by electronics producers,” despite the potential assistance that EPR policies could offer.

“One important thing to note is that e-waste compensation does not free producers from their legal obligations under extended producer responsibility schemes in countries where their products are sold,” it explained. “It is a voluntary complement by participating businesses/customers.” 

The importance of setting the right price cannot be overlooked, emphasized the authors. The cost must be attractive to potential customers looking to upgrade their devices, yet also competitive enough to discourage purchases from the secondary market. At the same time, prices should not be inflated to the point where devices are recycled too early.

Plans in Place

The authors go on to suggest that African governing bodies should focus on determining the accurate expenses involved in processing materials locally and establish an “enabling environment” to attract investments in regional processing capacities. This can be achieved by utilizing consistent regulations, defining clear responsibilities and job roles within the sector, and granting licenses for both formal and informal positions. E-scrap processors based in Africa are also advised to track and disclose information regarding the volume of materials processed and associated costs.

When formulating regulations for the electronics sector, governments and institutions are encouraged to cover aspects such as product design, right to repair, and end-of-life management. In order to promote fair competition, these guidelines should facilitate the growth of new recycling ventures and evaluate the effects of EU-wide EPR and required compensation for e-scrap as a transitional step, stated the report.

Incorporating repair and recycling strategies, outlining circularity targets, and advocating for e-scrap compensation are essential responsibilities for electronics manufacturers and importers. These initiatives mark “a step in the transition” in the industry’s evolution towards sustainability.

“There is a need for much better understanding and collaboration between the people who are aiming, in different ways, to address the global mess that is e-waste,” the report relayed. “There is often the challenge of ‘friendly fire’ when talking about pathways to real sustainability. Rather than viewing this as an impasse, we believe this opens up a series of options for collective problem-solving.”