New Horizons Energy is one such company producing gas and fuels out of trash.
One of its plants in Cape Town, worth $30 million, aims to consume 560 tons of solid waste per day. This is about seven percent of the total waste the six million residents of Cape Town produce daily.
"We are trying to be a landfill alternative which means we take waste from various sources, bring the waste in, clean it up, produce gas, produce fuels," Egmont Ottermann, New Horizons Energy's CEO, told CNN.
Companies such as waste removal company Wastemart already pays to deliver its waste to the plant.
"We see the plant in Cape Town as a springboard for developing more plants in the future," added Ottermann.
"It's where we have to get things right, it's our blueprint, it's the first one where we get the formula for building and operating it right."
How it works
The waste used for fuel has to be organic matter. It is piped into huge vats, where bacteria converts it to natural gas. The biogas generated is then cleaned and piped to the market, either as methane rich gas or liquid CO2 rich gas.
"The Cape Town market is looking for alternatives to its current energy sources, so alternatives to heavy fuels, coal, LPG, diesel; and it fits beautifully in that," said Silvia Schollenberger from AFROX, one of the main gas suppliers in Cape Town and a New Horizons Energy shareholder.
There are plans for similar projects in at least three other cities in South Africa, and eventually across Africa.