The Development Bank of Southern Africa (DBSA) is working to develop and implement a National Water Programme that will include a water partnership office that could replicate some of the successes seen in the energy sector.

The programme is aimed at establishing a “programmatic approach” to address South Africa’s water challenges in a comprehensive and prioritised manner to mobilise available resources in the best way possible.

The DBSA, working as the fund manager and secretariat to the Infrastructure Investment Programme, seeks to attract public- and private-sector investment, while providing tangible solutions for different stakeholders, such as municipalities and other role-players in the water sector, says DBSA water-sector innovation specialist Johann Lübbe.

Speaking during a webinar hosted by the DBSA, the National Treasury and the European Union to unpack the solutions for and successes of South Africa’s water infrastructure challenges, he said that the DBSA, along with various partners, is establishing the programme approach to tackle the various systemic issues that are hindering progress in the water sector.

Reviewing the success of other sectors, specifically South Africa’s successful renewable-energy programme, the DBSA zeroed in on two key success factors.

In the Renewable Energy Independent Power Producer Programme, an Independent Power Producer Office was created, which became the “one-stop shop” for everything that was renewable-energy-project-related, and emerged as a “centre of excellence”, he says.

Further, he highlights that there were also specific funding solutions that paved the way for its success.

“Those are the two key elements that stood out for us and we said how can we replicate that in the water sector?”

The DBSA, together with the Department of Water and Sanitation (DWS), is now developing the National Water Programme to bring in some of those elements.

Discussions are under way for the establishment of the water sectors’ own centre of excellence, or one-stop shop, in the form of the Water Partnerships Office, to deliver capacity and provide support, including preparation, feasibility, financing, bankability and implementation, to project owners, such as water boards, municipalities and government, to take projects forward.

It aims to create an enabling environment to support projects with the standardised approaches.

The Water Programme will specifically address water reuse and nonrevenue water supply, off-grid sanitation and rural water supply through subprogrammes, and is part of the water capital expenditure programme for South Africa, with capital deployed using programmatic and blended finance strategies.

“The water sector is probably the most difficult sector to finance. It is much more difficult than, for example, energy, where there are clear revenue streams,” Lübbe comments.

An element currently being worked on, he said, is to develop innovative and alternative funding solutions amid the various systemic, bankability and project pipeline challenges that need to be dealt with to access sufficient funding for water supply and sanitation infrastructure projects.

Currently, there are two major options when it comes to financing water infrastructure: municipal balance sheets for municipalities to raise funding on the balance sheet to invest in infrastructure and public–private partnerships (PPPs).

PPPs are not suitable for all projects and the balance sheets of municipalities do not allow them to raise sufficient funding to meet all the needs.

“The DBSA is reviewing blended finance, bringing in the private sector more, reducing reliance on government funding and to see how we can then put those specific funding options available together to become part of a suite of options that can be used to finance specific projects.”

The programme aims to facilitate private-sector participation, not only from a funding perspective, but also from an operational, maintenance and implementation perspective.

The umbrella National Water Programme will host several subprogrammes, including the water reuse subprogramme, in which the partners will work to scale and escalate water reuse projects across the country, and the nonrevenue water subprogramme, which will focus on the significant physical and revenue losses currently experienced.

Another subprogramme will address some of the wastewater treatment challenges that municipalities are facing, with the potential development of a new private-sector participation model that is specifically geared to support municipalities, especially under- resourced municipalities, to mitigate nonperformance related to wastewater treatment.

Lübbe says that another subprogramme being considered is off-grid sanitation through a community and rural water supply initiative, and this could potentially encompass other programmes, such as ecological infrastructure, desalination and agricultural water use.

While South Africa has had several successful water resource projects since the dawn of democracy that have resulted in increased access to water and sanitation from 50% to 90% of the population, what remains concerning is water losses and the quality of water, says DWS acting deputy director- general Leonardo Manus.

Good work has been done over the past two decades, but quantity and quality remain a concern.

“Our unaccounted-for water that we are recording across this country is just too high, particularly around water losses. We cannot afford water losses because we are a water-scarce country that is facing a 17% deficit by 2030,” he says.

Further, the quality is still not acceptable in a many cases as far as the wastewater treatment is concerned.

The Green Drop report, to be published in due course, will aim to diagnose the challenges and deliver a baseline from where the country can improve.

“The one thing that we have to focus on is restoring functionality, because we have, perhaps for far too long, been focused on building new infrastructure. We have to refurbish and rehabilitate what we have.”