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'Invest in water or face 30% shortage'  Comments

SA must spend R2.8bn a year to prevent deficit - report

November 24, 2009

By INGI SALGADO


South Africa is heading for a water deficit of between 17 percent and 30 percent in 2030 - and needs to invest $365-million (R2.8 billion) a year to prevent shortages, according to a global water report released in Washington yesterday.

The Water Resources Group study, a collaboration between the International Finance Corporation, McKinsey consultants and private companies such as SABMiller, says South Africa faces "tough trade-offs" between water use for agriculture, industrial activities such as mining and power generation and domestic consumption in expanding urban centres.

Its best-case scenario projects a water shortfall in two decades of 2.9 billion cubic metres, rising to 3.8 billion cubic metres if moderate climate effects are taken into account and 5.4 billion cubic metres with accelerated economic growth. Currently water supply is about 15 billion cubic metres.

But it says South Africa can close the gap provided it adopts a mix of solutions, chiefly infrastructure investment in water transfer schemes.

Of the required capital outlay, 70 percent is needed for additional water supply measures, 13 percent for interventions in agriculture, another 13 percent for those in industry and 4 percent for domestic and municipal uses.

"We're definitely not doomsdayers at this stage," said Marc van Olst, a partner at McKinsey South Africa. "But it will turn into a crisis later if we don't act on these things very quickly."

The big question facing South Africa is the sourcing of funding for large infrastructural projects.

State-owned water utility Rand Water said last month that it faced a R5bn funding shortfall between 2010 and 2015, when it would invest R8.6bn to augment infrastructure.

The global water report notes there is wide agreement that water has suffered from chronic underinvestment. "There is good reason to believe that water will be an important investment theme for public, multilateral and private financial institutions in the coming decades," it says.


The report, which looked at demand and supply in China, India, Brazil and South Africa, found that under an average economic growth scenario, world water requirements would surge to 6.9 trillion cubic metres - or 40 percent more than current accessible, reliable supply.

By far the cheapest and most effective solution to South Africa's pending water shortages is a blend of infrastructural investment and efficiencies in agriculture (the country's biggest water user), industry and the domestic sector.

This solution would result in net annual savings of $150m in 2030 as about half of the measures involve significant savings of other input costs, such as fertiliser.

Desalination, the removal of salt from sea water, is listed among South Africa's most expensive options. Van Olst said many people regarded desalination as a "silver bullet" but its carbon footprint was very high and transport costs restricted its use to coastal areas.

The report calls for strong co-ordination and co-operation between water users.

Van Olst believed water would be "high up" the agenda of National Planning Minister Trevor Manuel's commission.

Manuel earlier this month noted that while alternatives existed to generate energy, there were none for water.

Africa should resist a course of "water for profit" in favour of water "as a right", but he cautioned: "We're living on earth in 2009 with the same amount of water that was available in 1900, meanwhile the global population has quadrupled".

The water report does not delve into the pricing of water, although it does refer to a possible role for private investors, either as traditional financiers or under build-operate-transfer models. The latter would require private investors to own raw water infrastructure and charge cost-related tariffs.
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Showing page 1 of 1 comment pages, 5 total comments
11 Weeks ago The Disciple. Cape Town, South Africa. wrote :
As long as the nations keep leaning towards dumb talk and Godless theories like evolution, we are destined to become engulfed in calamitous shortages that, in truth, do not exist. At this point, I will focus on, by far, the most valuable commodity of all, which is water; - the lack of which spells death. In truth, the saying, "water, water everywhere but not a drop to drink," would not exist if only people would stop being so much like the fools who believe there is no God. This world we inhabit was created by an all-knowing and super-loving and caring Creator, who people refer to as God; this I do not only believe, but KNOW! I do also happen to KNOW that He makes no junk, and certainly makes no miscalculations, and certainly no accidental mistakes! Whatever He created for His beloved human race is perfect! He, therefore, provided for our every need for time immemorial! He has most definitely not slipped up on the world's water supply! Therefore, excluding the oceans and natural lakes, there is a much more than abundant supply of potable water available in the bowels of our planet to cater for all our needs, whatever they may be, but; to get the powers that be to listen to the truth regarding how man can accurately connect and tap into this really monstrous, natural underground reticulation system, has become another monstrous problem. They simply keep spending billions on drilling endless thousands of boreholes, of which, relatively few produce really worth-while, constant water-flow results, and the rest produce pathetic to no results. There is no more time to be wasted on expensive, pot-luck borehole drilling tactics, which are making certain people very, very comfortably-off in the process, while the water starved of the world are subjected to living under deplorable, life-threatening conditions. God is not spiteful or confused: He never supplies a life-giving, life-saving source without the means to access it. He has, many years ago, revealed the technique to a sincere, Godly man, who is willing to share it with the whole world, but has had no success in his efforts to share it with the so-called powers that be; probably because this would lead to far less boreholes being drilled, and with far superior results in solving the great and increasing water-shortage problems in our country, & elsewhere. The technique for pin-point accuracy in the plotting of water drilling sites is available, but not to those who will first think in terms of how much wealth it will Agenerate for them, but rather to those who place the interests and welfare of the nations as their main line of focus. Maybe the time to share this well-proven technique with the world has finally arrived. Maybe not. However, the situation is in His, GOD'S hands.
11 Weeks ago Anonymous wrote :
Go and take a look at WET listed in the UK. Working to help sort out the AMD problem on the Reef and sell the water back to Rand.
11 Weeks ago andilekakuzwayo wrote :
To Anonymous Shut up
11 Weeks ago mike mano wrote :
The difference between electricity and water is that you can always make more electricity (unless you let regulators and ministers mess up the organisation that should be doing the job) At the coast, we can make more water from desalination so there is no crisis - although it is going to be expensive. Inland, once we have made the next few investments in Lesotho Highlands and the Thukela, the only option is to move water from one group of users to another. This is why mining companies are already fighting for the privilege of using municipal waste water - a really positive development. And why irrigation farming is not a good business to get into in the long term So we had better get used to the idea that every new water user will require an existing user to give up some water. The law provides for that - but it is not clear that the national psyche has caught up with this reality
11 Weeks ago Anonymous wrote :
sounds as bad the electricity crisis here! our basic commodities - water and elec. and this government has stuffed it up!
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