South Africa

The strategic sector cooperation between Denmark and South Africa on water 2023-2025

Photo: Colourbox

The Danish Environmental Protection Agency in South Africa

The Strategic Sector Cooperation (SSC) on Water between the Danish Environmental Protection Agency and the South Africa Department of Water and Sanitation has been established in 2016 as a long-term framework for co-operation in the water sector. The co-operation supports a balanced social, environmental and economically sustainable development support a balanced social, environmental and economically sustainable development.

The SSC project currently in its third and final phase (2023-2025), where it consists of five tracks of cooperation, namely, Water Services Management, Groundwater, Water Efficiency in Industries, Research and Innovation, and a Project Support Facility focussing on investment planning and financing for water related projects. Each track is led by representatives from the South African Department of Water and Sanitation and the Danish Environmental Protection Agency (EPA). The Research and Innovation track is managed by the Danish Agency for Higher Education in cooperation with the Department of Science and Innovation.

General environmental challenges in South Africa

South Africa is ranked as the 30th driest country in the world. The country has an arid to semi-arid climate with an average annual rainfall of 465 mm, which is well below the world average of around 860 mm. It is estimated that less than 10% of South Africa's rainfall becomes available as surface water, one of the lowest conversion ratios in the world. According to South Africa's National State of Water (NSoW, 2020/2021), 98% of the country's available water resources are already allocated. Water demand in South Africa is expected to increase over the coming years in the agricultural, industrial and municipal sectors driven by a combination of population growth, increased land use, economic development, resulting in unsustainable pressure on water resources and water infrastructure.

According to the second edition of the National Water Resource Strategy (NWRS II, and NWRS III respectively), South Africa is currently over-exploiting its renewable water resources at the national level. The reports highlight the need for both demand-side and supply-side interventions to address a projected supply deficit of 17% by 2030. Increased land use, economic development, population growth and demands for increased living standards result in unsustainable pressure on water resources and water infrastructure. At the same time, only 15% of South Africa's water consumption is based on groundwater and less than 15% is recycled, while the rest is dependent on surface water. In addition, water consumption in South Africa per inhabitant 217 liters per day, compared to 105 liters per day in Denmark, where it was possible to decouple water consumption and growth. The water-loss of approx. 40% is also very high. This clearly shows an unrealized potential for diversified water resource provision and improved water efficiency at all levels. Furthermore, available water resources in South Africa are unevenly distributed in terms of geography, and access to clean and adequate water remains socially biased. The water and environmental management issues are strongly linked to overriding social challenges of poverty, unemployment and inequality, and solutions must be seen and found in that context. In short, South Africa faces significant challenges in meeting demands for sustainable and safe water supply and effective management of the sector in the coming decades.

Although South Africa is often recognized as one of the countries in the world with the best legislative and strategic frameworks for water management, there is still a recognized need for updates and specifications. These are necessary to implement the framework effectively at all levels and to achieve the desired societal benefits and sustainable growth. There is a great need for adjustment of governance and management models, institutional reforms and improved resource costs and revenue collection modalities. In response, the Department of Water and Sanitation (DWS) is currently putting in place a Water Services Improvement Programme to strengthen its support and intervention at municipal level. The aim of the programme is to make DWS’ support and intervention more consistent and systematic as opposed to the current ad-hoc approach. Key elements include issuing updated and more comprehensive norms and standards for water services and publishing a National Regulatory Dashboards to regulate the compliance of Water Service Authorities with these standards. This strategy will be a strong vector in the direction of the sector.

The SSC Project on water between Denmark and South Africa

Denmark has a strong position within the water sector. Not only was the country among the first to develop a national environmental plan that focuses on ensuring a sustainable water supply through the managed exploitation of groundwater resources, but the country is also home to a number of large companies with world-class technological products in areas such as pumps, valves and water meters for the water sector.

The National Water and Sanitation Master Plan of 2018 is a strong vector in the direction of the sector and the focus of third phase of the Strategic Sector Cooperation on water between Denmark is South Africa is designed and formulated to support the main objectives of the Master Plan. The SSC project focuses among other on policy and regulatory mechanisms that will have crucial impact on service improvements. Any of these service improvements will alleviate the most vulnerable parts of society and hereby contributes to combat poverty.  Currently two SSC projects in South Africa within the water sector aim to contribute to mitigating the challenges faced by South Africa. The South Africa – Danish Strategic Water Sector Cooperation focuses on clean water and water management on a national level.

Parallel to the national project is the Water Resilient Cities project, which is an urban water SSC partnership between the City of Tshwane and the City of Aarhus, and which aims to contribute to adaptation to climate change through a focus on non-revenue water, wastewater treatment management and water security on municipal level to improve service delivery in the water sector with the goal of wider application of the developed frameworks and learnings.

Photo: Colourbox

Phase 1 has been successful in building relationships, networks and sector position and has also delivered tangible results in all its work streams. This work has been continued and advanced in phase 2, where the main objective has been to move forward towards capacity building and knowledge sharing on actual implementation of policies, guidelines, demonstration projects, new technologies and high innovation in the late stages. Despite the challenges of COVID-19, Phase 2 has overall been very successful. By the end of 2022, the SSC Water project had achieved tangible results in efforts to support and improve the overall status of the South African water sector. Results include, but are not limited to:

  • Contribution to the Water Research Commission's think tank on water form
  • Introduction of Danish financing options for partner organizations with a view to financing municipal projects with a view to improving the water supply
  • Borehole optimization in Modimolle-Mookgophong in efforts to increase water security and reliable water supply to the local community
  • Contribution to the competences of the partner organisation's staff through DFC courses in Denmark
  • Encouraged measurement and monitoring through installation on meters in dairies.
  • Guidelines for groundwater by WRC and expert group
  • Geological and hydrological models (eg. in Ladysmith ).
  • The South African Groundwater Mapping and Assessment Methodology SAGMAA.
  • A Well Field Management Systems (WfMS)
  • The contribution to the national groundwater strategy
  • Guidelines and tools as part of implementation and dissemination of the No Drop programme
  • Development of a method for assessing costs associated with the production of drinking water, based on Danish experience and tested in four pilot municipalities.

The main overriding objectives of phase 3, which started in spring 2023, are to

  • Support an increased contribution of the water sector in South Africa to a balanced social, environmental and economically sustainable green development, based on South African national development agenda and National Water Resource Strategy II (2013).
  • Consolidate, and extend the Danish water sector specific policy contribution adapted to South African water management needs.
  • Significantly contribute to improved framework conditions for private sector technology and financing involvement in the water sector in general, and green water sector investments in projects with Danish participation.

Accordingly, the project aims to a.) Contribute to a development of a water sector that characterized by enhanced environmental, socially and economically sustainable green development, b.) Assist the South African Departments of Water and Sanitation in establishing a Water Services Improvement Programme to strengthen its support and intervention at municipal level, and c.) To improve the investor attractiveness of the water sector, both of which in support of the realization of the SDGs and to secure sustainable water and sanitation services for all. In this way, the strategic water sector project will contributes to the improvement of the framework conditions of the South African water sector, in particular with respect to both investment planning and water supply services.

Phase 3 will support the dissemination and uptake of instruments developed in phase 1 and phase 2. There will also be a strong drive towards reform initiatives to strengthen municipal water supply services. The new funding opportunities will look at further upscaling of pilot- and investment- projects that are aiming at the improvement of water supply and services. Research and innovation will continue being the main driver for capacity building and skills dissemination within organizations as well as outcome harvesting and impact identification. The focus shall moreover be on further developing cooperation in science and technology as well as on test and demonstration, which all can be beneficial for the other components. Moreover, opportunities for investment projects will be explored. The Danish water sector considers South Africa to be a potentially interesting future market in connection with the increased urbanization that is taking place in these years. The growing population demands better and expanded infrastructure. Here, Danish exporters with this expertise will be able to contribute to improvements, including in the water sector ( Read and see key figures and facts about the Danish water sector - Water Vision 2025

Phase 3 of the project is subdivided into two overall tracks / outcomes:

Outcome A aims at a South African water management framework enhanced with strategies, guidelines and regulatory tools developed in phases 1 and 2 of the SSC project

This will be based on progress in results from Phases 1 and 2 on groundwater management, water supply, efficient water use in industries, water sector research and consolidated innovation. This will include consolidation, institutional anchoring and dissemination of results – e.g. regulatory tools, guidelines; technological approaches, etc. on groundwater management, urban water, water efficiency in industries and the water sector's research and innovation.

The track also includes support for major structural initiatives to reform the water sector in terms of strengthening revenue collection chains, fiscal arrangements and private sector involvement in the provision of water are supported, which are under implementation. The support is provided based on Danish expertise as consultancy within the water supply sector. This includes support for the work the Department of Water and Sanitation and the National Treasury is undertaking to implement crucial structural reform initiatives for improved service delivery at municipal level, making the water sector a good business and facilitating the involvement of the private sector, based on priorities of the political and administrative management.

If South Africa wants to achieve its goals for water services and sanitation by 2030, it has been estimated that the water sector must invest approx. 800 Bill ZAR. Only a 300 bill is expected from the Ministry of Finance. One of the main reasons for this significant backlog is a lack of capacity for project planning, formulation, design, contracting, financing and implementation. In order to build capacity within this complex of challenges and to implement smaller demonstration and pilot projects, as identified by the thematic tracks, the SSC project decided to establish a Project Support Facility in phase 2. The facility is a fully integrated component of the SSC project that facilitates and oversees the formulation, selection and implementation of smaller demonstration projects as identified by the experts in the thematic tracks. The demonstration projects are carried out by the Danish experts from the EPA and other authorized bodies in close cooperation with their peers in South Africa. The Project Support Facility continues into Phase 3 with significant reinforcement from the Investment Adviser Facility. The work will lead to the implementation of demonstration projects and financing modalities developed in phase 2, which must be further developed, scaled up and disseminated to stakeholders, such as e.g. municipalities, water boards and industries. The component will also, with the support of the investment adviser (and thus and differently from phase 2), bridge funding sources from Danish funding facilities and institutions. The Project Support Facility will ensure that the selected projects serve the overall objectives of the SSC project, including HRBA and poverty orientation in the design of the call for proposals, evaluation and award of proposals.

The transition and exit will be ensured by streamlining the RSA Government's water project pipeline and project development facilities: the National Water Partnership Office and the National Water Infrastructure Agency. In addition, the investment advisor's presence and support will continue beyond the water project and will support the transition.

All projects finally awarded as a result of the qualification process provided by the PSF team will be fully implemented in line with other activities in the previously defined thematic tracks (groundwater, urban water and industrial water efficiency). This implies that the EPA, together with the South African partners, will manage the awarded projects, supported by a consultancy firm (under 30% in total for the total project).

Outcome B will involve Joint activities of the South African Department of Science and Innovation and the Danish Agency for Higher Education and Science, that facilitate

  • matchmaking and co-learning through recurring activities and project collaboration,
  • continued DFC short courses and master’s students and funding of R&D projects, as well as
  • exploration of new opportunities for both technical and governance/resource management training.

The science and innovation outcome B will be cross cutting and support the other outcomes of the sector cooperation.

Outcome B aims at improved water sector capacity and knowledge as a results of increased research and innovation. It seeks to ensure, that

  • Research role players and funding streams are aligned to support the thematic priorities of the SA-Danish Water Sector Co-operation (ground water management, urban water management, water efficiency in industries). To this end 1-2 events/ workshops/ symposia will be held to connect existing and potential new DFC research contract awardees
  • Structural reform support processes underway through the SA-Danish Water Sector Cooperation are supported through a more effective understanding of how to mainstream narratives, approaches and priorities for a just and green water sector reform in complex institutional settings. A workshop/dialogue on green and just water sector reform will aim to mainstream narratives, among others by clarifying how those descriptions relating to just and green transition realistically can shift us towards a stronger human rights paradigm in water sector implementation activities.
  • Cooperation on platforms between South Africa and Denmrak for sector specific skills capacity building and research are consolidated and expanded. A survey at the end of the project of 10 Innovators with solutions supporting the thematic priorities of the South-African-Danish Water Sector Cooperation will assess how the innovators have been connected to training and upscaling opportunities.

 

Private sector involvement

Denmark has been among the first countries to develop a national environmental plan focusing on ensuring a sustainable water supply based on a managed usage of groundwater resources. Denmark also hosts a number of excellent knowledge institutions and large companies with excellent technological products within areas such as pumps, valves, and water meters for the water sector.

Danish technology is already present on the South African market and has proven its value in application both in private and in public sector infrastructure projects. Danish Technology and expertise is attractive as to its huge advantages both in terms of product lifetime and operational costs related to  maintenance and energy efficiency and .

The South African market is highly protected under the BBB EE and local content regulations and the Danish companies are working proactively to comply.

The biggest challenge is however that the market – contrary to the expected demand – acts very slow. The main reason for that is little planning, project scoping, procurement, contracting and implementation capacity at the municipal level.  Additionally the municipalities’ ability to finance bigger infrastructure investments is limited due to inefficient revenue collection and no ring fencing of the utilities economies. Components of outcome A are addressing these challenges in the municipalities.

The SSC project between the City of Tshwane and City of Aarhus is similarly addressing these challenges, where the Water Resilient City Project particularly involves a collaboration on both the improvement of service delivery in City of Tshwane within Water Distribution and Waste Water Treatment, and development of a holistic Water Security Strategy. Having both a national and municipal water project gives opportunities for working in the full water governance chain. City of Tshwane is a central municipality as testing ground for the National water project, testing tools on e.g. NRW and water pricing.

The two projects also open opportunities for the South African stakeholder dialogue both at working, decision maker and political level 

The Danish water sector considers South Africa to be a potentially interesting future market that could also be a hub for serving the rest of the Sub-Saharan Africa; a market that also has an enormous potential for growth in connection with the increased urbanization that has taken place over recent years. Danish water sector exports to the Danish expert of water technology and knowhow to South Africa doubled from 2008 – 2018 after which it plateaued.

Finally, the South African market has been and is an interesting test bed for trying out innovative products and concepts within the water sector. Being part of this development will not only allow Danish companies to test new technologies in a diverse market situation, but it might also lead to development of new “frugal innovations” that might prove competitive on the Danish market. Hence, there are possible “take-home”-aspects of relevance to companies and Danish Environmental Protection Agency as well as the Danish Agency for Higher Education and Science.

Alignment with strategic directions and priorities of the Minister of Water and Sanitation and with the Department of Science and Innovation will be maintained in the third and last phase of the SSC project.

Poverty and human rights orientation

South Africa is one of the most unequal countries in world and has even with a highly industrialized economy more than 40 % of the population living under the poverty line and often challenged by multidimensional poverty where limited access to clean and safe water and sanitation is considered serious dimension as it also constitutes a significant health threat.

Access to consistent sources of clean water is crucial to poverty reduction. Lack of access to clean water may cause difficulties including issues with health, education, gender equity, and economic development. An efficient and competitive infrastructure is crucial to facilitate economic activity that is conducive to growth and job creation. This calls for further strengthening of key services such as water supply, while ensuring their long-term affordability and sustainability. The National Development Plan (NDP) published in 2013 has clearly defined milestones to achieve its 2030 objectives. Some of the milestones include, among others, ensuring that all South Africans have access to clean running water in their homes. Infrastructure investments that should be prioritized are several new water schemes to supply urban and industrial centres, new irrigation systems and a national water conservation programme to improve water use and efficiency.

A vision for the National Water Resources Strategy 3 (NWRS-3), as aligned with the vision of South Africa’s NDP Vision 2030, is: “The protection and management of water resources to enable equitable and sustainable access to water and sanitation services in support of socio-economic growth and development for the well-being of current and future generations.”  The NWRS-3 aims to achieve this vision by focusing on three overarching goals, where the first goal is that water and sanitation must support development and the elimination of poverty and inequality, by increasing water supply, managing effective water and sanitation services and regulating the water and sanitation sector. Strategies to avoid future water deficits include reducing water demands and managing effective water services. The South African government raises public awareness on the importance of water conservation for the future. The National Water and Sanitation Master Plan emphasizes the need to reduce water demand and increase water supply. Moreover, alternative sources of water and water that is not utilized need to be identified. Water demand in urban areas should be reduced by 15% below the business as usual scenario by 2030.

Phase 3 of the SSC will support:

  • An increased focus on water efficiency and management based on use of technical solutions and guidelines during phase I and II of the SSC project as well as on capacity building related to reduced water loss and increased water use efficiency derived from measurement and assessment water supply and use amounts.
  • Identification and management of aquifers as resources that become increasingly important for water supply in South Africa.
  • Investigations of frame conditions for investments in infrastructure, including bulk water supply programs, maintenance of existing infrastructure, and efficiency/recycling initiatives.

All the outcomes of the 3rd phase of the SSC project will address challenges and provide solutions that if fully implemented would lead to vast improvements of the water services provision and thereby, also serve as means to alleviate one of the main drivers of poverty - lack of access to clean and safe water and sanitation. 

Transition strategy

The third and last phase of the SSC water cooperation between Denmark and South Africa will particularly focus on anchoring and implementation of the achieved results and new initiatives in accordance with the overall objective.

There is a common and consolidated understanding between the partners that phase 3 will include among others

  • Implementation of guidelines and regulatory instruments developed during phase 1 and 2 as part of the South African water governance and management framework (see the above list on achievements), among others:
  • A Process Action Plan for adoption of all tools developed under phase 1 and 2 of the SSC cooperation into South African regulatory framework.
  • A Water Conservation and Water Demand Management implementation guideline for the South Africa industrial sector
  • Dissemination of guidelines developed during phase II through stakeholder engagements with various sectors
  • Incorporation and implementation of the five groundwater guidelines into existing regulatory frameworks in South Africa,
  • Proactive contribution to and inclusion and mobilization of governance structures and resources in Danish - South African Green Strategic Partnership Agreement (SPA)
  • Capacity building by training provincial officers and Municipal officials to ensure upscaling and implementation of the guidelines and other outputs from phase 1 and 2, for example as part of processes driven by the Water institute of South Africa (WISA), the South African Local Government association (SALGA) and Municipal, Infrastructure Support agent (MISA). City of Tshwane - where we have the Water Resilient Cities project with City of Aarhus - is one of the municipalities we have chosen to work with in the National Project. Additionally we seek to include stakeholders from the two project in dialogues and activities where relevant.
  • Assistance in supporting structural reforms to improve governance and ensure management effectiveness, which could lead to better sector outcomes and improve service delivery. This will be done in consultation with COGTA (which consist of the Department of Cooperative Governance (DCoG) and the Department of Traditional Affairs (DTA), The National Treasury and other stakeholders and draws on South Africa’s experience over the last 25 years as well as international experience.
  • Upscaling of the Project Support Facility (PSF) by amalgamating structure, experiences and project pipeline into in to the National Water Partnership Office (permanent institution under DWS hosted by DBSA) and the National Water Infrastructure Agency.

Establishment of public private partnerships that will align with the South African minister of Water and Sanitation’s strategic partnerships and focus on technology, innovation and knowledge-transfer that addresses current municipal service challenges such as non-revenue water, deteriorating water infrastructure, as well as improvement of administrative and organisational capacity.

Contact

Dirk-Ingmar Müller-Wohlfeil

+45 41 39 24 99