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National Water Investment Framework & Strategy Advanced Product 2

National Water Investment Framework & Strategy Advanced Product 2. Steering Committee Meeting & Work Session 26 January 2012. 1. Overarching Purpose. To develop and maintain a dynamic comprehensive National Water Investment Framework/Strategy/plan. 2. Purpose of Meeting.

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National Water Investment Framework & Strategy Advanced Product 2

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  1. National Water Investment Framework & StrategyAdvanced Product 2 Steering Committee Meeting & Work Session 26 January 2012

  2. 1. Overarching Purpose • To develop and maintain a dynamic comprehensive National Water Investment Framework/Strategy/plan

  3. 2. Purpose of Meeting To obtain a common understanding of the purpose and drivers (mandate) as well as scope, principles and format of the product/programme To obtain guidance on product design To facilitate extended and improved information input To facilitate effective output, ownership and application

  4. 3. “Drivers” for Developing an Investment Framework • National Treasury requirement (national funding is conditional to submitting an Investment Framework) • Legal requirement: NW Act requires a development plan • Component of NWRS-2 (investment component and impementation costing) • Socio-economic development & outcomes demand integrated infrastructure delivery plans • Various programmes require special investment (e.g. Basic services, wastewater management, disaster management, asset management, demand & conservation management)

  5. “Drivers” for Developing an Investment Framework (cont) • Outcomes 6,7,8,9+10 programmes demand infrastructure investment frameworks & programmes • All major project developments (e.g. de Hoop Dam, water reconciliation studies) demand investment frameworks • Poor track-record & challenges: under utilized dams & systems, housing with no services • The application of “source-to-tap, tap to source“ management principle • It is a logical business approach (appropriate planning and solutions • Cabinet Lekgotla requirements • Funding negotiations, need for asset mangement

  6. 4. Response ? • No comprehensive response and system • Ad hoc products, ad hoc development • Lack of co-ordination, frustration • NOW: top priority, urgency, high expectations!!!!!!!!!!! • Include job creation, fuctionality

  7. Development process 1 • DWA workshop 13 -14 June 2011 • Development of “first order high level business case” and framework: • DBSA responsibility (as per MoU) • Quick win (based on available information –no research; no development support) • Support task team established • Product developed (As per DBSA)(August/Sept 2011) • Product incomplete

  8. 5. First order product & perspective • Based on input received as per workshop (DWA, Water Boards, TCTA, MIIF) • Focus on National and Municipal infrastructure • Spread sheet data base with development time frame for water resources infrastructure • High level national perspective (limited spatial, institutional and project presentation) • Limited timeframe • Limited validation (comprehensive municipal data base)

  9. Financial perspective: first order development Capital requirements • R573 b is required over 10 years (R58b/a) • R254 b available from present funds over 10yrs (R26b/a) • Deficit = R319 b (investment must double to meet development and refurbishment requirements) (R32b/a) • Water resources bulk capital requirement = R16.2b/a vs R11b/a available • Water services requires R394bover 10 years (excludes major turn around investment eg Waste water works) • Need to invest in dedicated programmes eg demand & conservation management • Based on essential requirements Action: • Differentiated approach to address unique needs in rural & urban • Financing and tariff model to be development to identify and mobilize alternative funding • Ring fencing of water services financial management to enhance self-financing and viability • Improve investment funding & grants (outcome 9.2 action) • Stretch existing financing through effective water use and infrastructure maintenance • Prevent leakage of available financing through effective financial management

  10. 6. Existing Task Team • DWA, DBSA and TCTA • Initial purpose was to facilitate specific component input to DBSA • However: need was identified to develop a comprehensive system (“as per drivers” and mandate) • Actions extended to also develop the concept, scope and format • Actions initiate to develop an advanced intermediate product by March 2012 and a comprehensive dynamic system by March 2013

  11. 6. Framework design and approach • Framework vs strategy vs plan • Investment framework = Infrastructure plus business plus people plus institutional and governance • Total value chain (source to tap to outcome to source) • Includes outcome, technical, management, institutional and financial information and perspectives • Existing,5y MTEF, 10y and longer term perspectives

  12. 6. Framework design and approach (2) • All water related sectors value chains (municipal, agriculture, energy, industry, etc.) including outcome alignment • Spatial orientated and reflected • Funding and financial model • Strategic analysis and perspectives • Prioritization and appropriate solutions (modeling) • National to project level perspectives • Project status, information • Accessibility and deliverables

  13. Total sector perspective municipal agriculture Water resource national energy industry regional local other waste

  14. Investment Framework future Macro WR existing impl committed reality supply waste Governance & management Local WR Reg bulk Int bulk reticulation energy Agriculture

  15. Investment model Development status technical Value chain financial management institutional

  16. Investment Framework future Macro WR existing impl committed reality supply waste Governance & man Local WR Reg bulk Int bulk reticulation energy Agriculture

  17. 7. First order product: gaps • Only water resources and municipal water services perspective • Lack of regional and spatial perspective • Still need local validation and alignment • Extensive municipal information but requires strategic assessment and alignment • Municipal information based on MIIF modelling • Still need financing modelling and perspective • Operations and maintenance, governance and programme costing not addressed • Limited prioritisation and scheme alignment

  18. 7. Development process 2 • Need to develop comprehensive and functional (live) framework and system: • Major expectations (Cabinet, Minister, NT) • Concept and framework developed • Extended (intermediate) product initiated (limited time frame) • DBSA support • Comprehensive business framework well advanced and development programme 3 underway • Extended task team

  19. 7. Development process 2 • Establish extended task team: • Technical theme champions • Business and governance champions/role players • Sector partners and champions • Strategic and decision making/enabling partners • Consolidate and align existing programmes and initiatives

  20. 8. Activities Strategic assessment 5 1 3 Integrated system and data base (PSP) Functional & sector output Financial model 2 Spatial information system 4 Action 1 Action 2 Action 3 Action 4 Action 5 Action 6

  21. Existing programmes and activities • Macro programmes (NGP, Vision 2030, Cabinet, Outcomes 6,7,8,9,10; job creation) • Sector programmes (energy, electricity, agriculture and food, municipal, mining, schools, health, environment, housing, rural development, Cabinet Lekgotla: 22 DMs plus..) • National water infrastructure, water resources planning, all towns studies, reconciliation studies, bulk infrastructure programme, basic services, infrastructure asset management, Waste water systems /water supply, under utilised dams

  22. Existing programmes and activities 2 • Water quality (resource) and resource protection • Governance programmes (monitoring networks, regulations, water use efficiency) • NWRS 2 costing • Enabling strategies and programmes: institutional, skills development, financial model and tariff strategy • Feasibility studies, budgets, development plans • Implementation projects • MIIF, asset management plans and programmes

  23. 9. Development examples

  24. Large Water Resource Infrastructure Projects R162 billion investment required over 10 years

  25. Water Reconciliation for main growth areas Legend Study Focus Areas Economic Growth Areas Economic Value of Growth Areas Spatial targeting to ensure water security for main socio-economic hubs

  26. All town study: Water resource intervention

  27. Developing Water Solutions for each Town by 2012 (e.g. Free State) 22 towns in Free State require immediate water resource solutions

  28. Regional Bulk Infrastructure

  29. Bulk cost perspectives & RBIP projects Location of current RBIG projects

  30. Informal Settlements

  31. Wastewater Treatment Works : Performance Rating • Combined Rating of: • capacity exceedance • effluent compliance • skills deficit • delivery & functionality 14% good/excellent 56% very poor / critical Total WWTW = 1155 821 municipal works

  32. Mtata Dam: Communities in need

  33. Growth /New Backlogs Rehabilitation Municipal Investment Requirements : Metros & Cities Smal & medium Towns Rural Focus on new & refurbishment Focus on backlogs & refurbishment

  34. Municipal Water Supply Investment Requirements(bulk investment and rehabilitation are critical) R7b/aDeficit Required Actual

  35. Rural areas are currently not supported by bulk infra & service management: • Action: • develop institutional model (bulk water utilities?) • develop financing model (existing schemes subsidize new schemes?) • political endorsement (performance agreements)

  36. Supply Chain 3 Water Supply - key challenge areas & situation Issue: • Access to basic water supply( 59% of households in 1994 to 94% in 2011) • Formal backlog as per approved RDP standard (0,82 mil households = 6%) • Housing related needs (2,3mil new houses with associated services) • Requires major infrastructure & financial investment (R62 bil deficit) • Based on available funding & implementation capacity 2014 targets cannot be met • Drinking water quality • Only 66 of 914 water treatment works got blue-drop status (95% performance in metros & cities; 62% in other areas) • Service quality • While 94% of households have access to infrastructure less than 75% of households have functional services • Existing infrastructure in poor state and reaching end of life resulting inregular service interruptions and customer dissatisfaction Resource Bulk Distribution Service delivery Reticulation Environment Impact

  37. WATER AVAILABILITY CHALLENGE • Extensive water backlogs • Water stressed areas • Requires large WR & bulk development (DeHoop + oth) • GROUNDWATER & WATER QUALITY CHALLENGE • Scattered rural settlements • Low economic development • Groundwater dependent • Groundwater quality challenges • Limited surface water potential • WATER DISTRIBUTION CHALLENGE • Scattered water needs • Within water-rich WMA (but no access) • Requires major WR & bulk developments Formal Historic Basic Water Supply Needs Main backlogs in EC, KZN, LP

  38. Basic Urban Water Supply Challenges • 2.3 million households (Mar 2011) • informal settlements & backyard dwellers • note location differs substantially from formal backlogs indicated in blue Main challenges in Metros & Cities Spatially not aligned with formal backlogs • KEY URBAN WATER SERVICES CHALLENGES • Urbanization and densification • Housing related “new” services needs • Internal bulk infrastructure challenges with associated service quality challenges (e.g. drinking water quality, wastewater management, interruptions, effective use, loss prevention and asset management) • Environmental impacts and risks (e.g. urban river quality, health and recreation)

  39. Integrated delivery example:Olifants development

  40. ORWRDP: PROJECT AREA POLOKWANE MOKOPANE STRYDPOORT MOUNTAINS LEBOWAKGOMO BURGERSFORT JANE FURSE FLAG BOSHIELO DAM STEELPOORT TOWN Carbonatites DE HOOP DAM MOTOTOLO Google Purchase ID: 659773445422225

  41. ORWRDP: WATER RESOURCES DEVELOPMENT Olifants-Sand RWS POLOKWANE MOKOPANE STRYDPOORT MOUNTAINS LEBOWAKGOMO Olifantspoort South RWS Lebalelo RWS Mphahele and Groothoek RWS MOOIHOEK BURGERSFORT Tubatse RWS JANE FURSE Flag Boshielo RWS STEELPOORT TOWN FLAG BOSHIELO DAM Nebo Plateau RWS DE HOOP DAM MOTOTOLO LEGEND SUPPLY AREAS EXISTING BULK WATER PIPELINES ORWRDP PIPELINES ESKOM PSS INFRASTUCTURE PUMP STATIONS WATER TREATMENT RESERVOIRS EPSS Google Purchase ID: 659773445422225

  42. ORWSDP: SUPPLY AREAS AND FEASIBILITY STUDIES Olifants-Sand RWS POLOKWANE MOKOPANE STRYDPOORT MOUNTAINS LEBOWAKGOMO Olifantspoort South RWS Lebalelo RWS Mphahele and Groothoek RWS MOOIHOEK BURGERSFORT Tubatse RWS JANE FURSE Flag Boshielo RWS STEELPOORT TOWN FLAG BOSHIELO DAM Nebo Plateau RWS DE HOOP DAM MOTOTOLO LEGEND SUPPLY AREAS EXISTING BULK WATER PIPELINES FEASIBILITY AREAS Google Purchase ID: 659773445422225

  43. LEGEND Study Area Phase 1 Strydpoort Mountains 2006-2010 Olifants River Leolo Mountains Jane Furse Flag Boshielo Carbonotites Steelpoort River Google Purchase ID: 659773445422225

  44. LEGEND Study Area Phase 1 Phase 2 WTW Reservoir Strydpoort Mountains 2011-2014 Olifants River Leolo Mountains Jane Furse Flag Boshielo Carbonotites DE HOOP DAM Steelpoort River Google Purchase ID: 659773445422225

  45. LEGEND SUPPLY AREAS EXISTING BULK WATER PIPELINES ORWRDP PIPELINES WATER SERVICES BULK PIPELINES ESKOM PSS INFRASTUCTURE PUMP STATIONS WATER TREATMENT RESERVOIRS ORWSDP: WATER SERVICES DEVELOPMENT Olifants-Sand RWS POLOKWANE MOKOPANE STRYDPOORT MOUNTAINS LEBOWAKGOMO Olifantspoort South RWS Lebalelo RWS Mphahele and Groothoek RWS BURGERSFORT MOOIHOEK Tubatse RWS JANE FURSE Flag Boshielo RWS STEELPOORT TOWN FLAG BOSHIELO DAM Nebo Plateau RWS DE HOOP DAM MOTOTOLO EPSS Google Purchase ID: 659773445422225

  46. LEGEND SUPPLY AREAS EXISTING BULK WATER PIPELINES ORWRDP PIPELINES WATER SERVICES BULK PIPELINES ESKOM PSS INFRASTUCTURE PUMP STATIONS WATER TREATMENT RESERVOIRS ORWSDP: TOTAL WATER SERVICES DEVELOPMENT CAPITAL REQUIREMENTS Olifants-Sand RWS R 518M R 811M POLOKWANE MOKOPANE STRYDPOORT MOUNTAINS R 254M R 255M LEBOWAKGOMO Olifantspoort South RWS Lebalelo RWS Mphahele and Groothoek RWS R 349M BURGERSFORT Tubatse RWS JANE FURSE Flag Boshielo RWS R 935M STEELPOORT TOWN R 922M FLAG BOSHIELO DAM Nebo Plateau RWS DE HOOP DAM MOTOTOLO EPSS TOTAL R 5 400m Google Purchase ID: 659773445422225

  47. Task Team/ Steering Committee TOR • Represent sector, theme, business area with associated responsibilities and implications • Provide input and advice on concept, design, output and application • Facilitate sector, theme, technical and any other related information input • Facilitate validation, quality control and alignment • Partake in strategic analysis • Establish ownership and application • Provide development support

  48. Though leadership may be hard to define,the one characteristic common to all good leaders is the ability to make things happen.Ted W Engstrom

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