On Thursday, water sector experts lauded public-private partnerships (PPPs) as a feasible alternative procurement methodology.
Andre Kruger, CEO of PPP Training Online, which offers training across Africa, added that South Africa needs to “wake up” to opportunities in this realm.
Kruger said this during the Digital African Utility Week & POWERGEN Africa virtual conference while moderating one of the many sessions.
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As governments continue seeking new finance mechanisms to remedy water services, the public sector is increasingly making use of the private sector to deliver water solutions to its utilities. Essentially PPPs are long term performance-based contracts.
Tumelo Gopane, managing director of the East Rand Water Care Company, a Section 21 wastewater company with shareholders Ekurhuleni Metropolitan Municipality, Johannesburg Metropolitan Municipality and Lesedi Local Municipality, pointed out that the private sector looks for consistency and longevity – a challenge in African markets.
“From my side, I think there’s a lot of money in private hands, that is how economies work,” said Gopane. “And as governments, we need to leverage on that. We just need to be able to provide certainty in terms of our tariff. So the private sector can understand that we will be paying them a tariff, that we’ll be repaying their loan, their capital, their interest.”
Gopane believes this is the way forward as there are already many PPPs in a variety of industries, and as such, it’s possible for the water industry. “Wastewater reuse might actually be low-hanging fruit [for PPPs],” he said.
Missed opportunity for PPPs in water sector
Kruger added that South Africa has been missing opportunities in this space: “There are even international examples where wastewater treatment plants, or the management of water in a municipality, or a county, or whatever we want to call it; where the electricity generated through that wastewater is sufficient to run the plant. To literally take out the cost of electricity.
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“So there are various ways and means. I just think – if I may say this – that somehow we have been very inward-looking over the last number of years. Fighting with ourselves. And not looking at what’s happening elsewhere in the world, and how these opportunities do exist. So certainly I think maybe the water sector in South Africa, it is time for us to wake up.”
Kruger pointed at successful projects in Botswana, crediting speakers Ntshambiwa Moathodi and Bakumbudzi Othusitse, who both run wastewater treatment plant PPPs in conjunction with the country’s parastatal, Water Utilities Corporation.
Unfortunately due to a power cut in Gabarone, Moathodi and Othusitse could not join the conversation. ESI
By Biénne Huisman
Digital Energy Festival
The following sessions are still available to watch on demand as part of the Digital Energy Festival for Africa:
The Digital Energy Festival for Africa in 2020 was hosted jointly by four of Clarion Events’ leading energy brands Africa Energy Forum, African Utility Week & POWERGEN Africa (now Enlit Africa) and the Oil & Gas Council’s Africa Assembly and the leading energy journal ESI Africa providing six weeks of compelling content.