1. Alternative funding model for water conservation African Water Leakage Summit 7 September 2011, Midrand

2. Thembi Mkhize Chief Director, Metsi-a-Lekoa water services unit, Emfuleni Local Municipality Andries MeyerManager, Sustainable Water Sasol New Energy Joint presenters

3. Presentation overview –Vaal River system water availability & risks –Stakeholder interests –Vaal system analysis and water conservation targets –Emfuleni opportunity –Development partnership –Funding and implementation model –Governance structures

4. Southern African perspective

5. Integrated Vaal River system Vaal system as part of Orange-Senqu

6. Integrated Vaal River system Vaal River Vaal Barrage Vaal River Vaal Dam 2600 mil.m 3 LHWP 780 mil.m 3 /a Gauteng Rand Water 1450 mil.m 3 /a Return flow To Vaal Return flow To Crocodile Sasol Infrachem, Sasolburg 22 mil.m 3 /a Katse Dam 1500 mil.m 3 Sasol Synfuels 90 mil.m 3 /a Mohale Dam 850 mil.m 3 VRESAP pipeline Vlakfontein Canal Knoppiesfontein Eskom 290 mil.m 3 /a Grootdraai Dam 350 mil.m 3 Trichardstfontein Komati & Usutu transfer schemes Sterkfontein Dam 2600 mil.m 3 Vaal River Tugela transfer scheme Woodstock Dam Tugela River Heyshope & Zaaihoek transfer schemes ELM Polihali Dam (430 mil.m 3 /a future)

7. Main risks to Vaal River system Unlawful irrigation: estimated volume of 222 mil.m 3 /a abstracted unlawfully from Vaal system Acid mine drainage (quality and quantity) Municipal water losses estimated at 420 mil.m 3 /a

8. Vaal system analysis and water conservation targets 15 % WCWDM target

9. Vaal catchment stakeholder interests (1) Department of Water Affairs –“Half water losses by 2014” Pres. Jacob Zuma –15% Municipal water conservation targets Emfuleni Local Municipality (Metsi-a-Lekoa) –Water Service Authority in terms of Water Services Act –Responsible for provision of water services to consumers in Emfuleni municipal area –Committed to sustainable catchment management Orange-Senqu River Commission (ORASECOM) –River basin organisation representing interests of Lesotho, RSA, Botswana & Namibia –Seek WCDM PPP model that can be replicated –In support of SADC objectives

10. Vaal catchment stakeholder interests (2) GIZ Transwater SADC –German Agency for International Cooperation involved in trans- boundary water management projects in SADC region –Supports people & societies in developing countries in shaping their own future and improving living conditions Sasol –Fuel and chemicals production facilities dependant on water supply from Vaal River system –Committed to sustainable catchment water management as endorser of UNGC: CEO Water Mandate

11. Emfuleni Local Municipality Fourth largest municipality in Gauteng Province Main city/town areas of Vereeniging, Vanderbijlpark and peri-urban townships of Sebokeng, Evaton, Sharpeville, Boipatong, Bophelong and Tshepiso Covers an area of 987 km 2 Total population of 658 422 (Stats SA 2001) Current total population estimate of 1 200 000 159 811 Formal stands 2 849 km of water pipelines 14 Potable water reservoirs

12. Largest advanced pressure control installation in the world Savings of R150m over 5 year period Fully implemented customer care awareness programs (e.g. education and awareness campaigns) Leak repair projects conducted in: –Bophelong –Ironside/Debonairpark –Beverly Hills –Sharpeville Emfuleni water conservation successes

13. Emfuleni Municipality water balance Water balance elements2009/10 water volumes mil.m 3 /a Water cost (1) R mil Input (purchased from Rand Water) 81 (100%)372 Billed metered consumption25 (31%) Billed unmetered consumption20 (25%) Non-revenue water / losses (input volume less billed consumption) 36 (44%)165 ( 1) Calculated at Rand Water bulk tariff of R4.59/m3

14. Emfuleni residential water losses External plumbingInternal plumbing Lack of awarenessConsumer behaviour

15. Development partnership Emfuleni water conservation project Emfuleni LM (Metsi-a-Lekoa) Sasol (Private sector partner) GIZ Development funding Community Savings from reduced losses Funding from ringfenced savings Seed funding Reduced risk Off-setting Seed funding, governance, auditing role Local economic activity Emfuleni & GIZ/Sasol partnership agreement (MoU) GIZ/Sasol Development partnership

16. Funding model Municipality‘09/10 water demand (mil.m 3 /a) 15% targeted savings (mil.m 3 /a) Value (R mil./a) Emfuleni811262 SasolR 5 milSeed funds and skills to initiate a project to help achieve target by end 2014 GIZ / AusAid/ UKAid R 5 mil

17. Implementation model Principle of Implementing Agent acting within collaborative governance structures Main focus on physical water loss reduction Includes awareness and education program (behaviour change) Selected priority areas (Sebokeng / Evaton wards) Retrofitting and repair of leaking pipes, taps, toilets, valves Local skills development. Seek alignment with DWA “War on Leaks” Spend bulk of funding on local providers (plumbers, materials) Responsibilities and skills transfer to Emfuleni Excludes revenue enhancement initiatives (done by ELM)

18. Role of GIZ/Sasol as Implementing Agent Provide seed funding and in kind contributions Project management –Managing Contractor Sustainability initiatives –Facilitate community education and awareness –Facilitate training in line with DWA “War on Leaks” –Transfer of project skills and responsibilities to Emfuleni Provide procurement, commercial and financial systems Provide for financial and project results auditing

19. Project governance structures Project Steering Committee Providing strategic direction and high level decision making. Agree on key measures of success Manage and prioritise allocation of funds Set milestones for handovers to Municipality Set criteria for enablement training of local labour Monitoring and evaluation of project

20. Project governance structures Community Stakeholder Committee Enlist community representation – Community Liaison Officers Facilitate and advise on community desires, needs and preferences Advise on selection of local labour and service providers. Facilitate access to the project areas (incl. private homes) Monitor the communities’ perceptions of success Project Management Committee Responsible for detailed Project Plan and Project Budget Oversee administration, management and delivery of the project Liaise with Community Stakeholder Committee regarding local issues

21. Development partnership - Questions?