Can lessons from Eskom be used to tackle SA's water crisis with determination and strategy?

 At its meeting of 15 October 2025, the South African Cabinet celebrated the end of load shedding and what was regarded as Eskom’s return to profitability.

The next big challenge will be the water crisis. More than 100 municipalities owe water boards an eye-watering R28-billion and counting.

Unlike electricity, which can be generated from wind and solar with rather simple technological gadgets in order to avoid load shedding, water can’t be created and can’t easily be moved around. It is either stored underground and accessed via boreholes, or it falls from the sky, but not in all places equally.

The obvious question we should ask is, what lessons from the way the electricity crisis was resolved can we apply to tackling the deepening water crisis?

One thing is for sure: the end of load shedding proves that we can resolve a crisis if we are determined. That should give us hope when we think of other infrastructure crises such as water, freight logistics, passenger transport and waste.

However, when it comes to the water system, it is far more complex than the energy system. Like energy, it has its own ministry, but there is no equivalent of a single vertically integrated entity like Eskom to drive a top-down solution.

Water is delivered by 256 municipalities, over half of which are dysfunctional. As a recent National Planning Commission (NPC) National State of Service Delivery report revealed, the result is service delivery breakdowns that affect the poor more than the rich.

These 256 municipalities buy their water from water boards. There are 15 water boards, which are legally constituted as state-owned enterprises and which are supposed to be self-financing. Several have become dysfunctional because municipalities owe them R28-billion, and they don’t have access to the same budget allocations as municipalities.

The stories of collapse are well known: Johannesburg’s multi-day supply breakdowns are due largely to poor maintenance, water leaks that result in the loss of 40-50% of the piped water (technically known as non-revenue water), and growing demand without adequate increases in capital investment. Hospitals, courts, businesses, restaurants and households all incur extra costs to access water via tankers and other means.

Unplanned restrictions

In eThekwini Municipality, non-revenue water has reached an alarming 58%, with planned and unplanned restrictions cutting off water as pipelines and sewage treatment capacities collapse.

Frequent water service cuts have plagued areas like Durban North, Phoenix, Verulam and others.

In Makhanda, the rationing of water to around 50 litres/person/day has been going on for many months as crucial infrastructure upgrades get delayed due to funding and mismanagement. Residents queue at standpipes, tankers and JoJo tanks, while businesses and university departments get seriously disrupted. Water disruption has become a way of life in Makhanda.

In Hammanskraal, years of failure by water authorities to attend to deteriorating wastewater treatment works resulted in the supply of unsafe potable water and a cholera outbreak in 2023. Residents rely on tankers and bottled water and pay the price for healthcare.

In Emfuleni, local waterways have been contaminated with untreated sewage, and massive system losses have been recorded due to mismanagement and corruption. Besides the downstream ecological disaster caused by raw sewage in the Vaal River, public health deteriorated in Sebokeng, Sharpeville and Evaton.

Like Cape Town in 2018, Nelson Mandela Bay has suffered the impacts of climate change on rainfall patterns without putting in place response strategies in advance of the impacts, despite warnings by scientists.

However, although the rain eventually came, filling dams to over 80% by early January 2025, rolling water outages continue to disrupt households and businesses across the city. This is attributed to high leak rates, ageing infrastructure and frequent maintenance shutdowns.

In Polokwane, where water supply outstrips demand in a poorly managed and vandalised water system, month-long water outages have been reported.   

Critical levels

Many South Africans assume that water comes from dams and, therefore, more dams will deliver more water. Not true. According to the 2023 National State of Water Report, water insecurity has reached critical levels, with nearly 98% of the available freshwater resources already allocated.

What this means is that even without climate change, freshwater resources are finite. Unlike electricity, you cannot make more water.

For more than a century, increases in water consumption tracked economic growth rates. So, if we want more economic growth, we have to find a way to do this without increasing water consumption.

In short, economic growth needs to be decoupled from water consumption, a phenomenon that is evident in many parts of the world. It can be done. However, it means using water differently, rather than assuming that more dams create more water.

Climate change will only make things worse. Southern Africa is warming at twice the rate of the global average. Studies show that rising mean temperatures annually will result in drier climates in the more western regions, and (possibly) wetter climates in the eastern parts of the country, including more flooding. This has varying implications for the water sector:

• Declining water availability due to reduced surface and groundwater resources.
• Higher rates of evaporation due to higher temperatures.
• Increased irrigation needs.
• Risks of damage to pipelines, dams and other water infrastructure subsystems due to flooding.

To address these economic and ecological challenges, the National Planning Commission in partnership with the Development Bank of Southern Africa, which funded the research, the Presidential Climate Commission and SA-TIED, commissioned a research report to assess the investment requirements to achieve water security by 2050.

Based on this report and a multi-stakeholder workshop at the end of 2024, the National Planning Commission published a policy brief premised on the National Water Act of 1998.

The “Dublin Principles” for Integrated Water Resource Management were globally agreed in 1992, and it was no coincidence that when South Africa’s first democratic government began formulating water policy after 1994, and published the National Water Act in 1998, the country’s legislation resonated with the principles of Integrated Water Resource Management.

The National Water Act replaced South Africa’s 1956 Water Act, which was founded on European water law, and set out to align water allocations with the country’s post-1994 democratic ambition. In support of this ambition, the Department of Water Affairs coined the slogan “Some for All, Forever” to foreground the National Water Act’s balance between economic efficiency, environmental sustainability and equity. The National Water Act is highly regarded in the global water sector for the way it aims to achieve this balance.

In practice, however, things have gone wrong.

The South African water sector is governed through a complex multilevel institutional system responsible for the allocation, use, protection and sustainability of the country’s water resources, including drinking water, sanitation, irrigation and ecosystem services.

The Department of Water and Sanitation is the lead department responsible for policy development, regulation, management of national water resources, oversight of infrastructure delivery and intergovernmental coordination of the sector. Its mandate is defined by Section 27 of the Constitution, the Water Services Act (No. 108 of 1997) and the National Water Act (No. 36 of 1998).

The Trans-Caledon Tunnel Authority, which was initially established by the Department of Water and Sanitation to manage the investments in the Lesotho Highlands Water Scheme, has branched out into the financing of many other dams and water infrastructures.

Fundamental principle

The fundamental principle that the National Water Act put in place was that the national fiscus would fund the capital costs of water infrastructure, and municipalities would fund the operating costs from revenues received for water services delivered.

All workable, on condition that municipalities spend revenues received for water services on the ongoing operation and maintenance of water services. As soon as they bleed some of this revenue off for other purposes or fail to collect what they should, the model falls apart. This is what has happened.

Our report reveals that the water sector faces many serious challenges, including:

• Ageing and failing infrastructure (non-revenue water makes up more than 40%).
• Inequitable access, especially in rural and informal settlements.
• Municipal underperformance and poor financial management.
• Pollution of rivers and water bodies.
• Climate variability and drought risk.
• Slow rollout of Catchment Management Agencies (of the nine planned, only two are operational).
• Mismanagement of infrastructure by local governments, and low levels of payment for water.

The total current investment levels are about R165-billion, inclusive of both capital and operating expenditure.

To assess the investment requirements to achieve water security, three scenarios were developed: a baseline scenario (i.e. business-as-usual), a worst-case scenario, and a recommended sustainable alternative.

Each case is analysed using the World Bank’s “Beyond the Gap” methodology to determine future investment requirements compared with current investment levels. All three scenarios assume that the National Development Plan’s goals for water service delivery by 2030 must be achieved by 2050.

The baseline scenario assumes no policy change, median climate change impacts, maintenance of current energy mix, achieving the National Development Plan’s goals for water using conventional technologies only, maintenance of existing levels of invasive alien plant clearing, continuation of existing allocations of water to agriculture (which is over 60% of the total consumption of water), and the continuation of existing levels of (in)efficiency in the integrated bulk supply system at current levels.

The financing requirements for this scenario are R256-billion per annum for both operations and capital expenditure annually between 2023 and 2050, which is R91-billion more than current investment levels. In other words, to achieve the National Development Plan water goals without changing much, R91-billion more than current investment levels will be required.

In the sustainable alternative scenario, it is assumed that the National Development Plan water goals will be achieved in the context of a significantly wetter climate prevailing on the eastern side of the country; a meaningful transition away from the water-intensive coal-based energy system will take place in accordance with IRP2019 and IRP2025; there will be sharing of some water taps in certain communities during the initial years; aggressive water conservation/demand management systems will be implemented; increased clearing of invasive alien plants will take place; allocations of water to an increasingly water-efficient agriculture sector will be reduced as a result of improved water use technologies; and improved bulk water system efficiencies will occur over time.

To finance the sustainable alternative, the annual investment requirement to cover both operating and capital expenditure could be reduced under this scenario to R214-billion per annum, which is R75-billion more than current levels of investment, but R16-billion less than maintaining the baseline scenario.

The causes of the savings include reduced non-revenue water losses, higher efficiencies overall, reduced losses due to alien invasives and lower investments in upstream bulk water infrastructure.

The worst-case scenario assumes that the National Development Plan water goals will need to be achieved as a much drier climate unfolds across the country; no energy transition takes place to a low-carbon energy system; full conventional water technologies are used; no management of invasive alien plants takes place; there is an increased water allocation to agriculture; and a decline in system efficiencies.

Collapse

In short, this is where the water system was heading during the State Capture years, and it could go back in that direction if governance systems overall collapse again in future.

To finance the worst-case scenario, the investment requirement will increase to R314-billion per annum to cover both operational and capital expenditure, which is a funding gap of R149-billion per annum. This is a nearly 50% increase compared with current levels of investment.

The sustainable alternative is recommended because it is more affordable, ecologically more sustainable, and more inclusive. The baseline and worst-case scenarios are unlikely to attract the required financing, which, in turn, will result in the ongoing exclusion of poorer communities from adequate water and sanitation services.

The more affordable, sustainable alternative is more likely to attract funding at affordable levels, there is less waste, greater efficiency, reduced environmental impact, and therefore the potential for funding of social inclusion is greater.

The State Capture years had a devastating impact on the water services sector. However, since 2018, a water sector reform agenda has slowly recovered as institutional capacity was rebuilt. This agenda primarily focuses on increasing investment in water infrastructure maintenance and construction, improving water quality, and strengthening regulations and system performance.

The water sector reform process forms part of broader reforms coordinated by Operation Vulindlela located within the Presidency, aimed at accelerating structural changes to support economic recovery.

Given the institutionally complex nature of the water sector, all the different components of the water sector reform agenda are not always articulated as a single coherent reform programme. Based on the research and the presentations during the workshop at the end of 2024, the South African government’s reform agenda is broadly consistent with the sustainable scenario described above. It can be summarised as follows:

1. Establishment of catchment management agencies to coordinate the best use of water resources within SA’s catchment areas.
2. Establishment of a National Water Resource Infrastructure Agency to streamline the management of national water assets and oversee large-scale water infrastructure development to ensure sufficient bulk water supply for the country, and to drive investment through the amalgamation of the Trans-Caledon Tunnel Authority and the Water Trading Entity in the Department of Water and Sanitation.
3. Improve the water-use licence application process and ensure implementation across all sectors, in particular with respect to mines and other large economic activities that operate without water licences.
4. Revive the Green, Blue and No-Drop water quality monitoring system that used to be so effective in regularly assessing the health of our water systems.
5. Strengthen the regulation of water pricing and service standards to align costs and revenues, taking into account affordability and inequalities.
6. Implement a viable cost-reflective raw water pricing strategy.
7. Resolve the inefficiencies of metropolitan municipalities’ water and sanitation services by ringfencing revenue from the provision of water and sanitation services for exclusive use of these services (i.e. a return to the original National Water Act financing formula). Appoint water trading services managers with responsibilities for the full value chain to act as a single point of accountability. Use conditional grants as incentives to drive change at municipal level and coordinate the revitalisation of the water boards.
8. Stabilise the system in the short term by addressing municipal non-revenue water challenges.
9. Explore the separation of the municipal water authority from the water service provider; currently, municipalities are both.
10. Strengthen the Water Partnerships Office, a partnership between the Department of Water and Sanitation, Development Bank of Southern Africa, and the South African Local Government Association, to coordinate private sector participation.
11. Mobilise co-investments for water infrastructure projects via the Development Bank of Southern Africa-managed Infrastructure Fund.
12. Establish an independent water services regulator, equivalent to the role that the National Energy Regulator of South Africa plays in the energy industry.
13. Streamline the public-private partnership framework to enable greater private sector participation.
14. Address inefficiencies in the procurement system.
15. Address the culture of non-payment among consumers.

The 15 elements of the water reform agenda are essentially technocratic and regulatory reforms aimed at re-establishing the basics of a viable water sector during the post-State Capture period.

The National Planning Commission’s policy brief went further to address some of the wider political economy issues, including greater social inclusion and the mobilisation of private sector investment capital to address the gap between investment requirements and current levels of (mainly public sector) investments in order to realise the sustainable scenario outcomes described above.

The National Planning Commission policy brief proposed the following:

1. Take a strategic and policy decision to define the sustainable alternative as the preferred future scenario, not least because it is the most affordable. This is currently implicit rather than explicit in existing policy.
2. Translate the sustainable alternative into an integrated water policy framework that includes upstream water resources and downstream water services, with a focus on both operating and capital investment requirements. Some aspects of this form part of the 15-point reform agenda.
3. Engage the financial sector to ascertain the conditions under which it will be possible to significantly increase private sector investments in the provision of water as a public good for the benefit of all. The National Planning Commission and the Water Partnerships Office are helping facilitate this dialogue.
4. Address the capacity constraints in the water sector across all spheres of government, with particular focus on the municipal level, where it might be necessary to adopt creative institutional solutions to address the many challenges that have emerged in municipalities. The Development Bank of Southern Africa leads the way in this regard.
5. Consider elevating engagements between the water sector, the private sector, and local government to the level of a “national crisis committee for water”, equivalent to the National Energy Crisis Committee, which coordinates the work of more than 100 high-level officials from across the government and Eskom in collaboration with business and other social partners. This would streamline and enhance collaborative efforts at the policy and pipeline levels, and bring in additional capacity.
6. Convene a dialogue between the water and municipal sector that includes the appropriate senior policymakers, practitioners and researchers. This should be aligned with the local government reform process currently under way. This has started to happen, but it must be accelerated.
7. Improve communication about anticipated water sector reforms by engaging in more regular activities to connect, communicate, and collaborate (the “three Cs” of effective partnering for implementation). The December 2024 workshop revealed how few stakeholders understand the water sector reforms.
8. Differentiate between short-term interventions to stabilise the water delivery system and longer-term policy, governance, institutional and financial system reforms, and align the two processes to achieve the sustainable scenario outcomes.
9. Focus on developing trusted relationships and mutual accountability with communities. Improved relational governance could boost market and investor confidence while increasing customer confidence in the water delivery system, thus simultaneously addressing how infrastructure can be financed and repaid.
10. Create a water sector reform knowledge-sharing and learning network to promote adaptive processes and solutions: Act, test, pause, reflect, learn, adjust and repeat. A coherent, organised network of water researchers working with the government has yet to emerge.

To resolve the water crisis, it will be necessary to learn lessons from the way Minister Kgosientsho Ramokgopa tackled the energy crisis when appointed in mid-2022.

He did three things: he admitted there was a problem (thus contradicting his predecessor, who simply accused Eskom’s leadership of treason), he held weekly briefings to inform the nation about progress and frankly admitted the failures, he resolutely backed renewable energy (i.e. sustainable technologies) at a time when renewables had a bad name, and he explicitly referred to involving the private sector in transmission and generation without promoting privatisation.

This kind of leadership can transform a crisis into an opportunity for change.

The National Planning Commission’s policy brief is entitled “Some For All, Forever” — a slogan that harks back to the time when Kader Asmal was Minister for Water Affairs and Forestry.

If ever there was a true summary of what sustainability means, it is this slogan. Too much about today is the opposite: “All for some, for now”.

The 15-point water reform agenda, read together with the National Planning Commission’s recommendations, provides the basis for a more equitable and sustainable way of managing our water resources.

Kader Asmal will be turning in his grave. DM

Dr Zeph Nhleko is Chief Economist at the Development Bank of Southern Africa. Prof Mark Swilling is Co-Director, Centre for Sustainability Transitions, Stellenbosch University and a member of the National Planning Commission. He writes in his personal capacity.