Sanitation and Wastewater Atlas of Africa

concession contract. DurbanWater Recycling funded the entire project and also undertook the risk of meeting the two industrial users’water quality needs, meaning the municipal utility did not incur any extra costs for taxpayers. Figure 6.11 presents a stakeholder diagram for the Durban wastewater recycling project. The total investment in the project was R72million (US$4.858 million). Equity from Durban Water Recycling company was 19 per cent of the investment

cost. After signing a 20-year concession contract with the eThekwini Water Services (municipal utility), the Durban Water Recycling consortium approached the Development Bank of Southern Africa and the Rand Merchant Bank for loans of R34 million ($2.295 million) and R24 million ($1.62 million). The guaranteed demand for treated wastewater from the two industrial users made the project economically attractive. The Durban Water

into the IndianOcean. The costs of this infrastructure were very high, leading the city to consider alternative solutions to prevent large increases in the costs of wastewater disposal in the area. Through a public-private partnership, the municipality successfully implemented a wastewater recycling project for industrial purposes. This project is an example of sustainable wastewater management that also has multiple environmental, economic and social benefits for the region. In addition, the project is the first of its type in South Africa and is an example of a solution that does not dispose of wastewater, but considers it an asset. Instead of increasing the capacity of the existing marine outfall pipeline in the city’s Southern Wastewater Treatment Works to discharge primary treated wastewater into the ocean, Durban explored the possibility to further treat it for industrial reuse. A paper company and an oil refinery expressed interest in receiving the treated wastewater. The aim of the project was to treat around 48,000 m 3 per day (approximately 10 per cent of the city’s municipal wastewater) and achieve an acceptable quality for industrial reuse, with 85 per cent of the treated wastewater going to the paper company and 15 per cent to the oil refinery. In order to be able to supply recycled water to these two industrial users, the municipal water utility (eThekwini Water Services) needed to upgrade the existing activated sludge process, build a new tertiary wastewater treatment plant, refurbish the high-level storage tank and install a reclaimed water reticulation system. One of the project’s complexities was that the paper company required high-quality water, given that it is used to produce fine paper (World Bank Group 2018). The revenue from the sale of the treated wastewater for industrial use covers almost all operation and maintenance costs of the treatment plant as shown in Figure 6.10. After an international biding phase, Durban Water Recycling, a consortium of private companies led by Veolia (formerly Vivendi Water) was chosen to finance, design, construct and operate the tertiary wastewater treatment plant at Southern Wastewater Treatment Works under a 20-year 6.3.4.2. Sources of revenue

Stakeholder diagram for Durban Water Recycling

eThekwini water services

(public entity)

c y

r e

c l

e r

i n

a t

g

( P

w

t y

n

b a

) l

u r

t d

.

D

Clients

Zetachem

Development bank of South Africa

Water supply agreement for 20 years

Marubeni

2

OTV France (Veolia)

10

$ $

Khulani

18.5

Mondi (paper industry)

$

51%

SAPREF (refinery)

Umgeni

18.5

Rand merchant bank equity

Construction contract

Construction contract and O&M contract (20 years)

OTV South Africa (Veolia)

OTV France (Veolia)

Source: World Bank Group, 2018.

GRID-Arendal/Studio Atlantis

Figure 6.11. Stakeholder diagram for Durban Water Recycling

$ Durban Wastewater Recycling Project and Benefits

Wastewater

Treated wastewater Wastewater

Durban

SAPREF

MONDI

Potable water demand has been freed for 400,000 extra people. The need for investment in new infrastructure for water treatment has been postponed.

INDUSTRY Savings: Treated wastewater is cheaper (USD 200/m 3 ) than potable water (USD370/m 3 ). Risk mitigation: Reduced risks related to water availability and higher security in case of scarcity.

DURBAN WATER RECYCLING PLANT

Reference case in Africa: First project with these characteristics in South Africa. Risk mitigation: Ensured long-term revenue stream from industry (20-year contract).

Source: World Bank Group, 2018.

GRID-Arendal/Studio Atlantis

Figure 6.10. Durban wastewater recycling project and benefits

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SANITATION AND WASTEWATER ATLAS OF AFRICA