Business turning to private sector for infrastructure solutions

A local premium prepared food and beverage business has secured the services of Pretoria-based engineering consultant BBEnergy to use water more responsibly and improve management systems by implementing an energy and water utility model as South Africa’s water infrastructure continues to deteriorate.

An investee company of mid-market private equity investment firm Agile Capital, BBEnergy has developed various water projects on behalf of clients over the past four years.

“Wastewater is often regarded as an unavoidable operational cost. Reusing treated wastewater has become a cost-effective and reliable source of process water and reduces demand on surface and groundwater sources, as well as public wastewater treatment facilities,” explains BBEnergy business unit leader Jannes Bester.

Operating and maintaining water and energy management infrastructure is often not the core business of BBEnergy’s clients, but managing this infrastructure has become key to the success of their businesses.

Consider the 330 jobs lost in 2021 following dairy products manufacturer Clover’s closure of South Africa's largest cheese factory in Lichtenburg, in the North West, owing to “ongoing poor service delivery” by the Ditsobotla local municipality.

Having tried to engage the municipality for years on service delivery, Clover moved production to Queensburgh in Durban, citing large losses because of long-standing water and electricity disruptions as the municipality had failed to maintain the relevant infrastructure.

Potable water supply shortages have become a significant challenge for various municipalities in South Africa owing to ineffective or poorly maintained infrastructure, and with climate change mostly affecting underdeveloped and possibly underfunded emerging markets, it is becoming a global problem, Agile Capital CEO and founder Tshego Sefolo tells Engineering News.

The poor state of local water infrastructure is exacerbating water contamination, impacting on South Africans’ basic human right to fresh drinking water. As a result of poor water quality, health and environmental issues are increasing, with agriculture and food security significantly affected, he elaborates.

“The country’s mining activities also continue to add to water contamination, owing to acid mine drainage, for example. To ensure responsible environmental practices and good governance, companies are required to consistently test water at mines according to mining licence regulations, as do farms, to ensure crop quality and yield.”

Consequently, Agile Capital invested in Pretoria-based environmental monitoring and testing laboratory Aquatico in 2014 and intends to invest in other companies with good growth prospects in the water sector.