COULD WATER
COULD WATER WHEELINGSOLVE AFRICA’S WATERCRISIS?The World Resource Institute expects medium to extremely high water-stress conditions in Eastern and Southern Africa by 2050.Adapting the concept of wheeling, already popular inelectricity distribution, for water distribution, couldbring flexible and efficient water management to dryIregions, according to Helgaard Muller, Director at Cresco.It wasn’t that long ago that Cape Town went through its Day Zero event and theSouth African province of Gauteng is currently facing a crisis and struggling tomeet water demand. From a regional perspective, Zambia and Zimbabwe arefacing the severe drought conditions affecting Lake Kariba, resulting in knock-oneffects of major power cuts of up to 21 hours per day, as Zambia relies on 80% ofits electricity from the hydropower station at Lake Kariba.“Water wheeling” is a possible solution to the water shortages the continentfaces, presented through the current imbalanced distribution system. With waterwheeling, certain areas that have surplus water, such as places that are near largerivers or lakes, could help supply the drought-prone or water-scarce regions.Helgaard Muller, director at specialist project-finance-advisory companyCresco, explains that “wheeling” in the context of electricity, involves using a sharedtransmission network to transport electricity from a generator to a customer, oftenacross large distances. “Adapting this concept for water distribution could offerinnovative solutions for more flexible and efficient water management, especiallyin regions facing scarcity or distribution challenges,” says Muller.The wheeling of energy allows third-party electricity to flow through an existingnetwork owned by another party for the benefit of an offtaker located at a remotelocation. This is generally accepted to result in increased efficiency, resourceoptimisation and reduced reliance on central providers.Examples where electricity wheeling of especially renewable energy is beingapplied can be found in Europe and in South Africa, as well as through the regionalSouthern Africa Power Pool or SAPP, as it is generally known.“Water stress is a reality and not a new concept. According to the World ResourceInstitute, medium to extremely high water-stress conditions can be expected in regionssuch as Eastern and Southern Africa by 2050. It is critical that we start doing somethingabout it,” says Muller.PHOTO: AfDB
WATERInfrastructure constraintsMuller adds that water shortages will affect certain regions more than others andwill require costly solutions. Challenges such as infrastructure constraints willrequire complex and expensive development of new pipelines and reservoirs.“For example, Gauteng does not have sufficient naturally occurring watersources to support demand, and is already dependent on a ‘water wheeling’arrangement from the Lesotho Highlands Water Scheme. Population growthin the Gauteng area, as well as economic growth demands have resulted inthe current situation. Apart from local distribution, improved infrastructuremaintenance and construction projects, it is clear that additional water-wheelingsolutions (such as creating increased storage capacity in the Lesotho HighlandsWater Scheme) will need to be implemented,” he explains.The conceptLike electricity wheeling, water wheeling would involve a system where entitiessuch as governments, municipalities and private suppliers could transport wateracross existing pipelines to supply-demand points.Muller says that a potential deployment mechanism could be through thecreation of a “common carrier” model, much like grid infrastructure in electricity.The infrastructure could be managed by a third party or the government.There are many potential benefits of water wheeling, including the optimisationof resources from surplus regions to meet demand in deficit areas and theenvironmental benefits resulting from the reduced need for new infrastructure,leading to less disruption of natural ecosystems. In addition, water wheeling is areliable solution, since diverse sourcing reduces the risk of supply failure and italso reaches new markets without directly investing in extensive infrastructure,offering economic flexibility.Muller notes that logistics and technology required would include infrastructureupgrades and retrofitting of current systems to support a wheeling framework, aswell as advanced metering and sensor networks to track water quality and flow.Like energy markets, a centralised data management system would be neededto monitor, regulate and facilitate transactions. Importantly, legal and regulatoryframeworks would be required to establish water rights, pricing and responsibilitiesin the wheeling context.“By leveraging existing infrastructure and implementing a common carriermodel, water wheeling could reduce the need for costly new pipelines, minimiseenvironmental disruption and create economic opportunities. As the pressureon water resources intensifies, exploring these forward-looking mechanismswill be essential for fostering sustainable, reliable and equitable access to wateracross regions.”Examples and pilot programmesMuller concludes by noting projects and models around the world that resemblewater wheeling or could be seen as steps towards it. An example is China’s South-North Water Transfer Project. This is one of the world’s largest water-diversionprojects, aimed at transferring water from the Yangtze River in southern Chinato water-scarce regions in the north, including Beijing and Tianjin. The projectinvolves three major routes with canals, tunnels and pipes transporting water overhundreds of miles. It can be viewed as a mega-scale version of water wheelingacross different regions within China.“By analysing both the successes and challenges of electricity wheeling andexploring its applications in water distribution, we can offer a fresh perspective onmanaging a precious resource in innovative ways,” concludes Muller.For other examples of transfer and sharing schemes, see overleaf.ABOUT CRESCOCresco is a specialist project-finance-advisory company, which enables growth byworking closely with both project promoters and project funders across Africa. TheCresco team is made up of highly skilled individuals, with experience in closure andexecution of major capital projects across many industries in Africa. The companyhas significant inhouse logistics skills to complement its project development andfinancing experience to ensure the best service for the stakeholders.Challenges“There are some potential obstacles that will have to be faced and overcomefor water wheeling to be a feasible solution,” says Muller. “Water qualitymanagement is critical to ensure consistent water quality across sources andduring transport, and infrastructure will need to be adapted to a standardisedwheeling framework. Other considerations include the balancing of pricing forsuppliers and end-users and the negotiation of inter-jurisdictional agreementsfor shared regional resources.”Innovative opportunity“Water wheeling presents an innovative opportunity to address regional watershortages by optimising resources from areas of surplus and redistributing them toareas in need. While the concept faces challenges such as infrastructure constraints,water quality management and regulatory frameworks, it offers promising solutionsfor efficient water management,” says Muller.Helgaard Muller, Director at Cresco.27
