NCANDU DAM: Consortium responds

This is the full response to comments made during the uThukela Water AGM, as reported on in July.

Statements made below were submitted by the Ncandu Dam Consortium (NDC):

The recent commentary by officials made during the AGM of uThukela Water, regarding the construction of the Ncandu Dam, currently under consideration by the Newcastle Local Municipality (NLM) and following an unsolicited bid by the developers Ncandu Water, displays a serious lack of understanding of the available water resources and the efficacy of the dam project as a solution to address the water augmentations requirements.

Options which are allegedly available create an atmosphere in which time is not of the essence and endless possibilities exist with which to address the water shortage situation.

The notion thus created is irresponsible and dangerous.

NLM is currently under supplied by about 10 million m³/a as a result of inadequate bulk infrastructure (raw water supply pipelines and water treatment works capacity), and inadequate raw water storage, i.e. reliable yield.

The Department of Water and Sanitation (DWS) has historically and until very recently held that 23 million m³/a is available for Newcastle from Ntshingwayo Dam. This is not true, as can be seen from the latest DWS report: WP10588 “CONTINUATION OF RECONCILIATION STRATEGIES FOR ALL TOWNS (CRSAT) IN THE EASTERN REGION – UPDATE OF THE WATER RECONCILIATION STRATEGY OF THE NTSHINGWAYO DAM SUPPLY AREA -2012 TO 2040”, dated December 2014, states the available yield of the Upper Buffalo System, before reserve and after deduction of current allocations and uses, is 15.49 million m³/a.

However even this volume of 15.49 million m³/a is not available at Ntshingwayo Dam, but only in the Upper Buffalo River System, provided the Ntshingwayo Dam is fully operational, (the flood regulating gates need to be repaired to allow full storage of the dam), the applicable operating rules are properly managed and controlled, and no theft of water from instream flows occur.

None of these conditions are currently met and the DWS cannot make any additional allocations from Ntshingwayo Dam at this point without substantial refurbishment works, implementation of practical and implementable operating rules and the institution of adequate enforcement measures.

To implement, manage, control and enforce “operating rules”, would inter alia require the construction of significant infrastructure, at considerable cost estimated as follows:-

• Repair or replacement of the bulk raw water pipes from Ntshingwayo Dam to the Ngagane WTW (estimated cost R 575 million).
• Construction of a water transfer scheme with capacity of 90 Ml/day from the Buffalo River to the Ngagane WTW (estimated cost R600-million).
• Increase in existing (new) abstraction capacity from the Ngagane River at the Ngagane WTW.
• Implementation of an effective water conservation and demand management (WCDM) program in Newcastle (cost unknown and success rate elsewhere in South Africa very low).

Implementation of all these measures would relieve the current “under supply” but the remaining “spare yield” of 5 million m³/a would be insufficient to address the growth in NLM’s demand beyond 2020.

In recent correspondence with the NLM, the DWS readily acknowledges that there are “other currently water stressed areas” in the Buffalo River. By implication this means the Ntshingwayo Dam supply is also water stressed, as it forms part of the Buffalo River system.

The water resources (rivers and dams) supplying Newcastle and surrounds are not adequate to alleviate the “water stressed” situation which currently prevails.

The only feasible solution with which to address this “water stressed” condition is to augment the firm yield of the system through the construction of dams, to provide additional storage from which water can be released during dry periods.

The only question remaining is the locality, size and cost of the dam(s) needed to provide NLM with the most cost-effective and affordable water supply option.

THE NCANDU DAM OPTION

In 2012, the NLM, in consequence of the water resource dilemma, and having prior knowledge of the extensive work and authoritative research and authorisations completed by the NDC, in compliance with its previous agreements with the NLM, the Municipality in its capacity as the Water Services Authority, invited the consortium to propose a solution addressing the urgent needs of the NLM and simultaneously providing a cost effective and beneficial project, which would augment their water requirements, particularly in light of their statutory duty as the Water Services Authority in the region.

The duties of a Water Services Authority such as the NLM, is defined in the Water Services Act (No 108 of 1997) as follows:-

Section 11(1) Every Water Services Authority has a duty to all potential consumers in its area of jurisdiction to progressively ensure efficient, affordable, economical and sustainable access to water services.

To comply with this statutory duty, it must assure, amongst others, appropriate investments in water infrastructure are made. This invitation led to the Unsolicited Bid by Ncandu Water (Pty) Limited currently under consideration.

The suggestion of “research” revealing inadequacies in the proposed Ncandu Dam catchment area, is both misplaced and disingenuous. The DWS in considering an application for a licence to store water, set the terms of reference for a comprehensive hydrological study to be conducted inter alia to determine the effect of the Ncandu Dam on downstream users as well as for setting the “environmental reserve”. The environmental reserve was duly signed off by DWS and by implication the hydrological analysis must have has been accepted as correct.

This hydrological analysis,which was calibrated against 50 years of flow records at the Ncandu Falls gauging weir, clearly indicates the proposed Ncandu Dam can yield 16,87million cubic metres per annum at the Boschoek weir at a supply reliability of 98 per cent. There exists no “research” which could come to a different conclusion.

Other dam sites that may have been identified do not offer the advantages of the Ncandu Dam and a series of in depth and specialised studies have reached the same conclusion namely that:-

• The existing raw water and other bulk infrastructure in NLM are inadequate to meet CURRENT demand.
• The lowest cost solution that offers the lowest risk (highest assurance of supply) to NLM is the Ncandu Dam project as proposed by the Bidder.
• Ncandu Dam is a solution that can be implemented without any DELAY.
• Ncandu Dam is a solution that would allow for GROWTH in Newcastle and surrounds and that would be of great net ECONOMIC BENEFIT and JOB CREATION.
• The “DO NOTHING” option is “NOT AN OPTION”. It is too late for that. It is also not possible to claim innocence of the dire water stress condition. Too much information is available to indicate the severity of the problem. NLM would have to make a decision soon.

The Ncandu Dam project has many opponents; most notably officials, ex-officials and consultants associated with uThukela Water (Pty) Limited. The motivation for their opposition to the project is unclear and it is certainly not underpinned by facts. Their influence inside the NLM and the DWS, as well as their combined statements to the press and general public, have been most effective in delaying the implementation of the only viable project which can save Newcastle from severe and certain water shortages.

It needs to be noted uThukela Water (Pty) Limited is merely a water services provider in terms of the Water Services Act and it is authorised to render bulk water services to the NLM by virtue of a contractual relationship with NLM. It seems inconceivable it could be at variance with a decision of its parent body, particularly in view of the differing roles and duties provided for by the Act.

The Municipal Finance Management Act, Act No. 56 of 2003 requires the NLM to comply with Section 33 thereof prior to entering into any agreement having a multi-year budgetary implication. This Section inter alia requires a full and comprehensive public participation process. At that stage any serious objection to the affordability, feasibility and sustainability of the Ncandu Dam project can be aired. It should not be dealt with prior to and whilst the process of considering the Bid is ongoing. The Municipality have taken a decision to consider the Bid and should be allowed to do so without mischievous interference.

In conclusion, Ncandu Dam offers a unique opportunity for the NLM to acquire a valuable and necessary asset at an affordable price, ensuring water security for the inhabitants and businesses of Newcastle for many decades to come. Any other potential water augmentation option (if it practically exists) will come at significantly greater cost and risk to NLM and will almost certainly not be delivered within the timeframe to would prevent a very serious water shortage. No amount of obfuscation by presenting unknown research, alternative dam sites or denying the obvious, will change the fact that Newcastle has run out of both water and time, and current water resources, without the creation of storage augmentation, will be inadequate to meet NLM’s short and long term demand.

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