Bio

Claire Pengelly is the Water Programme Manager at GreenCape. In this role during the 2017-18 water crisis she and her team provided guidance to the business community as it sought to understand the crisis and its implications for business continuity and sustainability. Claire has an Honours in Business Science and a Masters in Economic Development, both from UCT. She has previously worked in the fields of tech innovation and online marketing. She joined GreenCape in 2015.

Key points

• Climate change is here, it is real and it is happening now; the way we will feel climate change is through extreme events, so we have to have some redundancy built into our system and expect and pay for that redundancy, and we have to be ready and respond to events much quicker
• Day Zero had a huge impact, both positive and negative, but difficult to imagine surviving the drought without it
• There has been a dramatic change in level of awareness of water at household level and among businesses
• Businesses surveyed reported that they had been able to reduce their water consumption by 41% on average over the past year; remarkable when you consider that many of these businesses have a high level of water intensity in their production processes, so this required a huge amount of innovation and a lot of investment; when the private sector is forced into a situation where it has to do something its ability to react and respond and invest is incredible
• Another key lesson: the power of data, and the ability of transparent, credible information to change behaviour
• Businesses have no real regard for or interest in the politics happening within city, provincial or national government; they just need to know what government is doing so they can make plans based on that
• CoCT has been incredibly successful in managing to absorb 1 million additional people into the city over the past fifteen years without an increase in water usage; real unaccounted for water was around 14% in 2017, which is excellent in global terms; the city’s pressure management programme is massively successful and is estimated to be saving the city 70 million litres of water per day
• Many users went off grid, mostly through accessing groundwater, which impacts both the viability of municipal finances and the sustainability of the groundwater resource
• Water is not an environmental concern only, it is also an important economic concern; a lack of stable and secure water supply has employment, growth and development costs
• Collaboration and partnerships are important in a crisis situation

Index

0:00:06

GreenCape, its functions, its role during the water crisis; her role as Water Programme Manager at GreenCape; their normal sector development activities were focused more on the supply side; big shift that happened for her team was around July 2017 when they started realising that actually it was not so much about the water sector on the supply side but more the work they could do on the demand side, the water user side; getting companies to adhere to restrictions and giving them verified, independent information on what was going on; actual severity of the drought was not clearly understood or articulated at the time, so they tried to package the information and deliver it to businesses; information-sharing approach; high-level, aimed at reducing information asymmetry; towards the end of winter 2017, concern that we were not going to make it through the summer and about City’s large-scale augmentation plans to deliver; her team of three people scaled up to twelve people; their core mission and focus was to ensure that the drought does not become an economic crisis, that jobs were not lost; at the beginning of 2018 the restriction levels for businesses were suddenly raised from 20% to 45%, and tariffs more than doubled on the 1st of February; work with individual companies – can obviously be done only on a certain scale; also workshops, very focused, quite intense, sector-specific; web useful for scaling up even more: dedicated drought-support page with FAQs, links to resources, and regular updates; technical products; built a business case calculator for water technology, looking at different types of interventions you could possibly implement; “so by doing that we could illustrate that it wasn’t only about responding to a crisis and being a responsible business and making sure that you were reducing your usage as much as possible in as short a time as possible, but actually that so much of it made such good financial sense”; modelled it on both highly punitive Level 6 tariffs and on Level 1 tariffs, proving that even in a normal year “it’s an absolute no-brainer to invest in these kind of interventions now because it will hold you in good stead into the future”; between July 2017 and August 2018 they directly supported 400 businesses; in addition there were phone calls, emails and thousands of visitors to the website

0:14:45

The work of the Water Coordinating meeting; a task team of officials as well as their government partners that met weekly at the height of the crisis to figure out how to address the drought with the economic sector, how to get businesses through this; GreenCape’s role within that task team; they focused on industrial sector; also a means to unburden on the part of City officials who would sometimes get abuse back at the them

0:19:13

Biggest lesson that has been learned by Cape Town broadly “is the fact that climate change is here, it is real and it is happening now … like a lot of people I understood that there was going to be a drying trend, that we would see less water in 2050, but I think what it highlighted for me and it highlighted for a number of people throughout the city is that in fact the way that we will feel climate change is through extreme events, and that the severity and unpredictability of the droughts that we experience in this region have been accentuated because of climate change and that is going to only accelerate over the next few decades … the reality is that the lesson that we’ve learnt is that climate change produces a high level of unpredictability into the system and the way that we plan and the way that we manage has to take that into account. We can no longer take, you know, historical trends of rainfall for granted; we have to assume that actually the 0.33 percent probability of this event happening could happen, so we have to not only have some redundancy built into our system and expect and pay for that redundancy but we also have to be ready, so we also need to understand that the means in which we need to respond to events has to be much quicker … if this is our new reality, and this is what climate change brings, we just have to change our entire perspective on what it means to live in a drought-stricken environment”

0:22:13

Large-scale emergency augmentation programme initially proposed by the CoCT to build additional capacity of 500 million litres per day; factors underlying the city government’s thinking; Requests for Information sent out in June 2017 asking for solutions to augment existing supply with new supply; followed up with tender processes; “and I think it was at that stage once the actual tender responses started coming in that it was really starting to be understood that in terms of the cost of this augmentation was going to be by far the largest procurement programme any South African entity had ever done, and the speed with which it could be implemented would even at the fastest rate that the City was able to push through, that in terms of the technical and technological restrictions on it, that it still would be too little too late – that actually it wasn’t going to save us from the crisis. And I think the other key concern that was coming into it as well was that there was, the kind of demand reductions that were needed from the city’s citizens to be able to get through the summer had not been achieved anywhere in the world and had not been achieved to date within the city either”; hard threshold around 600 million litres per day; trying to push down to 500 for a number of months and not getting anywhere, hence the need for new supply

0:25:57

The concept of Day Zero; was a concept and campaign that generated a life of its own; CoCT initially resisted it; “I think the key shift was really when they understood you could utilise Day Zero as a behaviour change campaign, and really try to link the water usage now to a potential date in the future as to when we could possibly run out of water and quantifying that”; Day Zero has obviously had negative implications “but it did a number of really important things that perhaps without that level of drama would have been difficult to achieve”: drove down consumption significantly – suddenly got to below 500 million litres per day; also became clear that national DWS had to implement the required curtailments of agricultural use for the city to avoid Day Zero; “so I think it had a huge impact on a number of both positive and negative, but I can’t imagine surviving the drought without it”

0:28:28

Another big lesson: at a very core level, just an awareness of water; dramatic change in level of awareness of water use at household level; also much improved level of knowledge of where our water comes from, of dam levels and how the water system is managed; also at a business level big change in understanding, metering at higher level of granularity; use of different types of water for different purposes; large reductions in water use achieved by businesses in their Western Cape operations

0:32:14

Another key lesson: the role that business can play in the midst of a crisis; GreenCape initially went in just asking businesses to reduce their consumption; incredibly impressive results: businesses they surveyed reported that they had been able to reduce their water consumption by 41% on average over the past year; incredible when you consider that many of these businesses have a high level of water intensity in their production processes, so this required a huge amount of innovation and a lot of investment; “so I think that the key thing for us to recognise there is that when the private sector is forced into a situation where they kind of have to do something their ability to react and respond and invest is incredible; they mobilised so quickly and they were able to change their behaviour patterns and production patterns incredibly quickly”; in addition businesses fulfilled a number of other roles, one of these being as an influencer within their own system – supply chains, customers, staff, role within society that often has importance and influence; “using their ability to kind of magnify the messages that needed to get out there was incredibly powerful”; saw examples of companies that sponsored plumbers to go to their staff’s houses to install new fittings and fix leaks; businesses also came to the fore with CSI efforts to assist communities; example: Smart Schools Challenge that was launched initially by Shoprite – corporate would sponsor to have a smart meter installed at a school; many businesses saw themselves as a partner, came with many ideas and they wanted to respond in the best way that they could

0:36:29

Another key lesson: “the power of data, and the kind of ability for transparent, credible information to really change behaviour”; initially a lot of misinformation, clouded information, frequent changes in information; “there was a lot of questioning as to really the credibility of that information, and the credibility of the City overall to respond to the crisis, I think there was a real undermining of trust because there were these big plans being proposed but no details behind them, no real kind of forthcoming project plans etcetera, and real questions around the timelines of it, as well as kind of what the real situation really was”; this changed very dramatically at the beginning of 2018, with the release by the CoCT’s water department for the first time of the Water Outlook Report in January 2018; gave detail as to what the situation was and what the City was doing to manage it; this information flow to businesses had a huge impact “because suddenly there was a sense that actually the City had a much better handle on what was going on than people thought previously, there was a lot more working going on in the background than I think people were aware of, and that actually that they were really kind of not necessarily on top of the situation but they certainly were aware of all the risks and the issues that were at play”; similarly for residential users; no one had access to models in city government that predicted Day Zero date; independent modelling by outsiders like UCT researchers; beginning 2018 City came out with weekly Water Dashboard, with dam levels, consumption levels and rainfall levels, also date and graph on which Day Zero projection was based; suddenly this uncertainty was lifted from the system; UCT results were almost in complete alignment with the City’s results; “the credibility and trust in the City to manage the crisis was really heightened when people actually had information at their fingertips of what they were doing”

0:40:55

The CoCT did not come out with that level of transparent information earlier for a number of reasons: emergency procurement programme was initially in a state of chaos, things were changing all the time and it was quite difficult to give detailed information; also political situations in the city government that meant release of information not allowed; this changed when politics died down a bit and engineers came out and said, these are the facts, and politicians had to toe the line to a certain extent; “I think for a while effectively the politics got in the way because there was a lot of concern as to kind of almost exposing the severity I think of the situation that Cape Town was in”

0:42:15

Another lesson from GreenCape’s engagements with business: they have no real regard for or interest in the politics happening within city, provincial or national government: “for most businesses and citizens, government is simply government”; there was quite an extended period particularly towards the end of 2017 of finger-pointing and political point-scoring, “but for a business, we don’t care that, you know, this person hasn’t fulfilled their responsibilities and this government entity hasn’t come to and responded quickly enough – like, what are you guys actually doing, and how do we respond to that; so I think that was also one of the key learnings is that in terms of a business’s understanding of government mandates and different organisations and things like that, there’s very little regard for that – it’s, you know, just give us the picture so we can work with the reality and make our decisions on that basis”

0:43:38

The role of the media; “the frustrating thing for me in dealing with the media was that there didn’t seem to be a lot of background research and understanding of the situation … often when you would try and explain a situation, give the context, give some data, give some statistics, those would be ignored in the face of really trying to kind of build out this whole story”; saw this particularly with the international press around Day Zero; hysteria took hold; press looking for angles of political contestation; the blame game was a really key area of interest for a number of journalists – question she was asked all the time: “who’s to blame? why are we here?”; “obviously the media is there as a voice as well, it also raised a number of issues from communities that perhaps weren’t being heard by the City, about how they were surviving within the drought, and I mean generally they really saw this as a key opportunity to kind of highlight a particular issue and really kind of tackled it, but they probably could have done it with a little bit more research and responsibility”

0:46:51

Non-revenue water; NRW rate across SA very high: around 41% at the moment; GreenCape developed a pre-feasibility tool or model that helps a municipality understand the eventual impact of various potential NRW projects on its water business, to help it prioritise; GreenCape has quite a key interest in this as they see it as an area that requires a lot more attention; “I think it’s really important to acknowledge that the CoCT has done an incredible amount on non-revenue water … they’ve been given international awards for the work that they’ve done on this”; over the past fifteen years the city’s inhabitants increased by 1 million but the water usage did not increase; “that is largely because of the water demand management measures and investment that the City has made”; this was achieved by a number of different interventions, both on the behaviour side and the technical side: replacing metering, fixing pipes and leaks, installing water management devices, pressure management; incredibly successful; real unaccounted for water sitting around 14% in 2017 – this compares to 20% in London; but diminishing returns to a lot of these investments; pressure management falls under the ambit of interventions that the City started before the drought that they accelerated; aggressive pressure management kicked off beginning 2018; at all costs they wanted to avoid water shedding, they didn’t want to have any kind of actual disruption to the water network because that has huge implications on the infrastructure; “it’s really important to emphasise the success of that programme”; estimated that pressure management programme is saving the city 70 million litres of water per day; massively successful campaign

0:53:13

Economic impact of the drought: quite surprising – over the last year CT’s unemployment rate has fallen by 2.1% and the Western Cape’s by 1.5%; “overall the economy here is much more resilient than we thought it would be, and in fact businesses were able to adapt and manage the crisis much more effectively than we thought they would”

0:54:38

“If we hit Day Zero I think that would have been an absolute catastrophe, I don’t think there’s any doubt about it; you know, when you’re thinking about as a business not only how do you supply your workers with water when they’re there or even how do you run your office or your production processes but are your employees going to be standing in queues for hours for water, what does that do for productivity? Are there going to be massive riots and protests and they’re not even going to be able to get to the building or the office? … if that had actually happened I think that would have been an economic catastrophe amongst a number of other catastrophes, humanitarian etcetera would have occurred if it had actually happened”

0:56:14

Tricky situation CoCT is in at the moment is trying to figure out what the demand is going to look like in the future; in the crisis many users either went off grid or started processes to go off grid; largely done through accessing groundwater; this has two important implications: 1) effect on municipal finances, and 2) effect on groundwater resource; municipal revenue is reduced by people going off grid and no longer receiving municipal water and no longer paying; but those people are still using sanitation, which is charged as percentage of the water bill, so they effectively get sanitation services for free; also broader question around the management of groundwater as a public resource; because the kind of management and monitoring of the system is not happening at the scale it should be, there is a lack of understanding of the cumulative impact of all the groundwater abstraction that is happening by all the users in the system, including the CoCT; hundreds of businesses have invested in their own groundwater resources; have heard anecdotally of thousands of households that have done the same; no one has an exact clear picture of what the situation really is but there is a real concern as to the sustainability of the resource into the future as well as the viability of the municipal revenue under that situation; at the same time increased level of security for a business of being off-grid, and having your own access to groundwater makes the business much more economically secure; “so there really is a balancing act that needs to play out around how do we ensure the sustainability of the system overall both from a municipal revenue side but also the actual resource while appreciating that sometimes the economic impact of having people having a really secure supply of water also has a really good impact on the system”

1:00:09

Water as a constraint to future economic growth; projected economic growth of some Western Cape municipalities shows that they will not have enough water to support their economies – unless some significant new supplies start coming on board; “the concern for me is the other systems or other municipalities that are reliant on the same system as Cape Town that do not have the resources of Cape Town, nor the capacity, nor the attention really”; Swartland as an example of this; “water is not an environmental concern only; water is also a really important economic concern”; costs to employment, growth, development if we don’t have a stable and secure water future

1:03:09

Summary of lessons that the rest of the world could learn from CT’s water crisis: you can expect the politics to get messy; the importance of collaboration and partnerships

1:05:00

CT was probably the best city in SA to experience a crisis of this magnitude because it has well resourced and capacitated city departments with skilled personnel and dedicated people; it also has a well developed organisational ecosystem with a number of intermediary organisations like GreenCape providing structures and frameworks, even though these were not formalised, that helped a lot to manage a crisis like this.