Location: South Africa

A special purpose vehicle for addressing municipal and industrial water challenges

Rustenburg Municipality, a water-stressed area in South Africa, faced the dual challenge of increased water demand from domestic and industrial sources and reaching wastewater treatment capacity. Public finances could not meet investment needs, which led to an engagement with local mining companies. The municipality and mining companies established an SPV – the Rustenburg Water Services Trust – to finance and operate new water infrastructure: 50% of the SPV’s revenue comes from mining companies who have a 25-year agreement to off-take non-potable treated wastewater. After seven years of operation, the Rustenburg Water Services Trust had cash reserves of USD$12 million.

The SPV has realized several benefits: secured supplies for mining, reduced dependence on freshwater sources for industry that is increasing freshwater availability for other purposes, and improvements in downstream water quality through better wastewater treatment