Reeep Annual
Report 2022
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  1. REEEP Annual Report 2022
  2. Climate Change, Clean Energy and Urban Water in South Africa

Project

Climate Change, Clean Energy and Urban Water in South Africa

Empowering municipalities to build capacity, identify appropriate interventions, access finance and ultimately deploy clean energy technologies and systems in their water infrastructure.

  • Location: South Africa
  • Status: completed

Full Film: Climate Change, Clean Energy and Urban Water in Africa

Background

Water and waste water systems form the core infrastructure that underpins delivery of water and sanitation services in cities. With pumps and other systems running 24 hours a day, they are also among the largest consumers of electricity in municipalities – and therefore generate substantial costs and greenhouse gas emissions. As cities, particularly in the developing world, continue to grow rapidly, demand for water and wastewater services will continue to rise, increasing the pressure on underlying infrastructure. Decisive action is required to manage both the environmental and financial impacts of providing water and sanitation as essential services to growing urban populations.

Clean energy technologies and energy efficiency interventions can dramatically improve efficiency and reduce GHG emissions in urban water and wastewater infrastructure, and do so cost-effectively, with investment payback periods of often only a few years. However, municipalities often lack both the staff capacity and the financial means to plan, fund and implement such interventions.

REEEP SUPPORT

The Climate Change, Clean Energy and Urban Water in Africa project, funded by the European Commission, implemented by UNIDO and executed by REEEP, aimed to empower South African municipalities to upgrade their water infrastructure with clean energy and energy efficiency solutions, to reduce energy use, costs and greenhouse gas (GHG) emissions, and improve service delivery.

The project, which wrapped up in July 2019, created pathways to empower municipalities to build capacity, identify appropriate interventions, access finance and ultimately deploy clean energy technologies and systems in their water infrastructure. The pilot project was implemented in two disparate municipalities in South Africa, Nelson Mandela Bay in Eastern Cape and !Kheis in Northern Cape.

REEEP and its local partners developed technical action plans with both host municipalities, which, based on detailed energy usage data collected through energy audits, led to the selection of high-impact technical interventions at their waterworks sites. Each municipality also signed a Memorandum of Understanding with the National Cleaner Production Center (NCPC), which joined the project to provide accredited energy training to the municipalities’ technical teams.

Our work with these two municipalities has revealed that, despite the vast difference in population and municipal budgets, they face similar challenges. They could apply similar approaches to overcoming these challenges and successfully implementing clean energy interventions. The best practice advice developed based on experiences in the two municipalities was therefore useful to most municipalities in the country and created a solid base for replication across sub-Saharan Africa.

Aerial view of the Fishwater Flats Waste Water Treatment Works in Nelson Mandela Bay Metropolitan Municipality. Credit: Charles Meadows for REEEP

 

Our approach consisted of four main parts:
  1. Building capacity: The project provided training to municipal technical managers to help them identify, procure, finance, install and operate fit-for-purpose clean energy interventions in municipal water infrastructure.
  2. Laying foundations: The project assisted municipalities in carrying out energy audits and other baseline studies, so that technical interventions can be identified and selected based on reliable data, and any energy and cost savings proven.
  3. Connecting stakeholders: The project created opportunities for representatives of municipalities, the private sector, financiers and government to meet and discuss challenges and opportunities, improve mutual understanding and remove barriers for future cooperation.
  4. Untangling procurement processes: The project helped municipal technical managers identify and navigate the procurement pathways that must be followed to upgrade their water and wastewater infrastructure, and facilitates a dialogue with private sector stakeholders to enable them to respond effectively to municipal tenders.

Locations

The Fishwater Flats Waste Water Treatment Works in Nelson Mandela Bay Metropolitan Municipality. The project helped the municipality install an energy metering system to better monitor the energy use and functioning of some of the plant’s key assets.

Credit: Charles Meadows for REEEP

Nelson Mandela Bay Municipality

Nelson Mandela Bay Municipality includes Port Elizabeth, South Africa’s sixth largest city and a major industrial hub. The technical intervention under this project centred on the Fishwater Flats Waste Water Treatment Works which processes 67% of the municipality’s wastewater – 120 million litres per day. An estimated 70% of the energy used by the site is consumed by 70 motors used to aerate sludge – a step in the wastewater treatment process which allows bacteria to filter out organic matter.  The treatment works aimed to replace these motors with new technology providing a more precise and vastly more efficient method for aerating sludge. The intervention required gathering data on energy use, so that savings can be calculated and investments in upgrades justified.

The Fishwater Flats site did not have equipment to measure the energy use of its different assets over time, though, and monitored only the site’s total energy use. With the assistance of this project, the municipality installed sophisticated energy meters for the sludge mixers, a significant first step towards making this process much more energy efficient. For the first time, technical staff at the site could now oversee operations and diagnose problems remotely, via an online dashboard. The municipality used the data gathered to future-proof Fishwater Flats, increase its resilience to climate change and improve service delivery to its 1.1 million residents.

4. Andries Letsheenyo, Rauco Trading Technical Team - Groblershoop treatment plant

Andries Letsheenyo from Rauco Trading Technical Team at the Groblershoop treatment plant in !Kheis Local Municipality.

Credit: Incubate for REEEP

!Kheis Local Municipality

!Kheis Local Municipality is a stretched out, sparsely populated municipality on the edge of the Green Kalahari in Northern Cape province. The municipality, which measures nearly 100 km from its northernmost to its southernmost point, and roughly the same east to west, employs only a handful of engineers to maintain all infrastructure, including roads, electricity and water and sanitation provision to its widely dispersed population. The municipality’s technical staff, together with the project partners, identified fifteen sites for clean energy interventions.

Energy meters were installed at all sites, allowing for remote monitoring of the functioning of different assets and for the remote identification of breakdowns, and ten pumps were replaced with new, energy efficient models. Back-up pumps were installed for pumps that are critical to the water supply, to prevent service interruptions in case of breakdowns. In addition, REEEP conducted a community engagement event in Groblershoop, the municipality’s largest town, to inform the local community of the planned interventions. As part of this event, educational plays were performed at two local primary schools, teaching hundreds of students about the importance of saving water.

Stakeholder Engagement

In parallel with the technical work, REEEP ran an intensive programme of stakeholder engagement events which brought together, often for the first time, representatives of different departments in municipalities, the finance sector, private sector technology providers and project partners. The lessons learned at these roundtables were integrated into a Best Practice Guide, which contains advice for municipalities on which steps to take when implementing clean energy solutions. The lessons have also been leveraged in a Policy Brief, which provides policy recommendations to the South African government to create an enabling environment for clean energy and support municipalities to procure and fund improvements to their water infrastructure.

“WE ARE VERY OPTIMISTIC ABOUT THE POTENTIAL OF THESE ENERGY EFFICIENCY INTERVENTIONS TO SAVE ON OUR ELECTRICITY BILLS. THIS PROJECT WILL IMPROVE SERVICE DELIVERY TO OUR COMMUNITIES FOR DECADES TO COME.”

Desmond Dolopi
Technical Manager, !Kheis Local Municipality

FIND OUT MORE

In 2018, REEEP produced an informative brochure on Climate Change, Clean Energy and Urban Water in Africa: Promoting Market-Based Deployment of Clean Energy Technology Solutions in Municipal Waterworks: Pilot Initiative in South Africa

PROJECT BROCHURE

Donors

Programme

The Private Financing Advisory Network

Mobilising investment for climate change adaptation and mitigation projects and businesses

  • Location: Global
  • Status: ongoing

Leaf Capital | PFAN success story | Fiji

ABOUT PFAN

The Private Financing Advisory Network is a global network of locally based climate and clean energy finance experts which offers free business coaching and investment facilitation to entrepreneurs developing climate and clean energy projects in low and middle-income countries. With a focus on clean energy and climate mitigation and adaptation, PFAN has been in operation since 2006, making it one of the longest-standing project preparation facilities working with SMEs in developing country markets. Since 2016, REEEP has been co-hosting the Private Financing Advisory Network (PFAN) together with UNIDO. PFAN aims to build clean energy markets one business at a time, mitigate climate change and mobilise private investment in support of the Paris Agreement on Climate Change and the Sustainable Development Goals. While combating climate change is its ultimate goal, in its day-to-day work, PFAN is driven by a desire to help entrepreneurs succeed. Getting a project off the ground is difficult; there are many barriers faced by entrepreneurs, especially those linked to accessing additional investment. Its efforts have resulted in a milestone in 2022: since inception, PFAN-supported projects have mobilised over USD 3 billion in investment.

PFAN operates in

  1. Sub-Saharan Africa
  2. South Asia
  3. Southeast Asia
  4. Pacific Islands
  5. Eastern Europe & Central Asia
  6. Latin America & the Caribbean

PFAN in 2022

Now more than ever, supporting small and medium-sized enterprises (SMEs) that focus on climate change is crucial. SMEs play a critical role in driving sustainability, reducing greenhouse gas emissions and increasing climate resilience. By increasing investment in and supporting SMEs that prioritise climate action, we can help create a more resilient and sustainable future, while also promoting economic growth and job creation.

Throughout 2022, PFAN continued its work with its global network of locally-based clean energy and climate finance experts. Its focus remained on bridging the gap between entrepreneurs and investors, which includes capacitating entrepreneurs to develop bankable projects, increasing investor confidence in and providing access to climate and clean energy projects as well as enhancing the capacity of local ecosystems to develop self-sustaining and gender-responsive climate mitigation and adaptation markets.

2022 was a year of global challenges: ongoing impacts of the pandemic and the war in Ukraine resulted in a significant increase in food and energy prices and tightening financial conditions, all factors which are hindering the efforts towards the Paris Agreement on Climate Change and the Sustainable Development Goals. Despite these challenging circumstances, PFAN celebrated the remarkable achievement of USD 3 billion leveraged by PFAN-supported climate and clean energy projects.

In 2022, 47 PFAN-supported projects mobilised financing and leveraged over USD 865 million.  It is continuously working to improve support for climate entrepreneurs, including looking at new ways of creating impact and introducing new service modules to get them better equipped to interact with investors. Last year, PFAN capacitated its network of Advisors to transform them into effective agents of gender-equitable change in their support to entrepreneurs. It also increased its focus on the circular economy with dedicated capacity building to its networks and launched a knowledge corner on the topic.

PFAN further intensified its efforts to raise awareness of the need for adaptation solutions and organised several events to originate projects with a focus on climate adaptation. With the return of more in-person events, PFAN took the opportunity to showcase its work in adaptation at COP27 and facilitate a space for discussion and exploring key challenges and opportunities in scaling up adaptation finance and closing existing gaps between relevant actors.

Cold storage solutions at PFAN-supported project New Leaf Dynamic Technologies in India.

PFAN in Numbers: 2006-2022

3
Total investment leveraged (USD billion)
1803
Clean energy capacity added (MW)
1327
Total projects supported by PFAN
243
Total projects which mobilised finance
18%
of projects mobilised finance
4.93
Potential CO2e emission mitigation (megatonnes/year)

MILESTONES & FOCUS AREAS

Credit: Polarfux

USD 3 BILLION LEVERAGED

After reaching the milestone of USD 2 billion in investment leveraged by PFAN-supported projects and businesses in 2021, in just over one year, PFAN celebrated another milestone of USD 3 billion in investment leveraged. PFAN continues to grow on its journey to create greater transformative impacts. Project origination and development are increasingly important to create compelling climate investment opportunities to mobilise climate finance, reduce GHG emissions, contribute to the Paris Agreement and Sustainable Development Goals and empower and accelerate a just transition.

A SokoFresh employee holds an avocado kept cool at their hub near Nairobi, Kenya.

Credit: Redbunny

Climate Adaptation

The focus of PFAN’s work has traditionally been on mitigation projects for the deployment of relatively mature clean energy technologies and, more recently, other innovative climate mitigation solutions. While this is paramount to reduce greenhouse emissions to help achieve the goals of the Paris Agreement, the implementation of solutions for adaptation plays a key role in reducing exposure and vulnerability to the impacts of climate change, also contributing to sustainable development. Climate risks are rising, and impacts are already coming at only 1.1°C above pre-industrial temperatures.

Mindful of the relevance and need for adaptation solutions, PFAN started looking into adaptation through pilot projects several years ago with positive outcomes. More recently, the private sector and investors, spearheaded by the Lightsmith Group and the support of various multilateral organisations, contributed to the definition of what consists of adaptation solutions by developing a taxonomy, which is used as the blueprint for PFAN’s engagement in this space.

Women carry fresh produce at New Leaf Dynamic Technologies’ GreenCHILL centre in India

Credit: New Leaf

However, it has been observed that the deployment of climate adaptation solutions faces additional challenges, such as a high-risk investor’s perception or the lack of knowledge about these technologies and their business models. The Adaptation Gap Report 2022 stated that “global efforts in adaptation[…] financing and implementation continue to make incremental progress but fail to keep pace with increasing risks”.

To address these challenges, PFAN intensified its efforts in 2022 to raise awareness of the need for adaptation solutions and organised several events to originate projects with a focus on climate adaptation. For example, PFAN hosted an evening event on the sidelines of COP27 titled “Closing the Financing Gap for Climate Adaptation SMEs” on Finance Day in Sharm El Sheikh, Egypt, which highlighted the actions needed to mobilise the necessary capital to finance climate adaptation projects and businesses and emphasised how the roles of both the public and private sectors are critical in catalysing investment. Furthermore, it submitted the Resilient Investment in Southern Africa-Technical Assistance Facility (RISA-TAF) project to the Green Climate Fund, which was developed in partnership with Camco to mobilise private sector capital for climate adaptation projects and businesses in the agriculture sector in 8 countries in Southern Africa.

Rural women with clean cookstoves from BioMassters in Rwanda.

Credit: BioMassters

Gender Mainstreaming

In 2022, the work with Value for Women – a consultancy firm specialised in providing gender mainstreaming advisory services – continued in order to ensure that the network of PFAN advisors received training on integrating gender aspects in the evaluation and advisory process while supporting entrepreneurs in raising finance for their projects and businesses. The main focus of PFAN’s gender mainstreaming activities centred on outreach to women entrepreneurs and exploring collaboration with women’s organisations with the support of the newly introduced Gender Focal Points, as well as the implementation of activities which contribute to ecosystems becoming more gender inclusive.

Masterclasses on Gender Lens Advising were provided to PFAN Advisors and Country Coordinators in all regions, which resulted in over 100 PFAN advisors successfully completing the training. Externally, outreach to women entrepreneurs and women’s organisations included a gender-targeted campaign on social media with a particular focus on sub-Saharan Africa to demonstrate PFAN’s work towards making projects and businesses more gender-responsive for a positive impact on economic growth and society.

Furthermore, PFAN initiated two new collaborations in 2022 involving outreach and selection of businesses, namely the African Development Bank Group’s 2022 AgriPitch Competition targeting young and women agripreneurs and the partnership with Serengeti Energy via the Umoja Incubator. With the involvement of the Gender Focal Points, gender aspects were integrated in the evaluation and advisory process of both partnership initiatives which were led by PFAN partners Private Equity Support and Serengeti Energy respectively. These collaborations underlined that PFAN’s commitment goes beyond making its own advisory process more inclusive, but we also influence other entrepreneur support organisations to include gender aspects in their evaluation and advisory processes.

”We are grateful for PFAN. Through their support, we were able to get an advisorwho has supported us on this fundraising journey. We believe that through the PFAN network, we can be able to find investors to work with us.”

Mohammed Lubowa
Founder, All In Trade

FIND OUT MORE

PFAN’s Annual Report provides an overview of its activities in 2022 from the global perspective and regional pages featuring highlights and statistics from each of its areas of operation as well as a selection of PFAN-supported projects sharing their success stories and experience in the PFAN Journey.

Explore the report

PFAN’s Donors