Shared water, shared responsibility, shared action: eMalahleni, South Africa

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Water scarcity affects more than 40 per cent of people, a figure that is projected to increase as a result of climate change. By 2050, it is projected that at least one in four people will be affected by recurring water shortages. Ensuring universal access to safe and affordable drinking water by 2030 requires greater investment in infrastructure, sanitation facilities and hygiene programmes at every level. All ICMM members implement the 10 principles that underpin our Sustainable Development Framework. Principle 6 requires companies to continually improve their environmental performance which includes water management.

When the UN’s Sustainable Development Goals (SDGs) officially came into force in January 2016, the nations of the world committed to mobilise efforts to end poverty, fight inequalities and tackle climate change. Business has a significant part to play, alongside governments and civil society, in creating pathways for a greener, safer and sustainable future for us all. Metals and minerals are essential to almost all aspects of everyday life; they enable farming, healthcare, communications, construction, transport and energy and water supply. And they will arguably become more important as they help to deliver the infrastructure required for a low-carbon future. This is one of a series of case studies gathered as part of joint paper with IFC to show how through collaboration comminities, governments, and industry can work together to manage shared water risks.

South Africa’s eMalahleni Water Reclamation Plant is a spectacular feat of engineering. This $200 million state-of-the-art facility currently treats more than 30 million liters of acid rock drainage every day, transforming 16 million liters of it into drinking water for more than 80,000 consumers in a highly water-stressed, cash-poor, and rapidly growing urban municipality.

Built in 2007 as a collaborative project of Anglo American, BHP Billiton (now owned by South32) and the eMalahleni municipality, the plant broke new ground as the world’s first facility to treat acid rock drainage, purifying it to potable standards.

It has reduced to net-zero Anglo American’s reliance on external water sources, since the treated and recycled water meets all of the water needs of Anglo American’s mining operations in the area.

Collaboration and co-investment to solve an existential business problem

The plant came about because the two companies – both vying for a dominant share of the local coal market – understood that they needed to address a shared business threat and forego any potential competitive advantage of doing so alone.

Concern was growing over water availability as more people migrated to the city. To address the situation, the government imposed new – and expensive – water treatment regulations on the industry.

The only way to solve the complex web of problems was for the two companies to work together, along with the government, community leaders, and other private sector players.

So, they did. They co-invested in the water treatment plant, benefitting from economies of scale in meeting regulatory requirements while turning an environmental liability into a business and societal asset–but not without a lot of dialogue and ongoing consultation first.

To ensure alignment across key stakeholder groups, discussions were held in various forms, with regulators, through community seminars, water usage agencies and other existing water usage agencies. To get to this solution, the mining companies engaged in frequent dialogue and back-and-forth discussion.

Due to thorough stakeholder engagement, everyone involved had good understanding of the project, which led to timely permitting.
The press contributed significantly by elevating the public profile of the project with frequent news articles. This enhanced the level of interaction and public participation.

Organisational infrastructure to monitor progress

The partners set up an operations liaison committee as the central body to evaluate performance against targets and planned production. Today, committee meetings continue to serve as a platform to manage water supply contracts and service-level agreements between stakeholders. The active committee also ensures that the policy of open engagement regarding the water treatment facility will be maintained and that the supply of water will continue to benefit the public at large.

Challenges remain but rewards outweigh risks

The partnership is not without its challenges, mostly due to irregularities in the financial arrangements with the municipality, which pays for the water transfer and chlorination.

Still, with the rewards far outweighing the risks, the original partners have broadened their collaboration to include a wider focus on longer term water sustainability. “We’re definitely getting better at collaboration,” says Ritva Muhlbauer, Water Manager for Anglo American’s coal business.

The first mining initiative endorsed by the United Nations Framework on Climate Change, the eMalahleni wastewater recycling plant has set a new standard as a force for sustainability in a changing climate. Other companies and other municipalities in water stressed regions are now replicating the effort. It has brought additional benefits to the municipality as well: job creation, lower water costs, and increased access to clean water by poor communities, resulting in public health improvements.