Multibillion-rand backlog crippling SA’s public assets
The state of the country’s hard infrastructure is regarded as a barrier to growth, with electricity and water utilities in dire straits,
ROADS:
Hard Numbers: Our road network comprises 747 000km. The South African National Roads Agency Limited is responsible for 16 000km; provincial governments for 184 000km and the metros for 66 000km. The bulk, 339 000km, falls under municipal authorities while some 140 000km are unproclaimed. It has a replacement value of around R1.7-trillion.
Backlog: Towards the end of 2014, Sanral CEO Nazir Alli said the maintenance backlog stood at R197-billion, up from R149billion in 2010. The director-general for transport has told parliament: “We require about R80billion annually . . . We are only getting R36-billion a year.” He estimated that 80% of the network was older than its designed life of 20 years.
Challenge: Marianne Vanderschuren, professor of civil engineering at the University of Cape Town, says the standard of national roads maintained by Sanral is generally good, but the state of provincial roads, especially outside the Western Cape, and local roads is poor.
The National Development Plan says: Freight transport is damaging roads and must be shifted to rail. Better maintenance is a priority.
RAILWAYS:
Hard Numbers: The total primary railway network stands at around 22 000km, the majority of which is managed by Transnet Freight Rail. About 60% of the network utilises electricity for power. The network has not expanded much since 1925. The majority of the urban network is owned by the Passenger Rail Agency of South Africa. The replacement cost of Transnet rail assets is estimated at R388-billion.
Backlog: By the end of 2014, Transnet had an infrastructure maintenance backlog of just more than R30-billion.
Challenge: Prasa’s Metrorail business is severely underfunded. This is why passenger trains often break down. Prasa lacks sufficient train sets to meet passenger demand. A replacement fleet will only be delivered over the next seven to 10 years.
The National Development Plan says: Improve rail freight services to carry coal. Invest in commuter trains.
ELECTRICITY:
Hard Numbers: Eskom owns and operates about 95% of the country’s electricity. Municipalities and redistributors make up 4% and private generators 1%. Eskom has more than 300 000km of power lines. It has 18 coalfired power stations, the two biggest of which — at Medupi and Kusile — are still under construction or not yet fully operational. Coal accounts for around 80% of South Africa’s electricity. Nuclear energy accounts for about 5%, with one nuclear plant at Koeberg.
Backlog: At the end of 2014, the Department of Energy reported that the maintenance backlog had increased from R38-billion in 2006-07 to R68-billion, but the primary problem was that infrastructure is insufficient, hence the construction of Medupi and Kusile. For this Eskom has had to borrow heavily. It is undertaking a R280-billion capital expenditure programme over five years.
Challenge: The national installed capacity is 42 gigawatts, but the network is crumbling due to inadequate maintenance and lack of new generating capacity. Reports indicate availability of the network is at 70%. This means only 29.4GW of installed capacity can be relied upon at any time. Electricity demand is in excess of 32GW and Eskom’s new-build programme is 10 years behind schedule. Load-shedding and even loss of life result.
The National Development Plan says: A diversified solution is the answer — coal, gas (including shale gas), green energy and nuclear. The plan warns against the cost of nuclear, but the government seems to be rushing into implementing it, with Russia expected to be the main beneficiary of a controversial trillion-rand deal.
PORTS:
Hard Numbers: South Africa has eight main commercial ports, including Durban and Richards Bay, under Transnet. Their replacement value is estimated at R80-billion.
Backlog: Transnet has undertaken to invest R312-billion to expand our ports. Some R33billion of this will be invested in Transnet Port Terminals and R47-billion in the National Ports Authority.
Challenge: The World Bank identifies one of the biggest obstacles to doing business as the amount of documentation required to enter a South African port. Transnet’s main ports are generally well funded and operate to a good standard.
The National Development Plan says: South Africa has a weak maritime industry. The country needs to reappraise the maritime sector in light of its geopolitical positioning.
WATER:
Hard Numbers: South Africa has about 4 718 dams. The Department of Water Affairs owns 305, accounting for about 70% of the country’s dam capacity. The department also owns more than 800 water treatment plants and 2 000 wastewater treatment plants. It has an estimated replacement value of R139-billion and generally produces highquality water, with some exceptions, particularly outside metropolitan areas.
Backlog: According to environmental agencies, South Africa could start running out of water in 2020. In 2013, theWater Research Commission reported that about half of all South African water was stolen, wast- ed or leaking away each year.
Challenge: Several commentators have said the country’s water network is collapsing due to inadequate maintenance, a decline in skills and lack of investment and upgrading.
The National Development Plan says: Implementing broader policies that address equitable allocation and protection remain a challenge. Water restriction threats remain due to delays in infrastructure investment and a failure to moderate demand.