Regional Bulk Infrastructure Grant / Programme (RBIG)

Grant and Policy

Workshop with Water Boards

30 April 2010

Purpose of the grant1. Distinguish between direct service delivery of reticulation

schemes that MIG is targeting2. Water availability & scarcity (Link Water Resource

Strategy and planning)3. Benefit of scale4. Integrated management (multi users)5. Institutional aspects & arrangement (ownership,

implementation, O&M)6. Socio-Economic development7. Financial issues (Viability & funding)8. Implementation options9. Sustainable management (water resources, O & M)

Bulk Infrastructure Program Drivers

Basic ServicesBasic Services•Basic supplyBasic supply•Wet sanitationWet sanitation•HousingHousing

Economic Economic DevelopmentDevelopment

•GrowthGrowth•BusinessBusiness•Industrial Industrial

Service QualityService Quality

•Drinking waterDrinking water•WastewaterWastewater•Water lossesWater losses•Interruptions Interruptions

Flagship projectsFlagship projects•Olifants Olifants •Sedibeng Sedibeng •Political prioritiesPolitical priorities

Sustainable & Asset Sustainable & Asset managementmanagement

•ConditionCondition•ReplacementReplacement•Refurbishment Refurbishment

Integrated Integrated SolutionSolution

Conditions for the grant• Only for regional bulk infrastructure• Only for social component• No duplication (only co-funding)• Implementation readiness• Confirmed need & solution (Feasibility)

Technical Water resources Environmental & legislative Governance e.g. IDP

• Institutional arrangement in place Implementation O&M (Sustained management) Ownership

• Financing confirmed: Social & Economic component.

Special grant conditions as per DoRA

• DWA must ensure appropriate involvement• Role players must understand implications• Agreement prior to implementation to be reached on:

Ownership ImplementationOperation & MaintenanceSocial & Economic component funding

• Total business planning.

Structure of policy document1. INTRODUCTION

2. BACKGROUND

3. PURPOSE OF THE PROGRAMME

4. OVERVIEW OF THE PROGRAMME

5. MANAGEMENT OF RBIG

6. FUNDING

7. MANAGEMENT OF INFRASTRUCTURE DEVELOPMENT

8. OVERSIGHT OF OPERATION AND MAINTENANCE OF REGIONAL BULK INFRASTRUCTURE

9. ACCOUNTABILITY, INTEGRATION, TRANSPARENCY

10. LEGISLATION AND REGULATIONS

11. RESPONSIBILITIES

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Objectives of the policy

1. Identify all regional bulk project requirements, through appropriate planning processes.

2. Assist with the implementation of infrastructure projects and where necessary assist in the funding of projects through RBIG

3. Ensure that existing regional bulk infrastructure is properly operated and maintained.

4. Facilitate the development of institutional arrangements and capacity to ensure the implementation and effective operations and maintenance of regional bulk infrastructure.

Ch 3, Purpose of the programme

PlanningInfrastructure Project

evaluation

RBIGFacilitating other

funding

Support O & MSupport,

implementation

Institutional arrangements,

capacity

Training and skill development

monitoring regulations

Regional Bulk Infrastructure Grant Programme

Ch4 : Overview; Definition of Regional Bulk

The infrastructure required to connect the water resource, on a macro or sub regional scale (over vast distances), with internal bulk and reticulation systems or any bulk supply infrastructure that may have a significant impact on water resources in terms of quantity and quality. “Macro” is defined as infrastructure serving extensive areas across multi-

municipal boundaries “Sub-regional” is defined as large regional bulk infrastructure serving

numerous communities over a large area normally within a specific district or local municipal area

Over “vast distances” is considered as any distances greater than 5 km Bulk infrastructure that has a “significant impact on water resources”

includes:• Any bulk scheme that is designed for maximum demand of 5 Ml/day or more• Any waste water treatment plant that discharges into a fresh water resource system

Water, sewerage and effluent infrastructure

Environmental

Social

Management

Institutional arrangements

Financial arrangements

Customer

Bulk supply infrastructure

Reticulation

CustomerSanitationServices

Water Resource

Water ResourcesWater Services

Local Government

WS an integrated process

Ch 5: Management of Grant

5.1 Governance of RBIG

5.2 Project identification and project selection

5.3 Funding Processes

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Governance

RulesEvaluation Conditions

CriteriaImplementation

conditions

stipulations (must be included in

agreements)

criteria by which projects will be

evaluated financial conditions

prerequisite (must be illustrated in implementation

ready report

criteria by which project funding will

be reallocated

project management requirements

General / key rules for funding

Obj

ectiv

esPr

oces

s

Grant Governance

planningproject

identification/ registration

Feasibility studies

Adjudication for funding

Implementation

Rules for implementation projectsa) All infrastructure developed must be owned by a relevant WSI or a water

board.

b) The need for, and choice of, a regional bulk solution must be confirmed and accepted.

c) Projects must be “implementation ready”.  

d)  There must be available co-funding for the portion of the water to be supplied that is not for social users.  

e) Projects must provide for realistic longer-term development scenarios and “total needs”

f)  Projects must be environmentally acceptable (approved EIA and environmental management plan).

g) Standard agreements between all key role players must be signed.

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Criteria a) General criteria (screening)

b) Prioritization criteria 

c) Other specific criteria include:

Social criteria: Economic criteria Technical criteria Institutional criteria Financial criteria Legal criteria Sustainability criteria

Project identification

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interim yr 1 (within 2-3 yrs)

Regional levelNeeds

assessment

Consolidate known projects

from all stakeholders

Review by Regional

planning ForumMaster Plan

Prioritisation process by

regional pla. Forum

Regional Deliverables

Preliminary list of projects per

region

Regional list of Proposed

Feasib. studies

National levelS.A. Overview

revision aS.A. Overview

revision b

Prioritisation by National

Planning forum

National Deliverables

National list of Proposed

Feasib. studies

S.A. Overview

Grant Funding allocation processa. Consolidate all provincial project lists into a national list

b. Determine the national cost allocation per province according to the following key allocation guidelines.

c. According to cost allocation per province identify the priority projects that can be funded from the provincial lists.

d. Convene the overview committee consisting of DWA, COGTA, NT and SALGA, and review the list of projects and funding allocation.

e. Submit overview committee recommendations for approval by DWA: Minister

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Category of project 2011 2012 2013 2014 2015emergency/flagship 10% 10% 10% 10% 10%Water services backlog 65% 55% 50% 45% 40%Water services economic / housing 15% 15% 20% 20% 20%Waste Water Treatment Plants 10% 15% 15% 15% 15%Refurbishment of aging infrustructure 0% 5% 5% 10% 15%Total 100% 100% 100% 100% 100%

Ch 6: Funding

6.1 Funding options

6.2 Factors affecting funding options

6.3 Support on funding options by DWA

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a. Funding from lending institutions.

b. Funding from WSA budget: The financially strong WSA must consider funding regional bulk projects through their own budgets generated from providing water services to their consumers.

c. Raising bonds

d. Funding by Water boards Where applicable WSA must consider the opportunity of allowing water boards to develop and fund regional bulk infrastructure.

e. Private sector co-funding: WSA must ensure that they obtain private sector co-funding for the component of water use by them

f. Private -Public partnership with consumers: Join development of schemes with large consumers (i.e. mines)

g. Private – Public Partnership with private water utilities

Ch 6.1 Funding options

Factors Affecting Funding Issues

• FinancingSocialEconomic

• Viability• Funding availability• Borrowing capacity• Etc.

Funding & Financial Management

Funding & Funding & Financial Financial

managementmanagement

Own fundingOwn funding

Loan fundingLoan funding

Co-fundingCo-funding

Grant funding (MIG)Grant funding (MIG)

Grant funding (BIG)Grant funding (BIG)

OtherOther

Financing, Planning Financing, Planning & Organizing& Organizing

Financial ManagementFinancial Management

•Cost recoveryCost recovery•InstitutionalInstitutional•O&M grantsO&M grants•Equitable ShareEquitable Share•TariffsTariffs•CostingCosting•Viability Viability

Grant funding (BIG)Grant funding (BIG)

Ch 7: Management of all infrastructure development

7.1 Planning process

7.2 Planning by Water Boards

7.3 Support of projects not funded by RBIG

7.4 Monitoring

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Ch 8:Oversight of Operation and Maintenance

8.1 Monitoring

8.2 Support on Operation and Maintenance

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Ch 9:Accountability, Integration, Transparency

9.1 Integration requirements within DWA

9.2 Integration with other government dept

9.3 Integration with MIG and other stakeholders

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10, LEGISLATION AND REGULATIONS

10.1 Legislative provisions

10.2 Proposed regulatory policies for the management of bulk

11, Responsibilities

11.1 DWA management structure

11.2 Specific roles and responsibilities

The End