In the wake of South Africa adjusting to the prolonged impact of the now-eased loadshedding, water-shedding has emerged as another significant risk, threatening the sustainability of businesses across the country.

Water security is rapidly becoming one of the biggest challenges facing South Africa. Amid water shortages, supply challenges and localised issues, water needs to remain at the top of the agendas of both private-sector leaders and government.

“As a business, a day-zero scenario, or water outages, is a real possibility and can be extremely disruptive,” says Nedbank Commercial Banking head of climate resilience and sustainability strategy Mark Boshoff, noting that it should be part of management’s focus when crafting strategies around the risks facing operations.

The impact of water supply interruption was noted during December when Johannesburg Water cut off water for maintenance for 72 hours. The effect of the interruption was limited owing to maintenance occurring over the school holidays, a weekend and a public holiday.

However, those in Johannesburg and operating businesses during a heat wave had an indication of the impact of a lack of water has on households, businesses and operations.

Companies should pay equal attention, through water resilience investment strategies and responses, to the risk of water-shedding as they have to the loadshedding crisis, which has somewhat eased but still remains a threat, he says.

Since 2007, State-owned power utility Eskom has been implementing rotational power cuts in stages to mitigate the load on the national electricity grid when electricity is insufficient. It is likely that the water sector will follow suite with so-called water-shedding, where water supply is throttled or restricted and distributed in rotation.

In response to loadshedding, many companies installed renewable-energy alternatives, such as solar and wind power, and, as consumers and businesses alike face significant impacts of water-shedding and no water supply, they should start considering several mitigating solutions.

The effects on businesses can now be quantified, and it is specifically businesses that are completely reliant on water or on a specific purity of water that are at risk, including key sectors such as agriculture, pharmaceuticals, food and beverage, hygiene and medical services, besides others.

“It is one of our concerns and one of the risks flagged. We are looking at it from a credit risk point of view. It has arrived at the point where we no longer only look at a client’s financial risk; we now start looking at the environmental risks that the client is subjected to.”

Businesses now have to use valuable working capital to deliver solutions and mitigate any possible impacts.

Nedbank now has various financing options available, in addition to its in-house, business-to-business marketplace Avo, which aims to provide clients with solutions.

Boshoff further discusses several potential solutions, such as rainwater harvesting and building or adapting catchments through buildings’ and roofs’ drainage systems. However, rain is seasonal, and the stored water may not last through the dry seasons.

Other options include water storage – which is finite, as municipal water is used for storage and topping up – greywater use, recycling, reporting municipal leaks and fixing own leaks, and adopting water efficiency.

“Water efficiency is the low- hanging fruit, and every little bit helps,” he says.

According to the Department of Water and Sanitation, currently, 41% of municipal water nationally does not generate revenue, while 35% is lost through leaks, with municipalities losing about 1 660-million cubic metres of water a year through nonrevenue water.

In November 2024, Johannesburg Water introduced water reduction schedules in high- consumption areas to combat water scarcity. Municipalities across Gauteng were already implementing Level 1 water restrictions at the time.

Water restrictions such as these were widely implemented in Cape Town and other areas in the Western Cape during the ‘day zero’ water crisis in 2016.

Forging public-private partnerships and leveraging the template of the energy sector, which resulted in some success with private-sector renewable- energy investment, will also assist in boosting water supply.

“Part of the reason that we no longer have loadshedding is the fact that there is quite a lot of production of energy now, from households through to large solar farms that supply to various municipalities.”

Public-private participation projects within the water sector can lead to water purification plants and other solutions that would alleviate the pressure on the national water network.

Nedbank is also involved through its various clusters and is financing water reticulation projects in which municipalities are involved.

Through its corporate social investment, Nedbank is also engaging communities, and Boshoff says that more companies are increasingly doing the same.

“It is the right thing to do, and is essential to remain operational. No business can thrive in a society that is struggling. If your client base is not prospering, your business will suffer in response. It is really all about symbiotic relationships.”