Water insecurity a business risk in the Western Cape, says Alan Winde
By Adrian Ephraim
THE Western Cape’s drought has been officially declared a provincial disaster. For business leaders, that’s not just an environmental headline – it’s a material risk warning that belongs in your quarterly risk register alongside load shedding and logistics failures.
“Water is no longer just a municipal service issue,” Western Cape Premier Alan Winde told Cape Business News. “It’s an economic risk, and we’re treating it as such.”
With dam levels falling and multiple municipalities under acute pressure, the province is asking the same question it faced in 2017: can water infrastructure keep pace with economic growth?
This time, the government isn’t waiting for “Day Zero” to force action. The disaster declaration is a coordination mechanism designed to deploy engineers faster, escalate failing systems, and unlock emergency powers when local capacity has collapsed.
For business, the message is clear: water insecurity is moving from background noise into foreground planning.
The numbers behind the risk
Since the 2017-2018 near-crisis, the province has invested R284 million purely in water coordination – not infrastructure, but analysis, oversight and strategic pressure on municipalities.
That’s dwarfed by what cities are spending. Cape Town alone allocates 40% of its annual capital budget – billions of rands – to water infrastructure.
According to Winde, despite five million residents (up from four million pre-crisis), Cape Town is still using roughly one billion litres per day – the same consumption achieved through emergency restrictions in 2018. That reduction has held because of institutionalised leak detection, pressure management and real-time monitoring.
“If you tell people to save water but there’s a gushing leak next door, there’s no trust,” Winde says. “Fixing leaks and using technology is absolutely central.”
Where the exposure is sharpest
Cape Town has built resilience. Smaller municipalities have not.
In Knysna, provincial engineers have been deployed repeatedly to stabilise collapsing systems. Thousands of households aren’t properly metered — meaning municipalities are losing both water and the revenue needed to fix infrastructure.
“Water losses are massive in some areas,” Winde says. “You have to measure them, fix them and collect the revenue you need to reinvest. Without that, the cycle just repeats.”
Towns like Zoar, Kannaland and parts of the Klein Karoo are under acute pressure. The Garden Route is particularly vulnerable.
Business is already moving – at a cost
Many companies haven’t waited for the government. Boreholes, storage tanks and water recycling systems are becoming standard capital investments, just as solar and batteries became essential during the energy crisis.
But unlike renewable energy, there’s no Section 12B rebate for water infrastructure. And unmanaged solutions bring their own risks.
“You can’t just sink boreholes everywhere,” Winde warns. “In dry seasons, too many boreholes drop the water table – and that creates another crisis.”
The province has launched the Western Cape Water Resilience Strategy 2025–2035 – a framework designed to secure supply while supporting long-term growth. It’s a coordination tool used through the Integrated Energy and Water Council, where government, municipalities and business assess risk together.
“We realised energy was one systemic risk,” Winde says. “Water was the next one. Our job as a province is coordination and understanding risk — even where we don’t have direct responsibility.”
Key priorities include:
- Reducing water losses across municipal systems
- Enforcing demand management without killing economic activity
- Increasing private sector participation in resilience infrastructure
- Faster approval processes for water-efficient developments
Agriculture: mitigation, not immunity
Agriculture remains uniquely exposed. When dams run dry, irrigation stops — and there’s no easy workaround at scale.
But the sector has adapted aggressively: satellite-based irrigation management, biomass monitoring, shade netting and precision water application are now standard practice on commercial farms.
“They probably understand water better than most sectors,” Winde says. “They mitigate risk where they can, but it’s obviously harder.”
What’s expected from business
Environmental approvals are tightening. New developments, like Amazon’s recent Western Cape investment, are going beyond compliance with water capture, recycling and biodiversity protection built into project design.
“Big water users are businesses, factories, golf courses, data centres,” Winde says. “The question is: how do we reduce net demand through recycling and closed systems?”
The government wants business as a partner, not just a consumer.
The next six weeks are critical
Dam levels are falling. The key risk now is how low they go before winter rains arrive.
“If we reach April at 30% instead of 40%, next year is a very different ball game,” Winde says.
His message to businesses in the Western Cape is direct: “Responsible partnership. It’s about your own longevity. Together, let’s make sure we get through this risk.”
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