1. Capital Expenditure Programme
Rand Water
Capital Expenditure Programme
Anthony ELS
Tariff consultation
14 October 2015

2. CONTENT Demand growth forecast 2. Augmentation & renewal plan to 2035
3. Capital budget

3. Demand Growth forecast
Customer base snapshot 2014/2015

4. Demand Growth forecast
Factors affecting growth
Major customers play dominant role
Domestic usage = 70% of total
Natural population growth, inward migration, system losses
Projected growth in demand
Projected demands contractually based on customer forecasts
Projected population growth of 3 million from 2010 to 2030
With an annual growth of 1.75%:
Year
2020
2025
2030
2035
Average Demand (Mℓ/d)
4700
5100
5500
5900

5. Demand growth versus raw water

6. Response to Limitations
WDM plans
Municipal customers required to submit WDM plans when applying for new connections (offset WDM savings against new demand)
WDM initiatives not intended to restrict development
Typically, areas of saving and development nodes are geographically separate
In future, customers will be measured on WDM performance
Potential for deferral of some capital expenditure, but:
Major projects have long lead times
Some existing infrastructure approaching full utilisation at peak periods
Require ‘headroom’ to take major infrastructure out of service for renewal
Response
First see effectiveness of WDM initiatives by location
Complete current projects but defer future projects

7. Corporate Systems Rand Water Eikenhof Supply System
Zwartkopjes Supply System
Palmiet Supply System
Mapleton Supply System
Booster Systems
Vereeniging Purification System
Zuikerbosch Purification System
Primary Systems *
Raw Water Supply System
* Primary = Raw Water + Vereeniging + Zuikerbosch

8. Corporate Systems
Booster
Primary
200km

9. City of Tshwane
Palmiet system
Eikenhof system
Mapleton system
Zwartkopjes system
Primary systems
Vaal Dam

10. Augmenting for 2015 to 2030 cycle
Projected growth in peak day demand = 1600 Mℓ/d over 15 years
Growth split between four booster systems
Primary systems 1600 Mℓ/d growth
Palmiet system Mℓ/d growth
Mapleton system 300 Mℓ/d growth
Eikenhof system Mℓ/d growth
Zwartkopjes system 300 Mℓ/d growth
Northern Jhb
Tshwane
Ekurhuleni
Central Jhb
Southern areas
North west Jhb
West Rand
Rustenburg
Eastern Tshwane
Ekurhuleni
Mpumalanga

11. Peak demand by pumping station
Design capacity
Projected peak day demands (Mℓ/d)
(including WDM savings - indicative)
2020
(2025)
2025
(2030)
2030
(2035)
2035
(2040)
Primary Systems
Zuikerbosch
3800
4300
4800
5300
5800
Vereeniging
1400
1300
Booster systems
Palmiet
1870
2000
2190
2380
2570
Mapleton
960
990
1080
1180
1270
Eikenhof
1470
1610
1750
1880
Zwartkopjes
800
760
780
840
880

12. CONTENT Demand growth forecast 2. Augmentation & renewal plan to 2035
3. Capital budget

13. Augmentation & Renewal Planning
Increase capacity to meet future demands (quantity & quality)
20 year view of projects based on 35+ year view of demands
Renewal
Extend life of existing assets (replace, refurbish, upgrade)
Integrated asset management approach
Many projects combine augmentation and renewal (eg pipelines)
Integrate at plant, site and system level

14. Capital expenditure – top 15 projects
Spend R(m)
Augment
Renew
2009
5-year
2015
AWS 1
Zuikerbosch scheme (System 5)
2812
516 Δ # 2
O6 Palmiet to Klipfontein augmentation
580
150 3
S4 Van Dyk Park to Rynfield pipeline
550
100 4
Mapleton Station upgrade
534 52 5
B1, B2 pipelines refurbishment
454 44 6
B16 Zuikerbosch to Slangfontein pipeline
444 7
Automated meter reading: quality
431 51 8
H43 Brakfontein to Lyttelton Pipeline
430 9
F46 Waterval to Weltevreeden pipeline
398 98 10
Automated meter reading: flow
400 46 11
R5: Vlakfontein to Mamelodi pipeline
360 12
200 Mℓ reservoir at Meredale
336 13
A6, A8 Vereeniging to Zwartkopjes pipelines
307 14
100 Mℓ reservoir at Bronberg
300 15
F49 Krugersdorp-Randfontein pipeline 65
Total
8,636
1,149
49.4%
41.6%

15. Asset Portfolios Buildings and property Civil structures Pipelines
Mechanical
Electrical
Process
Automation

16. Infrastructure renewal
Asset category
Replacement value (Rbn)
Design life (yrs)
Annual renewal allocation (Rm)
Pipelines 46
65+
312
Civil 12
50 to 100
242
Mechanical 9
30+
134
Process 7
15 to 20+
181
Buildings 4
80+ 98
Electrical 1
20 to 30+ 55
Automation
5 to 10+
127
Total 80
1,148

17. Infrastructure augmentation
Providing for 2015 to 2030 augmentation cycle
Augment primary capacity, with associated major pipelines and booster pumping capacity
Package of linked major projects for backbone infrastructure
2009 Additional Water Supply (AWS) Scheme
Anchor project for the 2009 AWS Scheme
Purifies and pumps into the network additional 1200 Mℓ/d after completion of phase 2
Station 5 at Zuikerbosch

18. Augmenting for 2015 to 2030 cycle
Projected growth in peak day demand = 1600 Mℓ/d over 15 years
Growth split between four booster systems
Primary system – 1600 Mℓ/d growth
Palmiet system – 600 Mℓ/d growth
Mapleton system – 300 Mℓ/d growth
Eikenhof system – 400 Mℓ/d growth
Zwartkopjes system – 300 Mℓ/d growth
Northern Jhb
Tshwane
Ekurhuleni
Central Jhb
Southern areas
North west Jhb
West Rand
Rustenburg
Eastern Tshwane
Ekurhuleni
Mpumalanga

19. Primary Systems – 1600 Mℓ/d growth from 2015 to 2030
Additional Purification Plant – 1200 Mℓ/d capacity
Additional raw water pipelines and purification plant upgrades
Purification plant upgrades
Vereeniging and Zuikerbosch
B19 raw water pipeline
R30 million budget for 2015/16
Station 5 at Zuikerbosch
1200 Mℓ/d capacity in two phases
R516 million budget for 2015/16

20. Augmenting for 2015 to 2030 cycle
Projected growth in peak day demand = 1600 Mℓ/d over 15 years
Growth split between four booster systems
Primary system – 1600 Mℓ/d growth
Palmiet system – 600 Mℓ/d growth
Mapleton system – 300 Mℓ/d growth
Eikenhof system – 400 Mℓ/d growth
Zwartkopjes system – 300 Mℓ/d growth
Northern Jhb
Tshwane
Ekurhuleni
Central Jhb
Southern areas
North west Jhb
West Rand
Rustenburg
Eastern Tshwane
Ekurhuleni
Mpumalanga

21. Palmiet System – 600 Mℓ/d growth from 2015 to 2030
Additional Engine Room – 600 Mℓ/d capacity
Total 150 km of pipeline between 600 mm and 2100 mm diameter
Diepsloot
H39 Klipfontein – Brakfontein pipeline
R13 miilion budget for 2015/16
B17 Zuikerbosch - Palmiet pipeline
R213 million budget for 2015/16
O6 Palmiet - Klipfontein pipeline
R150 miilion budget for 2015/16
Engine Room 3b at Palmiet station
600 Mℓ/d operational capacity
R43 million budget for 2015/16
Zuikerbosch Purification & Pumping Station

22. Palmiet Augmentation Palmiet System pipelines for augmentation
Description
New pipe name
Existing lines augmented
Diameter
(mm)
Length
(km)
Required
(year) 1
Zuikerbosch – Palmiet pipeline
B17
B4, B6, B10
2100 46
2017 2
Klipfontein – Brakfontein pipeline (partial)
H39
H12, H21, H27
1700
14.7 3
Palmiet – Klipfontein pipeline (phase 1) O6 O2 18 4
Palmiet – Klipfontein pipeline (phase 2)
O2, part O5
1800 6
2025 5
Kwaggaspoort – Gomsand pipeline
H42
H22, H28
1000
9.7
2015
Northridge – Airfield pipeline
G37/H47 H3
900
5.8 7
Brakfontein – Lyttelton pipeline
H43
H12 portion
1500 26
2022 8
Lyttelton – Kwaggaspoort p/line
H14 portion
1200 9
Brakfontein – Kwaggaspoort pipeline -
H25, H30 21
2027 10
Kwaggaspoort – Hartebeesthoek pipeline
H22, H28, H42 15
2032 11
Hartebeesthoek – Rosslyn pipeline
H18, H29 ptn
1400
2030 12
Rosslyn – Soshanguwe pipeline
H16, H29 ptn 13
Kensington – Yeoville pipeline O7
New route

23. Palmiet Renewal Pipeline for renewal Age (yrs) Length (km)
Diameter (mm)
Anticipated renewal plan (subject to final assessment)
G17 South Hills – Germiston 68 10
940
Renovate if steel quality good
If replaced increase diameter to 1200mm
G18 South Hills - Wychwood 60 9
1140
If replaced increase diameter to 1400mm
G19 Meyer’s Hill – South Hills 59 2
1240
G25 Klipriviersberg – Butcher’s Hill 48 5
1450
Refurbish in phases
H3 Signal Hill - Northridge 70 50
710
Replace and increase diameter to between 1000mm and 1200 mm diameter
H4 Wychwood – Hurlevale 7
If replaced increase diameter to 1000mm
J4 Main Reef Road – Knights Road
1,5
400
Replace and increase diameter to 600mm
J5 Main Reef Road – Signal Hill 76 13
610
Replace and increase diameter to between 700mm and 1000 mm diameter
J6 Keswick Road – Churchill Avenue 65
2.2
760
Replace and increase diameter to 1000mm
O2 Palmiet - Klipfontein 42 33
1800

24. 10 year renewal plan for Palmiet ER 1
Objective
Maintain design capacity (455 to 500 Mℓ/d),and standby capacity of 200 Mℓ/d
Summary plan
Major replacement programme over next 5 years, excluding building
Last assessments
Integrated PPCA – October 2013 (see document ……)
Asset Portfolio
Summary of assets
Results of latest assessment
Renewal proposals
Estimated cost
Buildings
Brick building with RC sub-structure, pump room, control room, loading bay
Building in fair condition and expected to exceed design life
Maintenance only
Civil Structures
Pump plinths
Good condition
Dependant on pump set replacement
Pipelines
700 mm diameter steel suction lines
600 mm diameter steel delivery lines
Some corrosion noted
Refurbish during shutdowns for pump replacement
Electrical
Motors
Switchgear
Incomers
Motors in fair condition
Switchgear in fair condition
Replace motors and switchgear with pumps
Mechanical
7 x 91 Mℓ/d capacity two stage pumps, 204 m duty head
Suction & delivery isolating valves
Overhead crane – 10T capacity
Pumps beyond useful life, overhaul not practical
Valves in fair condition
Replace pumps in 2017
Refurbish valves with pipelines
Process
Not applicable
N/A
Automation
Control desk
PLC panels
Automation not to current RW standards
Upgrade to current standards, existing project …….
Objective
Maintain design capacity with slight increase from 455 Ml/d to 500 Ml/d, and standby capacity of 200 Ml/d
Summary plan
Major replacement programme over next 5 years, excluding building
Last assessments
Integrated PPCA – October 2013 (see document ……)

25. Augmenting for 2015 to 2030 cycle
Projected growth in peak day demand = 1600 Mℓ/d over 15 years
Growth split between four booster systems
Primary system – 1600 Mℓ/d growth
Palmiet system – 600 Mℓ/d growth
Mapleton system – 300 Mℓ/d growth
Eikenhof system – 400 Mℓ/d growth
Zwartkopjes system – 300 Mℓ/d growth
Northern Jhb
Tshwane
Ekurhuleni
Central Jhb
Southern areas
North west Jhb
West Rand
Rustenburg
Eastern Tshwane
Ekurhuleni
Mpumalanga

26. Mapleton System – 300 Mℓ/d growth from 2015 to 2030: R3 bn
Additional Engine Room – 300 Mℓ/d capacity
Total 90 km of pipeline between 1000 mm and 2100 mm diameter
R5 Vlakfontein – Mamelodi pipeline
R10 million budget for 2015/16
100Mℓ Bronberg reservoir
R10 million budget for 2015/16
200 Mℓ Vlakfontein reservoir
S4 van Dyk’s Park – Rynfield pipeline
R100 million budget for 2015/16
100 Mℓ Brakpan reservoir
M1 pipeline replacement
R8 million budget for 2015/16
Central Johannesburg
Engine room at Mapleton station
300 Mℓ/d additional capacity
R52 million budget for 2015/16
B16 Zuikerbosch – Slangfontein pipeline

27. Soweto priority for WDM
Southern and Central areas – 300 Mℓ/d growth from 2015 to 2030
Western and North Western areas – 400 Mℓ/d growth from 2015 to 2030
Lanseria
Waterfal to Weltevreden pipeline
R98 million budget for 2015/16
200 Mℓ Meredale reservoir
F49 Krugersdorp – Randfontein pipe
R65 million budget for 2015/16
Soweto priority for WDM
40 Mℓ Daleside reservoir
A6, A8 Vereeniging – Zwartkopjes pipeline replacement
B1, B2 pipeline refurbishment
R44 million budget for 2015/16
Arcon Park – Langerand pipeline

28. CONTENT Demand growth forecast 2. Augmentation & renewal plan to 2035
3. Capital budget

29. Capital budget for 2015/16 Annual budget 2015/16
Augmentation projects – R1.71 billion
Renewal projects – R1.28 billion
Current replacement value – R80 billion
Annual budget 2015/16
Forecast average demand growth of 1.75% per annum to 2030
Equates to about R1.4 bn per annum (Current planned is ~R1.4 bn/a)
Theoretical augmentation spend
Should spend 1% - 2% pa on renewal
Equates to R0.8 – R1.6 billion per annum (Current planned is ~R1.3bn/a)
Theoretical renewal spend

30. 5-year Capital Expenditure (2015/2016 to 2019/20) forecast of R17
5-year Capital Expenditure (2015/2016 to 2019/20) forecast of R bn for continuing business
System
Augmentation (Rm)
Renewal
(Rm)
Total
Eikenhof
1,084
1,127
2,211
Mapleton
3,043
1,388
4,431
Palmiet
1,662
1,157
2,819
Primary systems
3,529
2,255
5,784
Zwartkopjes
562
1,680
2,242
9,880 (56%)
7,608 (44% *)
17,488 (100%)
* the share of spend going to renewal of existing infrastructure has increased from 30% to >40% over the recent past. It is intended to increase this share further to ensure continued functionality of ageing infrastructure

31. 5-year Capital Expenditure (2015/2016 to 2019/20) year on year changes
System
Year
Augmentation (Rm)
Renewal
(Rm)
Total
Eikenhof
2015
492
694
1186
2016
1,084
1,127
2,211
Mapleton
956
734
1690
3,043
1,388
4,431
Palmiet
2,106
929
3,035
1,662
1,157
2,819
Primary systems
3,641
2,096
5,737
3,529
2,255
5,784
Zwartkopjes
453
954
1,407
562
1,680
2,242
7,647 (59%)
5,406 (41%)
13,053
9,880 (56%)
7,608 (44% *)
17,488 (100%)

32. 5 year period beginning 2014/15 5 year period beginning 2015/2016
Capital expenditure per main plant category
5 year period beginning 2014/15
5 year period beginning 2015/2016

33. Capital expenditure forecast

34. 20 Year View of Projects BG4
2015
2035
BG4
Priority score
Timing of red highlighted projects is subject to WDM success
Palmiet

35. THANK YOU