MARKET INTELLIGENCE REPORT WESTERN CAPE 2026 Water

The Western Cape water sector is transitioning toward innovative procurement and financing models due to tightening public budgets and increasing climate pressures. Significant capital expenditure is planned for 2025/26 to 2027/28, with approximately R16.5 billion from the City of Cape Town and R7.5 billion from other local municipalities. Key opportunities include public-private partnerships (PPPs) for large-scale infrastructure like desalination and water reuse, as well as a growing market for decentralized water-efficient sanitation solutions (WESS) in both public informal settlements and private property developments.

• Municipalities in the Western Cape are planning substantial capital expenditure on water and waste water (W&WW) management for the 2025/26 to 2027/28 period, with the City of Cape Town (CCT) planning ~R16.5 billion and other local municipalities planning R7.5 billion.
• The City of Cape Town has approved the use of a PPP procurement model for two major projects in the 2025/26 financial year: the Faure New Water Scheme (R3.2 billion CAPEX) and the Paarden Eiland desalination plant (R1.8 billion CAPEX).
• There is a growing market for water-efficient sanitation solutions (WESS), with an estimated capital investment potential of ~R870 million for public sector services to unserved communities and ~R480 million for private sector new property developments between 2026/27 and 2028/29.
• Regulatory reforms are being implemented to facilitate private investment, including the South African National Water Resources Infrastructure Agency Act (Act 34 of 2024) and amendments to Treasury Regulation 16 for PPPs effective 1 June 2025, which streamline approvals for projects below R2 billion.
• The SIDAFF Programme, funded by international donors including the Swiss State Secretariat for Economic Affairs and Impact Fund Denmark, is supporting project preparation in Swartland, Saldanha Bay, and Overstrand local municipalities to help them reach bankability for debt financing.
• Private sector adoption of onsite waste water treatment is increasing, evidenced by a six-fold increase in applications for such systems in the City of Cape Town between 2022/23 and 2025/26.
• Significant barriers to private sector participation persist, including complex procurement and PPP regulations, extended project timelines, and a lack of full lifecycle financial data for WESS systems to build robust investment cases.

APA

Tyhali, A., Mabila, N., & Roselt, M. (2026). MARKET INTELLIGENCE REPORT WESTERN CAPE 2026 Water. GreenCape. https://greencape.co.za/wp-content/uploads/2026/03/Water-MIR_2026-DR.pdf

Chicago

Tyhali, Akhona, Nkululeko Mabila, and Marielle Roselt. MARKET INTELLIGENCE REPORT WESTERN CAPE 2026 Water. GreenCape, 2026. https://greencape.co.za/wp-content/uploads/2026/03/Water-MIR_2026-DR.pdf.

Wikipedia

{{cite report |last1=Tyhali |first1=Akhona |last2=Mabila |first2=Nkululeko |last3=Roselt |first3=Marielle |title=MARKET INTELLIGENCE REPORT WESTERN CAPE 2026 Water |publisher=GreenCape |date=2026 |url=https://greencape.co.za/wp-content/uploads/2026/03/Water-MIR_2026-DR.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{tyhali2026market, author = {Tyhali, Akhona and Mabila, Nkululeko and Roselt, Marielle}, title = {{MARKET INTELLIGENCE REPORT WESTERN CAPE 2026 Water}}, institution = {GreenCape}, year = {2026}, url = {https://greencape.co.za/wp-content/uploads/2026/03/Water-MIR_2026-DR.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }