Recent flooding and Gauteng water crisis worsened by climate change

In the news this week have been some rather alarming headlines which point to the fact that South Africa’s infrastructure is not as resilient as it needs to be when it comes to withstanding the effects of severe weather events such as droughts and flooding, both of which are intensified by climate change.??

Warning 1: Gauteng’s water infrastructure??

The first warning issued by news headlines this week relates to the state of water infrastructure in Gauteng. The Gauteng City-Region Observatory has called water the next looming crisis as highlighted by articles in News24 and the Daily Maverick. The Daily Maverick article revealed that 64% of residents surveyed in the Gauteng Quality of Life Survey , are worried the province will eventually run out of water. Additionally, concerns about the quality of water being supplied is on the rise. Water cuts are becoming more frequent across all municipalities in the province and are rapidly increasing.?

The strain is being acutely felt in the three major metros of Johannesburg, Tshwane and Ekurhuleni. Water access and availability is critical to a number of health and wellness outcomes as well as to economic growth. These metros are major centres for jobs and possible economic growth and are all struggling with intermittent and interrupted supply.??

Warning 2: Flooding in the Eastern Cape??

Recent events in Nelson Mandela Bay also speak to the crucial need to maintain infrastructure. According to the Nelson Mandela Business Chamber, improved maintenance of municipal infrastructure, including stormwater drains, could have significantly reduced the damage caused by flooding in the metro on Tuesday, 22 October. The flooding has had multiple impacts on people’s lives, some of which are devastating. Tragically, the flood displaced 3000 people and claimed three lives (Daily Maverick ). The Markman area in particular, was severely affected due to its poor infrastructure (Daily Maverick ). On Tuesday evening, the power in large parts of Kariega was still off after a transformer in a flooded substation blew up and on Thursday it was reported that a major sewerage plant in Kariega had stopped working.??

Warning 3: The insurance costs of climate change??

Flooding such as the ones described above are increasing in frequency and severity and the insurance industry has taken notice as outlined in this Citywire article . The destruction from flooding and other extreme weather events are among the top reasons for soaring insurance claims costs over the past two years. Insurers say the risk has forced them to adjust their policies and adapt new strategies.??

Santam’s 2022/23 Insurance Barometer Report estimated the economic cost of the April 2022 KZN floods to be R54billion, half of which was covered by insurers. KPMG’s 2023 report confirmed it was the hottest year on record for South Africa documenting ten weather-related claim-events including flooding in the Western Cape, Eastern Cape and KwaZulu-Natal and hailstorms in Gauteng and Mpumalanga. The 2024 version of the same report showed that climate change related insurance claims are rising both locally and internationally and ongoing global warming is likely to worsen the situation.??

The result is a changing insurance industry landscape. Damage caused by natural disasters has made certain geographical areas uninsurable or unaffordable to insure with repercussions for both homeowners and the insurance industry.??

Together, these three stories highlight how essential it is that both the government and private sector increase their investments into infrastructure development and maintenance to ensure a better quality of life, enhanced service delivery and improved safety for all South Africans. They also highlight the need for investments in climate change adaptation (ability to withstand the effects of climate change) and mitigation (preventing further climate change and greenhouse emissions).??

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Brooke L. : sits within the ESG team at RisCura and each week she will bring you stories highlighting key issues and themes in the world of Responsible Investment that have caught her attention.

The views expressed are her own and the content in this newsletter is not intended to serve as a recommendation or endorsement of any specific product or company.