Addressing water access shortfalls: a cost-benefit analysis of grey and ecological infrastructure for basic service provisioning in South Africa

Johnson, Holly

Addressing water access shortfalls: a cost-benefit analysis of grey and ecological infrastructure for basic service provisioning in South Africa

Thesis / Dissertation

2026

Publisher

University of Cape Town

Department

School of Economics

Faculty

Faculty of Commerce

Abstract

This study conducts a comparative analysis of the economic viability of grey and ecological infrastructure solutions to address water supply deficits for the 2.77% of South African households lacking access to potable water. Utilising cost-benefit analysis across 10, 20, and 30-year time horizons and varying discount rates (8%, 10%, 12%), this study quantifies the net present value and cost-benefit ratio of each infrastructure approach. Grey infrastructure is found to yield higher net present values and cost-benefit ratios in the long-run but is more sensitive to fluctuations in the discount rate and requires significant upfront investments. Ecological infrastructure, however, demonstrates more stable outcomes under economic uncertainty and a far broader range of benefits. The decision between these two infrastructure types will therefore depend on the context of financial constraints and risk tolerance. Grey infrastructure should be prioritised if capital is available, while ecological infrastructure is more suitable for areas with limited resources or higher environmental resilience objectives.

Keywords

infrastructure

water access

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