This research focuses on incorporating arepresentation of water supply and infrastructure costs intoan energy systems model (SATIM-W) to better reflect theinterdependent nature of the energy-water nexus in SouthAfrica and the water supply challenges facing the energysystem. The research methodology developed embeds thevarious water supply options in a least cost optimizationenergy planning tool, so that the cost of water is captured.A key feature of the developed SATIM-W model is that itregionalizes power generaation, refining, and energyresource supply, thereby introducing a spatial dimension tothe water demands of the energy sector. It also contains aregionalized structure of the basins and deliveryinfrastructure that would be required to supply the energysector and assesses the impact of meeting those needs on thecost of supplying water. The results of this investigationdemonstrate the process and type of tools that can beemployed to examine the energy-water nexus in a nationallevel planning context, and the insights that can be gainedfrom water-smart energy planning. A number of relevantpolicy scenarios in South Africa were explored, and theresults show that specific energy sector policies can havesignificant implication for both new investment in watersupply infrastructure and in some cases can lead to strandedenergy and water investments, reinforcing the importance ofplanning these sectors through a nexus approach. This casestudy is the first time the cost of water supply has beenassessed in a sector wide energy supply expansion plan. Bydocumenting the methodology, the authors aim to help energysector planners and modelers properly incorporate waterconstraints in their work.
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