private water operators delivering performance for water-users and

THE INTERNATIONAL FEDERATION OFPRIVATE WATER OPERATORS

Private operators delivering performance

for water-users and public authorities

Examples from across the world

© AquaFed, 2012 – All rights reserved

Publications of AquaFed, The International Federation of Private Water Operators, can be obtained from AquaFed at:e-mail: [email protected], rond point Schuman box 5, 1040 Brussels – Belgium – Telephone: +32 2 234 78 07 – Fax: +32 2 234 79 11or 16, avenue Hoche 75008 Paris – France – Telephone: +33 1 53 89 08 10 – Fax: +33 1 45 63 04 72

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Printed in France

AquaFed, The International Federation of Private Water OperatorsAssociation legalised on April 9, 200516, avenue Hoche 75008 Paris – France

Private operators delivering performance

for water-users and public authorities

Examples from across the world

March 2012

2 AquaFed Private operators delivering performance

1. Introduction 3

1.1. Objectives of this brochure 3

1.2. Introducing Private Water Operators and AquaFed 3

1.3. Private operation, a management option for delivering good performance 3

1.3.1. An option to be considered 3

1.3.2. Private operators are change agents 4

1.3.3. Organising the road to performance 4

1.3.4. Common misconceptions about private water operators – “The lamp post syndrome” 4

1.4. Needs for high performance water services 5

1.5. Diversity of performance dimensions 6

1.5.1. Implementing the human right to safe drinking water 6

1.5.2. Improving wastewater management 8

1.5.3. Improving relationship with water-users 8

1.5.4. Improving efficiency of water utilities 9

1.5.5. Raising and maintaining staff capacity 9

1.5.6. Responding to natural disasters 10

Map of cases presented in this brochure 12

Field cases 14

Country cases 47

Developping countries 55

Bibliography 58

Contents

AquaFed Private operators delivering performance 3

Objectives of this brochure

Most water-users need drinking water and sanitation services to be organised for them by publicauthorities. These services must be of good quality, reliable and cost-optimised to suit both consumers’and authorities’ needs. Hiring a private company to deliver them is among the options that theseauthorities can choose. This brochure illustrates the many achievements that can be obtainedby using the capacity of private professionals in the delivery of public water and sanitation services.

Public services that perform well are those that are able to deliver good results simultaneouslyfor many dimensions. For example, improving access to drinking water and improving the levelof service to the population are equally as important as managing the utility in an efficient way.

This brochure collates a wide sample of field cases of private management of water or sanitationservices that illustrate the good results that are obtained, for all the most significant dimensions,by public authorities who have engaged private operators. Each case describes outstandingresults achieved on several of these essential dimensions. The cases come from all around theworld and illustrate the wide diversity of sizes of private companies.

This sample of cases does not present an exhaustive view of the performance of all private wateroperators that are members of AquaFed. Not all private operators are able to perform as well asthose examined here. However, these cases clearly illustrate that in appropriate conditions publicauthorities and water-users are able to obtain very high service performance from privateoperators. There are many other examples with similar results.

Introducing Private Water Operators and AquaFed

AquaFed, the International Federation of Private Water Operators, represents private companiesthat deliver water supply or sanitation services under the direction of public authorities.

Members of the Federation are water services providers of all sizes, operating in around40 countries, as both locally or internationally owned businesses. The members of the Federationserve the majority of those people who get water from private companies that are mandated andregulated by governments. Some supply water and sanitation daily to a few thousand people,others to hundreds of thousands and others to millions or even tens of millions of people1.AquaFed’s members’ business is to be the operators of public services entrusted to them bygovernments (central government, local government, water authority) through public-privatepartnership contracts or licenses to supply drinking water and to provide sanitation services totheir populations. They do it as instructed by public authorities and under their control.

In this way these private operators are used by public authorities as tools to implement theirwater policies.

Private operation, a management option for delivering good performance

An option to be considered

Public authorities that are responsible for the delivery of water supply or sanitation services tothe population and other water-users have several options they can choose for organising theoperational management of these services. They either manage the service themselves withtheir own operator (internal management), they entrust an external operator or they organise ajoint-venture with an external operator. External operators can be public bodies or privatecompanies. All these options can deliver excellent or poor results depending on the circumstances.In the case of external operators, public or private, success factors are mainly the capacity of theoperator, the quality of public policy, sustained political support and above all, the goodorganisation of the relationship between the authority and its operator(s).

Introduction

1 See ref. 15

1.1

1.2

1.3

1.3.1


Private operators are change agents

To achieve their water policy outcomes, public authorities need to identify their goals, mobiliseappropriate means and charge their operator(s) with appropriate operational targets. In the caseof private operators these targets are imposed through a public-partnership contract (PPP) or anoperating license and the corresponding regulations. These targets are usually measurable andtime-bound. They will almost certainly evolve over time. When initial targets are achieved orobjectives change, new targets can be fixed by the authority.

Regulated private operators are change agents that are used to create improvements in thequality and the efficiency of the service delivered. They cannot be held responsible for thesituation of the service at the beginning of their contract or license. They are not a substitute forthe public authority. Their responsibility is to achieve progress between the situation at the startof their engagement and the current status of quality and efficiency of the service.

This is where the performance of operators lies. It is in their ability to manage change effectivelyand improve the performance of the service delivered. The cases presented in this brochuredescribe improvements achieved over a specific period of time and not situations at a given date.

Organising the road to performance

Performance in the delivery of water or sanitation services requires skills and the appropriate means,including legal, financial and operational capacities. It also requires mutual understanding betweenthe public authority and the operator. The latter cannot invent the goals that will satisfy theauthority. These goals have to be formalised in a contract or a license. Usually, performance againstthese goals is monitored through performance indicators that are used to measure progress.

Performance indicators can be very diverse. Some relate to the internal functioning and efficiencyof the water utility or its cost-effectiveness. Others concern the service delivered to users, itsimpact on the environment or its relationship with stakeholders. The indicators are controlled bythe public authority and show its priorities. They can vary over time since progress achieved inone direction can permit subsequent progress in other directions.

Common misconceptions about private water operators – “The lamp post syndrome”

Many misconceptions circulate about the work of Private Water Operators. Private wateroperators mandated and regulated by public authorities through licenses or public-privatepartnership contracts (PPP) are far less numerous than public utilities. In spite of this, they aremore visible than other options because of the concentration of commentary on them. AquaFedrefers to this as “The lamp post syndrome”.

Because the work of regulated private operators is formalised, and made transparent bymonitoring and reporting, knowledge of their action is far more developed in academic or officialreports than knowledge of the action of informal operators, NGOs or even public operators.Contracts and licenses provide for strict monitoring, detailed regular reporting, publicinformation and formally debated political decisions. This is not usually the case for the othertypes of operators. In addition public scrutiny is higher on private operators than on public onesand expectations are higher. As a consequence, the level of knowledge of the work of privatewater operators is far more extensive than knowledge of any other type of water provider. Thisincreased basic knowledge creates a cumulative effect. The number of research papers on privateoperators is greatly out of proportion to their position in the water and sanitation services sector.

The most important issues are not necessarily where there is the most light. The risk of the “lamp-post syndrome” is the risk of looking at the problems of only the minority of cases where they aremost visible or most documented and to miss the majority of cases where the magnitude ofthese problems might be much higher2.

2 See ref. 5

1.3.2

1.3.3

1.3.4


Figure 1 - The Lamp Post Syndrome

The many research reports on individual public-private partnerships (PPPs) cases show a broaddiversity of results and illustrate the challenges of ensuring that public-private partnerships aresuccessful. However, they are not sufficient to give a fair and true vision of the beneficial impactof private management of public water services (Private Sector Participation orPSP). Somecommentators have tried to present a global vision of water PSP, however these are marred bymethodological limitations since systematically they omit or play down the good results achieved3.

To AquaFed’s knowledge, the only serious global assessment of the impact of private managementof public water services that has a statistical value has been made by the World Bank. Its 2009research4 provides evidence about the average performance of public-private partnershipscontracts (PPPs) in developing countries, a part of the world where these kinds of contract havedeveloped regularly since the eighties.

Needs for high performance water services

Water-users need drinking water. They also need their wastewater to be collected safely and theyneed to be protected from polluted waters. The majority of them have no other choice than toexpect these services from public authorities. The performance of such public services shouldmatch the expectations of users at an optimised cost.

The cost of these services is ultimately borne by users, either as consumers through water billsor as taxpayers through public budgets. Public water or sanitation services can only be consideredto be performing well if users’ expectations are satisfied, improvements decided by publicauthorities are realised and the overall cost is optimised.

The “raison d’être” of private water operators is to contribute to all these expectations as instructedand regulated by public authorities. This brochure provides examples of performance in a varietyof directions identified below as the “dimensions” of performance.

3 See ref. 5 4 See ref. 26, 28

1.4


Diversity of performance dimensions

The performance cases presented in this brochure illustrate outstanding achievements in avariety of dimensions. They are sorted according to the following categories.

Implementing the human right to safe drinking water

Individual water-users need clean water daily. Their basic needs are now the subject of the humanright that was recognised at the UN level in 2010 as part of the right to an adequate standard ofliving. In practice, this means precise requirements. It does not only mean that everybody getsa minimum quantity of clean water. It means that this water should be safe, accessible,acceptable, affordable and can be obtained without discrimination. These dimensions areindependent one from another. For example, progress on safety and regress on affordability canoccur simultaneously. In terms of performance, the improvements made can be measured on a“radar” diagram5 (see below) where progress on these different dimensions can be measuredindependently. The starting points differ from one city to another; they can also be very diverseaccording to different users in the same city.

Figure 2 - Showing progress towards the criteria of the right to safe drinking water

The field cases presented in this brochure illustrate all these dimensions of the human right todrinking water. They describe the extension of coverage of water networks (physical access),realisation of domestic connections and increase of regularity of water supply (accessibility),compliance with potability standards (safety), suppression of bad taste or odour (acceptability),subsidy mechanisms (affordability) and pro-poor programmes (equity).

Access. The cases included in this brochure provide many examples of the extension of watersupply to previously un-served people. In many cases the increase in the domestic “coverage” ofwater networks is very impressive (see figure below). These achievements are all the more remarkablewhen one notes that on average the coverage of piped water supply in all cities of the developingworld has only progressed by less than 1 percent in the last two decades6.

5 See ref. 20 6 See ref. 3, 18, 19

1.5

1.5.1


At the global level, an extensive World Bank study7 has made a detailed examination of the 36 largestPPP contracts in developing countries. Initially these contracts supplied drinking water to 48 millionpeople. After less than 10 years the population served had been increased to 72 million people. Thisrepresents an increase of 50% in the number of people benefiting from a good public service on thosecontracts8.

Figure 3 - Water supply: linear representation of progress of coverage in selected cities

Accessibility. Operators have created millions of new individual connections thereby facilitatingaccess to water. Urban Senegal is an interesting example. In 1998, 20% of the population wascompletely un-served, without access to tapwater or to a public standpipe, and 22% were suppliedthrough public standpipes. By the end of 2010, only 1.5% remain un-served and only 10% are stillusing standpipes. All the others benefit from tapwater at home. Switching people from standpipes totapwater creates a dramatic improvement in their daily lives.

Furthermore, in all cases where water is not running continuously the operator is requested toimprove the regularity of water supply which improves availability of water. The examples of Latur,Limeira, Mbombela, Cartagena, and Algiers are described in this brochure. At the global level, astatistical survey made by the World Bank9 found that on average in developing countries privatemanagement has brought a 41% increase of the number of hours a day that water is running at the taps.

Safety. Potability of water supplied is the primary target of all private operators. Their job is toprovide healthy water to people10. In Apalit 50% of the population could have its water disinfected. InPetropolis, water is now safe everywhere when only 2% was treated in 1998. In cities where watercoverage reaches 100%, safety of water becomes the utmost priority. Examples of England or Algiersare good demonstrations of this situation. In Paris a change in the safety regulation imposed thereplacement of 70% of all connections because they were in lead. This was done in only 7 years.

Acceptability. Users dislike water that is coloured. In Limeira the cloudiness and the unacceptablecolour that were present before 1995 have been removed so that the water is now correct aesthetically.

Affordability. The cases presented illustrate the many mechanisms that are used to keep accessto water affordable for all users. For consumption, cross-subsidies between users are described in

7 See ref. 1 8 See ref. 6 9 See ref. 25 10 See example of impact in ref. 10


Apalit, Limeira, Petropolis. For new connections, subsidy mechanisms are described in the cases ofsmall towns in Uganda and Urban Senegal. In Tangiers more than one third of the population paysfor the volume of water supplied at home at a price that is cheaper than the price paid by the watersupply company to purchase it from the bulk supplier. It could be added that the Government of Chilehas put in place a pro-poor subsidy mechanism funded at the central level that aims to mitigating theimpact of the cost of the huge investment program. As the subsidies are tailored to the income ofeach customer, this mechanism reaches the poorest people effectively.

Equity. Private operators are usually requested by public authorities to ensure, at leastprogressively, a universal service in the area where they are mandated to supply drinking water.This means that they have to face all individual situations including supplying water to all poorwater-users. This is normal and usual. There are cases in this brochure that illustrate their pro-pooractivities. In Cartagena, 86% of domestic customers newly connected to water networks are fromlower income classes. In Jakarta the number of connections to low-income users has been multipliedby 8. In 1999 in Mbombela 79% of informal houses did not receive water at all and the remainder onlyreceived water irregularly. In 2009, only ten years later, in spite of the growth in number of informalhouses, the proportion of informal houses with no access to water supply was reduced significantlyfrom 79% to only 9% and 81% of informal houses were receiving water every day.

Improving wastewater management

Wastewater management is a key sanitation service. It is essential for human health, economicdevelopment and protection of ecosystems. For individuals, it starts by collecting domesticwastewater from households and transferring it away from dwelling areas. Then pollution needsto be removed from the wastewater before its discharge or reuse. If not, water bodies and aquifersbecome more and more polluted by human activities and both humans and ecosystems suffer.

The field cases presented in this brochure illustrate significant improvements in wastewatercollection and treatment. In Limeira (Brazil), in spite of a 31% population growth, the proportion ofpeople connected to the wastewater collection system was raised from 78% to 100% in less than tenyears. Simultaneously wastewater treatment, that was almost non-existent at the beginning, hasbeen extended to all the urban wastewater. In the surrounding suburbs of Rostock, the proportion ofthe populations that is connected to the wastewater collection system has been increased from 28%to 86%. In Chile where only 17% of urban wastewater was treated in 1998, the proportion of urbanwastewater that is treated has been increased to 87% in 2010 and should reach 100% by end 2012.

These improvements in wastewater management are beneficial to people where they live. Theyalso help to sustain and protect both the built and natural environment. In the field cases presentedin this brochure there are several examples of complete recovery of the quality of beaches.Beaches near Gdansk had been closed since 1978. They have been reopened and this has stimulateda tourist boom in the whole coastal area. In Rostock, the quality of the bathing water in the Baltic Seaat this seaside resort region has also been improved. The Bay of Tangiers is now free from wastewaterdischarge on the beaches allowing the city to upgrade its tourist resort status.

Improving relationship with water-users

Supplying good quality water to people is not sufficient. The operator has to take care of water-users, their expectations and their interaction with the water utility.

The field cases presented in this brochure illustrate significant improvements in customer carewith many examples of ways through which the life of water-users has been made easier: morereliable billing, customer centres closer to water-users, increased public information, call centresallowing quick responses, etc. These cases also describe outstanding results in increasingcustomer satisfaction ratings. In Cartagena the proportion of satisfied users has increased from 71%to 87%. In Bucharest, it has rocketed from 46% to 75%.

1.5.2

1.5.3


Improving efficiency of water utilities

The search for efficiency is rooted in the genes of private professional water operators. Privatecompanies are used to improve efficiency of services, which is one of the main reasons why theyare hired by public authorities. In particular, the authorities expect cost-savings that will enablethem to limit the increase of water rates that they charge to their water-users.

In this brochure there are many examples of where significant improvements in reducing leakageand water losses in water networks are saving huge amounts of freshwater. The table below givesa flavour of these achievements.

Energy consumption is another domain where optimisation is key. In Bucharest the annualelectricity consumption has been reduced by 75% between 2000 and 2010.

Water utilities can only deliver a good service if they are able to collect the monies due to themfrom users. Field cases in Mbombela, South Africa, and small towns in Uganda provide examples ofsignificant improvements in billing and cash collection.

Professional water operators care about the sustainability of the services that they deliver. In thisrespect, they work to improve the management of the existing assets and in particular tomaintain the networks in good condition. In the case of the distribution of water in Central Paris(intra-muros) more than 50% of the distribution networks were renewed by the private water0operators and the average “functional” age of the distribution networks is now 21 years youngerthan it was at the beginning of the PPP contracts 25 years before.

Efficiency is necessary to be able to deliver a good quality service in all conditions. However,costs must remain reasonable and affordable. When an ambitious new water policy aims atimproving the service significantly, it is also necessary for the government to limit the priceincreases that would inevitably result from the new investments required. This is one reason forhiring a private operator. In any case, budget constraints mean that cost-optimisation is alwaysrequired from private operators. In addition, competition and regulation drives cost-effectiveness:a public authority would not hire a private operator if a cheaper option that could deliver thesame results was available. The field cases presented in this brochure illustrate significantinvestments that private water operators have been able to undertake despite strict budgetaryconstraints. In Bucharest, significant cost-savings have allowed the population to benefit from the 3rdlowest water tariffs out of the 44 main Romanian operators, even though all the other operatorsreceive subsidies to help them implement their investment programmes. In England and Wales,annual investments for water and wastewater infrastructure have more than doubled since the 1989privatisation. However, huge efficiency savings have avoided nearly 70% of the cost of newinvestments from being reflected in water bills paid by water-users.

1.5.4


Raising and maintaining staff capacity

The water services can only be efficient and well-perceived by users if the staff of the watersupplier has appropriate skills. This is why training the personnel to upgrade its capacity is anessential tool for delivering additional performance. Private water operators are used to organiseregular training of their staff. In some cases they have even invested in dedicated private trainingcentres. This is the case of Amendis, in Tangiers, that has built a large training centre. The quality ofthe training programmes is so good that the centre is entitled to deliver diplomas through anagreement with universities. In Cartagena, the initial training programme has been massive:125 hours per employee in 2000. In Algiers, 55,000 training days have been undertaken from 2006 to2011, through trained trainers (70% of them are Algerian).

Responding to natural disasters

Operators of public water services must do more than just operating public systems in normalconditions. They must be prepared to anticipate and react to exceptional events such as heavystorms, floods, droughts or accidental pollution or disruption of infrastructure. This is becauseusers need water every day and experienced professionals know that exceptional events have ahigh probability of occurring over several decades. The case of earthquakes is particularly difficultsince it happens very rarely and is particularly disruptive. A big earthquake can destroy waterplants and break the main water pipes. In such case, water supply may be completely stoppedfor days or even weeks since repairing large underground pipes may be particularly difficult. Thecase of the February 2010 earthquake in Chile is remarkable. There, an earthquake more powerfulthan the one that destroyed Port-au-Prince in Haiti has damaged water networks in a whole regionof Chile. The local private water operators reacted immediately. Only 72 hours after the disaster, 87.5%of the water supply was restored and operating in the areas affected. Five days after the earthquake,90% of the water services had been restored and regions such as Valparaíso, Metropolitana, deO’Higgins and La Araucanía had 100% of its services restored. This was a costly operation, yet, thanksto the insurance contracts secured by the private operators in charge of the affected areas, thedamage suffered by the water industry has not had any cost transferred to the government and hasnot had or will not have any impact on the tariff that the population in the affected areas pays.

1.5.5

1.5.6


Implementing the human right to safe drinking water

Extending access to water to un-served people Apalit, Cartagena, Latur, Mbombela,Petropolis, Tangiers, Uganda, Urban Senegal, West Jakarta

Improving accessibility of water Latur, Petropolis, Urban Senegal, West Jakarta, Bucharest, Cartagena, Uganda

Improving availability of water Algiers, Cartagena, Latur, Jakarta, Limeira, Mbombela,

Securing water safety Algiers, Apalit, England & Wales, Gdansk, Paris, Latur, Petropolis, UrbanSenegal, Pennsylvania

Improving acceptability of water Pennsylvania, Rostock, Limeira, Gdansk

Contributing to affordability of water services Apalit, Urban Senegal, Limeira, Petropolis, Tangiers

Ensuring more equitable water supply Cartagena, Mbombela, West Jakarta,Tangiers

Improving wastewater management

Extending wastewater collection Limeira, Cartagena, Chile, Petropolis, Rostock

Protecting the environment from wastewater pollution

Chile, England & Wales, Gdansk, Limeira,Rostock, Tangiers, Algiers, Petropolis

Improving relationship with water-users

Satisfying users’ expectations Algiers, Bucharest, Limeira, Cartagena, Urban Senegal

Making life of users easier England & Wales, Latur, Rostock, Tangiers, Cartagena

Improving efficiency of water utilities

Reducing leakage and water losses England & Wales, Latur, Paris, Petropolis,Shenyang, Urban Senegal, West Jakarta,Bucharest, Limeira, Pennsylvania, Tangiers

Improving energy efficiency Bucharest, Pennsylvania, Shenyang

Securing revenue streams Mbombela, Uganda, Shenyang

Managing infrastructure assets sustainably Paris, Pennsylvania, Algiers

Optimising economics of public services Bucharest, England & Wales, Paris, Uganda,Chile, Petropolis, Urban Senegal

Raising and maintaining staff capacity Algiers, Apalit, Cartagena, Tangiers

Responding to natural disasters Chile

Field cases illustrating the many dimensions of performing water services


Field cases

N° Country Area Operator Populationin the area

Page

1 The Philippines Apalit Balibago 103,000 14

2 China Shenyang SEDA Shenyang Sembcorp Water 127,000 16

3 Brazil City of Limeira Foz do Brasil 280,000 18

4 Brazil City of Petropolis Aguas do Brasil 290,000 20

5 Germany Rostock Eurawasser 310,000 22

6 South Africa Mbombela Sembcorp Silulumanzi 440,000 24

7 India Latur SPML 500,000 26

8 Poland Gdansk Saur Neptun Gdansk 510,000 28

9 Morocco Tangiers Amendis 900,000 30

10 Colombia City of Cartagena Acuacar 1,000,000 32

11 USA Part of Pennsylvania Aqua America 1,400,000 34

12 Romania City of Bucharest Apa Nova Bucuresti 2,000,000 36

13 France City of Paris (Central Paris) Veolia Water / Suez Environnement 2,200,000 38

14 Algeria Algiers (city and wilaya) SEAAL + Suez Environnement 3,200,000 40

15 Indonesia West Jakarta Palyja 4,500,000 42

16 Senegal Urban Senegal Sénégalaise des Eaux 5,500,000 44

The cases presented in this brochure illustratemany types of performance resulting from pri-vate management of public services (PSP). Ineach field case only a few types of perform-ance achieved are described even if other use-ful results have been obtained. These caseshave been selected to show the wide diversityof countries, types and sizes of partnershipsand operators. There are many other success-ful cases in the world.

Note: on this map, the darker the colour, the higher the HumanDevelopment Index (HDI) in the country

Source: UNDP – 2011 Human Development Report

Cases presented in this brochure


Country level


Page

18 Uganda Small towns Members of APWO 880,0001 48

19 Chile Urban Chile Members of ANDESS 15,000,0002 50

20 United Kingdom England & Wales Members of Water UK 55,000,0003 52

Global level


Page

21 DevelopingCountries

Locations supplied by private operators

Many private operators 160,000,000 56

1 79 contracts – Size range: 50 – 2000 connections2 58 contracts and licenses – Population range: 1,000 – 5,200,000 inhabitants3 24 private operators – Population range: 160,000 – 8,600,000 inhabitants

HDI

> 0.793

0.698 - 0.793

0.522 - 0.698

< 0.522


Organising authority: Municipality of Apalit,Pampanga Province, Central Luzon Region,Philippines.

Water operator: Apalit Waterworks, a subsi-diary of Balibago Waterworks System Inc.

Location: Municipality of Apalit.

PPP description

Starting from a Memorandum of Agreementin 2003 to take over a pump and borehole pro-vided by an NGO, Apalit Waterworks was ableto develop the water system rapidly throughcoordination with barangays1 in Apalit andneighbouring Macabebe. The aim was todevelop additional boreholes, networks andcustomer management systems. Investmentand operation are carried out by the company,which finances the works and operations mainlyfrom revenue from customer charges. It nowserves 103,000 people.

Context and PPP objectives

The Municipality of Apalit is situated in the eas-tern portion of the province of Pampanga inthe Central Luzon Region of the Philippines. Ithas a total land area of approximately 6,147hectares and it is composed of 12 barangays.

As with many towns in the region, urbangrowth has been very rapid. Between 2000and 2011 the population has grown by 74%and the number of households by 77%.

Prior to the involvement of Apalit Waterworks,the municipality was having difficulty provi-ding water to its fast growing population, espe-cially in outlying districts. The initial objective

was to overcome this with a pilot project toshow how a private company could improvethe operation of the borehole and create apiped water network.

Subsequently, the services have been exten-ded to the other barangays in Apalit and partsof the adjacent municipality of Macabebe.

Extending provision of water supply

Having been given the initial well and pump bythe barangay of Tabuyoc (the farthest from thetown centre), Apalit Waterworks started to ins-tall a network of PVC pipes and connect cus-tomers with meters. Since then the companyhas progressively extended its water services toother areas, installing new boreholes, pumps,backup generators, 3 elevated storage reser-voirs and distribution networks to extend theservice to parts of all 12 barangays in the muni-cipality and 2 barangays in Macabebe.

The number of customers supplied in Apalithas increased from 150 at the end of 2003 to10,128 in 2011. In Macabebe the numbers ser-ved have risen from 258 in 2008 to 429 in 2011.This means that the overall coverage ratio hasincreased from 0.89% to 52.87% of the popu-lation over the period.

The number of pumps and boreholes hasincreased from 1 in 2003 to 9 in 2011, withthree more planned in 2012.

To ensure reliability, pumps have backup die-sel generators, all procured and installed byApalit Waterworks. In this way the water supplyis assured on a 24/7 basis for all connectedusers.

Apalit, PhilippinesPopulation: 103,000

Continuous 24/7 water supply hasbeen installed for 10,128 customersin 8 years, increasingthe coverage ratio from 0.89% to 52.87%.

1 Barangay is the smallest administrate unit in the Philippines

Apalit

ManilaGoogle Maps - ©2012 Google


n Extending water supply to un-served peoplen Ensuring water safetyn Contributing to affordability of water services

The length of the networks has been exten-ded from 0 in 2003 to 60 km in 2011.

The volume of water produced in 2011 rea-ched 2,746,751 m3. Average consumption inDecem ber 2011 was 21 m3/customer. The majo-rity of customers are domestic households, butcommercial customers are also supplied.

Water users that are not connected to the waternetworks mostly use shallow wells with cheaphand-pumps or small electrical pumps that areexpensive to operate. In both cases, supplies areof dubious quality and are time consuming orcostly to use.

Ensuring water safety

All the pumping stations are equipped withelectronic chlorinators to ensure water safety.The water quality is tested and controlled forbacteriological and physical-chemical com-pliance with the Philippine National Standardsfor Drinking Water (PNSDW 1999). Copies ofthese tests are submitted to the National WaterResources Board (NWRB) and results showconsistent compliance with PNSDW parameters.

When combined with the extension of thewater network, the safety of the water supplyfor over 50% of the population of Apalit hasbeen assured within eight years.

Subsidies to domestic users

Customers are offered the opportunity toconnect to the Apalit Waterworks network ona voluntary basis as the pipes become available.The connection charge, is currently (2011) 2,360Pesos for a ½ inch domestic connection and2,660 Pesos for a ½ inch commercial connection.

The tariffs are agreed between the LocalGovernment Unit and Apalit Waterworks andthen approved by the NWRB. The currentwater charges are set out in the table below.This shows that there is a cross-subsidy in placethat enables commercial users to give somesupport to domestic customers.

The safety of the water supply for over 50% of the population of Apalit has beenassured within eight years.

Apalit Waterworks Tariffs 2011

Note: the average conversion rate Php – Euro for 2011 was 0.0177

Other significant improvements

It is notable that Apalit Waterworks has crea-ted 39 jobs directly. Its continuing pipe-laying,construction, repair and other activities like-wise promote local employment. Also, as thecompany has developed, it has implementedappropriate modern technology such as dataloggers, hydraulic modelling, geographic infor-mation systems and variable frequency drives.This has required it to expand the skills andcompetencies of its staff accordingly.

Moreover, aside from the increased producti-vity and improved sanitation it brings with itspiped water, Apalit Waterworks has made aconsiderable contribution to the local eco-nomy through providing water to commercialand industrial activities and permitting theconstruction of new housing subdivisions.

“ Apalit Waterworks has been the Municipality of Apalit’s partner in our pursuit to improve thequality of life in our town. lt has been providing potable water to the Apalitenos. Challenges thoughare present and many areas for improvement are abundant but with the local government unitand Apalit Waterworks’ solid cooperation, the obstacles for continued success will be handled allfor the common benefit of our townsfolk.” Mayor Oscar Tetangco Jr.

Residential

Min: 1-10 m3 P 205.00

11-20 m3 P 21.30 /m3

21-30 m3 P 22.10 /m3

31-40 m3 P 23.00 /m3

Above 41 m3 P 24.20 /m3

Commercial

Min: 1-10 m3 P 409.00

11-25 m3 P 40.90 /m3

Above 26 m3 P 44.20 /m3


Organising authority: Shenyang Economic& Technological Development Area (SEDA).

Water operator: Shenyang Sembcorp WaterCo. Ltd.

Location: Shenyang is the capital of Liaoningprovince and a major economic, political, indus-trial centre in North East China. The servicearea of the concession has a population of127,000 over 88.5 km2.

PPP description

In 2008, Shenyang Sembcorp Water Co. Ltd. inan 80/20 partnership with SEDA acquired3 water works facilities and correspondingwater supply networks. The company was gran-ted exclusive concession rights for 30 years tosupply water to customers in the area plusfuture areas to be developed. The companycurrently supplies over 700 industrial and over30,000 domestic customers (a population ofaround 77,000 people).


Shenyang Project is the first tap water supplyproject of Sembcorp in China. The total des-ign capacity of the company is 160,000 m³/day,and the total network length is 210 km. Theproject objective is to supply high quality waterto customers inside SEDA and provide the bestservices to customers. Its aim is to develop anoptimum mode of operation to set a standardfor other water supply projects in China.

Location of SEDA

Reduction of non-revenue water

The company made a comprehensive plan toreduce the Non-Revenue Water (NRW), whichwas more than 30% before takeover. Losseswere mainly from pipeline leakage causedby the corrosion of underground pipelines,uneven ground settlement, or extreme wea-ther. However, some special factors, whichcause the high NRW in China, were also found.

1/ Disorderly construction

Before takeover, construction of water pipe-lines was managed by various parties, andwas haphazard and unorganised, leading toincomplete and inaccurate data on under-ground pipes. Unauthorized connections weredifficult to identify. The company made a bigeffort to investigate pipelines, valves and firehydrants. The company also strengthened theinspection team and set up Standard OperationProcedures (SOPs).

Losses caused by disorderly construction

2/ Improper meter management

A meter management system has been set up.It was common that meters were not calibratedand were not replaced for many years beyondtheir lifespan. The inaccuracy of some oldmeters was between 12% and 14%, which cau-sed a lot of the water used by customers to gounregistered. An ongoing meter managementplan was implemented.

Shenyang SEDA, ChinaPopulation: 127,000

Non-revenue waterhas been reducedfrom 30% to 10%within a 3 yearperiod.

City of Shenyang


n Reducing water losses n Improving energy efficiency

3/ High NRW in residential estates

There are about 20 old residential estates, andmost showed very high NRW of 70% to 80%.Thus only 20% to 30% of water supplied tosuch estates was registered. This was mainlydue to the poor quality of the estates’ internalpipelines. A detailed work plan has been imple-mented. Measures include monitoring of thestatic water level of storage tanks, checking allvalve pits and fire hydrants and the pipelines ofthe cogeneration company, checking for unau-thorized connections and unmetered waterconnections. For one estate the NRW has beenreduced 70% to below 5%.

Inspection of Residential Estates

With these measures, NRW has been reducedfrom over 30% to around 10% to 12% within a3 year period.

Energy efficiency

Reducing NRW also leads to higher energy effi-ciency. The optimization of the energyconsumption of the whole operation has been

A saving in energyconsumption perunit of production of 6% has beenachieved.

completed. The major areas of improvementafter takeover are supply pump station ope-ration, use of storage tanks, backwash mana-gement and supply pressure control.

Currently, a combination of variable speedpumps and constant speed pumps is used forall the supply pump stations, and there are8 variable frequency drives installed at 4 sup-ply pump stations to ensure that the pumpsare operating at high efficiency levels. The maxi-mization of the use of the off-peak electricitytariff, which is only 1/3 of the peak tariff, hasbeen reviewed for every pump in the com-pany. The water level of storage tanks is kept ata low level in the daytime by shutting downsome of source well pumps.

The filter backwash has also been changed tooccur late at night. The filtration tank back-wash cycle has been optimized from 24 hrs to120 hrs, and the backwash duration shorte-ned from 8 minutes to 5 minutes. The pipelinenetwork for the 3 water plants, which were notinter-connected before takeover, was even-tually interconnected in Jan 2011. This enablessupply pressure optimization using a hydrau-lic model. As a result, the unit power consump-tion is reduced significantly. A saving in energyconsumption per unit of production of 6% hasbeen achieved.


After takeover, a localised billing and collectionsystem was established and implemented forall customers in 2011, and it created a secureand reliable platform for billing and collection.

“Shenyang Sembcorp Water is a typical successful JV case in Shenyang, and Sembcorp used theirvast experience and technology of water business resolving the problems and brought excellentservice to SEDA.” Director of SEDA

1st year of concession


Organising authority: The city of Limeira.

Water and sewerage operator: Foz deLimeira, 100% subsidiary of Foz do Brasil.

Location: Limeira is a city located in the stateof Sao Paulo, 150 km from the city of Sao Paulo.

PPP description

Foz de Limeira manages the municipal waterand sanitation services of Limeira througha concession contract. Foz de Limeira was selec-ted by a process of international competitivebidding among 18 other proposals. The ope-rations started in 1995 and the duration of thecontract is 30 years. Limeira is the first city inBrazil to enter into a concession for its munici-pal water and sanitation services.


The city of Limeira had a significant popula-tion growth between 1960 and 2010. Duringthis period, the population increased from61,000 to 280,000. This city growth, in numberof inhabitants and thus in surface area, createdsome serious problems for the safe water sys-tem and sewerage. Through a public and inter-national bidding process, the city of Limeiracalled on the private sector for cooperationand created a Public-Private Partnership, aimingat the following goals:

• Universal coverage of water and sanitation• Water supply 24 hours a day and 7 days a week• Water quality improvement• Water losses reduction• No pollution of local river (Piracicaba)• Universal treatment of wastewater• Affordable tariffs for the whole population

Extending wastewater collection

At the beginning of the concession there were164,000 people connected to the wastewatersystem, they represented 78% of the wholepopulation. Thanks to the investment that hasbeen made since 1995, the whole populationwas connected to the sewerage system by2004; thus, the company achieved one of itsmain goals – collection of 100% of wastewaterfrom the population – in less than 10 years.

The following graphic shows this evolution.The number of people connected to seweragesystem has been increased by 68%.

The city is included in the regional sanitationplan named “Piracicaba, Capivai and Jundai”.At the end of 2010, the average of wastewa-ter collection of the 62 municipalities fromthe valley was 85%, Limeira being one of themost advanced cities collecting 100% of itswastewater.

Increasing wastewater treatment

At the beginning of the operations, only 2%of population had its wastewater treated.Industrial wastewater did not receive any kindof treatment, which means that wastewaterfrom all industries, charged with industrialcontamination such as heavy metals, grease,detergent, etc. was dumped into the river .Sinceonly a tiny percentage of urban wastewaterwas treated, water poured in Piracicaba Riverproduced serious pollution. At this time thecity of Limeira was responsible for 40% of theriver’s pollution.

Thanks to the investment that has been madeby the operator, the percentage of treatedwastewater has increased every year, as shownin the graph, attaining a 100% of wastewatertreated in 2011.

City of Limeira, BrazilPopulation: 280,000

In spite of the 31%population growth,the proportion of people connectedto the wastewatercollection systemwas raised from 78% to 100% in lessthan ten years.

Wastewatertreatment wasalmost non-existent.Today all urbanwastewater is treated.


n Extending wastewater collectionn Increasing wastewater treatmentn Satisfying users’ expectations

Wastewater treatment plant

Satisfying users’ expectations

The company has proved high performancein numerous matters such as the universality ofwater supply and sanitation, the treatment ofthe total flow of wastewater, the water qualityimprovement – which, before 1995, sufferedfrom cloudiness and a certain colour – thedecrease of water losses from the drinkingwater network – which has been reduced from40 to 15% – and the consequent improvementto a 24 hours a day water supply for all connec-ted households. All these improvements havehad a positive impact on customers and publicauthority’s satisfaction.

Customersatisfaction surveysshow that more than91% of the waterusers are satisfied.

The social tariffprogram allows5,000 families to havea 50% reduction on their bills for their consumption below 15 m3.

This is proved by the satisfaction poll conduc-ted by the company with its customers.According to the results of the 2011 survey,91.5% of those polled considered the servicesatisfactory, and only 0.4% of them are notsatisfied with the service.


The company and the municipality have laun-ched a social tariff program through internalsubsidies. Subsidies are funded and deliveredby the operator to 5,000 families selected by themunicipality on the basis of their low revenues.The graph shows the money paid by a familywith a social tariff (in red) and the money paidby a family with the regular tariff (in blue) accor-ding to their consumption. The differencebetween both curves represents the savingsrealized by a family with social tariff. A family

with consumption of 15 m3 or less will have adiscount of 50% on their bill.

Finally, Foz de Limeira has obtained the ISO9002 certification for its quality policy, in 1998,the ISO 9001:2000 in 2002 and the ISO IEC17025 for its laboratories, in 2008.

See ref. 28

In 2011, Foz de Limeira received the title of “Company of the Year in the area of Social andEnvironmental Responsibility”. Awarded by the City of Limeira


Organising authority: The city of Petropolis.

Water and sewerage operator: Aguas doImperador, 100% subsidiary of SaneamientoAmbiental Aguas do Brasil (SAAB).

Location: Petropolis is a city located in thestate of Rio de Janeiro, 65 km from the city ofRio de Janeiro.

PPP description

Aguas do Imperador manages the municipalwater service of Petropolis. Aguas do Imperadorwas selected by a process of international com-petitive bidding. The contract, started in January1998, and has a duration of 30 years.


Before 1998, the city of Petropolis had seriouswater supply problems such as the coverage(percentage of population without access towater), continuity of water supply (some hou-seholds had water supply only once a week oreven once a month), and only 2% of the popu-lation with access to water received disinfectedwater (only by chlorination). In addition, thewater losses in the system were about 50%.Only 45% of the population were connected tothe sewerage system and only 4% of waste-water collected was treated.

The city of Petropolis, by a process of interna-tional competitive bidding, called the privatesector for cooperation and created a Public-Private Partnership, aiming at the followinggoals:

• Regularization and increase of water pro-duction in order to supply water 24 hours aday and 7 days a week.

• Universal coverage of water and sanitation.

• Replacement of obsolete pipes in order toreduce leakage and water losses.

• Treatment of 100% of water supplied.

• Installation of water meters and implemen-tation of a reading and billing system.

• Increase the amount of wastewater collectedand treated.

• Enhancement of customer service.

Extending access to water to un-served people

The water network has been to neighbou-rhoods that did not have access, mostly slums.In spite of the 15% population growth, the pro-portion of population connected to public net-works has risen from 56% to 92% between1997 and 2011. These figures include poorneighbourhoods that are located in areas ofdifficult access due to the rugged landscapeof the region.

In order to supply water for this growing popu-lation, Aguas do Imperador has invested inbuilding seven water treatment plants. Theseinstallations have allowed the system to dou-ble the production of drinking water from 300l/s to 600 l/s. With the current installed capacity,the company is able to supply with water 95%of the population if it was necessary.

Reducing leakage and water losses

The company also invested to improve the effi-ciency of the network. In addition to the newpipes for the new covered areas, the companyhas replaced more than 300 km of existingpipes in the distribution system.

As a result of these investments, water losseshave decreased from 50% to 19%, allowingcontinuous supply in many districts.

City of Petropolis, BrazilPopulation: 290,000

In spite of the 15%population growth,the proportion of people connectedto public waternetworks has risenfrom 56% to 92%.

Water losses havebeen reduced from 50% to 19%.


n Extending access to water to un-served people n Reducing water lossesn Improving accessibility of water

Improving accessibility & availability of water

More than 130,000 people have been connec-ted to the network. To connect these people thenumber of connections has increased from24,000 in 1998 to more than 60,000 in 2011.This means an increase of 150% more connec-tions installed during 13 years.


The company itself has financed and continuesto finance the different investments required.Half of the funds are from the company and

The number ofwater connectionshas been multiplied by 2.5.

the other half comes from loans that the com-pany obtains directly. The company has notreceived any financial support from the publicauthorities (neither from the municipality, northe state, nor the country). The only revenuesthe company has come from tariffs. In orderto make the tariff affordable to everybody,considering the proportion of people livingwith limited resources, the company and themunicipality have introduced social tariffs usinginternal subsidy. Subsidies are funded anddelivered by the operator to families selectedby the municipality on the basis of their lowrevenues.

The safety of the total supply of drinking wateris now guaranteed by the operator, this makesa significant difference compared to the initialsituation where only 2% of the drinking waterwas treated, and that only by a process of chlo-rination.

Progress concerning wastewater is also remar-kable. The number of connections to a seweragenetwork has ben increased by 85% and todayalmost the whole population is connected tothe wastewater network (97%). In addition,wastewater treatment was almos non-existantbefore the concession (4% of wastewater-collected). Currently, the operator managesfifteen sewage treatment plants where 64%of wastewater collected is treated.

See ref. 27

In 2006, Aguas do Imperador received the “Ouro Azul” award in the Private Company category.This award aims to disseminate, motivate and highlight Brazilian environmental projects thatcontribute to protect and recover water and ecosystems for future generations.


Responsible authority: Warnow Wasser andAbwasserverband Water Board (WWAV).

Water and sewerage operator: EurawasserNord GmbH (EWN), a private company, esta-blished in 1993 in the state of Mecklenburg-Vorpommern, Germany and now a subsidiaryof Remondis Aqua.

Location: City of Rostock and neighbouringtowns and rural regions in Mecklenburg-Vorpommern.

PPP description

A cooperation between Eurawasser and theWarnow Wasser and Abwasserverband WaterBoard (WWAV) through a PPP contract for25 years. Signed in December 1992 after acompetitive tender, the contract was initiallyfor drinking water supply and wastewatermanagement in the City of Rostock. In 2003 itwas merged with another contract to servenow approximately 310,000 people in Rostockand neighbouring towns and rural regions inMecklenburg-Vorpommern.

The figure below shows the drinking watersupply and wastewater management area ofEWN with the division into regional responsi-bility areas.

Water supply and sanitation area of EWN

Wastewater collection and treatmentto protect the environment

Eurawasser Nord GmbH has extended and ope-rates wastewater systems in the service areas,and has realised the following system upgradesand network rehabilitation:

• 55 wastewater treatment plants with theRostock central wastewater treatment plant asone of the most modern in Europe.

• 2.028 km of sewers and stormwater lines.

• 7.863 small sewage treatment plants and sep-tic tanks for areas that are not yet developed.

Since the beginning of the contract, EurawasserNord has spent a total of 300 million € for therestoration and investments in water and was-tewater infrastructure. The table below showsthese top Investments.

The extension of the wastewater network inthe suburbs surrounding Rostock has resultedin an increase from 28% to 86% of the num-ber of people that have their wastewater col-lected.

City of Rostock and adjacent districts, GermanyPopulation: 310,000

Extension from 28%to 86% of thenumber of people in the surroundingsuburbs that areconnected to thewastewater network. Project Investment

(million €)

Development of the Rostock water plant 10,9

Modernization of the Rostock WasteWater Treatment Plant

84,7

Extension of the drinking water system 63,9

Increase of access to the wastewaternetwork for the people in thesurrounding suburbs (from 28% to 86%)

141,5


n Removing pollution to protect the environmentn Improving the acceptability of watern Making life of users easier

An environmental commitment

Eurawasser Nord has always been stronglycommitted to environmental protection inOder to attain the objectives of the HelsinkiConvention.

In obtaining a modern wastewater treatmentplant, Rostock succeeded in complying withthe new environmental requirements in effectin the countries of the Baltic region.

The quality of the bathing water in the BalticSea at this seaside resort region has also beenimproved as a result of this investment.

Optimising water treatment to improvequality and acceptability of water

In Rostock, Eurawasser Nord took up the chal-lenge of quality water.

The construction of ozonation units in the drin-king water production plant improved tastequality and reduced the quantity of chlorineused for disinfection by 80%.

In addition to its better taste, the water distri-buted in the city is strictly monitored today.

Today, the quality of drinking water meetsthe strict standards of the German DIN 2000regulations on drinking water. External inde-pendent monitoring by the German Public

80,000 customercontacts a year. 94% of water-usersfind that water is of excellent quality.

Health Department attests the good qualityof the drinking water.

Each month, 120 samples are subject to micro-biological tests and 460 samples are analysedfor chemical compliance.

The storage of drinking water in Biestow, witha capacity of 10,000 m³, and in Niederhagen,with a capacity of 5,600 m³, guarantees a highdegree of safety of supply for the city of Rostockand 19 municipalities in the Bad Doberandistrict.

Services designed for customer satisfaction

A series of customer satisfaction surveys havebeen carried out. These examine issues suchas the setting up of a single call number and acall centre (handling 80,000 customer contactsa year). In the last survey, a total of 2,000 cus-tomers were asked about Eurawasser Nord.94% of the sample thought that the companyprovides for a very good drinking water, anexcellent water quality, and very good waste-water services. 76% appreciated that the WWAVand Eurawasser Nord have kept prices on thesame level, complying with customer wishesand keeping them informed as well as offe-ring the latest technology and improving drin-king water quality.

Management of drinking waterquality is certifiedISO 22000.Water qualitycomplies with theGerman DIN 2000standards.


Organising authority: Mbombela LocalMunicipality. In 2000 Greater NelspruitTransitional Local Council (created in 1994)merged with White River and Hazyview tobecome Mbombela Local Municipality.

Water and sewerage operator: SembcorpSilulumanzi.

Location: Greater Nelspruit area. Nelspruit isthe capital of the province of Mpumalanga,South Africa. The concession covers the cityof Nelspruit, and the main Nsikazi townshipsof Kanyamazane, Tekwane, Msogwaba andMatsulu. It also extends to other peri-urbanareas such as Zwelisha, Mpakeni and Luphisi.

Total population in concession area is 440,000of which currently 380,000 are receiving theservices (2011).

PPP description

Sembcorp Silulumanzi (formerly known asGreater Nelspruit Utility Company) is the waterutility in charge of the Greater Nelspruit area.It is a subsidiary of Sembcorp Industries ofSingapore.

On the advice of the Development Bank ofSouthern Africa, a request for proposal wasissued in 1996. The Transitional Local Councilselected Sembcorp Silulumanzi by a processof competitive bidding among 5 other com-panies and in 1999 the contract was signed.The concession agreement was approved by

the Department of Constitutional Affairs andthe Department of Water Affairs and Forestry.Operations started in November 1999 and theduration of the contract is 30 years.

Sembcorp Silulumanzi operates, maintains,replaces and upgrades the assets leased fromthe council. The assets will be transferred backto the council at no cost and in the same orbetter condition at the end of the concession.The PPP is regulated by a Concession Moni -toring Office within the municipality.


Nelspruit Town population was 25,000 in 1990and the majority of households were mid toupper class. In 1994, when Greater NelspruitTransitional Local Council was created, the areaincreased by over 8 times and the populationto 250,000. The total income of the area, howe-ver, was only 38% greater. This was due to thefact that the new areas included were lesswealthy and had a significant proportion ofinformal households, particularly the peri-urbanareas which had 100% informal households.Consequently, when the operations started in1999, 56% out of the 43,000 households wereinformal. Thus, the access to water service waslimited, 44% of all households and almost 80%of informal households did not have access towater supply.

Some of the main performance targets assi-gned to the operator to be achieved by 2009were:

• 24 hour water supply to all formal householdsby 2009

• to use best efforts to improve the number ofhouseholds in informal areas with a 24-hourwater supply

• to comply with national water quality stan-dards

• to improve revenue collection

• annual customer satisfaction survey andfollow-up actions to address issues identified

• community-oriented training and develop-ment programmes

Mbombela, South AfricaPopulation: 440,000


n Extending access to water to un-served peoplen Ensuring more equitable water supplyn Securing revenue streams


The company achieved the first target: areaswith a 100% of formal houses, such as Nelspruitand Tekwane, had full coverage of basic watersupply, 24 hours a day and 7 days a week, by2009. Over and above the 24-hours services,the operator was successful in connecting allcustomers in these two areas to sewer network.Overall performance figures are also remarkable,especially considering the demographic expan-sion. The population has grown by 65% bet-ween 1999 and 2009, with most of this growthconcentrated in informal areas, an increase of20,000 informal houses. In spite of the high levelof growth of the population, the concessionaireimproved the coverage of basic water supplyfrom 56% to 89% of all households in only thefirst five years of the concession.

Equity & non-discrimination

It is important to note the efforts made by thecompany to supply water in areas where mostof the houses are informal. In 1999, none ofthe informal houses received water 24 hours aday, and 79% of informal houses did not receivewater at all and the remainder only receivedwater irregularly. In 2009, only ten years later,in spite of the growth in number of informalhouses, the proportion of informal houses withno access to water supply was reduced signifi-cantly from 79% to only 9% and 81% of infor-mal houses were receiving water every day.

The same improvement can be seen in the sta-tistics in rural areas. In 1999, only 21% of the ruralpopulation of Mbombela Concession was ser-ved at or above the basic level of service. Thisfigure is far lower than the average national sta-tistics, where 48% of rural population had accessto water. After the first ten years of the concession,the percentage of rural population with at leasta basic level of service increased to 81%, whichis above the national average of 79% in 2009.

Basic water supplyhas been expandedfrom 56% of thepopulation to 89%in only 5 years.

The proportion of informal houseswith no access to a water servicereduced from 79%to 9% from 1999 to 2009, in spite of the increase of informal houses.

The proportion ofrevenue collectionout of the total billsincreased from 73% to 78%.

Securing Revenue Streams

For political reasons, the percentage of revenuecollection was low in Mbombela. This wasbecause refusal to pay for any municipal orgovernment provided services was used as aform of protest against the apartheid govern-ment. Without the payments it was very diffi-cult to support the development and operationof the water and sanitation systems. One ofthe main goals of the concession was to convertthis strong culture of non-payment for waterservices. Among the contractual requirementsto be achieved by 2009 there were targets forrevenue collection for each area.

The efforts of the concessionaire to addressthis problem have allowed an increase in thetotal revenue collection from 73% of the totalbills in 2000-2001 to 78% in 2008-2009. Thebest improvements have been in Matsulu andKanyamazane and Tekwane as shown in thefollowing graph.


One of the main improvements is the waterquality. The Sembcorp Silulumanzi systemsobtained the South African Department ofWater and Environmental Affairs’s Blue andGreen Drop awards. This was due to the goodcondition of infrastructure. thanks to a goodmainteance program, including efforts andinvestment spent to upgrade the existing infra-structure. All that having tariff levels similar orlower than comparable municipalities acrossSouth Africa.

See ref. 29

SembcorpSillulumanzi is oneof the few watersystems to obtainthe Blue and GreenDrop awards.


Organising authority: Latur MunicipalCorporation (LMC)

Water operator: Latur Water Supply Man -agement Company Ltd.

Location: Latur is the regional headquarters forthe Latur district, located in the Marathwadaregion of Maharashtra. It has an area of 32.56sq km, and a steadily growing population ofover 500,000. Apart from the resident popu-lation, Latur has a floating population of about25-30,000 people that visit the city every day forvarious trade and commerce related activities.

PPP description

In June 2008, Maharashtra Jeevan Pradhikaran(MJP), the state level water authority and assetowner, engaged SPML to undertake the watersupply operations to the city for 10 years. Aspecial purpose vehicle called Latur WaterSupply Management Company Ltd, was esta-blished by SPML.


Latur is the district headquarters, an impor-tant administrative centre that houses manyregional offices of the state government, andhas reputed educational institutes, qualityhealthcare facilities and infrastructure services.

The water supply to the Latur city was previouslymanaged by Latur Municipal Corporation (LMC)and faced major problems because of sourcelimitations and very poor water supply accoun-ting. During the summer season, the water sup-ply was reduced to about 40 litres per capita perday and 30 to 40 tankers per day were engagedto manage the shortfall of water supply. The resi-dents faced extreme water shortages and onmany occasions, violence erupted over water.

The water management function was transferredfrom LMC to Maharashtra Jeevan Pradhikaranto infuse operational improvements and financevarious capital schemes.

The main features of the project assigned toSPML were:

• take over the existing assets from source to tap

• carry out operations, maintenance and repairof the existing resources

• deploy staff for operation, maintenance andnetwork expansion including key employeesseconded from MJP and LMC

• provide minimum average water supply toresidents at adequate pressure

• ensure daily and pressurized water supplieswithin contract period

• increase the number of new connections

• ensure meter installation to 100% of existingconnections

• collect revenue based on the tariffs fixed inthe management contract

• implement billing and revenue collectionsystem

• create consumer awareness

Aeration of Raw Water at Treatment Plant


With the aim to make water available to the100% of the population, SPML has worked relen-tlessly to improve the situation. These effortshave produced good results. At present watersupply is improved up to 100 litres per capita perday covering 90% of the population of the city.This is significant progress from the initial situa-tion where the city received a limited supplyof 75 l/c/d during the normal season – duringthe summer season the water supply was redu-ced to 40 l/c/d – and only 70% of the populationwas covered.

Improving accessibility & availability of drinking water

After taking over the operations and manage-ment, SPML changed the entire situation

Latur, IndiaPopulation: 500,000

Access to the watersupply has beenexpanded from 70%to 90% of populationin only three years.

Availability of waterhas increased from75 litres per capitaper day to 100 litresper capita per day.

Regularity of watersupply has improvedfrom 1 hour once in 10 days to 3 hoursevery two days.


n Extending access to water to un-served peoplen Improving accessibility & availability of drinking water n Making life easier for users

rapidly. It conducted research to select andadopt world class technology to manage thewater supply to the satisfaction of the resi-dents. The water supply duration has impro-ved significantly from one hour once in 10 daysto 3 to 4 hours on alternate days.


An almost complete control of water wastagehas been achieved by:

• pipeline and valve replacement, repair

• development of District Metered Areas (DMA)for active leakage control, utilization of FlowControl Valves (FCV) for regulating the flowof water

• implemented Supervisory Control and DataAcquisition (SCADA) for the projected achieve-ment of 24x7 water supply system with 100%metering to achieve reduction in Non RevenueWater

NRW losses have been brought down froman abnormal 45% to 10% within a two yearperiod by using advanced technology for leakdetection and repairs in transmission lines anddistribution network.

Improved customer services

Some of the important initiatives taken bySPML to improve customer services are:

• implemented modern distribution manage-ment and reduced lost revenue

NRW losses havebeen brought downfrom an abnormal45% to 10% within a two year period.

• efficient operation & maintenance by institu-tional strengthening, business process anddistribution improvement

• implemented state of the art informationtechnology, management reporting and auditprocesses

• adopted effective utility management, costbenefits and sustainable methodologies

• established adequate infrastructure like zonaloffices, billing and collection centres in allzones, to enable efficient consumer serviceand resolution of complaints.

• implemented billing software for error freebilling

• established online billing centers connectedwith 55 km of optical fibre cables

• used GIS & satellite images for householdidentification and more than 35,000 proper-ties have already been identified

• used mobile vans for on the spot bill genera-tion and collection

• established customer care centre with tollfree number

• conducted consumer awareness programsabout the conservation, supply, quality anddistribution of water.

SPML has been successful in convincing resi-dents to pay for the services. It has created awa-reness of the importance of reducing wastageand instilled customer’s sense of ownership of thecity water. Things have changed as the residentshave understood the difference between thepreviously government run water supply sys-tem and the new approach. The people now feelconfident to come to SPML for their complaintsand get immediate and efficient response, amost significant achievement of SPML.

Other improvements

Improvements in the quality of water beingsupplied have been achieved through conti-nuous laboratory analysis, proper operation ofchemical dosing system and replacement,repair and clearing choked pipelines, to main-tain a uniform and consistent quality watersupply to the residents.

Pipeline repairs 1763

Valve repairs 844

Clearing choked pipes 273

Removal of contamination 123

Installation of new valves 24


Organising authority: City of Gdańsk, Poland.

Water and sewerage operator: Saur NeptunGdańsk (SNG).

Location: Gdańsk and Sopot, Eastern Pomerania,Poland. Population: 510,000 in 2011.

Gdańsk is a major Polish port on the Baltic Sea,the City of the late revolutionary union leaderand president Lech Walesa. Gdańsk is also amajor summer resort with the beaches andamenities of the Sopot beach resort attractingover 1 million visitors per year.

Public-Private Partnership

A lease/affermage contract was signed in 1992for a duration of 30 years between the city ofGdańsk and Saur Neptun Gdańsk (SNG). SNGis a Joint Stock Company held for 51% by SaurInternational, a private group from France and49% by the City of Gdańsk. This “mixed” com-pany operates the water and wastewater ser-vices in Gdańsk and Sopot. It is responsiblefor operation and maintenance of the system,maintaining quality of service standards,and billing and collection. Today, it serves510.000 people.

The city of Gdańsk remains the owner ofthe infrastructure through an asset-holdingcompany GIWK – Gdańska InfrastrukturaWodociągowo-Kanalizacyjna. This company isresponsible for funding and realising the newinvestments. The city remains also responsi-ble for regulation and setting of tariffs (yearlytariff-setting by the Municipality).

The Gdańsk PPP contract is often characte-rised as the 1st major water PPP contract inCentral Europe. It is a two-ways public-privatepartnership: through a PPP contract betweenthe local government and an operator andthrough a co-ownership of this operator.


Prior to the beginning of the PPP contract, themain problems in Gdansk were related to thequality of the water supplied which was com-pletely unsatisfactory for the population served.

In addition, major network failures led to hugewater losses (25% Non-Revenue Water in 1992)and problems with continuity of service.

Untreated wastewater resulting from under-investment had led to the closing of seasidebathing beaches in Gdańsk and Sopot.

Removing pollution to protect the environment

Sopot, the beach resort near Gdańsk, has world-class beaches and spa facilities, including thelongest wooden pier in Europe. However, dueto pollution caused by lacking wastewatertreatment and the resulting toxic sewerageeffluents, these beaches had been closedsince 1978.

Only two years into the contract, by 1994, SNGhad overcome the failure of wastewater treat-ment and this led to the festive reopening of thebathing beaches in Gdańsk and Sopot. Marineenvironments were restored, leading to a rene-wed flourishing of this spa resort and a touristboom for the whole coastal area.

Securing water safety

SNG focused on the improvement in the watertreatment stations dealing with surface water.The implementation of new technology andtreatment systems led SNG to rapidly achievecompliance with EU drinking water standards.In 1992, 8% of water circulating in the Gdańskwater supply network met European standards,compared to 87% in 2010.

Gdańsk, PolandPopulation: 510,000

Beaches reopenedafter being closedfor 16 years becauseof wastewaterpollution.


n Removing pollution to protect the environmentn Securing water safetyn Improving acceptability of water

Improving compliance to EU quality standards for drinking water

In 2010, ISO 22000: 2005 certification dealingwith Hazard Analysis and Critical Control Point(HACCP) was obtained by SNG, qualifyingGdańsk tapwater for food safety certification.

To monitor continuously the quality of waterSNG has deployed the wisdom of nature: abiomonitoring system based on the behaviourof rainbow trouts and Unio tumidus mussels.In 2010 the residents of Gdańsk benefited fromthe services of 80 trouts and 40 mussels.

Bio-monitoring at SNG

In 2010, 87% of water suppliedmet Europeanquality standards,compared to 8% in 1992.

Improving water acceptability

Prior to the PPP there were huge expectationson Drinking Water Quality improvements:“People said they would even welcome thedevil if the water quality only went up!” (asreported by the WaterTime research project in2005).

Improvements performed by SNG have rever-sed the perception of users.

In 2010, a Poland-wide test by Brita, a leadingwater filtration products brand, of tapwaterprovided by the largest 10 utilities, revealedsome remarkable results in terms of “accepta-bility” of the water supplied. Gdansk tapwatercame out first in terms of odour (best smell)and taste (least detectable).

In recent customer satisfaction enquiries, 70%of the customers declare their drinking waterto be of good to excellent quality (source SNG).

Compared to the 1992 situation, the accepta-bility has dramatically improved in objectiveand subjective terms.

Other improvements: reduction of water losses

• Network breakdown rate decreased by 50%.

• Water losses in the Gdańsk water networkwent down from 25% to 13% (in 2010).

• A leakage monitoring system for the entirewater supply network was introduced.

• All these efforts have led to significant watersavings (460,000 m3 in 2010 in comparisonwith 2009).

In 1992 the waterwas perceived aspretty bad by users.Today, 70% of water-users declare theirdrinking water of good or excellentquality.

Water losses in the Gdańsk waternetworks wentdown from 25% to 13%.

“Saur Neptun Gdańsk has done a great work to guarantee high standards of services, among themthe superb quality of water.” Pawet Adamowicz, Mayor of Gdańsk, Global Water Summit, Berlin 2011


Organising authority: The City of Tangiers.

Water and sewerage operator: Amendis, alocal privately-controlled company (a subsi-diary of Veolia Environnement).

Location: The region of Tangiers – Asilah onthe Northern Coast of Morocco. Approximately900,000 inhabitants.

PPP description

The Public-Private Partnership (PPP) is a conces-sion-type contract for the supply of drinkingwater, management of the sewerage systemand the distribution of electricity in the cityof Tangiers. The operator purchases drinkingwater and power in bulk from state-ownedproducers.

The PPP contract started in 2002 for a dura-tion of 25 years.


Some of the key objectives of the PPP contractwere to:

• Finance and implement an ambitious invest-ment program comprising the protection ofthe bay of Tangiers against the wastewaterpollution that gave rise to bad odours for theneighbouring population, recurrent seweragefloods and direct disposal of the wastewater inthe vicinity of tourist areas.

• Complete the access to basic services to thewhole population of the contract area.

• Improve drainage to reduce flooding.

• Improve the quality and the efficiency of thecustomer service.

Protecting the Bay of Tangiersthrough removing pollution from wastewater

It was paramount to rehabilitate and completethe sewerage system of the city in order toremedy the bad hygiene conditions of thepopulation and the long standing problem ofodours from the rivers in the city and alongthe coastline, and also to improve the quality

of bathing water on the beaches of the city inorder to maintain its status as a tourist resort.

From the start of the contract in 2002 up to year2010, the overall investment program amoun-ted to 2,170 million Dirhams (€190 million)of which 54% was dedicated to the sewerageservice alone.

The new wastewater treatment plant

The sewage system that has been built andimplemented by the operator comprises:

• 50 kilometres of main sewers to collect thewastewater that was previously disposed ofin the small rivers (“oueds”) and indirectly intothe bay,

• 14 pumping stations across the city,

• a waste water treatment plant (primary treat-ment),

• a 2.2 km long sea outfall.

Nearly 60 kilometres of rivers (“oueds”), formerlyused as open sewers, have been completelycleaned, as well as 500 km of sewer lines.

Miscellaneous waste in a sewage collectorbefore cleaning

Tangiers, MoroccoPopulation: 900,000

In 2002, wastewaterwas dischargeduntreated in manylocations on the seashore. 10 years later, 95% of wastewater is collected andtransferred to a treatment plantthen discharged faroffshore allowingthe city of Tangiersto upgrade itstourist resort status.


n Protecting the environment from wastewater pollutionn Making life of users easiern Raising and maintaining staff capacity

Making life easier for users

The customer service has been the focus ofspecial attention from the operator.

The improvements implemented since the startof the contract comprise:

• the creation of a customer care centre (“callcentre”) named “Amendis Direct”,

• the increase in the number of branches from7 in 2002 to 15 in 2010 for customers to resolveany issues/requests,

• the introduction of 2 mobile branches to serveremote areas through fully equipped buses,

• the introduction of a new billing system aswell as the redesign of the bill,

• provision of better information to customers,

• the facility for customers to pay their bill atlocal groceries,

• meter reading through handheld devicesimproving the efficiency of the reading/bil-ling cycle.

Mobile branch to serve remote areas

The number ofcustomer centreshas been doubled to simplify the life of water-users. Remote areas are served by 2 mobile centres.

Raising and maintaining staffcapacity through intense training

A massive training effort for the staff has beenundertaken: 160,000 hours of training between2002 and 2010, i.e. an average of 26 hours oftraining per staff per year, with an overall bud-get of 25 million dirhams for the period 2002to 2009.

A new training center has been built with12 specific training rooms (in a 1,300m2 buil-ding) and a 4 hectare field, equipped to pro-vide training in water, sewerage and electricity.Through an agrement with 3 universities thenew training centre is entitled to deliver officialdiplomas.


The network has been extended by 35% since2003 and the connection rate has improvedby 19% from 73% in 2003 to 92 % in 2009. Thenumber of customers has been increased from111,000 to 198,000 at the end of 2011 (i.e. +78%).

Cross-subsidies allow the 35% of customerswho consume less than 6 m3 per month (lowestbilling block) to pay a metric charge that islower than the price paid by Amendis, the dis-tribution operator, to the bulk water provider.

16,000 “social” connections have been realisedbetween 2002 and 2010 targeting poor hou-seholds (partly funded through a World Banksupported Output Based Aid scheme).

The efficiency of the water distribution net-work has been improved from 63.3% in 2002to 80.4% in 2010, saving the equivalent ofthe water consumed by a Moroccan city of200,000 inhabitants.

The improvements to the sewerage and drai-nage networks have also contributed to sol-ving the issue of recurrent floods during wetweather in some of the low points of the city(nearly 60 flooding hotspots have been elimi-nated), thus contributing to better hygiene ofthe population concerned.

The System of Quality Management is certi-fied ISO 9001-2008. The wastewater treatmentplant is certified ISO 14001.

See ref. 28

Cross-subsidiesallow the operatorto charge 35% of customers a priceper cubic metre that is cheaper than it purchases it from the bulk water provider.


Organising authority: Municipality ofCartagena de Indias.

Water and sewerage operator: Aguas deCartagena SA E.S.P. (Acuacar).

Location: Cartagena de Indias is a city loca-ted in the state of Bolivar, Colombia.

PPP description

Aguas de Cartagena manages the municipalwater service of the city of Cartagena de Indias.It is a “mixed” company owned by the city (witha share of 50%), by a private operator (AGBARgroup - with a share of 45.9%) and some localprivate shareholders (with 4.1%). PPP opera-tions started in 1995 and the duration of thecontract is 26 years.


The city of Cartagena de Indias had significantpopulation growth during the years before1995. This city growth, in number of inhabi-tants and thus in surface area, created seriousproblems for the water and sewerage systems.Through a public and international biddingprocess, the city set up a Public-Private Partner -ship, aiming at the following goals:

• universal coverage of water and sanitation• water supply 24 hours a day and 7 days a week• water quality improvement• water loss reduction• universal treatment of wastewater• affordable tariffs for the whole population

Improving regularity of water supply

In 1995, at the beginning of the concession,there were areas where households receivedwater supply less than 8 hours a day, other sec-tors where households received water supplybetween 8 and 16 hours a day and in some areashouseholds received water supply between 16and 24 hours a day. Water supply of 24 hoursa day was practically non-existent. On averagewater was running at the tap for only 14 hoursa day. The map illustrates these different sec-tors according to water supply regularity.

Thanks to efforts on rehabilitation and repla-cement of the existent network, the situationhas been reversed and currently water supplyis continuous in almost all the city (99.3% of thetime in average), as shown on the second map.

Ensuring more equitable supply

Cartagena has seen its population increasefrom 510,000, in 1995, to more than 1 million in2011. This demographic growth has resulted inthe increase of the number of connections from94,639 in 1995 to 218,948 in December 2011.

86% of new domestic users are from lowerincome groups. In Cartagena water users areclassified in six different bands according totheir socioeconomic status where bands 1,2 and3 receive subsidies and bands 5 and 6 pay anadditional percentage above the regular price,which is paid only by band 4. Water connec-tions of lower classes (bands 1 and 2) have beenincreased by 87,000, i.e. multiplied by 3.3.

City of Cartagena, Colombia Population: 1,000,000

In 1995, there wasrunning water at the tap only 14 hours a day on average.Since 2002, it isrunning more than99% of the time.

86% of domesticcustomers newlyconnected to waternetworks are fromlower income classes.

Caribbean Sea

Caribbean Sea


n Improving availability of water supplyn Ensuring more equitable supplyn Raising and maintaining staff capacity

Raising and maintaining staff capacity

One of the more profitable investments reali-zed by Acuacar has been, and continues to be,its staff training. All workers, including theGeneral director, have received training thathas allowed them to develop their talents andabilities. This has been developed through aseries of Training and Management Develop -ment approaches, based on organizationalstrategy, key processes and continuous impro-vement programmes.

During the ten first years, the company put allits efforts into training and into the develop-ment of basic competencies for all its workers.In 2000, the number of training hours peremployee per year was 125 hours. It was par-ticularly important to achieve the professio-nalisation of a significant part of the operativestaff and qualify them as “Technician in drinkingwater and basic sanitation”. To do this the com-pany increased the number of “man-hours” oftraining significantly.

During the later years, the company has workedon strengthening competencies, mainly for

The company hasrealised significantefforts on capacitybuilding and workerstraining, which havehad very positiveimpacts.

managers. This explains the reduction in thenumber of man-hours of training. However,the effectiveness of the training is maintainedbecause it has a multiplier effect and createshigh levels of productivity.


Despite the doubling of the population, theefforts made by the company have permittedan increase in the percentage of the populationconnected to the drinking water supply net-work from 72% in 1995 to 99.9% in 2008.

The coverage of sewerage connections increa-sed from 60% to 88% between 1995 and 2011.

The company implemented mobile officeswhere customers can easily go to regularizetheir services with payment plans accordingto their budgets and capacity to pay. This ini-tiative strenghtens the relationship betweenthe company and its customers.

Mobile office in Cartagena

The investments have allowed an increase in thepopulation that benefits from a continuouswater supply, improving the water quality andprotecting the environment of the bay andthe lake as part of the “Master Plan of WaterNetwork, Sewer Network and EnvironmentalSanitation“. All these elements contributed tosatisfy water users expectations. According tosurveys, customers’ satisfaction has been increa-sing steadily since 2005, reaching more than85% from 2007.

See ref. 2,13,14, 28, 30

“It is so satisfying to see the commitment to excellence in management that companies such as Aguas de Cartagena have. Congratulations for this achievement that contributes to the progressof our beloved Colombia.” Quote from President of Colombia Juan Manuel Santos, in a letter sent

to Acuacar in October 2011, on the occasion of the Health and Safety certification

Despite populationdoubling watercoverage has beenincreased from 72% to 99.9%.

Customer satisfactionhas improved from 71% of userssatisfied to 87% in 2011.


Responsible Authority: Commonwealth ofPennsylvania.

Regulatory Agencies: Pennsylvania PublicUtility Commission and Pennsylvania Depart -ment of Environmental Protection.

Water Utility: Aqua Pennsylvania (Aqua).

Location: Pennsylvania in the Northeast regionof the United States is home to more than12.7 million residents. Aqua serves 1.4 millionpeople in 30 counties across Pennsylvania.

About Aqua Pennsylvania

Aqua was founded as the Springfield WaterCompany in 1886 to supply water to a townshipin suburban Philadelphia. After more than a cen-tury of development and change, the SpringfieldWater Company grew to become a nationalinvestor-owned utility called Aqua America.

The Pennsylvania subsidiary is the company’slargest one and operates under the regulationof the Commonwealth of Pennsylvania.

Improving water quality and acceptability

In the Neshaminy Creek, from which one ofAqua’s treatment plants takes its water, algaeblooms occur naturally. These algae bloomsgenerate taste and odour problems in water. Tocontrol this, the company used to apply pow-dered activated carbon (PAC). From time totime, some customers still reported an earthyor musty taste and odour in the drinking water.Aqua conducted studies to find a better methodto ensure a good taste and odor of its water. Thecompany adopted a UV-oxidation system thatreduces the contaminants from the algae thatcause taste and odour. According to historicaldata, a powdered activated carbon dosage of30 mg/l could achieve a maximum 55 percentreduction in those contaminants. The UV-oxidation method almost doubles the effecti-veness of the process by ensuring a minimum90 percent reduction.

Increasing Energy Efficiency

Aqua is engaged in the enhancement of energyefficiency in order to reduce environmentalimpacts and energy costs.

Since 2004, the company has adopted lightingcontrol technology to reduce wasted powerfrom lighting. Aqua’s efforts included electro-nic dimming ballasts, more efficient fluores-cent lamps, and occupancy and photo sensors.This system enables Aqua to save roughly916,000 kWh annually. Aqua also updatedlaboratory equipment for water testing toincrease equipment power efficiency. A newtesting method also enables Aqua to do a “microextraction”, which needs 98 percent fewertesting chemicals and solvents to get suffi-cient data. This procedure reduces the energyconsumption of the laboratory and also reduceshazardous waste byproducts.

Aqua uses alternative energy, such as wind andsolar power. Solar-powered mixers that conti-nually mix the water ensure water qualitywithout additional chemicals. Aqua receivedfunds from a partnership with the PennsylvaniaDepartment of Environmental Protection anda $1 million federal stimulus grant from thePennsylvania Energy Development Authorityto help install the Ingram’s Mill Solar Farm.On sunny days, the plant can sell as much as300 kilowatts back to the local energy providerwhile still running the plant for free. Aqua saved$130,000 in electricity costs in 2011 in this way.

Pennsylvania, U.S.A.Population: 1.4 million people served by Aqua Pennsylvania

Aqua Pennsylvaniahas reduced its electricityconsumption by almost 3.9 millionkilowatt hours andits fuel consumptionby roughly 28,000 gallons from 2009 to 2010.

Algae contaminantsthat produce badtaste and odour are now effectivelyeliminated thanks to a UV-oxidationsystem.


n Improving water quality and acceptabilityn Increasing energy efficiencyn Optimising asset management

Rather than pay for certified recyclers to haulused motor oil away, Aqua installed specialheating systems that recycle the waste oil andheat two of its maintenance garages.

In total, Aqua’s southeastern Pennsylvania ser-vice region has reduced electricity consumptionby almost 3.9 million kilowatt hours and itsfuel consumption by roughly 28,000 gallons,lowering its estimated greenhouse gas emis-sions by about 3,250 metric tons from 2009 to2010.

Optimising Asset Management

Aqua is convinced of the importance of goodasset management to ensure continued ser-viceability and to prolong the life of infra-structure. With this in mind, the companyadopted a new asset management softwareat three division production facilities in 2009.The software has a detailed database of allassets (8,000 assets were included in 2011) andcaptures and records all preventive, predictiveand corrective maintenance jobs. During thefirst quarter of 2011, the database had gene-rated more than 31,500 routine/preventivework orders. One important goal of the data-base is to be able to identify patterns in orderto make informed maintenance decisions.

In 2008, Aqua had already set a precedent bywinning the “Management Innovation” awardfor an Asset Information Management System(AIMS) coupled with a Geographic InformationSystem (GIS). AIMS allows users to retrievedetailed information on pipes, hydrants mainbreaks and customer taps, including thou-sands of scanned images of as-built construc-tion plans. Both programs enable Aqua toprioritise infrastructure projects efficientlywhile optimising the use of capital to replaceor upgrade the system. In day-to-day opera-tions, AIMS and GIS can be used by emer-gency crews.

The company wonthe ManagementInnovation nationalaward for its Asset InformationManagementSystem andGeographicInformation System programmes.

Other Significant Improvements

An important Key Performance Indicator to mea-sure network efficiency is the amount of unac-counted water (UAW), which is water that theutility has no way to track, including unknownleaks and breaks, malfunctioning meters andtheft. Compared to the national figures, Aquamaintains its level of UAW below the average.However, Aqua has to make significant efforts tomaintain those values because it has acquiredoperating systems that contain many watermains well over 100 years old. One example ofan inherited high-loss system that has reducedwater loss is Laurel Lakes. This system had anaverage UAW of more than 50 percent two yearsago. Thanks to careful monitoring, research,more efficient equipment and targeted infra-structure investment, Aqua reduced the UAWto 25 percent in only two years.

More information in Aqua AmericaSustainability Report


Organising authority: The city of Bucharest.

Water and sewerage operator: Apa NovaBucuresti (ANB), a subsidiary of Veolia Waterwith 16.7% owned by the Municipality ofBucharest and 10% by the employees of thecompany.

Location: The city of Bucharest, covering apopulation of about 2 million.

PPP description

In March 2000, the Municipality of Bucharestentered into a public-private partnershipcontract (PPP) for the management of its waterand sewerage systems. The 25-year innovativeconcession contract was awarded to ANB fol-lowing an international competitive tenderingprocess.

The PPP contract is output-based. Services obli-gations (levels of service targets) are clearlyspecified and have to be met by the operatorin a fixed timeframe. Targets are related towater service, sewerage service and commer-cial relationship with end-users. The type andamount of capital expenditure required toreach each service target are not imposed bythe contract (with the exception of the Crivina-Ogrezeni water treatment plant) and are plan-ned at the discretion of the concessionaire.

Compliance with some specific service targetsis a mandatory condition before triggering thetariff increases set out in the contract.

The national competition office (ANRSC) super-vises the correct application of tariff settingrules.


In the 1990s, more than half of the populationof Bucharest was not satisfied with the falte-ring water and sewerage utility. The water ser-vice was intermittent and unreliable, and wasin a dire financial situation. The municipal objec-tives to be achieved through the concessioncontract were the following:

• Complying with EU standards for potablewater and sewerage services at the lowestpossible tariffs;

• Running services that are financially inde-pendent from Municipal and Governmentalfunding;

• Improving efficiency and operational perfor-mance;

• Avoiding monopolistic behavior and obtai-ning sustainable contractual arrangements;

• Increasing environmental protection andpollution control.

Below are some of the achievements 10 yearssince the start of the concession.

Improving Energy Efficiency

ANB has significantly improved operationalefficiencies, including in particular increasingenergy efficiency with a reduction of about75% of annual electricity consumption between2000 and 2010, allowing a cumulated decreaseby 800,000 tons of indirect greenhouse gas(GHG) emissions for the period 2000-2010.

Annual electric energy consumption andrelated reduction of annual greenhouse gasemissions per comparison with year 2000

A pumping station after modernisation

This is the result of the reduction of water lea-kages, the decrease of water abstraction aswell as extensive modernization of the pumpingstations and optimization of pressure mana-gement.

City of Bucharest, RomaniaPopulation: 2,000,000

Annual electricityconsumption has been reduced by 75% between2000 and 2010.


n Improving energy efficiencyn Satisfying users’ expectationsn Optimising economics of services

Satisfying users’ expectations

Client services have improved, with the mete-ring of all the customers, new customer recep-tion areas and a new Call Centre to deal withcustomers requests 24 hours a day.

With improved services (correction of all lowwater pressure problems, improved water qua-lity) and customer care, customer satisfactionwent up drastically from 46% in 2002 to 75% in2008 (Gallup measure) and customer com-plaints dropped from 11,462 in 2001 to 1,056in 2008.

Service efficiency and cost savingsgenerating financial resources for increased investments

In the first 10 years of the concession, ANBhas invested US$258.8 million, equivalent to30 percent of its total revenue over the period(2000-2009).

Unlike the other Romanian utilities, ANB finan-ced all its operations and investment withoutpublic subsidies, and the tariff has remainedaffordable. In 2011, tariffs in Bucharest werein the low range in Romania, on the 42nd placein descending order out of the 44 operatorswith 1st Class License in Romania as of April 2011(according to the Romanian Water association)…


Bucharest’s water quality considerably impro-ved. In 2009, the technical regulator reported

Customer satisfactionwent up drastically,from 46% in 2002 to 75% in 2008.

that ANB met the standards for all water qualityparameters included in the concession contract.In comparison, according to Bucharest’s PublicHealth Department, only 69 percent of sam-ples taken from other Romanian distributionnetworks complied with the required standardfor residual free chlorine in 2000.

Even if water and sewerage coverage wasalready high when the concession started, waterand sewerage coverage in Bucharest increasedfrom 91 to 93 percent between 2000 and 2009.This level is higher than the coverage in otherRomanian cities, which averages 86 percent forwater and 73 percent for sewerage.

Water resources have been preserved by areduction of two-thirds in the water losses inthe distribution networks as a result of bothdecreases in consumption and reduction of lea-kage.

See ref. 7, 24

Significant cost-savings have allowedthe population to benefit from the 3rd lowest watertariffs out of the 44 main Romanianoperators althoughmost other operators are subsidised to implement theirinvestmentprogrammes.

“[…] PPP concluded between Bucharest Municipality and Apa Nova Bucureşti S.A. […] by itsperformances and restrictions […] represents a guide for good practices which can be generalisedto other cities in Romania or in the European Union.” Effects of Public-Private Partnership in Water

Supply and Sewerage Public Services, Radu, Lefter, Şendroiu, Ursăcescu, and Cioc. The Bucharest

Academy of Economic Studies, 2009

“The concession of Bucharest’s water utility has brought its citizens higher-quality water andsewerage services, at a lower cost, than they could have had under continued municipal provision.”“Water in Bucharest - A Utility’s Efficiency Gains under a Concession” Earhardt, Rekas and Tonizzo, 2011


Organising authority: The City of Paris.

Water distribution operators: Two privatewater operators:

• Compagnie des Eaux de Paris, a subsidiary ofVeolia Water, for the Northern Bank of theSeine River),

• Société Parisienne des Eaux, a subsidiary ofLyonnaise des Eaux, for the Southern Bank ofthe Seine River.

Location: Central Paris (inside the first ringroad) corresponding to a resident populationof 2.2 million inhabitants.

PPP description (1985-2009)

Between 1985 and 2009, the water service inParis was split into two parts:

• The production of drinking water was underthe responsibility of a publicly-controlledcompany, named SAGEP, that sold the drinkingwater it produced in bulk to the two privateoperators in charge of the distribution of drin-king water to the city.

• The distribution of the water, bought in bulkfrom SAGEP, to end-users was undertaken bythe 2 private operators. This “supply” part of theservice represented only 15% of the waterand wastewater rates charged to end-users.

The two PPP contracts came to their naturalend at end of 2009. From January 2010 onwardsthe service was restructured into a single publicentity “Eau de Paris” to comply with the politi-cal will of the new mayor of Paris, who haddecided to take the whole management of thewater service back in-house.

Reviewing the period 1985-2009, the outcomeof the PPP contracts for water supply can bedeemed to be excellent.


The scope of the two contracts included, mana-gement of the distribution network, mainte-nance of the fittings, maintenance and cleaningof the water towers and reservoirs, monitoringwater quality, 24/7 supply of water to premisesthrough the 2,000 km long distribution net-work, billing and customer relationship mana-gement


In 1998 the European Directive 98/83/EC ondrinking water imposed more stringent stan-dards on the presence of lead in the watersupplied.

To ensure the potability and the safety of thewater for the water consumers in compliancewith this directive, it was found necessary toremove all lead communication pipes beforethe 2013 mandatory deadline. These repre-sented 70% of the total stock of connectingpipes in the network, about 66,000 in all.

Between 1999 and 2009 the operators wereable to replace all the remaining lead com-munication pipes still in the Parisian distribu-tion network. The cost of this important andunexpected investment has been fully repaidby water rates by the end of the PPP contracts.This permitted the City of Paris to make ratereductions or additional investment after 2010.

Managing infrastructure assetssustainably

In parallel with the very intensive and com-prehensive leak detection work, the operatorshave carried out a massive investment pro-gram on the network comprising both struc-tural rehabilitation and renewal of distributionpipes. Overall 1,100 kilometres of distributionpipes have been dealt with (either renewedor rehabilitated), representing more than halfthe overall length of the network. The cost ofthis important investment was funded by theoperators.

Between 1985 and 2009, the “functional” age ofthe network, despite a natural age increase ofthe 25 years of the contracts, has been reducedby 21 years.

City of Paris, FrancePopulation: 2,200,000 – Water Distribution

100% of the leadcommunicationpipes have beenreplaced to complywith tightenedsafety standards.

More than 50% of the distributionnetworks have been renewed. The average age of the distributionnetworks is now21 years youngerthan it was at the beginning of the PPP contracts25 years before.


n Securing water safety n Reducing leakage and water lossesn Managing infrastructure assets sustainably


At the start of the PPP contracts 22% of thewater purchased in bulk from the productionoperator was lost in the distribution network.

Improvement of the network performance wasachieved by zoning it into District MeteringAreas, equipping it with GSM sensors to help todetect leaks in sensitive sectors, permanentleak detection campaigns on a rolling basis,and routine operational monitoring.

This extensive approach undertaken by theoperators has enabled an increase in the effi-ciency of the network to a level as high as 96%,when it was lagging at a mere 78% in 1985.The leakage from the network has thereforedecreased from 22% to only 4%, which meansa reduction by a factor of 5 in the volume ofwater lost through leakage.

The leakage effort as well as the renewal invest-ment has allowed the city of Paris to save theequivalent of three years of annual drinkingwater consumption (617 million m3)


The operators also equiped all the customersand connections with an innovative system ofremote Automatic Meter Reading. This schemeprovides gains in the accuracy of the meteringas well as in the quality of service through online(internet) monitoring of the clients’ waterconsumption.

As an ultimate recognition of the good workundertaken by the operators, regular customersurveys have shown that 80% of customerswere satisfied or very satisfied by the qualityof the water service provided in Paris.

See ref. 9

Water losses in the distributionnetworks have beenreduced from 22% to4%, i.e. a factor of 5.

The Suburbs of Paris and the City of Paris not to be confused

The Greater Paris Region’s population exceeds10 million inhabitants. The population servedby the City of Paris is therefore less than ¼ ofthe Greater Paris population. In the suburbs,the water supply is organised by differentpublic authorities. They mostly use privateoperators through PPP contracts.

The largest responsible authority is theSyndicat des Eaux d’Île de France (SEDIF)that federates 142 municipalities. The SEDIFhas chosen private operation to manage thewater service for its population of more than4 million.

In 2010, the SEDIF has renewed its trust inprivate management and decided to enterinto a new public-private partnership contractfor 12 years. The new contract started on01/01/2011. The private operator is incenti-vised to further improve the performance ofthe service through a set of 190 performanceindicators. Meeting the target values directlyaffects the operator’s remuneration.

The stiff competition for the contract and theefficiency gains brought in by the previouscontract have led to a significant 18% price cutin the average price of the water service forthe 4 million people served by SEDIF.


Organising authority: water and wastewa-ter bodies of the Ministry of Water.

Water and sewerage operator: SEEAL withthe support of a private company through aPPP contract.

Location: Wilaya of Algiers, Algeria, a city andits surroundings.

PPP description

The Société des Eaux et de l’Assainissementd’Alger (SEAAL) is the water utility in chargeof the Algiers region. It is a company 100%publicly-owned by ADE (Algérienne des Eaux)and ONA (Office National de l’Assainissement)and co-managed with Suez-Environnementthat provides high level staff through a PPPcontract. The initial duration of the contractwas 5.5 years starting in March 2006. Thecontract was renewed and extended geogra-phically in September 2011 for a further 5 years.


This management contract was a pioneeringapproach and a test case in Algeria as part ofthe wider national policy undertaken by theAlgerian public authorities targeting the moder-nisation of water services in the main cities.

When the new management team at SEAAL tookover in March 2006 only 8% of the population hadwater on a 24/7 basis. The motivation of thepublic employees of the company was very lowand the customer service was particularly poor.

The main performance targets assigned to theoperator through the contract were to:

• improve the living conditions of the localpopulation through achieving continuous24/7 water supply within 3,5 years, ensuring100% potability of water supplied

• improving the performance and coverage ofsanitation services

• improve customer satisfaction

• organise and deliver the transfer of know-how to the 4.500 employees of the companyand its 1000 managers.

Ensuring continuity of water supply

In March 2006, only 8% of the population hadcontinuous water supply. The others, the majo-rity of the population had only water at theirtaps in an irregular manner, ranging from afew days in a week to a few hours per day.

This resulted from obsolete infrastructure andserious water losses in the water network obli-ging the operator to supply water sector bysector on a rationing basis.

Huge efforts have been engaged in all sectorsto bring the infrastructure up to standard andreduce leakage so as to supply water on amore continuous basis. SEEAL and its privatepartner have fixed 130,000 leaks on the waterdistribution network. 250 km of network mainsand 50,000 communication pipes have beenrenewed. 350,000 meters have been installed.

After 3.5 years, SEEAL has been able to supplydrinking water 24 hours a day and 7 days aweek in all sectors, thus achieving one of itsmain objectives.


In 2006, numerous pollution events occurredresulting from polluted water infiltrating fromthe ground to water pipes when the waterpressure was low.

These resulted in non-compliance with pota-bility requirements of 3% of samples of water.

Algiers, AlgeriaPopulation: 3,200,000

Continuous 24/7 water supply hasbeen expandedfrom 8% of the population to 100% in 3.5 years.

Non-compliance of water suppliedwith bacteriologicalrequirements (3% of samples in 2006)has disappeared.


n Improving availability of watern Securing water safetyn Satisfying users’ expectations

Thanks to the efforts made to reduce leakingpipes and to maintain internal pressure on acontinuous 24/7 basis, these events have disap-peared and the bacteriological compliance ofwater supplied has reached 100%.

Satisfying water-users’ expectations

Customers’ satisfaction was not measuredbefore the PPP. When the PPP contract startedthe monitoring of water-users satisfaction wasorganised through regular surveys made by anindependent external survey organisation. Ithas risen from 70% in 2007 to 89% in 2010.

These surveys include several questions towater-users selected on a random basis. A “cus-tomer’s satisfaction index” is built from the ans-wers. This has allowed measurement of thedramatic increase of customer satisfaction thathas resulted from the significant improvement

Customers’satisfaction was notmeasured before the PPP. It has risenfrom 70% in 2007 to 89% in 2010.

of the water services implemented in Algiers, asshown in the following graphic.


The asset management skills have been rein-forced as part of the wider know-how transferprogramme which has been a catalyst for suc-cess enabling the management of a massiveinvestment program ($ 500 millions) committedby the public authorities in support of theactions undertaken by the operator.

55,000 training days have been undertakenfrom 2006 to 2011, through trained trainers(70% of them are Algerian).

The sanitation system has been dramaticallyimproved. 53% of the wastewater of Algiers isnow treated before discharge to the environ-ment against 6% in 2006, with the objective toreach 70% in 2012. 3,300 kilometres of sewe-rage pipes have been cleaned. 64 out of the72 beaches of Algiers have been permited andreopened to the public for swimming duringthe summer 2011 against only 39 in 2006.

This success has been made possible by closelycoordinated and complementary action by thedifferent parties involved, based on a well defi-ned PPP contract that defines precisely andclearly the respective roles. The State has under-taken significant investment; the Water depart-ment of the Wilaya has completed major newinfrastructure works. Suez has effected a signi-ficant transfer of management, modernisationand project management know-how to SEAALand finally the local teams of SEAAL have enga-ged strongly in the project.

“In Algeria, we do not have any a priori nor dogma concerning Public-Private Partnerships.”“In Algiers, results are entirely correct.” Quotes from Minister Abdelmalek Sellal


Organising authority: PAM Jaya has theoverall responsibility for the water servicesfor the Jakarta Provincial Government (DKI).

Water operator: PALYJA has a 25 year contractfor the operation, maintenance, customer ser-vices and partial investment in the infrastruc-ture for West Jakarta.

Location: Jakarta, the capital city of Indonesia.The population of the Jakarta City territory is9.6 million and forms part of the 26.3 millionof Jabotabek (Greater Jakarta). It has one ofthe highest population densities in the world.

PPP description

The cooperation agreement in the form ofconcession contract between the public autho-rity PAM Jaya and PALYJA came into force in1998 for 25 years.

The contract covers the operation, manage-ment and extension of the water services tothe Western part of the city, which has a popu-lation of around 4.5 million. PALYJA is also res-ponsible for establishing an investment planand development feasibility studies for newinfrastructure every 5 years.

PAM Jaya supervises and monitors the mana-gement of the contract, while the Jakarta WaterService Regulatory Body (JWSRB) is responsiblefor regulating the services, ensuring the balancebetween different stakeholders’ interests, andproposing the tariff grid to the City’s Governor.


Prior to the contract starting, water service per-formance in Jakarta was very poor, with limitedfinancial resources, a low service coverage ratio(32%) and very high water losses (57%). About70% of customers did not receive a 24/7 watersupply. Large parts of the service area wereun-served.

The high levels of water losses and intermit-tent service provision exacerbated the diffi-culties that arise from limited and vulnerablesupplies of raw water.

Rehabilitated Penjonpongan water treatment plant

Extending coverage of water supply

In spite of serious constraints and many diffi-culties, the operator has made significantimprovements in the situation by the mid-termof the contract.

It has extended the network length by 1,300 kmand rehabilitated a further 950 km, bringingthe total length of the network in Wes Jakarta,within the PALYJA scope, to around 5,300 km.About 213,000 new customer connections havebeen installed which has doubled the numberof customers served.

This action has improved the service coverageratio from 32% in 1998 to 63.5% in 2011 and hasincreased the number of people connected by1.3 million.

West Jakarta, IndonesiaPopulation: 4,500,000

213,000 customerconnections havebeen installed which has doubledthe number ofcustomers served.

The service coverageratio from 32% in 1998 to 63.5% in 2011 and hasincreased thenumber of peopleconnected by 1.3 million.


n Extending access to drinking watern Reducing losses to improve availabilityn Ensuring more equitable supply

Reducing losses to improve regularity

The volume of water sold has risen by 57%since 1998. Since limited additional sources ofraw water were available this has been largelyachieved by reducing the non-revenue waterby 34%. In 2011 alone, using innovative inten-sive leak detection methods, the company hasbeen able to detect and repair 58,000 leakssignificantly reducing water losses.

The improvement in access to water supplies isclearly demonstrated by comparing the dia-grams opposite, which show that the situationof water coverage in 1998 dramatically increa-sed as shown by the second map.

Ensuring more equitable supply

Particular effort has been made to reach lowincome domestic customers. The number ofcustomers in the low income category hasbeen increased 8 times compared to a dou-bling for middle and upper-class clients. This isdemonstrated in the diagram below.

Pro-poor activities

In addition to the emphasis on connecting thelowest income category of users where the tariffis highly subsidised (one twelfth of the com-mercial tariff), the operator has also engaged inadditional pro-poor activities. These focus onthe low income population and people living indeprived areas without access to clean water.

Using OBA, PALYJAhas provided a further 30,000people connectionsto the network.

“The community gets reliable access to an affordable water supply, while Palyja supplies a largenumber of houses with water at much lower overhead and administrative costs” UNEP 2011,

Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication

16,000 peoplebeyond the reach of existing networkshave been suppliedby installing water kiosks.

See ref. 11, 28

They include:

• the construction of 52 water kiosks that provideclean water to around 16,000 inhabitants

• Master meters providing additional cleanwater to around 580 inhabitants

• the use of output-based aid in a scheme withthe global partnership on output-based aid(GPOBA) to provide over 5,000 additionalcustomer connections that serve approxi-mately 30,000 inhabitants.


Organising authorities: The State of Senegaland the Société Nationale de l’Eau du Sénégal(SONES), its assets-owning company.

Water operator: Sénégalaise des Eaux (SDE).

Location: Urban centres of Senegal, i.e. themain 56 cities across the whole country as wellas 400 villages close to the main distributionnetwork, covering an overall population of5.5 million.

PPP description

After an international competitive bidding pro-cess a tripartite Public-Private-Partnershipcontract was signed in 1996 for ten years. Itwas renegotiated in 2006 and extended untilthe end of 2012.

The scope of the private operator is to produceand supply water on a daily basis using theinfrastructure that is owned by SONES. It is an“affermage” since major investments are fundedby SONES.

The main shareholder of SDE is Finagestionwith 57% of the shares. The population cur-rently supplied by the contract is close to5.5 million inhabitants.


The contract is a performance-based contract.The outputs targeted are monitored by a verycomprehensive “performance contract” signedwith SONES. The numerous performance indi-cators cover all operational processes inclu-ding, the quality of water supplied, the qualityof services (speed of reaction to customer com-plaints and requests and to service interrup-tions), technical aspects as well as financialperformance.

SDE with its partner SONES has managed todeliver significant improvements to the watersupply service.

Improving accessibility to water

The main improvement is the coverage of thepopulation. At the start of the contract, in 1996,the connection rate was less than 80 %. Thiscomprised 58% of the population suppliedthrough private household connections andthe remaining 22% supplied through standpipes. The total number of customers was241,671. The overall connection rate is now98.5%. 88.3% of the population is suppliedthrough private household connections and10.2% through stand pipes. The total numberof customers that benefit from this improvedaccess is now 536,540 (2011).

This 98.5% connection rate is the highest inSub-Saharan Africa for urban dwellers accor-ding to the World Bank. The reduced use ofstandpipes is a significant improvement in theaccessibility of water.

Urban SenegalPopulation: 5,500,000

While only 80% of urban dwellershad access to publicwater networksthrough private tapsor public standpipesin 1996, the overallconnection rate is now 98.5%.

The proportion of population usingpublic standpipeshas been reducedfrom 22% to 10%only thanks to 220,000 newhouseholdconnections.


n Improving accessibility of watern Contributing to affordability of water servicesn Reducing leakage and water losses

Contributing to affordability of water services

The majority of newly-connected householdshave benefited from subsidised “social connec-tions” funded by SONES and installed by SDE.Over 15 years 155,000 such social connectionshave been installed free of charge for the bene-fiting customers reaching a population of about1.7 million. At the same time more than 600stand pipes have also been installed. The popu-lation targeted has been mainly in the poorestparts of the cities, in particular the slums ofDakar. This newly connected population repre-sents 30% of the population that is suppliedtoday.

This social connection program has been fun-ded through the support of many internationaldonors and by revenues raised from custo-mers.

The domestic tariff scheme has been designedas Increasing Blocks Tariff comprising a first“social” block for a monthly consumption ofless than 10 m3. This targets the most vulne-rable customers with a significantly discountedrate as illustrated by the following table :

This household tariff has been kept unchan-ged for almost 10 years since 2003.


SDE has also demonstrated an excellent recordin leakage reduction limiting the increase inproduction required to supply the newlyconnected population.

Over the first ten years of the contract (from1996 to 2005), the production of water hasincreased by 16% while at the same time thewater supplied to the connected population

1.7 million people,mostly poor, havegained access totapwater throughfully subsidisedconnections.

has increased by 22%. This has been possiblethanks to a significant reduction in leakage.

This improvement in network efficiency (from68.2% at the start of the contract to an ave-rage 80% now) has allowed an annual saving of17 million m3 of water. This is equivalent tothe daily consumption of a population of900,000 people.

This outcome has been achieved in spite of thefact that the number of leaks on communica-tion pipes and on the network has remainedconstant since 1996 (respectively 30,000 and6,000 per year on average ). This is mainly dueto the investment needed to renew the net-work, which is the responsibility of SONES,being behind schedule. SDE has become veryefficient at monitoring and fixing new leaksvery quickly to avoid water being lost.

Women at a standpipe in a slum in Dakar


Quality of water supplied: The microbiologi-cal compliance of the water supplied reachesnow a rate of 99.4% against a contractualtarget of 96%.

The customer satisfaction rate regarding thequality of the water supplied now stands at99% against 45% in 2005.

The presence of a professionnal and efficientprivate water operator as well as the gover-nance framework have been instrumental inreinforcing the trust of international donorsand catalytic to attract their financial support.

See ref. 1, 2, 28

DomesticIncreasingBlocks Tariff

Monthly consumption

Price per m3

(FCFA)

Social block From 0 to 10 m3 191

Normal block From 10 to 20 m3 630

Deterrent block Above 20 m3 789The domestic tariffshave been keptunchanged in thepast 9 years.

Country cases18 - Uganda, Small towns

19 - Urban Chile20 - England & Wales


Water supply in Uganda: public water supplyis organised in two ways. In large cities it isoperated by a national utility, the NationalWater and Sewerage Corporation (NWSC). Inthe small towns the water systems are initiallybuilt by the central government (Ministryof Water and Environment and Local WaterAuthorities). These systems are then transferredto municipalities who contract the operationand maintenance to private operators.

Organising authorities for small towns: arethe Municipalities through Water Authorities.

Water operators: 18 local private companies,members of the Association of Private WaterOperators (APWO). They operate in small townswhere the total population is 880,000.

Location: small towns throughout Ugandathat have been “gazetted” for Public-PrivatePartnership. About 92 such towns exist, ofwhich 79 are currently operated by privateoperators.

In small towns and rural areas of Uganda, where90% of the population lives, water shortagesare part of daily life. In these areas, 60% of thepopulation lacks access to safe water, andwaterborne diseases and infant mortality arewidespread (see ref. 25).

PPP description

The private operators engage in short-term(3-5 year) management contracts under whichthey operate and maintain the infrastructureprovided by the Water Authorities and conductthe billing and customer relations of the ser-vices. They are also responsible for providingnew customer connections and tertiary distri-bution networks. The operators have perfor-mance obligations and an incentive basedmanagement fee, which is calculated as a per-centage of the water sales/revenue. In morerecent contracts the responsibility for provi-ding and funding has been increased and somecontracts now run for 7-10 years.


Faced with high levels of population growth inthe small towns and high levels of poverty in the

country, the Ugandan Government embarkedon the Small Towns Water project in 2000.

The Ministry of Water and Environment investsin providing basic infrastructure for water abs-traction, treatment, storage and distributionfor the small town municipalities throughoutthe country.

For the “gazetted” towns, private operators areinvited to submit competitive tenders to ope-rate the system, to connect new customersand to conduct the billing and cash collectionfor the services.

Over the last decade regulation has been deve-loped and the skills of the operators increa-sed. This demonstrates how capacity can bedeveloped as experience grows and the bene-fits of external capacity building efforts of deve-lopment agencies start to pay off. The resultsstand out in the graphical presentations below,which point to a clear step change in perfor-mance from around 2007.

Extension of urban water supply

One of the best measures of the contributionthat the private operators have made to impro-ving access to the population is the progressionin the numbers of active customer connec-tions managed. This has risen from just 4,700 in2002 to 34,631 in 2011 (blue bars in graphbelow).

Growth in number of connections served and average active connections per town

In the same period, the coverage in the townshas grown from an average of 215 to 394 activeconnections per town (red curve in graphabove). This represents a significant increasein the “density” of the services provided.

Uganda, Small Towns with private operatorsPopulation: 880,000

The number of active customerconnections has risen from 4,700in 2002 to 34,631 in 2011, an increaseof 640%.


n Extending access to drinking watern Securing revenue streamsn Optimising economics of services

Improved billing and cash collection

One of the main objectives of the Governmentof Uganda was to ensure that the economicsustainability of the water services was impro-ved. A key to this is to ensure that users arebilled for the services they receive and thatthese bills are collected. The graph below showsthe significant improvement in billing and reco-very that has been achieved since 2007.

The Challenge of Financing

The contracts in the small towns have facedfinancing challenges for a number of reasons.These include:

• difficulty for small operators to obtain financefrom overcautious commercial banks,

• unreliable power supplies causing loss ofproduction or very high alternative fuel costs,

• inability of poorer customers to pay the con-nection charges,

• relatively high level of outstanding bills,

• slow growth of services resulting from thelow levels of initial government investment,making the towns remain un-viable.

One of the approaches to overcome this finan-cing challenge is Output Based Aid (OBA).

Output Based Aid is a results-based fundingmechanism designed to improve access tobasic services to the poor. The operator pre-finances the services delivery and is only reim-

Amounts billed and cash collectedby private operatorshave been increased8 times in half a decade.

With output-basedaid and pre-financingby private operatorsthe centralgovernment subsidyper person gainingaccess is significantlylower than fortraditional input-based projects.

bursed once the quality of the agreed on out-puts has been verified by a third party.

Starting in 2005, 10 pilot schemes were initia-ted with the help and guidance of the GlobalPartnership on OBAs (GPOBA), which offereda $3.2 million investment grant. These pilotsinvolved both contracts to extend existinginfrastructure (Brownfield sites) of 5 years dura-tion and 7-10 year contracts to design-build-operate new infrastructure (Greenfield sites).The contracts were signed in 2008 and arenow well on track and are expected to benefitaround 45,000 people.

Contracts are awarded on the basis of thelowest subsidy required. This tendering pro-cess has resulted in a 20% efficiency gain. Thecentral government subsidy per person gai-ning access is significantly lower than for tra-ditional input-based projects.

Comparison of subsidy requirementsper new connection

The leveraging of private sector financinghas been between 10-30% of the capital costs,thus reducing the subsidy required from thecentral government, which under the tradi-tional approach would be 100%.

The OBA projects have had an added benefit inthat they have helped the private operators todevelop competence in accessing finance andat the same time increased the willingness oflocal banks to lend to water projects. In thepast banks were unwilling to lend and askedfor 100% collateral.

All these factors are helping the Ugandangovernment towards its objective of 65%coverage of “improved water supply” by 2015and 100% by 2035.

See ref. 15, 25, 32

Collection efficiency has continued to improve over the last five years, from 85% in FY2009/10 to 92% in 2010/11. This improvement is attributed to the increased vigilance of private operatorsmanaging the small towns. Government of Uganda, Ministry of Water and Environment, Water

and Environment Sector Performance Report 2011

Project type Brownfield Greenfield

OBA $ 0 - 36 $ 83 - 108

Input based $ 30 - 138 $ 37 - 250


Organising authority: Government of Chile.

Regulator: Superintendencia de ServiciosSanitarios (SISS).

Water operators: 58 Chilean companies pro-viding water and sanitation services to theurban population (87% of total population).

Two types of private operators

In the 90’s, the Chilean government sold themajority of the shares of 4 main water andsewerage companies to the private sector, kee-ping a minority stake in the capital. In 2011,the Government sold most of its shares in thesecompanies keeping only 5% in order to be ableto appoint one director in every company, thushaving the right to veto any possible transfer ofwater rights. A few other companies were pri-vatised in the following years.

In 1998, the central government put out ontender concession contracts for nearly all theother water companies for a period of 30 years.

Today there are 58 companies supplying waterand operating sewerage networks in the urbanareas. Most of them are privately-controlled(except a mid-size municipal company inMaipú).

Some operate publicly-owned infrastructureunder PPP contracts, others own the waterinfrastructure and operate under a license. Allare regulated by SISS, the national regulator.

Context and objectives

In 1989, the percentage of households connec-ted to sewers was less than 10%, which meanta population inferior to one million. The coun-try had no experience of wastewater treat-ment. A significant amount of wastewater wasdumped into rivers, lakes and the ocean.Numerous beaches and the coastline sufferedfrom pollution. The same occurred with waterused for agriculture in many regions. There waseven a cholera outbreak due to crop irrigationwith wastewater at the beginning of the 90s.

Ecosystems received thousands tons of garbage.Not only did this pollution affect water quality,but also the sea bottom. This pollution alteredfauna and flora, affecting biodiversity and some-times causing migration or extinction of species.

2 A mostly via stabilisation ponds

In 1998, the central government decided toimprove wastewater management and adop-ted a huge investment programme based oninfrastructure to be built in all cities with moresophisticated technologies than the very basicones used previously. Secondary treatmentwas decided for inland cities (80% of waste-water) and primary treatment + sea outfallswere planned for coastal cities (20% of waste-water). The target was to “treat” all urban was-tewater flows in these ways.

Access to private capital and private manage-ment through partnerships with the govern-ment provided the necessary funding andallowed the new infrastructure to be built. Thisrepresented a major change in the way ofmanaging water companies with a lot of inno-vations. A social policy was designed to pro-tect the poorest against the increases of water& wastewater bills needed as a result of themassive investment programme. These initia-tives have had positive impacts in the qualityof life of people.

Removing pollution from wastewater

The percentage of the population that has itswastewater treated before discharge or reusereached 87% by the end 2010 and was closeto 90% at the end of 2011. It is estimated thatthe sector will reach its goal of treating 100%of urban wastewater in 2012.

This growth means that the sewage of morethan 10 million Chileans has been incorporatedinto the wastewater treatment systems.

Urban Chile Population: 15,000,000

The proportion of urban populationthat has itswastewater treatedbefore discharge has been increasedfrom less than 17%in 1998 to 87% in 2010 and shouldreach 100% by end 2012.

Urban Chile 1998

Drinking water coverage 99.2% of population

Wastewater collection 91.6% of population

Wastewater “treatment” 2 16.7% of population


n Removing pollution from wastewatern Optimising economics of water servicesn Responding to natural disasters

The increase of wastewater treatment cove-rage represents around 1,000 million m3 peryear of sewage that is being treated through266 treatment systems in the whole country.

3 Mostly secondary wastewater treatment plants

A very important investmentprogramme

The annual amount of investment had to beincreased significantly in comparison with theprevious decades to allow for this importantenhancement of wastewater treatment, theimprovement of water and sewerage coverageas well as the operational modernization.

Investments have risen to an average of US$340 million per year. This amount representsalmost double that of the previous decade andmeans that during the period 2000-2010 thetotal invested was more than US$ 3,900 mil-lion, fully financed by the operators withoutany subsidy.

40% of this amount has been used for waste-water treatment plants and wastewater out-falls while 50% has been used for upgradingand maintaining drinking water and sewerageinfrastructure.

The huge 2010earthquakedisrupted a lot of networks. Theywere repaired very fast at no costto water-users.

The largest new wastewater treatment plant

Restoring service after an earthquake

Private water operators proved their profes-sionalism during the critical task of restoringwater supply after the devastating earthquakeon February 27, 2010. In spite of the magni-tude of the earthquake (level 8.8) only 72 hoursafter the disaster, 87.5% of the water supplywas restored and operating in the areas affec-ted, between Valparaíso and La Araucanía. Fivedays after the earthquake, 90% of the waterservices had been restored and regions suchas Valparaíso, Metropolitana, de O’Higgins andLa Araucanía had 100% of its services restored.The restoration of infrastructure of great impor-tance such as aqueducts, sewage ponds andwastewater treatment plants was not an easytask. However, the engagement of the industryand the cooperation with authorities made itpossible to restore the high quality standardsthat existed before the tragedy.

Damages suffered by the industry are estima-ted up to US$ 120 millions. Yet, thanks to theinsurance contracts of the private operators incharge of the affected areas, these losses havenot represented any cost for the governmentand have not had or will not have any impacton the tariff that population in the affectedareas pays.

See ref. 12, 16, 27

In the last decadethe annual amountof investments inwater and sanitationinfrastructurehas been nearly

5 times higher than before the 1989 privatisation.

Urban Chile 2010

Drinking water coverage 99.8% of population

Wastewater collection 95.9% of population

Wastewater “treatment” 3 86.9 % of population

“The restructuring of the water service sector has been quite successful and can be regarded as amodel case.” OECD/UN-ECLAC, Environmental performance Review, Chile, 2005


Organising authority: UK Government.

Regulators: Water Services Regulation Authority,Drinking Water Inspectorate, EnvironmentAgency.

Water operators: 24 private companies ope-rating according to licenses awarded by thecentral government.

Location: England & Wales, urban and ruralpopulation.

Privatisation

Up to 1989 water and sewerage services weredelivered in England and Wales by 10 largepublic bodies, the Regional Water and Sewer -age Authorities (RWAs) and 28 private com-panies supplying drinking water in part of theterritory.

End 1989 the 10 RWAs were privatised andreplaced by 10 companies listed on the LondonStock Exchange. These private companies ownand operate the water infrastructure accordingto licenses awarded by the government. Theyare regulated by several regulators. Theirtariffs are regulated by an economic regula-tor, the Water Services Regulation Authority(OFWAT).

One major aim of this privatisation was toimplement a huge programme of investmentpartly financed through significant savings ofoperational costs.

The success story of the waterindustry revitalisation

The regulated water industry post-privatisa-tion has been successful in service and opera-tional terms. It has been possible to financeand complete the investments in capital worksanticipated. Efficiency in operation has beenincreased. The levels of the services deliveredto water-users and to ecosystems have beensignificantly improved. Substantial cost-savingshave limited the growth of water bills thatwould have resulted from the numerous invest-

ments required to enable the U.K. to becomecompliant with European Union regulations.

Some factual achievements are summarizedbelow. They are average results at the countrylevel which may not reflect the diversity oflocal situations.

Improving water safety

In 1990 only 99% of water quality tests metthe required standards. Since then water qua-lity has increased regularly.

In 2008, overall compliance with the drinkingwater standards in England and Wales was veryhigh at 99.96%.

Realising the huge investments needed

Between 1990 (the date of the industry priva-tisation) and 2010, the industry has investedaround £80 billion in improving drinking waterquality, the water environment and customerservice.

That is almost £3,500 for every household inEngland and Wales. Investment is now runningat some £3 to £4 billion each year, well overthe £1.6 – £2bn before privatisation, delive-ring real improvements at no additional cost totaxpayers.

England & Wales, UKPopulation: 55,000,000

Overall compliancewith the drinkingwater standards in England andWales has increasedup to 99.96%.

Annual investmentsfor water andwastewaterinfrastructure havemore than doubledin England andWales since the 1989 privatisation.


Protecting the environment

In 2007, 72% of English rivers were rated eithergood or excellent compared with 55% in 1990;87% in Wales compared with 79% in 1990.Successes include the River Mersey, wherebreeding salmon have returned after a morethan 80 year absence in what was once knownas Western Europe’s most polluted river.

The number of beaches in England and Walesrecommended for excellent water quality bythe Marine Conservation Society’s (MCS) GoodBeach Guide has increased by almost 90%between 1998 and 2008. 380 beaches wererecommended by the MCS in 2008.

1 1990 2 1988 3 1994-1995

Reducing water losses

Between 2005 and 2010 water and seweragecompanies in England and Wales have laid,renewed or relinied approximately 20,000 kmof water mains – more than enough pipes tostretch from London to Auckland.

Since its peak in 1994-95 leakage has beenreduced by about one-third, enough to supplythe daily needs of more than ten million people.

After the 1989privatisation thepercentage of Englishrivers where waterhas either good or excellent qualityhas increased from55% to 72%.

Making users’ lives easier

Customer service has also been improved withservice levels now at their highest level since1990.

Improvements lie both in the way water ser-vices are delivered physically and in the contactwith customers.

For example, fewer than 1 in 1,000 propertiesis now likely to experience low water pressurecompared with 18 in 1,000 in 1991.

The proportion of properties at highest risk ofsewer flooding has been reduced by more than75% in the last 10 years.

Optimising water economics

This huge investment programme has beeninitially financed by the private companies.Through water bills, the water-users will onlypay for it progressively over several decades.

Water bills have gone up, but nearly 70% ofthe additional cost resulting from new invest-ments has been covered by the water compa-nies’ efficiency savings. This means that if thegovernment had funded the same programmeitself and had implemented it with its owninternal means, water bills would be higherthan they are today.

See ref. 17, 31

“Really the success is down to the companies – and their technical staff rising to the challengeand of course all those enterprises including consultants that support them.” William Emery,

OFWAT Director, 2003

n Improving water safetyn Realising huge investmentsn Protecting the environment

n Making users’ lives easiern Reducing water lossesn Optimising economics

Huge efficiencysavings haveavoided nearly 70%of the cost of newinvestments frombeing reflected in water bills paid by water-users.

Leakage has fallenby about one-third,enough to supplythe daily needs of more than tenmillion people.

Protecting the environment 1990-1995 2006

Good river water chemical quality 47%1 70%

Good river water biological quality 62%1 72%

Coastal bathing water compliance 66%2 99.4%

Sewage treatment works compliance 90% 99%

Unsatisfactory combinedsewer overflows 31%3 8.8%

Developingcountries

All locations with private operators


Private water operators mandated and regu-lated by public authorities through licenses orpublic-private partnership contracts (PPP) arefar less numerous than public utilities. Howeverthey are more visible (the “lamppost syndrome”,see paragraph 1.3.4.) than other options becauseof the concentration of commentary on them.The many research reports on individual PPPcases show a broad diversity of results andillustrate the challenges of ensuring that public-private partnerships are successful. However,they are not sufficient to give a fair and truevision of the impact of private managementof public water services (PSP). Some com-mentators have tried to present a global visionof water PSP, however with methodologicallimitations since they systematically omit thegood results.

To our knowledge, the only serious globalassessment of the impact of private manage-ment of public water services that has a sta-tistical value has been made by the World Bank.Its 2009 research (ref. 26 & 28) provides evi-dence on the average performance of PPPcontracts in developing countries, a part of theworld where these kinds of contract have deve-loped regularly since the eighties to reach 3%to 4% of the population (160 million peopleserved in 2007 according to these reports).

The World Bank’s global assessment

In 2009, the World Bank released two comple-mentary reports entitled Does Private SectorParticipation Improve Performance in Electricityand Water Distribution? and Public-PrivatePartnerships for Urban Water Utilities, A Reviewof Experiences in Developing Countries. The firstprovides statistical evidence from data on athousand water utilities. The second under-takes a thorough review of some performanceindicators in all the PPP contracts that theWorld Bank was able to identify in developingcountries.

These reports show that overall local and inter-national private companies deliver much morebenefit to the populations and governments ofdeveloping countries than is generally reco-gnised.

Extending access to drinking water

Improvement in the access to safe drinkingwater is particularly impressive. The extensiveWorld Bank study makes a detailed examinationof the 36 largest PPP contracts in Africa, LatinAmerica and Asia.

Initially these contracts supplied drinking waterto 48 million people. After less than 10 yearsthe population served had been increased to72 million people. This represents an increaseof 50% in the number of people benefitingfrom a good public water service.

The statistical study found an average 12%increase in domestic connections to water net-works between the pre-PSP period and thepost-PSP period.

Ensuring more equitable water supply

World Bank report (ref. 28) page 134: “There iscircumstantial evidence that poor householdssignificantly benefited from the increased accessand reduced water rationing that was achievedby a significant number of PPP projects. This wasnotably the case in cities with high poverty rates,and where access was improved significantly byexpanding the water network to poor neighbo-rhoods that were previously unserved, as in Côted’Ivoire; Senegal; Cartagena, Barranquilla, andMonteria (Colombia); Guayaquil (Ecuador);Manila (the Philippines); and even La Paz–El Altoand Buenos Aires (Argentina).”

Improving regularity of water supply

The continuity of service has been significantlyimproved. The World Bank statistical survey(ref. 26) found an average increase of 41% ofthe number of hours a day that water is avai-lable at the taps between the pre-PSP periodand the post-PSP period.

Developing countriesPopulation: 5.5 billion – Evidence on 160 million served by regulated private operators

In a decade increaseof 50% of populationconnected to publicwater networks in the territories of the 36 largest PPP contracts.

Private managementhas brought a 41%increase of thenumber of hours a day that water is running at the taps.


n Extending access to drinking watern Ensuring more equitable supplyn Improving regularity of water supply

n Reducing water lossesn Securing revenuesn Optimising cost

Reducing water losses

In many cases private operators are called tomake water savings as well as cost-savings. TheWorld Bank survey presents detailed results.It identified significant progress in reducingNon Revenue Water in the vast majority of PPPcontracts (more than 80% of cases studied).

Securing the revenues necessary to finance the public water services

Private operators are often requested to makethe revenue stream from users more reliable.The World Bank research found evidence ofmany cases where the rate of billing collectionhas been increased. These are the vast majorityof cases in comparison with the few caseswhere no change was observed “The most spec-tacular improvement was achieved in Yerevan,with the collection rate going up from less than20 percent to 80 percent in five years. This wasachieved through close collaboration between

Significant reductionof water losses.

the operator and the government, and in paral-lel with sizable improvements in service quality.”

Optimising cost

Anti-private activists habitually presentincreases of water rates as supposed proofsof alleged excessive costs brought by privateoperators. However, substantial rates increasesalways result from investment in new infra-structure or from changes in public policy. Ifa private operator is mandated by the publicauthority it is to limit the necessary rateincreases. A Public authority would not enterinto a Public-Private Partnership contract forthe implementation of its water policy if it wasa more costly option than public management.The global survey made by the World Bankprovides evidence of this economic behaviour.Despite broad statistical research it was notable to identify any statistically relevant diffe-rence between the costs of private and publicoperators.

Private managementdoes not cause pricerises that are higherthan for publicmanagement underthe equivalentconditions.

“The analysis of the four dimensions of performance (access, quality of service, operationalefficiency, and tariff levels) suggests that the overall performance of water PPP projects has beengenerally quite satisfactory.” Excerpt from World Bank report on PPPs in developing countries (Ref. 28)

Source: figure 3.6 of World Bank report, ref. 28


1. AFD, A. Blanc and C. Ghesquières, ‘Working Paper n°24 – Water sector in Senegal - a balancedpartnership between public and private actors to serve the poorest?’, June 2006

2. AFD, collective work, under the direction of A. Blanc et S. Botton ‘Recherches n°2 | Servicesd’eau et secteur privé dans les pays en développement – Perceptions croisées et dynamique desréflexions’, March 2011

3. AquaFed, Access to Drinking Water is deteriorating in the urban half of the world where rapidurbanisation is outpacing public services, press release www.aquafed.org, 7 September 2010

4. AquaFed, Private Water Operators celebrate the recognition of the Human Right to water andsanitation by the United Nations General Assembly. This resolution must be used to turn the Rightinto a Reality for the billions of people who do not enjoy proper water services, press release,www.aquafed.org, 29 July 2010

5. AquaFed, Private Water Operators contribute to making the Right to Water & Sanitation real,Submission by AquaFed to the UN Independent Expert on the issue of human rightsobligations related to safe drinking water and sanitation, www.aquafed.org, 26 March 2010

6. AquaFed, ’Professional private companies have provided over 25 million people, including manypoor, access to a reliable water connection’, press release, www.aquafed.org, 30 September 2009

7. Bucharest Academy of Economic Studies, I. Radu, V. Lefter, C. Şendroiu, M. Ursăcescu andM. Cioc, ‘Effects of Public-Private Partnership in Water Supply and Sewerage Public Services’, 2009

8. Business Standard, ‘Clean water to the doorsteps of parched throats‘ Article on the first 24x7water supply in India (in demonstration zones in Karnataka), July 24, 2009

9. FP2E, ‘Aquae de Novembre 2009 : le bilan des entreprises de l'eau après 25 ans passés au servicedes parisiens’, Aquae N°46, November 2009

10. Galiani S., P. Gertler, E. Schargrodsky, ‘Water for Life: The Impact of the Privatization of WaterServices on Child Mortality’, Found of Political Economy 113:83-120

11. GPOBA, I. Menzies and I. M. Setiono, ‘Output-Based Aid in Indonesia: Improved Access toWater Services for Poor Households in Western Jakarta’, OBA Approaches Note Number 38,November 2010

12. Humphreys – Clasificadora de Riesgo, C. Ebensperger H., ‘Empresas Sanitarias en Chile: unsector con potencial de crecimiento y atractivo para el inversor’, January 2012

13. Inter-American Development Bank. La experiencia de las empresas mixtas-Cartagena,Colombia, 2010

14. International Finance Corporation, L.A. Andrés, D. Sislen and P. Marin, ‘Water Concessions inColombia’, handshake Issue N°4 ‘CITIES ppps’, January 2012

15. OECD, J. Winpenny, Opportunities and challenges arising from the increasing role of new privatewater operators in developing and emerging economies, Background Issues Paper for OECDGlobal Forum on Sustainable Development “Public-Private Partnerships in Water Supply andSanitation – Recent Trends and New Opportunities”, Nov 21, 2006

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16. OECD / UN Economic Commission for Latin America and the Caribbean – UN ECLAC, ‘OECDEnvironmental Performance Reviews: Chile 2005’, May 2005

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Photo Credit Cover: Fédération professionnelle des entreprises de l'eau, Suez Environnement, AquaFed ; p16-17 Shenyang Sembcorp Water; p19: Foz do Brasil;p21: Aguas do Imperador; p26: SPML; p28-29: Saur Neptun Gdańsk; p30-31: Amendis; p33: Acuacar; p34: Aqua Pennsylvania; p36: Apa Nova; p38:Fédération professionnelle des entreprises de l'eau; p41: SEAAL; p42: Palyja; p44: SDE; p45: AquaFed; p47: Aguas Andinas, Veolia Water UK,AquaFed; p52: Aguas Andinas; p55: C.Guillais, AquaFed.

Most water-users need drinking water and sanitation services to be organised for them by public authorities.These services must be of good quality, reliable and cost-optimised to suit both consumers’ and authorities’needs. Hiring a private company to deliver them is among the options that these authorities can choose.This brochure illustrates the many achievements that can be obtained by using the capacity of privateprofessionals in the delivery of public water and sanitation services.

Public services that perform well are those that are able to deliver good results simultaneously for manydimensions. For example, improving access to drinking water and improving the level of service to thepopulation are equally as important as managing the utility in an efficient way.

This brochure collates a wide sample of field cases of private management of water or sanitation servicesthat illustrate the outstanding results achieved by public authorities who have engaged private operators.The cases come from all around the world and illustrate the wide diversity of sizes of private companies.

www.aquafed.org

private water operators delivering performance for water-users and

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