Focusing on performance Global water summit 2011
This book captures the messages for the international water community from the Global Water Summit held in Berlin in April 2011. We publish it so that the thinking from the cutting edge of the water business can be preserved and reach a wider audience than those people lucky enough to attend the actual event. We have one objective in staging the annual summit: to help the world of water work better.
DISTINCTION HIGHLY COMMENDED HIGHLY Global Water Awards Global Water Awards COMMENDED 2011 2011 Global Water Awards 2009
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Presented by Global Water Intelligence and the International Desalination Association Conference book sponsored by Myron L. Company Global Water Summit 2011 Focusing on performance Focusing on performance
The global water challenge as seen from space
Global warming is bringing both devastating Keynote address by Prof James Famiglietti floods and searing droughts in its wake. It puts the performance of water utilities on the line as never before. Foreword
Using satellite data from NASA, Professor Famiglietti has built up the most detailed picture to date of the evolving pattern of global water availability. This book captures the messages for the text of his speech on the Global Water Summit “Politics of performance” we address the policy and management. It is also about international water community from the website:. The URL is: question of whether politicians are a help or technology. We look at what the future holds Jay Famiglietti, pp 12-21 Global Water Summit held in Berlin in April www.watermeetsmoney.com/costrecovery. a hindrance in improving the performance of for renewable water resources in the section 2011. We publish it so that the thinking from P.lease pass the link on. utilities. entitled “Desalination and water reuse in Water and the challenge the cutting edge of the water business can be 2030”, while the current situation is reviewed of Asia’s economic rise Of course there is more to read in this book You can read about how seven utilities from If economic growth in Asia continues at current preserved and reach a wider audience than in “Desalination and water reuse in 2011”. levels, it will put impossible strains on the world’s resources – especially its water resources. than Dr Muhairwe’s speech. While failure of around the world dramatically improved
Chandran Nair explains those people lucky enough to attend the actual In the “Water technology idol” section five how constraints on resource financing is the most significant immediate the way they operate in the “Performance consumption will event. new water technologies go head to head to shape the new economy, and the central role of the cause of the global water crisis, in the longer challenge” section on pages 44-69. In the water industry in Asia’s see which one the judges think offers the best future growth. We have one objective in staging the annual term global warming could present a larger section entitled “Africa’s moment in water” Keynote address by Chandran Nair prospect for the future. [ ] summit: to help the world of water work challenge. On pages 12-21 you can read we hear the experiences of four utilities from better, and if there is one thing in this book Professor Jay Famiglietti’s explanation of Africa, and how they have been able to improve Smart water networks have become one of Chandran Nair, pp 22-29 that you should read to help that happen how this process is affecting the world’s standards and extend coverage despite the hottest new concepts in the water industry. it is Dr William Muhairwe’s argument in freshwater systems. It is the most clear and the enormous challenges they face. “New On pages 74-77 Djeevan Schiferli looks at how Water & the public sector favour of cost recovery tariffs outlined on credible explanation of the press that I have initiatives in private sector participation” these might change the world. financial crisis pages 298-299. Dr Muhairwe is the Managing seen to date. If you are involved in water, you looks at how the private sector is evolving in The biggest challenge facing the global water sector today is access to finance. In many countries the old model, based Frank Rogalla, who heads aqualia’s research and on central government finance, has been broken by the global financial crisis. Director of the Ugandan National Water and have to read it. Asia, the Middle East and Africa. Water utilities must development division raises some interesting do more with less, and find new ways of Sewerage Corporation. I have long believed raising money. Michel Camdessus offers his Chandran Nair, founder of the Global Institute But performance is not just an issue for the questions about the future of wastewater insight into what the public sector financial that promoting the value of water is central to crisis means for the water industry. Keynote address by Michel Camdessus for Tomorrow, tackles another important municipal water sector. Increasingly industrial treatment on pages 288-289. For example did [ ] solving the global water crisis. It is only if people global megatrend – the rise of Asia. What water users are beginning to focus on their you know that it requires as much energy to are prepared to pay for water, that we will be Christopher Gasson does it mean for the world if China and India water use. Businesses are concerned about create nitrates for fertiliser, as it takes to remove Michel Camdessus, pp 30-35 able to invest in the infrastructure we need Publisher, Global Water Intelligence start consuming resources like the West? Read the potential impact of water risk on their nitrates from wastewater? Do we have to to meet the challenges of the future, and it is Delivering performance amidst austerity how water represents both a threat and an operations, and they want to ensure that their change the paradigm if we are going to address
only if price is allowed to moderate demand After the Berlin Wall came down in 1989, the city state of Berlin was opportunity in this context. water use does not undermine the corporate the problem of agricultural run-off? Tony Wray, revolution pitched into a financial crisis The smart network from which it is still recovering. that we can minimise wastage. Dr Muhairwe Over the same period of time it has managed to build a world class social responsibility strategy. The trouble is that the CEO of Severn Trent Plc is similarly wary Utilities around the world are transforming their water utility. makes these points, and many more far more Michel Camdessus, a former Managing performance thanks to smart network technology. What can we By overlaying an information grid over the learn from the no one has yet developed a measure of water of the diffuse pollution challenge (see p. 291). production and distribution network, energy utilities experience of eloquently than I could, and he does so from a are seeing dramatic improvements in efficiency. Berlinwasser Group Director of the International Monetary Fund about delivering performance in industry which businesses Tony Wray’s overview of “Water, money and Is this the future for performance water utilities too? when money position of bitter experience. and one of the most enlightened voices in is tight? Keynote address by Jörg Simon can use to say how well they are doing. This performance” can be read on pages 70-73. [] the debate about how the Millennium Keynote address by His speech makes all those who argue that issue is addressed in the section entitled []Djeevan Schiferli Development Goals for Water and For those interested in where the water industry public water supply must be subsidised seem “Water performance in industry - are we Jörg Simon, pp 36-43 Sanitation should be financed, gives a is going, I give my round up of the top ten like out of touch do-gooders whose charitable asking the right questions?”. We then move magisterial tour d’horizons of the issue on business propositions in the global water Djeevan Schiferli, pp 74-77 feelings are in fact condemning a generation on to look in more detail at the issues raised The water pages 30-35. business on pages 278-287. performance challenge Successful initiatives of Africans to cholera, dysentery and lives of by performance in the food and beverage A scalable for-profit from around the world approach to serving What are the best utilities doing to improve their drudgery fetching and carrying water from Of course the theme of the event is “focusing industry (see pp. 196-209) and the oil and gas The Global Water Summit also plays host performance? We shortlisted seven utilities that the poor have significantly raised their performance levels. One of the big obstacles to bringing water services Each initiative is presented in the quick-fire distant and unprotected sources. Disseminating on performance”. Jörg Simon, the Executive industry (see pp. 224-241). to the Global Water Awards. This annual to low income communities is the lack of a viable 8 minute Pecha Kucha format before the audience business model. WaterHealth International has votes for the 2011 Water Performance Initiative challenged the assumption that you can’t make a of the Year. this kind of thinking is how we make a Director of Berlinwasser addresses this issue event recognises the best of the best in the business out of selling safe water to the poor. Speakers include WHI has raised serious Jean-Marc Jahn, CEO, SEAAL, Algiers Of course performance is not just about targets, Taqsem Khan, Managing Director, Dhaka WASA, Bangladesh money from venture capitalists Klaus Neder, Special Projects Adviser, CAESB, Brasilia to scale up its activities Lonnie Frost, Public Works Director, Gilbert, Arizona Chaired by Dan McCarthy difference in the world. We have put the full directly on pages 36-43. In the section on the water industry. In each category four entries Epsica Chiru, General Deputy Director, Apa Nova Bucuresti of Black & Veatch Water internationally. Is this the Zbigniew Maksymiuk, General Director, Saur Neptun Gdansk breakthrough the bottom Chuck Weber, Operations Superintendant, Wolcott WTP, Kansas [] billion have been waiting for?
Keynote address by []Sanjay Bhatnagar Water performance challenge, pp 44-69 Published by: Publisher: Direct sales manager: WDR editor: Focusing on performance acknowledgements: Media Analytics Ltd. accepts no liability or responsibility Sanjay Bhatnagar, pp 78-83 whatsoever for any loss or damage suffered by the reader Media Analytics Ltd. Christopher Gasson Duncan Wilson Tom Pankratz Editor: Charlotte Massey Global Water Summit 2011 Focusing on or any other user of the information contained in this performance The 2011 Global Water Awards Water, money The Jam Factory [email protected] [email protected] [email protected] Contributors: Lola Adesanya, Lorenzo Bosi, Emilie Filou, 27 Park End Street publication. Unauthorised distribution or reproduction Welcome to the 2011 Global Water Awards Welcome, this is the sixth edition of the noticed is the theme for the conference this Global Water Awards, the sixth time that we at the centre of his policy agenda, whether as Hiroko Kasama, Mark Kelleher, Alexander Zvinakis year. After the dinner, we will discover the part of the Millennium Development Goals, have come together to celebrate excellence and performance Key account manager: 47 contestants that have been nominated through the promotion of world peace, or Events co-ordinator: Head of research: in the global water industry: the projects, across 11 categories, and announce the top furthering the green revolution in Africa. In the technologies, and the people who are performers. of the contents of Focusing on Performance is strictly making a difference in the world of water all his endeavours, our guest speaker this today. In addition to the top 11 performers, we will evening has consistently recognised the vital Oxford, OX1 1HU be announcing this year’s winner of the Jim importance of water. When the British government was overwhelmed The Global Water Awards are voted for by Stewart lifetime achievement award; given So, this evening we have the privilege of you. We would like to take this time to thank to someone that has made a particularly you for the record contributions made by our hearing the proposal of a much needed by the liabilities associated with upgrading its water The Global Water Awards recognise what important contribution to the industry over vision, one that illustrates how water can be Layout & diagrams: Charlotte Massey and Heather Lang subscribers and members of the international the course of their career. water community. Never has it been more managed for the good of the world rather infrastructure back in the 1980s, it took the decision prohibited without prior consent of the publisher. senior executives across the international This evening marks a special occasion, not than as a cause of conflict, poverty, hunger Chris Bowling Jack Ceadel Jablanka Uzelac important than today to come together and United Kingdom recognise the very best in our industry. only because of the awards that we will or despair. be giving out later, but also thanks to the to sell all the utilities in England and Wales to water industry have acknowledged as the Even more so than in previous years, we Please join me in offering a very warm presence this evening of our special guest welcome to the former Secretary General of have placed a special focus on performance, of honour. We are delighted to welcome this private investors. most important achievements of 2010. which I am sure you will have already the United Nations, and winner of the Nobel [email protected] [email protected] [email protected] Conference photography: John Deputy evening a man that has always placed water Peace Prize, Mr Kofi Annan. Tony Wray, the CEO of one T + 44 (0)1865 204208 They are chosen by way of a free © 2011 by Media Analytics Ltd. All rights reserved. No vote given to all subscribers to Global Water Intelligence and of the few remaining UK Water Desalination Report, as well as to members of the International Private Water Association and utilities with international the International Desalination F + 44 (0)1865 204209 Association. The winners were ambitions, assesses the Conference organiser: Chris Bowling part of this publication may be photocopied, reproduced, announced at a special awards Head of sales & dinner held at the GWI/IDA GWI editor: conference in Berlin on 18th April private water proposition 2011 in the presence of Kofi Annan. The winners and distinctions in in the context of the current each category receive a crystal glass trophy encapsulating a globe state of financial affairs. retransmitted, put into a computer system or otherwise emblem. All shortlisted entries, marketing: Advertising: Duncan Wilson including highly commended Registered company entries, receive a framed certificate Ian Elkins with the judges’ verdict included. Keynote address by []Tony Wray number: 4412085 Emma Welsh redistributed without prior authorisation from Media [email protected] 86 Focusing on performance // The 2011 Global Water Awards [email protected] Analytics Ltd. 87 Tony Wray, pp 70-73 Global Water Awards, pp 84-131 2 Focusing on performance Christopher Gasson // Foreword 3 The politics of performance Water performance Global Water Summit 2011 The politics of performance in industry… …are we asking the right questions? Politics and performance so often work against Introduction The politics of performance could be better management, efficiency and productivity. each other in the water sector, and doubly so in these known as the politics of water in general. Water is arguably the most politicised of all It is when you look at the demand and supply Focusing on sides of the issue that politics comes up and Water scarcity threatens both ecosystems and difficult financial times. Rate increases, long term capital infrastructure sectors, and throughout history the issue of why haven’t we moved forward in expenditure programmes and discussions about private must certainly be the most political of natural providing water, in assuring water security as businesses. Although driven by very different resources. Historically, there has been one we should have? There must be a reason and sector participation are politically unattractive, but often clearly resounding concern related to water that reason could have to do with the whole and that is the question of access. In the post- subject of water politics. motives, investors and environmentalists alike industrial age, this concern has been solved essential aspects of delivering performance. Discussions on this issue only too often tend through the construction of pipes, water are pushing industries towards improved water treatment plants and other forms of complex to end up polarised, and on two sides of a infrastructure in order to get people all over given table. There is very rarely a roundtable the world regular access to clean water. discussion on the subject of the politics of efficiency and better risk assessments. performance. The way that the debate splits performance However, the important question of access tends to be between those that view water has not been comprehensively solved and access as an unimpeachable human right, Focusing on performance increasingly, an issue that has raised its and those that view water as an economic head in the water sector is that of scarcity. good. However, it must be nevertheless clear Speakers include There simply is not enough water available to all in the industry that – however they are Dr Ashok Chapagain, Senior Water in the world, at least not easily available, or arrived at – arriving at sustainable solutions But what are the best sustainably available. This fact has brought up to water scarcity is imperative for all countries Adviser, WWF concerns over allocation, demand around the world today. Laurent Auguste, ways of measuring President and CEO, Veolia Americas Marcus Norton, water performance Usha Rao-Monari Carbon Disclosure Project Usha Rao-Monari is currently the Global Head of Water in the Infrastructure and Natural and of ensuring the Resources Department of IFC, covering the global Utilities and Public Private Partnerships Dr Liese Dallbauman, Director of practice group. Water Stewardship, PepsiCo water sustainability Ms Rao-Monari joined the IFC through the Young Professionals Programme in 1990, and has Martijn Kruisweg, AkzoNobel since gained substantial experience in the infrastructure, manufacturing and petrochemicals Carlo Galli, Technical and Strategic sectors in several countries and regions of the world. In 1998, she assumed the position of of industrial activities? Adviser on Water Resources, Nestlé Regional Manager for Manufacturing and Services for South Asia and Country Head for India, based in IFC’s New Delhi regional office. Ms Rao-Monari assumed her current responsibility in Chaired by Here, the panel looks at how politics and performance 2001, when she returned to Washington DC. Ms Rao-Monari holds an MBA from the Bajaj School of Management in Bombay, and a Masters Roger Harrabin, can be brought into closer alignment. in International Economics and Finance from the School of International and Public Affairs at BBC Environment Analyst Columbia University. Prior to joining IFC, she was a Vice President at Prudential-Bache Capital Funding, working both in New York and London. [ ] Desalination & reuse2011 in 2011 Usha Rao-Monari // Introduction 203 Three years ago the desalination industry Politics of performance, pp 168-175 Performance in industry, pp 176-195 was driven by Spain, the east coast of Australia, Algeria and the property boom in the Emirates. The financial crisisreuse, continued growth in of the2030 BRIC economies and the Pacific Ocean Desalination and cooling cycle have changed that. Instead,2030 new markets are opening up driven by the minerals boom, The desalination industry changing water resources strategies, has evolved dramatically and changing weather patterns. The are shortlisted by our panel of expert judges, to make the difference are technologists, since the first large scale people behind the new generation of Speakers include distillers were introduced in desalination and reuse projects explain Halla Razak, Colorado River Programs Director,the SanMiddle Diego County EastWater Authority in the 1950s, Dennis Gibson, Director, Dennis Gibson & Associates their strategy and objectives. Dr Hu Fleming, Global Managing Director,but Hatch the Water biggest change is Rania Zayed, Director, Egypt’s PPP centralstill unit at to the Ministry come. of Finance The potential and readers of Global Water Intelligence, and engineers, investors, and public water agency demand for additional renewable freshwater resources is so great that it is difficult to see how it Water Desalination Report as well as members leaders. If the Millennium Development Goals might be met by existing About the organisers technologies. Speakers include Ross Young, Business Leader, Water, Australia, GHD Michael Flynn, Lead of the Water Technology Development Laboratory, NASA Ames Research Center In this session we look Dr Cynthia Daniell, United States Defense Advanced Research projects Agency of the International Desalination Association for water and sanitation in Africa are to be met, into the deep future for Dr Sherwin Gormly, HTI The Global water summit 2011: Focusing on performance was produced by Global Water Intelligence desalination and reuse. are invited to vote. The winners, and their governments and NGOs will play a role, but magazine and the International Desalination Association. Desalination and reuse, pp 136-167 achievements are presented on pages 84- it is going to be us—those most intimately 131, together with the address given on the involved in the sector—who are going to occasion by the former UN Secretary General have the biggest role to play. If Asia’s industrial Global Water Intelligence The food and beverage sector uses Water performance more water in its supply chain than any other industry. It is also more in the food exposed to consumer concerns about water usage and sustainability. Kofi Annan. powerhouse is to thrive without compromising Global Water Intelligence is a monthly international private water companies. The and beverage Here, we find out about the industries various water challenges and the environment, it will do so because of the subscription funded magazine providing analysis ‘GWI Desalination Project Tracker’ and ‘Reuse sustainability efforts in the sector. Finally, I should point out that none of this wastewater treatment plants and advanced and strategic data on the international water Tracker’ are GWI ’s monitoring services charting would be possible without the support of our technologies that we build. On the one hand all market. The publication boasts a network of the progress of international desal and reuse
Speakers include Claudia Ringler, Senior Research Fellow, sponsors. These companies and what they International Food Policy Research Institute Johan Raap, Royal Cosun Klaus Stadler, Director Environmental & this is good business for both the public sector specialist water and financial journalists, based projects. Water Resources, Coca-Cola Europa Chaired by David McBain of Veolia Patrick Regan, Global Brewing Industry Leader, GE Energy Richard Bedford, Supply Director, Diageo [] do are listed in the directory section of this and the private sector. A billion new water and in country with access to exclusive regional data. book. They are not sponsors in the normal Desalination projects are also covered in detail wastewater customers in Africa and Asia is a GWI has established itself as the market leading sense: for them the publicity and commercial on our web venture www.desaldata.com. Food and beverages, pp 196-209 great new market. Desalination, water reuse, publication for developers, suppliers, financiers, opportunities which go with having their Featuring details of over 15,000 plants the site is and effective demand management wherever governments, utilities and municipalities seeking Africa’s moment name associated with a high level summit a constantly updated source of news, technical there is scarcity is a huge business opportunity. information and analysis on water projects with in water and the related publication are of secondary info and company data. Africa used to be the backwater of the water sector where high So too are environmental protection, and an element of private sector participation. political risk, lack of financing and many other obstacles made it hard importance. What matters to them, and to us to achieve much. Over the course of the last efficient water and wastewater networks. But In addition, GWI publishes a number of specialist decade, progress has been made: between 2000 & 2008, the at Global Water Intelligence is the agenda for GWI ’s wide coverage helps readers interpret proportion of people with access to improved water supply increased they also make a difference to the quality of life and in-depth reports on specific areas of the from 55% to 60%. change in the water sector. How can we make the changes occurring in the global water This may finally be Africa’s Speakers include Joseph Karanja, Nairobi City Water and Sewerage Company moment in water; when asked for millions of people around the planet today. water industry, and on specific geographical Petrus Du Pisani, Strategic Executive, Infrastructure, Water and Waste whether Africa was a better place Chaired by Alexander McPhail Management, The City of Windhoek, Namibia of the World Bank Dr William Muhairwe, Managing Director, National Water and to invest today than in 2000, Sewerage Company, Uganda [ ] the world of water work better? market and identify investment opportunities 84.2% of the audience agreed. Aladji Dieng, Technical Director, Sénégalaise Des Eaux areas. For more information on these reports, We are not saying that, because it is business, it created by these changes. Tables, charts, graphs It is very much part of the ethos of the Global and on our organisation as a whole, please visit is necessarily good. There are plenty of ways of and diagrams are used to illustrate project Africa’s moment, pp 210-223 Water Summit. On one level it is just an effective our website: earning a dollar in the water industry without structures and investment requirements as well business conference which brings together www.globalwaterintel.com actually improving anyone’s lot. And that is the as provide essential financial data on the major Accessing the a select group of industry leaders to facilitate produced water market Chaired by John Veil of [ ]Veil Environmental LLC purpose of the Global Water Summit: to networking, the development of strategy and Vast volumes of water produced from oil and gas activities bring out the best in the water industry. are generated worldwide. This provides a fantastic opportunity for water technology companies to enter this growing market and design and develop management the pursuit of new opportunities. On another strategies to handle this water. To meet once a year to focus on the cross-over International Desalination Association With insider knowledge level it is about being an agent of change in the from produced water experts working in the oil and gas industry, this session between good business and good for the The International Desalination Association • International and regional conferences, Speakers include looks at the inherent
John Veil, Founder/CEO, Veil Environmental LLC challenges facing
Brent Halldorson, Chief Operating Officer, world.
Fountain Quail technology companies
Dr Roman Breuer, Head of International
Division, Bauer Environmental Group attempting to enter this
world.
Ed Steele, Environmental Adviser, Swift lucrative market, and is focused on desalination and water reuse seminars and exhibitions.
Worldwide Services
Dr Ted Frankiewicz, Division Manager of Oil & provides their insight into
Gas Production Facilities, SPEC Services Inc.
successful market entry.
You and I, and the others receiving a copy of Be part of it. Come to the Cavalieri Hotel in technology worldwide and is committed to Website access: this book, we are the people who make a living Rome on 30th April and 1st May 2012 for educating the public, specialists and students Produced water, pp 224-241 from the water industry. We do this because we through printed material, multimedia, • The largest database devoted exclusively to the 2012 Global Water Summit. The theme is are good at it and because we care. It matters to desalination, people, companies, plants and “Not business as usual”. See the summit website conferences, and graduate level scholarships. all of us that the water industry works. much more. New initiatives www.watermeetsmoney.com for further The IDA also organises regional workshops and in private sector • Recent Congress proceedings. participation There may be other stakeholders, but we are details. seminars on specific topics relevant to the local The combination of the public sector financing crisis in Europe and North America, the challenges of water scarcity in the Middle East, the ones best placed to make change happen • Links to corporate member sites and related and the financial confidence of the developing member needs such as the current IDA/GWI world, means that private sector participation in the water sector is back on the agenda. because it is our business. If the scarcity gap is Conference. The IDA presents the desalination organisations. Here we bring together some of those looking to bring in private sector expertise and money to drive Speakers include Shayo Holloway, to be closed in the Middle East as the region’s Christopher Gasson General Manager, Lagos Water Corporation perspective when participating in other water • Employment listings. performance in the sector. Chaired by Allard Nooy, CEO, JITF Water Infrastructure Ltd. Gérard Payen of Aquafed Omar Al Wahaibi, CEO, HAYA Water, Oman Lesego Raditsebe, [] of the Department of Water Affairs, Botswana population soars, the people who are going Publisher, Global Water Intelligence conferences. • Expert opinions on technology and future trends. Private sector IDA members get direct access to the initiatives, The great water debate desalination community through: • Member directory. Is cost recovery pricing the best way to ensure Water technology idol the poor have access to good water services?
Following its success at previous conferences, pp 242-259 Water technology idol returned to showcase five Supporting • Calendar of worldwide events. emerging technologies. The contest is based on Market preview motion the • Publications including Newsletters, the established American Idol / Pop Idol format, where the winner is decided by an audience vote.
Each finalist is given ten minutes to Membership Directory, Desalting Plants IDA members also receive discounted convince everyone of their technology’s Wenonah Hauter merits, and its potential to change the Global Water Intelligence world of water. This is followed by a publisher Christopher Gasson grilling, by the audience and panel, about Speakers include is joined by industry experts Dr David Zetland Inventory, ABC’s of Desalting, Congress Dr Sung Jae Kim, Research conference registrations, exhibition fees and the technical and commercial aspects Scientist, Massachusetts Institute Frank Rogalla of aqualia, and Neil of Technology of each technology. Dr Dileep Agnihotri, CEO, Reynolds of CH2M Hill, to present Advanced Hydro Inc. Dr Richard Stover, Executive their views on the top business Vice President, Desalitech, Ltd. propositions for 2011. Robert Wright, Partner, Proceedings and Quarterly subscription to Panel members: publication prices. Watervap, LLC Tom Pankratz, WDR Speakers include Debra Coy, Svanda & Coy Consulting Christopher Gasson, Publisher of Global Water Intelligence Lisa Henthorne, Water Standard Company Frank Rogalla, Director of Innovation and Technology, aqualia Anil Naidoo Neil Reynolds, Director, CH2M Hill [ ]John Tonner, Water Consultants International Opposing the motion D&WR Magazine. Dr William Muhairwe To join the IDA, go to www.idadesal.org Water technology idol, pp 260-275 Market preview, pp 276-291 The great water debate, pp 292-305 4 Focusing on performance About the organisers 5 Global Water Summit 2011 Focusing on performance Contents Contents Foreword 2 The smart network revolution 74 Christopher Gasson Djeevan Schiferli About the organisers 5 A scalable for-profit approach to serving the poor 78 Sanjay Bhatnagar Contents 6 The 2011 Global Water Awards 84 The global water challenge as seen from space 12 Welcome to the 2011 Global Water Awards 87 Prof James S. Famiglietti Replacing conflict with cooperation: the path to global water security 88 Water and the challenge of Asia’s economic rise 22 Kofi A. Annan Chandran Nair Water company of the year 94 Water & the public sector financial crisis 30 Desalination company of the year 96 Michel Camdessus Water deal of the year 100 Delivering performance amidst austerity 36 Public water agency of the year 104 Jörg Simon Desalination deal of the year 110 The water performance challenge 44 Water reuse project of the year 112 Desalination plant of the year 116 SEAAL performance in Algiers: From 8% to 100% 24/7 water supply in 3.5 years 46 Jean-Marc Jahn Industrial water project of the year 120 The performance challenges of Dhaka WASA 50 Water stewardship award 122 Taqsem Khan Water technology company of the year 126 From 0 to 2.5 million people served in 50 years: Rapid expansion in Brazil’s capital 53 Water performance initiative of the year 129 Klaus Neder The Jim Stewart lifetime achievement award 130 Partnering for performance: the Gilbert and Chandler experience 56 Lonnie Frost Water quality testing for better system performance 132 Think performance. Act performance. 59 Myron L Company Epsică Chiru Gdańsk, Poland: Improved performance 62 Desalination & reuse in 2011 136 Zbigniew Maksymiuk Desalination projects in the U.S. – Mexico border area 138 WaterOne: Water District No. 1 of Johnson County, Kansas, USA 66 Halla Razak Chuck Weber Water and desalination in the Australian mining industry 142 Dennis Gibson Water, money and performance 70 Desalination in the mining and metals industries 146 Tony Wray Dr Hu Fleming Wastewater treatment in the Nile Basin 150 Rania Zayed
6 Focusing on performance Contents 7 Global Water Summit 2011 Focusing on performance Contents
Questions from the audience 152 An industrial approach to sustainable water treatment: Stimulating methane production 200 Johan Raap Desalination and reuse in 2030 154 Water sustainability in beverage production 202 Desalination in Australia 156 Klaus Stadler Ross Young Driving change in the brewery industry: GE’s perspective 204 Application of advanced water recycling technology in space 158 Patrick Regan Michael Flynn Diageo’s approach to responsible water use: The state-of-the-art bioenergy plant 206 Clean water technologies for 2030 161 Richard Bedford Dr Cynthia Daniell Africa’s moment in water 210 Forward osmosis and the water power nexus in 2030 164 Dr Sherwin Gormly Improving water provision in Nairobi through control of non-revenue water 212 Joseph Karanja The politics of performance 168 Windhoek Namibia: A case study in water supply in an arid African country 214 Usha Rao-Monari Petrus du Pisani Fernando Santos-Reis Rania Zayed Turning around a public utility: the 10-year experience of the NWSC, Uganda 216 Jennifer Hosterman Dr William Muhairwe Diane d’Arras Africa: Already performing, and full of promises 220 Shayo Holloway Aladji Dieng Aranzazu Mencia Saeta Marco Antonio Accessing the produced water market 224 Velázquez Holguín Produced water overview 226 Water performance in industry: Are we asking the right questions? 176 John Veil From operational efficiency to water stewardship 178 Making oil and water mix 228 Dr Ashok K. Chapagain Brent Halldorson A new metric to assess water impacts 182 Case study: The Nimr WTP 231 Laurent Auguste Dr Roman Breuer The Carbon Disclosure Project’s water initiative 184 Water management challenges for unconventional gas resources 234 Marcus Norton Ed Steele PepsiCo’s commitment to responsible water governance 186 The character and opportunities of oilfield produced water 236 Dr Liese Dallbauman Ted Frankiewicz AkzoNobel’s efforts to improve water efficiency 188 Water challenges in the shale 239 Martijn Kruisweg John Veil Water initiatives in Nestlé: Creating share value 190 Questions from the audience 241 Carlo C. Galli Questions from the audience 192 New initiatives in private sector participation 242 Opening comments 244 Water performance in the food and beverage industries 196 Gérard Payen The global food & water nexus 198 Public-private partnerships in the Lagos water sector 245 Claudia Ringler Shayo Holloway
8 Focusing on performance Contents 9 Global Water Summit 2011 Focusing on performance
Privatisation and reform in the Indian market 248 Allard Nooy Wastewater treatment and reuse in Oman 252 Omar Al-Wahaibi Botswana’s water sector 256 Lesego Raditsebe Questions from the audience 259 Water technology idol 260 Massachusetts Institute of Technology: A portable water desalination & purification system 262 Dr Sung Jae Kim Advanced Hydro: Polymeric membrane coatings 266 Dr Dileep Agnihotri Desalitech: Closed Circuit Desalination TM 269 Dr Richard L. Stover Watervap: Brine disposal system 272 Robert R. Wright Market preview 276 GWI market preview: Top 10 business propositions for 2011 278 Christopher Gasson Wastewater as a resource: Harvesting energy & nutrients 288 Frank Rogalla Looking to the future: Key water market drivers 290 Neil Reynolds Final thoughts: Putting the pieces together 291 The great water debate 292 Subsidies expose water services to the vagaries of government fate 294 Dr David Zetland The money is here, it’s just been misspent 296 Wenonah Hauter Full cost recovery is the New Testament 298 Dr William Muhairwe There is now a human right to water and sanitation 300 Anil Naidoo Questions from the audience 302 Closing remarks 304 Company directory 306
10 Focusing on performance The global water challenge as seen from space
Global warming is bringing both devastating floods and searing Keynote address by droughts in its wake. It Prof James Famiglietti puts the performance of water utilities on the line as never before.
Using satellite data from NASA, Professor Famiglietti has built up the most detailed picture to date of the evolving pattern of global water availability. Global Water Summit 2011 Focusing on performance The water challenge as seen from space
of the extremes of flooding and drought and The water cycle Introduction groundwater depletion using the satellite to I hope today I can convey the compelling monitor groundwater levels. nature of what is happening to the global water Smaller water cycle amplitude cycle, because it is critically important and we Larger water cycle amplitude can’t really move forward without it. I am going Our expectations to introduce some of the work that we’ve been Let’s talk about what we might expect to see Precipitation Precipitation doing in my group over the past several years. versus what we’re actually seeing. The top left I will start by characterising the change in our figure is a schematic of the water cycle, with the water cycle, and will explore what we expect to Evaporation Evaporation ocean on the left of the illustration, and the land be seeing in a changing water cycle versus what on the right. we are actually seeing. I will go a little bit into The arrows in the figure show how water in the Discharge how the water cycle will behave in the future, and will finally look at how we should respond. water cycle is moving around, from the ocean, through the atmosphere, on to land and back into the ocean. In an accelerating or intensifying The water cycle is changing water cycle, we should expect to see that One of the most palpable impacts of global these fluxes of evaporation and precipitation Ocean Land change, ultimately, will be changes to the are getting bigger. If they’re getting bigger water cycle in terms of fresh water availability. over the ocean, we would expect to see more Discharge In a warming climate, the atmosphere can vapour transport from the ocean to land, hold more moisture, as its water holding where we would get more precipitation and Source: University of California Center for Hydrologic Modeling capacity is temperature dependent. In a more evaporation and more run-off from the warmer atmosphere we can expect more contents completing the cycle. We expect to be evaporation and, therefore, more precipitation. seeing an acceleration of this cycle over time. If we get more precipitation on land, we’ll also experience greater run-off. So in a warming climate we expect there to be an increase of the Our findings water exchanges in the water cycle. The first question my group asked a couple of years ago was: are we actually seeing this We are starting to see some of this behaviour and, in particular, are we seeing an Global discharge time series, 1994-2006, showing annual increase of 1.5%/yr intensification already, in the magnitude and increase in global discharge? We essentially frequency of hydrologic extremes, such as ×104x104 focused on this particular question: are river Annual 4.6 flooding and drought; we expect over time flows increasing, and do they indicate that Monthly 4.4 to see more extreme extremes. We will see a 4.2 earth’s water cycle is accelerating? 4.0 redistribution of precipitation from the mid 10,000 3.8 latitudes, to the high and low latitudes. So the We looked at the period from 1994 to 2006, 3.6 using a variety of remote sensing products, 3.4 wet areas will be getting wetter while the dry 3.2 areas will be getting drier; and we’re starting including some of the data from the GRACE Discharge (km³/yr)Discharge 8,000 3.0 to see some of this already. Collectively, we call mission. We saw that oceanic precipitation is, 2.8 06050403020100999897969594 this “water cycle acceleration” or “water cycle in fact, increasing at a rate of 240 km³/yr², while Prof James S. Famiglietti intensification” – in other words, an increasingly oceanic evaporation is increasing by 768 km³/ Professor James S. Famiglietti holds a joint faculty appointment in Earth System Science 6,000 energetic water cycle. yr². We are seeing greater vapour transport and in Civil and Environmental Engineering at the University of California, Irvine, where from the ocean to land, increasing precipitation he is the Founding Director of the UC Center for Hydrologic Modeling. His research Most of the work discussed here is based on on land, and therefore increasing continental group uses satellite remote sensing to track water availability and groundwater a satellite mission called GRACE: the Gravity discharge. The trend appears small at 1.5%/yr 4,000 Recovery And Climate Experiment, which (see the figure on the bottom left ). However, depletion on land, and has been working for many years towards improving Discharge (km³/month)Discharge is a joint DLR (Germany) and NASA satellite it’s a little clearer when you look at the annual hydrological prediction in regional and global weather and climate models. Famiglietti programme. It’s a gravity mission, and has average plot in the upper right of the chart is currently leading the Community Hydrologic Modeling Project (CHyMP) in the United 2,000 revolutionised our view of earth’s gravity field, rather than the monthly plot, shown in green States to accelerate the development of hydrological models for use in addressing but it’s also discovered some very important with the lighter green error bars. The trend is international priorities related to water, food, economic, climate, and global security. In things with respect to the global water cycle. actually quite significant if you start thinking on 2012 he will serve as the Birdsall-Dreiss Distinguished Lecturer of the Geological Society In particular, it has helped us to monitor ice 0 decadal timescales. of America, when he will lecture internationally on global water cycle change and Jul 94 Jul 95 Jul 96 Jul 97 Jul 98 Jul 99 Jul 00 Jul 01 Jul 02 Jul 03 Jul 04 Jul 05 Jul 06 mass losses on the Greenland and Antarctic freshwater availability. Source: Syed et al., 2010 ice sheets. My group has been looking at some
14 Focusing on performance // The global water challenge as seen from space Prof James S. Famiglietti // Our expectations 15 Global Water Summit 2011 Focusing on performance The water challenge as seen from space
the strength of the water cycle. This enables us Globally, the evaporation/condensation engine Ocean mass time series, 2002-2010 The implications to quantify changes in the water cycle. works like a giant steam furnace to redistribute So what are the implications of this? Well, you heat from the equator where it’s hotter to the may say “more water – that’s good”. However, The figure on the bottom left shows all land poles where it’s colder. But if there’s more water if these trends continue there will be an mass. The fluctuations of the land mass chart 15 in the water cycle, that translates into a more indication that the water cycle is spinning faster, and the ocean mass chart mirror each other as energetic water cycle. This means that there and with it some negative things happen. One water is transferred from the sea by evaporation will be a far greater release of energy when 10 is the increased land contributions to global and back again via discharge – the water precipitation forms, so rainfall will be delivered mean sea level rise. People don’t think much cycle at work. The strength of the water cycle in more severe storms. 5 about the land contributing to sea level rise, but amplitude is clearly increasing, and over a very it does in a significant way, in addition to the short period of time. This is, in fact, the future. Increasing variability melting of the ice sheets. poses great challenges to water management 0 So we see some profound effects associated and to water availability, again the primary We have to keep in mind that sea level with this increasingly accelerating water cycle. goal of which is minimising those variations mm equivalent SL mm equivalent -5 rise is fundamentally a global hydrologic The precipitation-evaporation cycle requires and maintaining a steady water supply. And phenomenon: it is water in the global water and releases huge amounts of energy. It of course, it poses great economic risk to cycle. Sea level rise is relatively slow and steady. takes a lot of energy to move water through -10 industries that depend upon reliable water But when we think about some of the extremes precipitation and evaporation; that’s what 15 sources. -15 on top of that, like the recent tsunami in Japan makes water very special, its high latent heat 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 and the increasing frequency of storm events 10 and vaporisation and condensation. that we will be seeing in the future, we’ll experience more extreme local rates of sea 5 level rise. Some examples are the impact of the Source: University of California Center for Hydrologic Modeling tsunami in Japan, and the broken levees in New 0 15 Orleans. Of course, with increasing river flows we’re
mm equivalent SL mm equivalent -5 10 going to see changing flood risk. Overall, there’s an increasing number of extremes and -10 5 variability in the water cycle. From a water management perspective, and from an industry -15 perspective, minimising that variability is 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 critical. What we all want with respect to water Land mass time series, 2002-2010 management and water availability is a reliable mm equivalent SL mm equivalent -5 supply.
-10 Variability in the water cycle 15 Returning to the data collected from the -15 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 GRACE mission, the figure on the top left 10 illustrates what happens to ocean storage; all of the water mass in the ocean plotted versus 5 time. If we think about it as a sort of bank account, there are inflows and outflows. The 0 inflows are the precipitation and river flows from the continents, and the outflows are the
mm equivalent SL mm equivalent -5 evaporation. When we look at a time series of ocean water structure, it has its ups and downs, following a wave pattern. -10 What happens if those fluxes increase? We get -15 more precipitation and we go up higher; we get 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 more evaporation and we go down lower. That’s the variability in the water cycle. What we’ve come to realise from our GRACE data is that the Source: University of California Center for Hydrologic Modeling amplitude of the storage signal is a measure of 16 Focusing on performance // The global water challenge as seen from space Prof James S. Famiglietti // Variability in the water cycle 17 Global Water Summit 2011 Focusing on performance The water challenge as seen from space
to the water cycle in the future. Many people The human fingerprint of water management on freshwater storage, 2002-2010 Audience response: What is your source for water data? believe that since we are in an interglacial +4% period, given orbital forcing of the earth around 80 the sun and the tilt of the earth, eventually Remote sensing 10.0% +3% temperatures should cool off anyway, just as 60 they did ten thousand years ago. Technical & government ? +2% Unfortunately, we are probably not going to 40 Ground based reports 62.5% see this cooling off because the greenhouse observational data 11.3% 20 +1% effect forcing is greater now than the orbital forcing. Just as in a colder world, where most of 0 the water is frozen and so there’s not much of a 0% What is your source ? water cycle, in a warmer world the atmosphere -20 can hold more water and we have a more active for water data? -1% water cycle, leading to the ups and downs -40 described earlier. -2% Hydrologic models Those growing fluctuations have huge 16.3% -60 implications. The earth will have to work -3% harder to redistribute the extra heat from the -80 equator to the poles. The way it does this is with -4% increasingly prolonged and intense El Niños, -150 -100 -50 0 50 100 150 changes in the magnitude and duration of Source: Famiglietti et al., 2011 flood and drought extremes, and an increasing Source: GWI Expectations for the future prolonged periods of drought, minimising number of hurricanes and typhoons. It’s all Moving forward surface water availability and natural recharge, about the energetics that are required to move What do we expect to see in the future? What can be done? Firstly, it’s vital to bridge the forcing an increased reliance on an already that water around. So we’re going to see an The IPCC tells us, and models suggest and gap between research and industry. Business We will see a overtaxed groundwater resource. Factor in increasingly intense water cycle that is going Water observations are beginning to confirm, that we is beginning to see water as an economic risk population growth and we will very soon to help to redistribute that heat. Returning to will see a redistribution of precipitation from to performance. Investors expect to see plans redistribution be seeing accelerated rates of groundwater the steam furnace analogy, the cycle has to availability the mid latitudes, from the semi-arid and the for adapting to water scarcity. However, the depletion in the coming decades. work harder and harder to redistribute heat of precipitation arid regions of the world, to the high latitudes around the earth and it’s going to do so in more dialogue between researchers and the private will be and to the low latitudes. Eight years of GRACE Question for the audience: variable bursts, in both time and space, rather sector remains fractured. Our understanding of data backs this up. The map above shows red What is your source for water data? Is it: than as a steady global increase. the water cycle is advancing so rapidly that it from the mid places that are losing water and blue areas can be difficult to maintain those links. far more • Hydrologic models that are gaining water, and across a relatively The end result is that future generations will live Most urban centres, and therefore most latitudes, from short space of time. So the question is: are we • Remote sensing in a far more crowded, hotter, wetter – at least in contentious infrastructure and industry, are vulnerable already starting to see this redistribution? • Ground-based observational data high and low latitudes – world, where sea level the semi-arid is considerably higher and more variable than to the kinds of extremes discussed earlier. than it is What’s happening in the mid latitudes, marked • Technical and government reports it is today. There will be increasingly powerful Rising sea levels and storm surges on top of a by the yellow regions on the map, is critical. According to the audience, technical and storms that will pummel our coasts. Flooding more variable sea level will see “higher highs” and the arid This is where you see the human fingerprint of government reports are the most popular and drought will be more extreme, more that have the potential to overtax our ageing today. Make water management on terrestrial water storage source for water data, with 62.5% of the vote frequent and severe. Groundwater resources flood defence infrastructure. Sacramento in regions of the – the red blobs mark major aquifers. So the (see the figure on the top right). The bad news in the arid and semi-arid regions will approach the United States would be an example of no mistake map shows that nearly all of the major aquifers is that a lot of what I have told you doesn’t depletion. The Arctic will thaw. Glaciers and an accident waiting to happen, because the world, to the in the world’s arid and semi-arid regions make it into technical or government reports snow cover will decrease and warming will situation with the levees is similar to New about it, we underwent significant groundwater depletion because it is brand new research. Unfortunately accelerate. Orleans. in this timeframe. water management is not built into global high latitudes What does this all mean for the private sector? are living models in a very meaningful way. Taking All of this means that water availability will be At least two billion people live in these regions, It must become more vigilant in its efforts to information from technical and government far more contentious than it is today. Make and rely on groundwater as the primary understand water cycle change. There’s no way and to the low reports, combined with remote sensing and no mistake about it, we are living through through rapid source of water for domestic, industrial and we can accomplish the goal of clean water ground-based observational data, is probably rapid climate change. There are serious and agricultural use, as well as for power. Climate for everyone without embracing what we’re latitudes. the best way to go. well-known implications for food security, climate change. change will hit these regions hard because international security and conflict, political seeing in the satellite data, and industry needs of the redistribution of precipitation and We can’t really know what is going to happen stability, economic security and energy security. to accurately quantify the economic risk that
18 Focusing on performance // The global water challenge as seen from space Prof James S. Famiglietti // Moving forward 19 Global Water Summit 2011 Focusing on performance The water challenge as seen from space
these water cycle changes pose, and factor this purposes, and one of the great successes, of One of the risk into investment decisions. This is clearly satellites is that we can get data across political exacerbated by the fact that the risk itself is boundaries, and when you put that together growing, as the water cycle becomes more with the picture I have showed you here today, main purposes, variable and less predictable. the evidence is quite compelling. and one of the Quick fixes are not the answer. They will not Such a task can only be accomplished by yield sustainable solutions. The problems that long-term public-private cooperation and great successes, we face are too complex. Decisions on policy collaboration, and by the informed views legislation and technological solutions must be of advances in water research by the water of satellites informed by the best available science. industry. Question for the audience: is that we Do you incorporate water risk into your investment decisions? can get data Water will play an increasingly dominant social, economic and political role in the coming across political decades. There’s no question about it. But when you think about what I have just shown you, I hope that you feel a sense of urgency. The boundaries. water landscape of our future will be defined by the need to move water from where it is in abundance to where it is in short supply, and by the need to most efficiently use and reuse water locally, in particular in the arid and semi-arid regions. We need to act now to begin building the technological, the civil and, importantly, the policy and the legal infrastructure needed to actually accomplish these things, as it is currently not in place. We need to work on that now together so that we can peaceably and efficiently share, trade, use and reuse water across political boundaries. One of the main
Audience response: Do you incorporate water risk into your investment decisions?
Yes 64.8% No 35.2%
Do you incorporate water risk into your investment decisions?
Source: GWI
20 Focusing on performance // The global water challenge as seen from space Prof James S. Famiglietti // Moving forward 21 Water and the challenge of Asia’s economic rise
If economic growth in Asia continues at current levels, it will put impossible strains on the world’s resources – especially its water resources.
Chandran Nair explains how constraints on resource consumption will shape the new economy, and the central role of the water industry in Asia’s future growth.
Keynote address by [ Chandran Nair ] Global Water Summit 2011 Focusing on performance The challenge of Asia’s economic rise
Introduction Water, as you know, is the most precious element on this earth. A very simple molecule – Ladies and gentlemen, I would like to ask you a it consists of just two hydrogen atoms and one question: how many of you have got a mobile oxygen atom. But as many of you know, 90% of phone? All of you. At breakfast, I saw that some the water on our planet is salty, 2% is trapped of you had two. Anyone not have a mobile in ice and snow, and just 1% is available for us phone so that you can stand up and we can human beings, who have gone about recklessly applaud your individualism? … There is no one. abusing it. So if you’re all going to be kind to Today, in Asia, we have passed a very important yourselves, you can see yourselves as guardians Today, in Asia, point in human progress – or lack of progress of the 1%. if you prefer to call it that. I am sure that you all I’m also told that we have the same amount of have access to a toilet. Today in Asia there are we have passed water in the world today as we had during the more people with access to mobile phones time that the dinosaurs went extinct, so please, than toilets. How did this piece of extremely a very important guardians, do your jobs properly. However I sophisticated technology, consisting of suspect that some of you are more interested in hydrocarbons, rare earths, metals, etc., become selling equipment than in taking care of water, point in human free? How did the mobile phone become free and not all the equipment your companies sell while the toilet became a luxury item? progress – or is necessarily serving the purpose of providing First, it is because modern economic models water, or serving the needs of those who need tend to underprice everything. I live in a bubble water the most. lack of progress called Hong Kong, where most of us think that this economic model is the norm. I can get a if you prefer to mobile phone for free in Hong Kong, all I need Intellectual dishonesty to do is tie my bank balance for two years to a As we have abused water resources, we have call it that. service provider and then it is free of charge. also found solace in conferences like this. We all But as you all know, it involves hydrocarbons, come here and think we have solutions. We all compressed energy; it is immensely intensive love the idea that we will have a technological in all respects – but monetarily, free. In explanation for every possible problem. There this respect, current economic orthodoxy will be a genius in Silicon Valley who will come underprices everything. up with the answers. Then there will be the financial institutions, who will find an innovative Second, I am told that tap water in Berlin is way to finance everything and above all, there Today in Asia drinkable, yet I’m given a bottle of mineral water will be free markets to solve our financial at this conference. I have been told that to solve problems. I don’t know if any of you have the problems of providing water to the poor, noticed, but there are some people outside there are more it will cost around $30 billion. Alternatively, I’m who don’t believe this fairytale and who are a Chandran Nair told that the mineral water industry is worth bit angry (the anti-privatisation demonstrators). Chandran Nair is the Founder and CEO of results within ERM’s international network. Mr Nair is also the Chairman of Avantage people with $100 billion. If I was in charge, this industry You shouldn’t see them as the enemy; they may The Global Institute For Tomorrow (GIFT) - For more than a decade, Mr Nair has strongly Ventures, an Asian based boutique would be put out of business, but unfortunately actually be on the right side. an independent social venture think tank advocated a more sustainable approach investment advisory company in the field I’m not. to development in Asia, and has helped of high impact social investing that was access to mobile I would argue that the biggest problem we face, based in Asia. governments and corporations instil these established in 2010. He is a visiting scholar Just before you all start thinking that I’m some as big as any of the global problems that have Mr Nair was Chairman of ERM in the Asia phones than rabid socialist from a depressed part of Asia with principles into their key decision-making at the Hong Kong University of Science and already been outlined, is the issue of intellectual Pacific until March 2004. He established the a chip on his shoulder, let me remind you that I process. Corporations seek his advice on Technology’s School of Business, running dishonesty. I go to many conferences where company as Asia’s leader in environmental toilets. live in Hong Kong. I like money and everything everyone talks about greening. The spin doctors how to meet the challenges of doing a course, “Leading in Asia for the Future”, consulting, developing it from one small that goes with it; you can’t not like money in who have created the term “greening” for business in Asia and of globalisation, as part of the HKUST MBA programme. He a place like Hong Kong. I am a water engineer office of 10 people in Hong Kong in 1991 to everything are the same people who, if they on investment geo-politics, leadership has been an adviser to the Prince of Wales who used to conduct research into reverse a strength of 500 in 12 countries when he existed around the time of slavery, would have development, ethics, sustainability, and International Business Leaders Forum, the osmosis; I’m not a social engineer. I remember called it “guest labour”, or “migrant work”. left in 2004. Clients included many Fortune corporate social responsibility. His first book, World Wildlife Fund in Asia, and to the Jane my first design project on reverse osmosis for 500 companies, multilateral agencies and We have adopted a language that allows us entitled “Consumptionomics: Asia’s Role in Goodall Institute. He is a fellow of the Hong a very reputable UK firm. I’ve been involved in governments. During his leadership the to spin everything and anything. Intellectual Reshaping Capitalism and Saving the Planet”, Kong Institute of Directors, and a Fellow of designing water and wastewater treatment business in Asia remained consistently works for a long time. In other words, I am a dishonesty, both in business and in politics, was published in December 2010. the Royal Society of Arts. profitable, producing some of the best realist. and in the realm of solving the crisis of
24 Focusing on performance // Water and the challenge of Asia’s economic rise Chandran Nair // Introduction 25 Global Water Summit 2011 Focusing on performance The challenge of Asia’s economic rise
humanity’s impact on the world, has become incredulous questions. All across Asia, we will Consumption in Asia Audience response: What should the true cost of a Big Mac burger be? commonplace. Quite often, I feel rather lonely need to mess with your car; but the technology Let me give you a couple of examples. Today, when I say these things; but then I get quite a we will need in order to do without cars is China is the world’s largest market for cars. few emails when I go home. No one wants to where innovation comes in. No more: 5.3% OECD countries have car ownership levels of support you publicly saying that sort of thing; about 750 per 1,000 people. In China, it’s about it’s too dangerous a game for most to play. $5: 8.2% 150 per 1,000 people. In India, it is only about 30 Pricing resources or 35 per 1,000 people – Indians haven’t even I could go on, but I would first like to ask today’s $10: 40.6% Climate and consumption started driving. The only good thing for India audience a question. The climate issue which we have been is that the roads are so bad, that perhaps car Question for the audience: addressing is a good launching-pad for me to numbers will never increase. I think this must The Big Mac burger is currently sold at about $4 talk about Asia, and suggest why the theory of be a hidden strategy by the Indian government around the world; what do you think it should What is the true cost consumption-led growth is something that we to make sure they do not add to the number of More than cost, taking all externalities into account, from of a Big Mac burger? in Asia must absolutely reject. cars in the world because we need more cars $100: 18.8% in Asia like I need a hole in my head. Most Asian the water needed to the carbon footprint? Why? I remember in 1989 when Asians were cities have been absolutely devastated with • No more told that we just didn’t understand how to run too many people – it is simply unimaginable banks and other financial institutions, and that – except perhaps for a few places such as • $5 we should let Western banks tell us how to Singapore. • $10 structure our economies and that the Western • $50 institutions would get it correct. My point is that we in Asia simply cannot follow the Western model. We will need to do things • More than $100 $50: 27.1% If you look back at the financial crisis, what very, very differently. Let me give you another Apparently 40.6% of those here think it should Source: GWI happened? In 2007/2008, we found out that example – fisheries. When people get wealthier be around $10, and that shows us how broken our teachers, the Western banks, had been in Asia, what do they do? They eat further up the current economic model is. wrong all along, and so the world’s leading the food chain, and when they eat further up which, as I have shown, will not work. Therefore, economists and experts said to the Asians, the food chain, they start eating fish. The good Some economists have done some work on my argument is that the only way forward for “Please consume, so that we can rebalance the thing about the Indian food chain is they all eat this, but not many are funded because no one In Asia, we face Asia is restraint, and we need to move beyond sacred statistics, the financial rebalancing that dhal, and I hope Indians stay that way; not get wants the right answer. The true price of a Big talking about greening and start talking about takes place in the world” – really quite separate caught by the water intensive meat fetish which Mac burger, taking externalities into account, constraining. But no one wants to go to a a conundrum. from the real world inhabited by most human is being promoted everywhere else. would be over $200. conference called “constraining”. Everyone wants beings. I would argue that 99% of humanity has Everything we buy is underpriced—like my no understanding of the financial industry, or But if 500 million Chinese people start to eat to go to a conference called “greening”, and it’s If three billion fish, not twice, not three times, but just once a phone—because the true price would factor even better when you add “making money” to what it does, or how it operates. But we were in water, land, the carbon footprint, and so nonetheless told in Asia: “please consume”. week, our oceans will be empty. There will be “greening”. Then we are being presented with a no fiscal stimulus that can solve that problem. on. Now you could argue McDonald’s could win-win situation. Asians today About six months later, the Copenhagen There are no market instruments that would be a very wealthy company, or it could go I would argue the opposite: the only way that climate conference was held. All of the world be able to replace our devastated fish stocks. bust, depending on how regulators begin to start consuming we can have the word innovation actually leaders assembled and said: “This is the most There is no technology that can save us. The intervene. meaning something going forward is through important challenge humanity faces, please only thing that will save us is if the Chinese So in Asia, we face a conundrum. If three billion constraint. as you do in let’s all do something”; and we all know what Government gets tough. Asians today start consuming as you do in the happened. Everyone blamed the Chinese. It’s This is the big lie that most of Asia will need to I know that there are various Chinese West, there are simply not enough resources the West, there very easy to blame the Chinese because they’re brutally confront. Today, we’ve all heard about government officials here, some of whom to satisfy demand. How is that related to an “oppressive regime”. You can get that onto food supply shortages and so on. I don’t have perhaps might disagree with me on this point. water? Because consumption will be driven by the front pages of the free press. So everyone enough space to connect all the dots but you are simply I hope most of you will agree that China should fossil fuels, which in turn, as you all know, will hurled blame and we all know what happened can work most of them out for yourselves and intervene. A couple of months ago, for example, affect the pace of climate change. We have to – absolute disaster. see why food prices are what they are. not enough the Chinese Government intervened in car stop, but the problem is it’s very difficult for What most intrigued me was that no one ownership in Beijing. When I’ve talked about Westerners to tell Asians to stop. The bottom line is that a small proportion of the resources to pointed out the fact that over the course of the this in the past, most people said “you must be In the West, the problem is one of maintaining world’s population consumes too much, far too financial crisis, all leading economists urged joking”. When I go to the U.S., I say you might existing levels of consumption, because it’s much meat, far too much underpriced water, Asia to consume. Yet there was an inherent want to consider the one car family – a slight very difficult to take away from people what and has a system of liberal governance that satisfy demand. contradiction there, in that if we consume more, play on the one child policy. They look at me they already have. Thus we have the automatic has proved to be totally inept at trying to price what will happen? Game over for the human as if I must be trying to interfere in American Western response which is to revert to resources in the right way; and it’s not just true race. internal affairs in some way, and they ask me economic instruments; economic instruments of water. This problem runs right through the
26 Focusing on performance // Water and the challenge of Asia’s economic rise Chandran Nair // Pricing resources 27 Global Water Summit 2011 Focusing on performance The challenge of Asia’s economic rise
entire western economic model. Then we will measure things differently, and we Audience response: How many litres of water are required to produce 1kg of beef? Conclusion may have a chance of rebalancing everything I wonder, for example, how many members of I will end with three points. I think the We need to that we’re discussing today in terms of how this audience have given any thought to how governments of Asia will need to do three very we use water, how we value natural systems; 10 L: 1.2% much water is required to produce the meat important things. The first one is to recognise and then how businesses might fit into that conceive of 50 L: 3.6% that they eat. that resources are constrained, and because equation. What is good for business, and I come resources are constrained, be it water or from a business background, is not necessarily productivity Question for the audience: something else, we will need to make sure 100 L: 11.7% 1,000 L: 45.7% always good for the planet. This is a very How many litres of water do you think are that economic activity is subservient to the important thing for us to understand. required to produce 1kg of beef? preservation of the vitality of natural resources. measures • 10 litres That is a pragmatic necessity. So I conclude by asking you to remember two things. Today in Asia we have more mobile that use as • 50 litres Secondly, and very importantly, resource use How much water is phones than toilets. I go to remote parts of must be equitable for both current and future needed to produce • 100 litres Asia where I see people with no toilets, people many people generations. That’s too easily said, but at its 1 kg of beef? • 1, 000 litres with no education, but they have got a mobile core is the belief that collective welfare must phone. It is a very sobering thought. • Over 10,000 litres take precedent over individual rights. This does as possible, I see that the majority here think it’s about not sit comfortably in many Western liberal Secondly, a recent WWF report states that over 1,000 litres and 37% think it’s over 10,000 litres. democracies: the west cannot stand the fact the next 40 years we will need to produce more and as few Over 10,000 L: 37.7% It actually takes about 15,000 litres of water to that collective welfare is more important than food than was produced over the last 8,000 produce 1kg of beef. So why is my burger so you, the individual. years. Now if that seems farfetched, then why resources as cheap? don’t we assume that WWF have got it wrong Lastly, in terms of economic restructuring, we by a factor of ten? That would still mean that need to completely change the definition of possible. Source: GWI over the next 40 years, we will need to produce Constraint and restraint productivity. In terms of the classical Western more food than was produced over the last 800 definition, I’m always amused that economists This is fundamentally the problem. Now, if the years. Now just think about that. Chinese and Indians, or even just the Chinese, today keep referring to Adam Smith, the famous start eating more meat it would be devastating Scottish economist. He lived in a time where for the planet. But who are we to tell the there were less than 500 million people in the Chinese what they can and can’t eat? world. We live in completely different times. It’s symptomatic of the “dismal science” that We can start pricing meat properly by starting economics has not progressed over the course My argument is that the only to price carbon, water, the rainforest and all of the last 250 years. factors of production. I have no doubt that way forward for Asia is restraint, governments will need to intervene. And when But we have to measure productivity differently. it comes to fisheries, in particular, I don’t see any It should be measured by resources rather reason why a government like Hong Kong can’t than people. What do I mean by that? Typically, and we need to move beyond intervene and say we will stop the consumption productivity is measured by how few people of tuna. Most of you will know that Blue Fin you can use to take advantage of as many talking about greening and start Tuna is already an endangered species in the resources as possible. For example, how can you South Pacific. Worldwide, fish populations are replace a person with a machine? And how can talking about constraining. going down. you consume as many resources as possible? So my point is this: the problems facing the In Asia, we have a completely different problem. world today will not be solved by technological Economists conceived of productivity when solutions. Coming from a technical background, they went to North America. There was a vast I clearly understand the role of technology, but continent, containing very few people. They we have vastly exaggerated the transformative said, “we need to populate this place, how do abilities of technology, finance and free markets we do it? Let’s bring machines in and let’s use with the suggestion that we will all feel nice and up as many resources as possible”. happy at conferences like this by thinking that We live in a different time and a different place. we are part of the solution. Part of the solution We now have far too many people. We need to is very much about constraint and restraint. The conceive of productivity measures that use as only way to impose such restraints is through many people as possible, and as few resources strong governments. as possible. I call this concept patient work.
28 Focusing on performance // Water and the challenge of Asia’s economic rise Chandran Nair // Conclusion 29 Water & the public sector financial crisis The biggest challenge facing the global water sector today is access to finance. In many countries the old model, based on central government finance, has been broken by the global financial crisis.
Water utilities must do more with less, and find new ways of raising money. Michel Camdessus offers his insight into what the public sector financial crisis means for the water industry. Keynote address by [ Michel Camdessus ] Global Water Summit 2011 Focusing on performance Water & the public sector financial crisis
Introduction From strategy to action Achievements The first Ladies and gentlemen, it is a pleasure to Of course, action has to be taken right away, Here, I would like to quote my friend Gerard be here. I’m very grateful to Global Water as nothing is more perverse than proclaiming Payen, who is my colleague in the Framework of decade of Intelligence for inviting me to this Global Water objectives and rights without implementing the United Nations Secretary General Advisory Summit. them. To guide the world community a Group, and the Chairman of its Financial strategy was designed in Kyoto, and a few Committee. the third I have many friends in this audience, some weeks later adopted as a basis for the global of which attended the Kyoto summit in 2003 Gerard notes that between the years 2000 and programme of action at the G8 Avignon where I was invited to present. A few months 2008, the number of people with a water tap millennium summit. later at the G8 forum, the Working Group drew increased by 545 million people. The number can be conclusions on the financing required for Let me remind you of the three important of those who have access to improved sources water sector investment around the world. This points underpinning this strategy: of water (which was the minimal objective) has seemed like a key moment to remind people improved even more. Congratulations to all of remembered • Firstly, the dream of pure water for all, and about the pressing urgency of doing more to those who have helped to achieve that. not only for half of those without access to provide both better access to, and sanitation of, water and sanitation (as stated in the MDG as the moment water for the billions of people still in need of it. objectives). Room for improvement when humanity Today is a very special occasion, as you are the • Secondly (providing that the feasibility Alas, in the domain of sanitation, performance is people whose job is precisely that. There are conditions announced in Kyoto are much less impressive, and there is a huge effort very few jobs that are closer than yours to the respected), the entire family of concerned needed to develop the sector. made access task of serving the common good and making actors must redouble its efforts in that Gerard not only shows that we are still far from the world better. This is really a wonderful direction. the objective, but that there are also even more to water and challenge. It is also a reason why you may • Thirdly, the above points should not fundamental misgivings. One is that the MDG frequently find yourselves at the centre of be seen as recommendations but as objectives are not demanding enough in terms sanitation a political controversy, for you cannot be so close obligations that everybody is obliged to of the quality of water. Another is that the to the heart of global governance and not be respect. MDG’s are far from being what they should be at the centre of controversy. Millennium in the domain of sanitation. A third misgiving Now, it is extremely difficult to be able to say, in Sustainable cost recovery concerns the demographic revolution that is Development front of such an audience, what strategies are The recognition that water is not a free good, going on in the world, namely the rapid spread needed in the aftermath of the crisis. So I will but that it has a price which must be reflected of urbanisation. Goal objective. restrict myself to a few remarks. in sustainable tariffs is central to the sustainable cost recovery strategy we invited water service Unexpected global developments Making water a right providers to not depart from; essentially, This mixed picture has been made more Michel Camdessus adopting tariff structures, facing full operating Let me start by reminding you that in the long daunting and, in certain ways, more promising, Michel took office as Managing Director and Chairman of the Executive Board of the and financing costs, together with the cost history of humanity, the first decade of the by some unexpected developments that have International Monetary Fund (IMF) in 1987. In 1996, the Executive Board of the IMF of renewing infrastructure, but ensuring third millennium can be remembered as the taken place, including: unanimously selected Michel to serve a third five-year term as Managing Director, beginning individual affordability for the poor. A lot still moment when humanity made access to water needs to be delivered to make this principle • The emergence of mature developing January 1997. To date, he is the longest serving Managing Director of the IMF. and sanitation a Millennium Development Goal fully effective, but it is essential to the success countries. (MDG) objective. Earlier in his career Michel Camdessus became director of the Treasury in the Ministry of of what we are trying to do. • The financial crisis. Finance in 1974, served as Chairman of the Paris Club, and was Chairman of the Monetary The end of the decade can be remembered Outlining these three main points helps us to • Better knowledge of the consequences of Committee of the European Economic Community from 1982 to 1984. In 1984, Michel was for the declaration by the General Assembly of recognise that we are far from implementing climate change on water. appointed Deputy Governor of the Bank of France, and then appointed Governor in November UNAIDS in July 2010 that access to clean water them fully. Nevertheless, it is also true that 1984. He served in this post until his appointment as the seventh Managing Director of the and sanitation is a human right. A Millennium • The acceleration of urbanisation. these three points have started guiding objective. A declaration of right. • A more precise sense of what the MDG IMF. the action of governments, international objectives should be, if we wish to avoid Michel Camdessus is Honorary President of the Semaines Sociales de France and was a A long-term effort has been needed to reach institutions, local authorities, public and private achieving only minimal results. Member of the Commission for Africa established by Tony Blair. He is a member of the UN this stage, but nothing less than this would service providers as well as private sector have been acceptable; remember that at the enterprises. This has led to significant progress. Secretary General’s Advisory Board on Water and Sanitation and was the Chairman of the Emergence of developing countries beginning of this century, more than one Of course, a lot remains to be done, and we World Panel on Financing Water Infrastructure. He is a Member of the Africa Progress Panel person in three throughout the world was are not yet on track to meet the MDG’s targets The recent Nobel economist winner, Michael (APP), chaired by Mr Kofi Annan, which is an independent authority on Africa launched in 2007 suffering hardship and indignity from the lack to halve the number of people without safe Spence, tells us that the phenomenon which to focus world leaders’ attention on delivering their commitments to the continent. of adequate water supply. drinking water and basic sanitation by 2015. has taken place in the last decade has only one precedent in the history of humanity: the
32 Focusing on performance // Water & the public sector financial crisis Michel Camdessus // Unexpected global developments 33 Global Water Summit 2011 Focusing on performance Water & the public sector financial crisis
Industrial Revolution, which began in Europe at living in cities in Africa with no access to tap Closing comments the end of the eighteenth century. After more water at home has increased by 37%. This is Thinking in particular about Africa, let me finish or less stagnating with a growth rate of around indeed a major challenge. by noting the importance for the multilateral 3% for years and years, these countries (and development bank to continue increasing their you know who they are) are now growing at a contribution to the poorest countries, and for rate of 7% or more. China is growing at a rate of Moving forward our countries to help the replenishment of two around 10%. So, where should we go in this new context? Significant changes can be expected, and the important facilities: the African Water Facility This phenomenon is changing the face of the most obvious among the new developments and the Global Water Access and Sanitation world. The IMF has a very conservative vision relates to advanced countries that are Facility. Here grant and ODA money are needed, of the world; nonetheless, they predict that facing huge indebtedness and deteriorating but it is key if we wish to reach the MDGs. China’s GNP will be higher than that of the budgetary positions. These countries will We must facilitate the access of utilities to Eurozone in 2025, and China will catch up with be obliged to tighten their budgetary financial markets. The borrowing capacity of the U.S. in 2030. If you were to calculate that management, and cancel any reliance on water operators needs to be enhanced so that in terms of purchasing power, then it would be government subsidies; especially for projects credible and bankable projects are elaborated much earlier. From now to the year 2050, 80% where full cost pricing is a possible source of and financed at several levels. This is possible, of the growth of the world will be the result of finance. This could end up translating into a particularly in this new context, provided that the development of these countries. reduction in ODA contribution. these utilities show that they are exemplary Invitations to multilateral development banks in their management and in the way in which Financial crisis – the World Bank and its regional sisters – they implement the principle of sustainable With the worst financial crisis in eighty years to increase their contributions, long term cost recovery with, I would say, a human face, (and possibly longer), despite the millions of loans and guarantee schemes have already namely accessibility for the poorest. We must people that continue to emerge from poverty, been developed, but this is something the know that there is a possibility of a circle government finances are in total disarray, with financial crisis will oblige governments and between accessibility and sustainability. This is some of them close to bankruptcy. In spite of development institutions to consider further. possible, and has been already realised in many that, we must continue to develop new work countries. Nevertheless, remember that I am talking and activities, in the face of the challenges This is a way towards major progress. before us. about financial deterioration in relation to advanced countries. The crisis has not affected all countries in the same way. Africa, Climate change for instance, has been little affected due to Another development of major importance its limited connection with major financial is better knowledge of the consequences of networks; while emerging economies exhibit a We must know climate change on water. There is a correlated further set of characteristics. need for climate adaptation, particularly that there is a mitigation but, for Africa in particular, Two key features must be kept in mind as far adaptation and better preparedness for as water is concerned. Firstly, these countries disasters are needed. are now developing domestic financial markets possibility of a very actively with the potential to play (for their countries and for others) the same role circle between Urbanisation as domestic markets have played in advanced We are losing the race between demographic countries, and, in particular, in Europe, urban growth and water infrastructure regarding the infrastructure we presently enjoy. accessibility and expansion. The number of people we thought Secondly, the problem many emerging could access more sanitation is increasing in sustainability. countries now face is no longer scarcity of the urban half of the world; you know that financing. When I discussed this within the the world population is half and half – urban This is possible, Framework of the G20, and the International and rural. There are more people now without Monetary System, the concern for developing access to tap water in cities than at the end of markets is retaining the capacity of the and has been the nineties; a huge challenge for the utilities exchange controls, in order not to be adversely there. affected by destabilising capital flows. So here already realised And, of course, as expected, Africa is a tragedy. you can help them to prevent this kind of Between 2000 and 2008, the number of people major risk. in many countries.
34 Focusing on performance // Water & the public sector financial crisis Michel Camdessus // Closing comments 35
Delivering performance amidst austerity
After the Berlin Wall came down in 1989, the city state of Berlin was pitched into a financial crisis from which it is still recovering. Over the same period of time it has managed to build a world class water utility. What can we learn from the experience of Berlinwasser Group about delivering performance when money is tight? Keynote address by [ Jörg Simon ] Global Water Summit 2011 Focusing on performance Delivering performance amidst austerity
Introduction Part privatisation: Improving performance Hello and welcome to Berlin. Today I will try A change in strategy There are four fields where BWB has improved We have a to do my best to tell you about water and Before the partial privatisation of BWB in 1999, its performance and is still improving: wastewater in Berlin; how we do our job and our group was active in many fields, including closed water optimise our business, what we have done in telecommunications and waste incineration to 1) Accounts receivable: Our customers get the last years together with our partners Veolia name just two. transparent information, as well as service and wastewater and RWE, and what our focus is for the future. around the clock. An important part of the restructuring process First let me outline the organisation of the was to make the business more streamlined, 2) Material costs: We have optimised the cycle; 95% of Berlinwasser Group. The Berliner Wasserbetriebe as well as to give Land Berlin the support to life cycle of our assets, while at the same time (BWB) is the largest part of the group, and develop the city as a business location. facing increasing electricity costs. We must the drinking is responsible for Berlin’s water, wastewater also consider our carbon footprint; as a water and rainwater. It is a regulated business, with For BWB, the following points were key and company, we consume large amounts of water comes all service costs being recovered through a were also contractually agreed: electricity, so we are also part of the problem. system of full-cost pricing. Competitive business • Fixed prices for water and wastewater 3) Staff costs: With the help of several socially directly from practices are also part of the Berlin Water Group, services until 2003. accepted HR measures our staff numbers have and we are active in various fields. • No dismissals until 2014. decreased considerably in the last years. For the succession of staff that are going to retire in the Berlin. Looking I would like to speak mainly about our • Contractually guaranteed investment (€2.5 next years, we need to find the right personnel core business, BWB, and about the partial billion from 1999 to 2009). privatisation that took place in 1999. Our two and train them correctly, while ensuring we at how we can • Securing the business of local suppliers. private shareholders, RWE and Veolia together implement suitable HR measures. • Division between “regulated” and improve this hold 49.9% of the business, while the city state 4) Investments: Like all European water utilities competitive business. – Land Berlin – holds a share of 50.1%. we are regulated by the EU Water Framework • Guaranteeing BWB’s autonomy and Directive, which means we have to invest in cycle is very Bringing water to the people economic independence. getting our wastewater cleaner. • Dividends on the basis of capital employed. important to us. Berlin has 3.4 million inhabitants. BWB has 200,000 direct customers since the large housing Land Berlin holds the majority of the shares and chairs the supervisory board. They also control companies providing accommodation for the Berliner Wasserbetriebe’s key statistics bulk of Berlin’s population are counted as just tariffs and set the legal parameters for water one customer each. So although we don’t have supply and wastewater treatment. Water direct contact with all Berliners, every person The private investors are responsible for in Berlin receives our water. We also provide optimising operational costs and investments, Volume of water sold 192 million m³/yr wastewater services to 500,000 inhabitants in and benchmarking. For Veolia building Length of pipeline network 7,889 km Brandenburg, a state around Berlin. competency in Berlin is important, so BWB Number of waterworks 9 The two rivers that run through Berlin, the carries out research on groundwater and Spree and the Havel, are very important in bank filtration here in Berlin, together with Number of wells 700 terms of the city’s water and water quality. universities and experts from Veolia within the Wastewater Our waterworks lie very close to the rivers; framework of the Center of Excellence for Water Volume of wastewater sold 234 million m³/yr 70% of our drinking water comes from bank Berlin. Length of pipeline network 9,541 km filtration, while 30% is from groundwater. BWB is closely focused on water services. The Water protection areas cover 25% of Berlin. Our group does have some daughter companies Length of pressure lines 1,173 km wastewater treatment plants are mainly located that are small relative to the group, but which Number of wastewater treatment plants 6 in Brandenburg, while most of our waterworks are highly competitive. For example, we have an are in Berlin. engineering company – p2m – whose turnover Number of pumping stations 150 in the last 5 years has increased by around Jörg Simon We have a closed water and wastewater cycle; Turnover 95% of the drinking water comes directly from 150%. Water €418 million Jörg Simon has been Chairman of the Executive Board of Berliner Wasserbetriebe since Berlin. Looking at how we can improve this 1999, and member of the Executive Board of Berlinwasser Holding AG since 2002. Prior cycle is very important to us; together with Wastewater €743 million to this he was Managing Director at Compagnie Générale des Eaux Deutschland. He has Veolia and the Center of Excellence for Water Number of full-time employees 3,948 degrees in Civil Engineering and Industrial Engineering from RWTH Aachen. Berlin we are looking closely at how we can optimise water quality in the future. Source: Berliner Wasserbetriebe
38 Focusing on performance // Delivering performance amidst austerity Jörg Simon // Part privatisation: A change in strategy 39 Global Water Summit 2011 Focusing on performance Delivering performance amidst austerity
Accounts receivable Biogas production increased by 8% in the last All BWB services are invoiced, and we are few years, and today 40% of our energy comes In 2008 we signed a working on improving our debt collection from biogas generated by our wastewater performance. For example, outstanding claims treatment plants. commitment with Land are in the region of €1.6 million per year. We We have been working on improvements in only transfer 525 cases of outstanding claims three fields of energy management. Firstly, we Berlin to reduce the carbon per year to our legal department (equivalent negotiated long term contracts, and purchase of €1.3 million), and the write-off rate is 0.12% electricity for ourselves at the stock exchange. footprint by 35,000 tonnes of turnover. That’s very low and we are proud Secondly, we are optimising our energy of this fact. We are also focusing on improving consumption internally through automation, meter reading. We replace 44,000 meters per through new pumps and through strict energy per year until 2010. year, and take around 115,000 meter readings controls. Thirdly, we are working on using per year. alternative sources of energy such as sewage Contact with our customers is extremely sludge, grease, wind energy and energy from important to us; we have several ways of wastewater. keeping contact, including by telephone, email, In 2008 we signed a commitment with Land We have already reached letter or fax. Our call centre is open from 7.00am Berlin to reduce the carbon footprint by 35,000 to 8.00pm, Monday to Friday, and 80% of the tonnes per year until 2010. We have already our target – in fact, by calls are answered within 30 seconds. reached our target – in fact, by the end of 2010 we had reduced CO emissions by 41,000 The past 10 years have seen a marked 2 the end of 2009 we had improvement in BWB’s working capital tonnes. indicator, with decreasing payments needed reduced CO emissions by to maintain our depreciating assets. Advanced Staff costs 2 payments have increased from €358 million to At the time of the reunification, there were 45,000 tonnes. €794 million between 2001 and 2010, while our three water companies in Berlin. One company working capital indicator has decreased from in East Berlin was responsible for water and €205 million to €21 million. wastewater, and there were two companies operating in West Berlin. After Reunification, Material costs Development of costs, 1999-2012 The diagram to the left shows the development Achievements in energy efficiency, 2005-2009 of costs between 1999 and 2012. The light green line indicates actual costs, while the Actual, from 1999 indexed dark green line shows the actual costs indexed Electricity Fuel (petrol Biogas against 1999 prices. You can see that by 2012, purchased and diesel) Heating oil Gas production Actual our costs will be 36% less than they otherwise 280 GWh 29.2 MNm³ would be, had we not undertaken our 2.5 ML 76 GWh 6,629 m³ 26.9 MNm³ €645.6 m programme of efficiency saving measures. 244 GWh 2.1 ML 5,881 m³ We have agreed to several optimisation programmes in partnership with company €471.2 m -36% unions, to work on life cycle costing, increasing 42 GWh 1 2 insourcing activities, working on improving energy efficiency, and so on. €405.4 m €415.6 m Let me show you some of our achievements
in the energy field (see top right figure). The -13 % -15 % +13 % -45 % +8 % 1999 2006 2012 electricity we purchase has decreased from E ciency programmes E ciency programme 280,000 MWh in 2005 to 244,000 MWh in 2009, TEMPO and NOVO, Initiative 2006, a reduction of 13%. However, the amount single measures single measures of heating oil we use has increased, to make 2005 2009 2005 2009 2005 2009 2005 2009 2005 2009 up for the fact that we have reduced our gas Source: Berliner Wasserbetriebe consumption by 45% from 2005 to 2009. Source: Berliner Wasserbetriebe
40 Focusing on performance // Delivering performance amidst austerity Jörg Simon // Part privatisation:A change in strategy 41 Global Water Summit 2011 Focusing on performance Delivering performance amidst austerity
these three companies were merged into one One important investment project I would Development of full-time employee numbers Planned and actual tariffs, 1997-2006 single entity. We had a lot of personnel, which like to discuss is our LISA project. There are 7,000 meant that we needed to optimise our staff many pumping stations in Berlin, which pump Full-time employees numbers. We also needed to better define our wastewater to WWTPs. By creating a network Tari s as planned in 1997 core business for the future, as well as what the between all of our pumping stations, we 5.60 Actual tari s 6,000 main targets were for personal development. installed an automated network, and a central monitoring system that measures wastewater 5.40 Here is what we did: 5,000 flows. On this basis, we are able to optimise • Systematic and strategic workforce planning these flows. The total investment for this project 5.20 4,000 and staff development. is around €65 million. 5.00 • Automation of WWTPs, waterworks and We are also working on connecting all of our 3,000 pumping stations. waterworks, through the LSW Project. Three 4.80 €/m³ • Continuous and demand-driven waterworks are manned around the clock, but 2,000 4.60 Number of employees development of employees and managers. we have homogenous remote control of 9 • Continuous expansion of the social and waterworks from just 4 staffed sites. 1,000 4.40 health-related benefits for employees. Since 1990, there has been a significant recovery of Berlin’s water bodies. Traces of 0 The diagram to the top left shows the 4.20 development of full time employee numbers ammonium have fallen by 97.9%, phosphorus
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 between 1999 and 2009. Within this timeframe, by 80.8% and inorganic nitrogen by 79.6%. 4.00 there has been a reduction of around 2,000 These improvements are related to the 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 employees, but this staff reduction was investments we have made in the last few years. Source: Berliner Wasserbetriebe Source: Berliner Wasserbetriebe socially accepted and reached through diverse measures including part time employment and Tariffs partial retirement. Investments of €7.3 bn in wastewater and drinking water since 1990 Our tariffs have increased over the last few years, On top of this, we value the promotion of since 2003. In the diagram to the top right, Between 1992 and training schemes for young people. Some the dark green line shows the development Focus Focus 100 young people start an apprenticeship of our tariffs up until 2006. But please note 1996, there was Merging the two supply EU Directive Local Wastewater annually, and we offer 24 technical, commercial the development Land Berlin planned in 1997 and disposal networks. Sewer rehabilitation, canalisation: and academic professional opportunities. We (light green line). In 1999 an increase of more a huge amount Improved e ciency. development of areas have around 380 trainees in the company, than 15% was planned, with smaller increases 700 Residential estates in water protection areas and increasing numbers of trainees are being thereafter. Looking at the diagram one can offered fixed jobs across our companies. of investment, 600 see that the actual tariff development has been consistently lower than Land Berlin’s Level of investment 500 Investments projections before partial privatisation. Both especially in the expected to increase The diagram on the bottom left shows BWB’s private investors and the municipality receive slightly in the future money from the BWB; each receives around 400 (self- nanced) investments after the year 1990. The green wastewater sector. bars represent investment in wastewater, while €120 million per year. On top of this, Land Berlin
€ million 300 the light green bars represent investment in receives about €60 million in groundwater drinking water. Between 1992 and 1996, there extraction fees, making BWB a lucrative source This went into 200 was a huge amount of investment, especially of revenue for the city. in the wastewater sector. This investment went improving the 100 into improving the eastern part of Berlin’s Closing comments 0 sewer and wastewater treatment systems, to BWB has managed to improve its operational eastern part of 1990 1995 2000 2005 2009 achieve a uniform standard with West Berlin. performance, while at the same time Source: Berliner Wasserbetriebe Between 1997 and 2009 rates of investment significantly improving the balance sheet Berlin’s sewer have remained steady, between €260 million through increasing advance payments, cost and €400 million; in the future we expect to see reduction, improved energy efficiency, staff and wastewater a slight increase in levels of investment. reduction and rising efficiency of investments. We invest around 43% in sewers and pressure Together, in cooperation with our private treatment lines, 16% in wastewater treatment plants and shareholders, we have achieved much in recent pumping stations, 10% in waterworks and 22% years and plan to achieve a lot more in the future. systems. in our pipeline network. 42 Focusing on performance // Delivering performance amidst austerity Jörg Simon // Tariffs 43 The water performance challenge Successful initiatives from around the world What are the best utilities doing to improve their performance? We shortlisted seven utilities that have significantly raised their performance levels. Each initiative is presented in the quick-fire 8 minute Pecha Kucha format before the audience votes for the 2011 Water Performance Initiative of the Year.
Speakers include Jean-Marc Jahn, CEO, SEAAL, Algiers Taqsem Khan, Managing Director, Dhaka WASA, Bangladesh Klaus Neder, Special Projects Adviser, CAESB, Brasilia Lonnie Frost, Public Works Director, Gilbert, Arizona Epsica Chiru, General Deputy Director, Apa Nova Bucuresti Chaired by Dan McCarthy Zbigniew Maksymiuk, General Director, Saur Neptun Gdansk of Black & Veatch Water Chuck Weber, Operations Superintendant, Wolcott WTP, Kansas [ ] Global Water Summit 2011 Focusing on performance The water performance challenge
SEAAL performance in Algiers: From 8% to 100% 24/7 water supply in 3.5 years
The starting point in Algiers partner with Suez Environnement for 5.5 years through a win-win management contract. The Jean-Marc Jahn Société des Eaux et de l’Assainissement d’Alger programme was also paired with $500 million in A Civil Engineer in fluid mechanics, (SEAAL) is the public company responsible for WINNER new public investment over 5 years. Jean-Marc Jahn began his career in water services in Algiers, the capital of Algeria. Global Water Awards 1981, teaching urban hydraulics. In SEAAL’s experience highlights an interesting Four years later water flows 24 hours per day for 2011 1983 he joined Lyonnaise des Eaux then approach to public-private partnership (PPP), in 100% of our customers and all 57 communities SUEZ ENVIRONNEMENT, where he has which the common goal and key success was of Algeria have continuous supply, which is to provide water, in a water-stressed area, to all occupied a range of posts, in France and obviously a great pleasure to Algerian citizens. of Algiers’ 3.2 million inhabitants. The quality of water improved quickly each abroad, in the public service sector for year, and we soon achieved 100% compliance The starting situation was very bad. 92% of water and waste management. (see the figure below), which we were able to customers did not have a continuous, reliable Since June 2007, Jean-Marc Jahn has achieve before having a fully continuous water supply of water and only 6% of the wastewater supply. been CEO of SEAAL (Société des Eaux was treated. At the same time the water et de l’Assainissement d’Alger), the company had poor customer service and Algerian public utility managed by SUEZ employee motivation was very low. ENVIRONNEMENT. SEAAL has 4,500 Water now fully complies with water quality standards employees and serves the 3.2 million A management contract 100 inhabitants of Greater Algiers. between Algiers and Suez 10 99 forms a new public company 9 98 The main performance targets of the PPP were 8 to: 97 7 • Provide continuous, 24/7 water supply for 96 6 all customers within 3.5 years. 95 • Provide 100% potable water. 5 94 • Improve the low levels of sanitation 4 coverage. 93 3 Number of con rmed pollutions Number of con rmed At the same time we wanted to enhance bacteria to standards % conformity 92 customer satisfaction and transfer know-how to 2 91 all 4,500 local employees. 1 90 The government decided to create a 100% 0 public company, SEAAL, as a test case for the Jan 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 modernisation of water services, and decided to Source: SEAAL
46 Focusing on performance // The water performance challenge Jean-Marc Jahn // SEAAL performance in Algiers 47 Global Water Summit 2011 Focusing on performance The water performance challenge
Fifty nine beaches are now open compared to with 6 being the best level in the world and 3 from Suez Environnement on the basis of a Before improvements to sanitation . . . 39 in 2006, an effect of our improved sanitation being the average international standard for a well structured method which enabled me to and sewerage, and this has clearly improved the mature water service. Our original targets with master my craft. In my turn I have become a lives of our citizens (see the figures to the left). the government were to set targets slightly trainer for my Algerian colleagues”. higher than the international average and we Each year we conduct a large scale survey of A customer reminded us that “the chore of are closing in on this target. customer satisfaction, and we are now the fetching water is now only a bad memory. . . in reference case in Algeria for water services after the past we waited for the water to arrive late just 5 years (see the top right figure). A satisfied public and a into the night to be able to fill the jerry cans”. She is happy that this is no longer the case: We have already met the targets in our sustainable improvement in water “Our life has changed completely. When we see roadmap in terms of the transfer of know-how services SEAAL, it is a strong company. Its employees are to company staff. We organised 50,000 days Testimonials from individuals representing present in the streets. They have equipment and of employee training, in which over 55% of the Algerian government, SEAAL staff, and high technology. The work is finished right to trainers are from Algeria, a key indicator of the public highlight their satisfaction with the end. We are developed”. sustainable knowledge transfer. To measure improvements in water services. According to our overall performance levels we used an an official from Algiers: “The water department I’m convinced that SEAAL is an emblematic original methodology developed by Suez of the municipality of Algiers and SEAAL have success story in that nobody initially believed it Environnement called the Water International set up a remarkable coordination at all levels was possible, but people now have water, the Knowledge Transfer Initiative (WIKTI). WIKTI of management and operations”. He continues, water quality is good, customer satisfaction is assesses the global efficiency of a water “the results are tangible: water 24 hours a day, good, the transfer of know-how has worked, company based on a mapping framework of fewer leaks, less water lost, quality customer and we are operating a sustainable system. In 36 business processes. For example, to assess management, and satisfaction of both the summary, Algerian authorities wanted a change drinking water service we look closely at leak population and the local authorities”. in their water situation, Suez Environnement repair, and in wastewater we will measure brought their know-how, and I can say that we One of our SEAAL managers said, “I have had Source: SEAAL maintenance of pumping stations, and so on. all succeeded together. Performance in each level is measured from 0-6, the opportunity to be trained by the experts
. . . And after: Improved sanitation benefits Algiers’ beaches 92% of customers Four years later Customer satisfaction climbs under SEAAL 100 did not have a water flows 24 Customer satisfaction continuous, reliable hours per day 90 supply of water for 100% of our 80
and only 6% of customers and all 70 %
the wastewater was 57 communities 60 treated... of Algeria have continuous supply, 50 which is obviously 0 2007 2008 2009 2010
a great pleasure to Source: SEAAL Algerian citizens. Source: SEAAL
48 Focusing on performance // The water performance challenge Jean-Marc Jahn // SEAAL performance in Algiers 49 Global Water Summit 2011 Focusing on performance The water performance challenge
The performance challenges of Dhaka WASA Introduction to Dhaka WASA The history of the Dhaka city goes back more than 400 years. Until 250 years ago it was At Dhaka Water Supply and Sewerage Authority ruled by a Moghul emperor and was 10 km² in DISTINCTION (WASA) we serve the capital of Bangladesh size. Under British rule it grew to 22 km² and and face a number of challenges. These Global Water Awards kept expanding during the Pakistan period to include unplanned development and informal 2011 50 km². Now it is 350-465 km² in area, and this settlements, transitioning to using surface water rapid growth is our main challenge. We expect instead of groundwater, and large investment our current population of 12.2 million people to funding. But we have a number of notable expand to 21 million by 2025 and to live in an achievements including improved service area of about 1,000 km² (see the figure to the quality, increased revenue, reduction of non- Taqsem Khan left). revenue water, and provision of water supply at Taqsem Khan is the Executive Head of Dhaka Water low cost. Supply and Sewerage Authority (DWASA), a service Challenges and investment plans oriented autonomous commercial organisation in the Evolution of Dhaka We have almost 100% water coverage and public sector covering a service area of more than 460 our water demand is 2.25 million m³/d, km², and a population of 12.5 million. Taqsem’s most which slightly exceeds our supply of almost important achievements are the significant increase in Tongi Khal Turag River 2.11 million m³/d. 87% of this water is from water production and productivity, and the substantial groundwater abstraction from our 577 deep raise in revenue earning. Tongi Bazar tube wells. The remainder comes from surface Balu River water and is treated by 4 small treatment plants. Taqsem has almost 30 years of management experience. He obtained his Master’s in Mechanical However, we have to change our focus to using Engineering from Moscow, USSR in 1981, and started surface water because abstracting groundwater is no longer ecologically viable with water his professional career with PHILIPS Bangladesh Ltd. as Mirpur tables falling 3 metres each year. But treating Production Engineer. Rupganj our surface water is also a challenge, because Besides his professional engagements, Taqsem is an the large rivers nearest to Dhaka are also quite environment activist and expert. He finds his greatest polluted. In our 10-year plan we plan to treat joy to be mobilising environment NGOs, civil society, surface water and intend to divert water from academicians and environment activists to bring them Sitalakhya River less polluted rivers 17 km, 45 km and even under one umbrella to fight against the degradation Shimrai 160 km distant. of Bangladesh as well as the global environment by At this moment we have a water treatment organising international environment conferences Buriganga River Bangladesh period plant under construction, with a water and forming civil society pressure groups. He is one treatment capacity of 225,000 m³/d, and we Pagla Pakistan period of the founders of the environment movement in have $250 million in Danish development British period assistance. The $1.8 billion allocated in our Bangladesh, and played an active part in the formation Moghul period investment plan for developing water sources of Bangladesh Poribesh Andolon (BAPA) in 2000. Narayanganj will give us an additional 1.6 million m³/d, Also, Taqsem is one of the leaders and a member which will allow us to eventually draw 70% of of the Initiators’ Group of Bangladesh Environment Dhaleswari River our water supply from surface water, and the Network (BEN), a global network of pro-environment remainder from groundwater. At this moment Bangladeshi professionals and activists living in the we have 6 ongoing investment projects, USA and abroad. Source: Dhaka WASA including one to construct boreholes for deep
50 Focusing on performance // The water performance challenge Taqsem Khan // The performance challenges of Dhaka WASA 51 Global Water Summit 2011 Focusing on performance The water performance challenge
From 0 to 2.5 million people
capacity building, promoting transparency Planned surface water treatment plants in all activities, establishing a new chain of command for accountability, and improving served in 50 years: Rapid Name of project Water production (m³) Investment ($ million) our operating ratio. Saidabad Phase II* 225,000 250 The programme also fosters customer service Saidabad Phase III 450,000 500 excellence by building a staff mentality that expansion in Brazil’s capital Padma/Pagla 450,000 550 customers are the masters and we are the Khilkhet 500,000 500 servants. Total 1.63 million 1,800 Key successes of Dhaka WASA * Project under implementation There are a number of key achievements that Source: Dhaka WASA reflect our commitment to better customer CAESB provides service: tube wells, and the Dhaka Water Supply water is only $0.08. While this is extremely water and Sector Development Plan to completely affordable, it is also a big challenge to us • A fully computerised billing system. replace our water pipelines using Asian since we wish to introduce a public-private • Monthly billing on time. sewerage services Development Bank funding. Under another partnership, which would entail setting an • 24-hour payment ability via SMS. World Bank project we plan to increase our economic price. At the same time we are • 96% of bills sent out and 92% of bills drainage coverage from the current level of trying to reduce our operating ratio from 0.79 to Brazil’s capital received. 38% to 100%. to 0.70 by the end of 2011. • 24/7 continuous water supply. Brasilia – the Besides water we also look after sewage Our recorded water loss was 34% for 2010, Besides our advances in customer service, treatment through our sewage treatment and at this moment it is down to 29%. This I would like to reiterate a number of Dhaka plant, though we only provide 30% coverage compares to an average of 35% across only large city WASA’s key successes. We now offer since most households have their own septic Southeast Asia, and we aim to bring water improved service delivery and our revenue tanks. We are also responsible for stormwater loss down to 25% by July 2012. in Latin America drainage and are able to cover 38% of the recovery has risen 92%. As mentioned earlier, city. Another large problem for us is water service our NRW as recently as 2009 was 34% but provision to our informal settlements, in has since fallen to 29%, and we are confident with full water We have 291,000 domestic and commercial which 37% of Dhaka’s population resides. of reaching our 2012 target of 25%. Another connections. This may seem low, but in some Dhaka WASA has undertaken a number of positive sign is our increased revenue, up and sanitation areas of Dhaka each connection may serve water and sanitation projects to tackle this 20%, or $14.5 million, in the last 1.5 years. up to 1,000 households. So this is how we issue. Finally our operational ratio is down to coverage. can serve a city of 12 million. 0.79, with a near-term target of 0.65, which We have also undertaken the 2010-2012 besides funding operations and maintenance At the moment we provide the cheapest Dhaka WASA Turnaround Programme, where will allow us to make larger investments in water in the world. The price of 1 m² of we have asked for institutional reform for the water future of Dhaka. How did CAESB Klaus Neder Klaus Dieter Neder is a Civil Engineer with specialisation in Sanitary Engineering. He is the The Dhaka WASA Turnaround Programme fosters customer achieve this? head of the Special Projects area from CAESB, a public company responsible for water and sanitation in Brasilia – Brazil, and has also been acting as an international consultant service excellence by building a staff mentality that for several institutions including the World Bank and the Inter-American Development Bank. With significant experience in the design, construction and operation of water customers are the masters and we are the servants. and sanitation projects, including water resources management, Mr Neder was able to develop several new concepts in wastewater treatment technology, especially regarding low cost solutions for developing countries.
52 Focusing on performance // The water performance challenge Klaus Neder // From 0 to 2.5 million people served in 50 years: Rapid expansion in Brazil’s capital 53 Global Water Summit 2011 Focusing on performance The water performance challenge
Brasilia’s basic challenges How CAESB restored water network and treatment facilities. However, primarily through modern management and we received from customers was that social in just 10 years, through the construction of appropriate technology. We are particularly participation helped people understand how Since our city At CAESB we are responsible for water and resources and achieved universal a sewerage network throughout the basin, proud of our Melchior treatment plant (see to use the system and also provided valuable sewerage services in Brazil’s capital, Brasilia, service many pumping stations, and two large bottom right figure), which serves 1 million information on expected costs and payment a 50-year-old city with a current population is upstream When the city of Brasilia began to be planned tertiary wastewater plants, the lake had fully people. This is the largest plant in the world options. of 2.5 million. Our tropical savanna climate, out, water and wastewater management recovered and the media headlines reported, that uses a combination of upflow anaerobic location in the centre of the country, and We are also recognised internationally of three were high priorities. The city’s first wastewater “Paranoá Lake healthy again”. sludge blanket digestion (UASB) reactors altitude 1,000 m above sea level give us a wet for our innovations generating low cost treatment facility, an innovative activated with a tertiary activated sludge process, and season and a very dry season. Our natural water In 1998, 20 years after the initial sanitation solutions and are recognised for continental sludge plant, began operation in 1962 when the it was developed, tested, and implemented quality is very good, but is only available in eutrophication incident, we achieved water resources management, appropriate city was only 2 years old. However, increasing ourselves. basins, limited quantities. And since our city is directly discharge of sewage into the Paranoá Lake led universal coverage, meaning sewerage and wastewater technology, and water loss upstream of three continental basins, our water to large-scale eutrophication as well as a public water services for all, and treatment of all control. Besides simply using modern management impacts the rest of the country. relations problem for CAESB. A 1978 headline collected wastewater. Fostering a business-orientated technology we also strive to be a company our water that invests heavily in research and in social Although Brasilia was envisioned by planners as from a newspaper stated, “The city is stinking”. We have also built 17 wastewater treatment and customer-orientated participation. management a “green city” in the late 1950s, the emergence of This presented a large challenge to CAESB so plants that we constructed using indigenous approach satellite cities and new settlements superseded we took the decision to make environmental technology appropriate to our conditions. CAESB is a business orientated company Our next goal is to use the water of the the city’s original master plan. This rapid growth sanitation our ultimate goal and undertook a In fact today we are the only large city which means that we operate without the Paranoá Lake, our formerly polluted water impacts the in population has brought large infrastructure large scale effort to restore water quality. in Latin America with full water and benefit of government subsidies. We are also body, as a water resource and we are challenges, such as service provision to low- Since eutrophication was not very well sanitation coverage. As can be seen in the a customer orientated service with a 24-hour currently evaluating membrane technology rest of the income settlements around the city. However, understood at the time, resolving the issue accompanying graph (see top right figure) call centre. All of our activities also include a to make this a reality. With our efforts at because of the availability of land, low-income was initially a difficult task. We had to conduct our increasing sanitation coverage correlates social participation component, especially CAESB to reuse most of our water in the country. areas are not informal slums as in other parts of research, decide on a course of action, quite closely with decreasing child mortality. in sewerage where we used it to develop a future, we can proudly say that we are firmly Brazil and instead have proper addresses and moving towards closing the water cycle. undertake detailed design, and construct the We achieved universal service coverage shared, condominial model. The feedback good infrastructure.
The link between sanitation coverage and child mortality The innovative Melchior wastewater treatment plant With our efforts 100% at CAESB to 90% reuse most of 80% our water in 70%
60% Water supply the future, we Sanitation 50% Child mortality can proudly 40% say that we are 30% firmly moving 20% towards closing 10% the water cycle. 0% 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004
Source: CAESB Source: CAESB
54 Focusing on performance // The water performance challenge Klaus Neder // From 0 to 2.5 million people served in 50 years: Rapid expansion in Brazil’s capital 55 Global Water Summit 2011 Focusing on performance The water performance challenge
Partnering for performance: the Gilbert and Chandler experience Water use in Chandler has caused a problem. There are areas in our process we chose was ballasted flocculation, and Gilbert valley that have experienced as much as 12 ft which essentially uses sand as ballast for the (3.7 m) of subsidence because of over-pumping particles to congeal around and fall out quickly. I would like to talk about a couple of of groundwater. In 1980 the State Legislature This process was chaosen since it requires municipalities that partnered to make things passed the Arizona Groundwater Management 25% of the space of the normal sedimentation happen. The Town of Gilbert and the City of Act, which mandated every user reduce process that we use at our North Water Chandler are located in the southeastern part groundwater use and either prove a 100-year Treatment Plant, so the footprint and cost were of the Phoenix metropolitan area in Arizona and water supply or halt development. much smaller. The ballasted flocculation process our municipalities have experienced explosive also treats water much quicker – in 20 minutes Both municipalities owned and operated growth. In Gilbert we were the fastest growing compared to 6 hours in a normal sedimentation We believed treatment plants treating Salt and Verde municipality in the United States in the 1990s, process plant. We also included ozonation, River water and some of their Colorado during which time we experienced a 10% a 6 MGD reservoir (23,000 m³/d), and 39,200 that there was River allocation. Our existing water system annual population growth. On average we were gal/min (148 m³/min) booster capacity out of occasionally was unavailable due to starting construction of 250-300 homes per the reservoir. We are also producing sodium maintenance and we knew we would need a significant month and this continued until 2005 (see the hydrochloride, or bleach, onsite for residual additional water sources to meet the demand figure at the bottom of the page). chlorination. opportunity projected for 2009. Moreover, we believed that Our climate is very mild, with an average rainfall there was a significant opportunity for the We also needed to construct a pipeline to bring for the of only 7.5 in/yr (19 cm/yr), an average daytime municipalities to save money by partnering to water from the CAP Aqueduct and we did temperature of 66 °F (19 °C) in winter, and an construct a joint plant to treat Colorado River this with a design-build scheme, in which we average daytime temperature of 108 °F (42 °C) water allocations. chose the designer and builder as a team from municipalities in summer. This is warm, but it makes for a mild inception. This method was chosen because of climate which is very good for farming. Our area Partnering to build a new water the substantial rights-of-way issues that needed to save money is widely known for its alfalfa, corn, potato and to be addressed in order to bring water to our wheat production. treatment plant and a pipeline to two municipalities. Pipeline construction began by partnering. On the far western edge of Arizona is the the Central Arizona Project in 2007 and was completed in December 2008, Colorado River. The Central Arizona Project When we engaged a design team in 2005 for on time and five months before the treatment (CAP) brings water from the river into central our new Santan Vista Water Treatment Plant, we plant was completed to ensure sufficient time Arizona and terminates in Tucson. Both chose qualifications over cost as our primary to fully test the system. municipalities already draw water supplies criterion and selected Black & Veatch. From From the CAP to our municipalities there is a from the CAP. To the northeast of us, we have there we moved into a pre-design study to look bend in the pipeline. Originally we intended for the Salt and Verde River systems, where our at different technologies. We made a concerted the pipeline to be 12 miles (19 km) in length, municipalities derive 50% of our supply through effort to visit and speak with actual operators, but the town of Queen Creek, which the pipe an extensive canal system maintained in the rather than operations managers, to better would go through, was undergoing extensive valley. In addition Gilbert and Chandler have understand the operational nuances of each of development and we were forced to choose a 18 and 30 groundwater wells, respectively, to the evaluated water treatment processes. longer 13.5 miles (21.7 km) route. supplement our water supplies. About 30% into the design process, we selected There were many challenges that we In this area, the overuse of our groundwater and engaged the construction team since had to overcome to build the pipeline. we wanted their input on the design and Environmentalists noted that the pipeline construction implications. Sundt Construction entered areas historically populated by was selected as the contractor based on indigenous populations, so we had to do Population growth of Chandler and Gilbert experience over cost. We began construction of assessments to mitigate any disruption to the water treatment plant in June 2007, and by buried archaeological artifacts. To secure Lonnie Frost Year Population of Gilbert Population of Chandler May 2009 we were producing drinking water. easements and right-of-way along the length Lonnie Frost holds a Bachelor’s Degree in Hydrology and a Masters Degree in 1980 5,700 29,700 In our pre-design study we aimed for a Phase of the pipeline, we also had to coordinate with Administration. He has worked for the Town of Gilbert, Arizona, for 26 years and 2010 208,000 236,000 1 capacity of 24 MGD (91,000 m³/d), with and request permits from 17 different agencies served as Director of Public Works for 13 years. He and his wife, Shelley, are the each municipality receiving 50% share of the to build this pipeline. We also had to take into parents of 6 children and have been married for 30 years. available capacity. The principal treatment consideration our impact on businesses and
56 Focusing on performance // The water performance challenge Lonnie Frost // Partnering for performance: the Gilbert and Chandler experience 57 Global Water Summit 2011 Focusing on performance The water performance challenge
traffic since our construction affected major In order to elicit stakeholder input open houses roadways. were part of our design and construction process. Before we began any construction However, the process was not entirely trouble- Think performance. we invited residents to several open houses free. We experienced a flood that was not and we continued these events throughout natural but manmade. As we were testing the the construction process. At construction treatment process, a couple of valves were milestones we held additional meetings to inadvertently left open and the gallery was explain our progress and future action they Act performance. flooded, which affected electrical equipment. could expect. We also made extensive use of In spite of this, the flood event did not slow us computer animation to show people a mock-up down since we came together as a team and of the plant to help them understand what they worked hard to successfully avoid any delay. To Presented by Epsica Chiru would see in the future (see the figure to the our great satisfaction we were under budget bottom left). both with the water treatment plant and the The vision of pipeline construction, which of course satisfied Apa Nova Bucuresti our elected officials (see upper figure). Accomplishment of major goals at Santan Vista and future Apa Nova Bucuresti is the Romanian subsidiary of Veolia Water Company. Since a public- Actual cost and budget of treatment plant and pipeline expansion plans private partnership (PPP) agreement in At our dedication celebration for the Santan 2000, Apa Nova Bucuresti is responsible for Costs Water treatment plant Pipeline Vista Plant, we had both mayors of Gilbert and the water supply, water treatment, sewage ($ million) ($ million) Chandler present, we held a ribbon cutting management and stormwater collection for Design 11.6 6.6 ceremony and took people on tours of the over 2 million people in Romania’s capital, facility to show the inner workings of the facility. Bucharest. As we perform a vital service for the Construction management 6.1 2.3 community we wholeheartedly embrace our We accomplished our major goals – our Land 4.2 2.6 mission statement: Think performance. Act dependence on groundwater was reduced performance. Construction 92.2 33.0 and a second source of surface water was Total actual cost 114.1 44.5 established. Furthermore the pipeline and And what is our definition of performance treatment plant were designed and constructed embedded in our philosophy? We often say Total budget 114.9 50.5 in only 44 months and we were able to meet about ourselves: “We like to swim and we are summer 2009 demands using this water. not afraid of the ocean”. Though to be fair we The municipalities saved $44 million in our must contend with the forces of nature from construction costs and we believe that we’re time to time. Moreover, in the challenging saving $600,000 each year as we operate this emerging market setting of Romania we attain Computer rendering of the Santan Vista Water Treatment Plant plant. We’ve received many awards, though a high level of performance by building on the what we are most proud of is the regional past and focusing on the future. This requires partnership we forged to make this happen. boldness, but with the hard work, human touch, passion and innovation of our over 2,000 What does the future hold for our plant? employees, we are up to the challenge. Because of the raw water pipeline’s drop Epsică Chiru in elevation from the CAP Aqueduct to the At Apa Nova Bucuresti we are powered by a set plant, there is a significant head of 220 ft of shared values: Epsică Chiru is General Deputy Director (in charge of quality, environmental (67 m of head) at the treatment plant. We protection and emergency situations management ) and spokesperson at are considering the possibility of generating • Performance at all levels to sustain long S.C. Apa Nova Bucuresti S.A. – a Veolia Water Company. Prior to this he was hydroelectric power, from which we could term development. Director at the Bucharest General Water Regia and Associated Lecturer at the save as much as $200,000/yr in power costs. • Responsibility in all our actions to improve University for Civil Engineering, Bucharest. In 2017, we are anticipating constructing the people’s lives. He graduated in chemistry from the Faculty of Technological Chemistry at the second phase of the Santan Vista Plant, which • Solidarity, we value our members’ University “Politehnica” Bucharest. He also has a PhD in Inorganic Chemistry will double our treatment capacity to 48 MGD communities and we believe success is (182,000 m³/d). everyone’s victory. and Environmental Protection from the same university. He is a member of the Romanian Water Association, the International Water Association, and the • Innovation in the services we provide to Romanian Association for Standardisation. In addition he has published 60 prepare for the future and permanently improve performance. technical and scientific papers, as well as 4 books for students.
58 Focusing on performance // The water performance challenge Epsică Chiru // Think performance. Act performance. 59 Global Water Summit 2011 Focusing on performance The water performance challenge
Apa Nova Bucuresti is more than simply a previous operator, Water Regia, did not utilise 9001- and 14001-certified. from over 600 million m³ in 2001 down to Before: Now: business and our people-based approach modern water treatment technology and 244 million m³ in 2010. Operations under Water Regia Our Arcuda Water Treatment Plant was Operations under Apa Nova Bucuresti highlights what we have been able to had insufficient water treatment capacity. completely refurbished in 2006 and now has Apa Nova Bucuresti is also actively involved achieve in only 10 years: Employees did not operate in a culture of a production capacity of over 650,000 m³/d. in several projects for raising environmental modern management and lacked both • We focus on the business and we are Many of the facilities have transitioned awareness, with special emphasis on sufficient safety measures and the proper one of the most profitable businesses in from manual to fully automated operation. youth education. The company’s events for tools to complete assigned tasks. the Romanian utility market. We feel no In case of emergency the Arcuda Plant the World Environment Days involve our shame in earning a profit as this can be Prior to the concession contract the can be operated independently from employers as well as our customers and reinvested. company operated with a top-down the national electrical power supply. We always include special events for children in • We empower our workers as the approach which was reflected in our also constructed a completely new and order to foster their creativity and to prepare centrepiece of the human resources customer service centres, wherein customers modern water treatment plant, Crivina, in them to undertake a green lifestyle. would have to physically stoop down to 1.5 years and inaugurated it in 2006. The management. While we take care of our customers, we also speak through the small service windows. modern treatment process now utilises • We take care of our customers’ take care of an entire city. So, we thought, Now at our facilities customers interact more water ozonation in 2 different stages and communities as we are part of a large why not contribute to the life of this city closely with employees in a much more powdered activated carbon treatment. We community of over 2 million people. and conduct a campaign to highlight the relaxed setting, and we are actually the only also built a state-of-the-art alert station for close relationship inhabitants of Bucharest • Driven by our beliefs, we work with an place in Bucharest where customers can sit detecting pollution on the Arges River and have with their capital? Entitled “Why do old saying in mind, “People bless the down on eco-friendly recycled furniture (see our teams are prepared to respond to any we love Bucharest?” we filled streets, bus place in which they stay”. figure to the left). incident. stations, subway stations and parks with As a manager at the former operator, Water When we assumed operation of the emotional messages posted in the places The transition to new Regia, I can recall our operating conditions sewerage network as Apa Nova Bucuresti most frequented during the day to remind all management before we began modernisation of our water much of our equipment was in need of residents about their favourite locations and The origin of Bucharest’s water supply and treatment plants. Built in 1970, the Rosu replacement, including critical tools for encounters in the city. sewerage network goes back more than a Water Treatment Plant was upgraded in 2002 staff working inside the sewerage system. This was followed in 2010 by our 10-year century. When Apa Nova Bucuresti assumed by Apa Nova Bucuresti and it is now one of Whereas before employees lacked protective anniversary campaign with the slogan, Source: Apa Nova Bucuresti management responsibility of the network in the most modern in Romania. State of the clothing and helmets, today they are fully Source: Apa Nova Bucuresti “Bucharest is yours to create!” Throughout the year 2000 through a 25-year concession art technology has made the difference, and equipped with the modern equipment the whole year, AquaNova involved the contract with the city of Bucharest, the all Apa Nova Bucuresti activities are fully ISO necessary to fully maintain all 2,400 km of our inhabitants of Bucharest in activities intended sewerage system. As you can see from the to make them feel closer to the city they live accompanying photographs (see top right) Apa Nova Bucuresti’s new eco-friendly customer service centre in and remind them that there are still things before the year 2000 employees approached Apa Nova to discover. Over 30,000 people joined in We are network problems as they dressed, several activities to clean the city and make haphazardly, but now they are well equipped Bucuresti is more it friendlier. getting and trained to deal with any situation (see than simply a bottom figure). Finally just as water is essential to life, so involved is performance essential to our business. In 2000, at the start of Apa Nova Bucuresti We wish to highlight our reduction over operation, a group of people envisioned - business and the period 2000 to 2010 of electric power in long performance. Today, we stand together with consumption from 217 GWh to 55 GWh, all our employees to act performance. our people- which is equivalent to a reduction of 800,000 term actions tonnes of greenhouse gases. Moreover we based approach Apa Nova Bucuresti is an achieved significant cost saving through our intended to ecological company management. According to the 2010 Castalia Report for the World Bank, “If the utility had highlights what We are aware of the impact of our daily protect the made the same investments in improved actions on people’s lives. Hence, we are service, but with the efficiencies observed in getting involved in long-term actions we have been Romanian utilities that do not have a public- environment intended to protect the environment and private partnership, the total cost of service to preserve water sources. We placed heavy able to achieve provision over the period 2000–2008 would and preserve emphasis on reducing any wastage of water. have been $349 million higher”. The result: a reduction of the raw water in only 10 years. Source: Apa Nova Bucuresti abstracted for drinking water production water sources.
60 Focusing on performance // The water performance challenge Epsică Chiru // Think performance. Act performance. 61 Global Water Summit 2011 Focusing on performance The water performance challenge
Gdansk, Poland: Improved performance
An overview of the Saur We serve over half a million inhabitants with Notable performance Neptun Gdansk public-private a 2010 turnover of more than €50 million. improvements since 1992 In addition to the contract with Gdańsk we partnership also have a contract with the city of Sopot, Because of SNG’s efforts, over 25 km Saur Neptun Gdańsk (SNG) is the first though only Gdańsk is an SNG shareholder. of Gdańsk and Sopot’s beachfront was public-private partnership (PPP) in Central Sopot is an increasingly popular resort town reopened, which had been off-limits for and Eastern Europe in the municipal service on the Baltic coast, which we think of as the 16 years due to water pollution. In order sector. The partnership is between the city of Polish Saint-Tropez with over a million visitors to achieve this, we had to optimise the Gdańsk and the Saur Group, holding 49% and annually. technology in our wastewater treatment 51% of ownership shares, respectively, and plants and improve management of our SNG operates a water supply network over stormwater flows. was signed for 30 years. 1,400 km long, with 22 water intakes and Gdańsk, the city that symbolises Poland’s annual production of nearly 30 million m³. Today it is hard to believe that when we political and economic transformation, is Our sewerage network is 1,200 km long and started in 1992 only 8% of our drinking water where the end of communism began, and we annually treat 100% of wastewater, which was in compliance with EU standards. Today we came into being in 1992 in this newly free is nearly 37 million m³. we achieve 87% compliance, including 100% and liberalised economy. in the central water supply system in Gdańsk. Thanks to further investment we will reach 100% compliance in 2012. According to Continually improving customer perceptions of water quality research conducted by Brita, a producer of household water filtration products, water Customer perceptions 80 in Gdańsk is the highest quality in Poland, of water quality: is potable directly from the tap and has the Good best taste. It is a challenge to counter the 70 deeply rooted and outdated stereotype from Bad communist times that tap water is unsuitable 60 for drinking. However, a survey we recently conducted shows a huge increase in public opinion about water quality and the number 50 of people drinking water from the tap % continues to rise impressively (see the figure 40 to the left). Zbigniew Maksymiuk The continual optimisation of both our Mr Maksymiuk is President of the Management Board and General Director of Saur Neptun Gdańsk, 30 organisation and cost structure is our passion. a private water utility delivering water to 500,000 inhabitants in Gdańsk and Sopot. He is a graduate During our operation we reduced the of the Environment Engineering Faculty at the Gdańsk University of Technology, and in the years 20 number of employees by half without having 1983-1992 he worked in the Regional Enterprise of Water Supply and Sewerage Systems. to resort to any layoffs, and at the same time we nearly tripled worker efficiency. To do Mr Maksymiuk is also the Vice-President of the Commercial Chamber of Polish Water Supply Systems 0 this, we tapped the expertise of the Saur and an author of a number of publications on public-private partnership. In 2009 he received from 1993 2009 Group, who had completed similar initiatives the President of Poland a Knight’s Cross of the Order of Polonia Restituta. Source: Saur Neptun Gdańsk
62 Focusing on performance // The water performance challenge Zbigniew Maksymiuk // Gdansk, Poland: Improved performance 63 Global Water Summit 2011 Focusing on performance The water performance challenge
elsewhere. This transfer of know-how has given The key success factor and our Innovative bio-monitoring methods include use of river mussels us a leading position in the waterworks and deep relationship with Gdansk sewerage sector. For example, we were the During our operation we first company in Poland to implement central The most important factor behind success is management of operations, where 36 staff help our people. Our philosophy of encouraging reduced the number of coordinate the work of 380 field staff using GPS, permanent training, multiple competencies, PC tablets, and GIS (see the figure to the top left teamwork, and permanent dialogue, including employees by half without of the page). talks between trade unions and workers, has helped us retain an extremely skilled and Thanks to the PPP we were able to build a satisfied workforce. having to resort to any management team independent of politics. In Poland the city council is traditionally the Our relationship with the city is more than layoffs, and at the same regulator of the water market and votes simply being a water services provider. The on water prices once per year. With greater Four Quarters Fountain, an investment of Saur time we nearly tripled independence we have been able to construct Neptun Gdańsk, which is in the centre of the a consistent external and internal strategy and old town has become a landmark and was worker efficiency. an organisational culture. Transparency and awarded the Best Public Area in Gdańsk in 2010. professionalism, both public and private, are We also sponsor the Lechia Gdańsk football also important issues for us. team, the most recent champion of the Polish Premier League, since we believe it is important As a market leader, we implemented several for people to take pride in their city. technologically and economically innovative projects. For example, we were the first in Finally, I leave you with the words of the Mayor Poland to use bio-monitoring of raw water at of Gdańsk, Paweł Adamowicz, who asked me scale. This technology developed in Poland to provide the utmost assurance that our city utilises unio tumidus mussels to monitor water has a positive relationship with SNG. According Source: Saur Neptun Gdańsk pollution levels and is natural, low-cost, and to Mr Adamowicz, “Saur Neptun Gdańsk has completely reliable (see the figure to the top done great work to guarantee high standards of right of the page). An added bonus is that our services, among them the superb quality of tap mussels also never ask for a salary increase! water. Our public-private partnership with Saur Central management operations to coordinate field operations Group is very satisfying”.
An added bonus is that our mussels also never ask for a salary increase!
Source: Saur Neptun Gdańsk
64 Focusing on performance // The water performance challenge Zbigniew Maksymiuk // Gdansk, Poland: Improved performance 65 Global Water Summit 2011 Focusing on performance The water performance challenge
WaterOne: Water District No. 1 of Johnson County, Kansas, USA
Introduction to WaterOne The project I want to tell you about is we wanted to ensure the public understood softening just upstream of microfiltration. WaterOne’s newest facility, the Wolcott Water what we were doing and that our presence This is an uncommon practice because of the We wanted Treatment Plant. Though it may appear to be was beneficial, both economically and as an potential for the calcium precipitate to plug a horse barn from the outside, looks can be emergency water supply. WaterOne’s unusual the membrane. This was a lot like a chemistry deceiving (see the figure to the right). Many approach successfully minimised an “us vs. experiment where we were unsure of the to ensure people may never have heard of Kansas or may them” narrative in the public commentary. result, so we performed pilot testing that picture the Wild West and tornadoes. But there’s showed that the combined technologies would the public Another unorthodox approach in this project a lot more going on in Kansas and we think we work in conjunction with tight control over was the large number of treatment processes, have one of the best water treatment plants in lime processing. Also testing concluded that understood over 50, that we considered and evaluated for the world. My hope is that this information will we needed to be able to respond quickly to potential use at Wolcott. To clarify our options dispel any stereotypical impressions of Kansas. changing conditions and equipment problems. we focused on automation and technology to what we were This would be challenging with our traditional WaterOne’s 700 km² service area is located in reduce life cycle costs such as power, labour, lime softening system and our manual the middle of the United States and we serve and chemicals. In our past expansions we doing and that approach to dosing chemicals, so we decided approximately 400,000 people. Our customer focused on the upfront costs and we tended to use a remote control lime softening system base is a mix of 92% residential, 8% commercial to use technologies we were familiar with. This and had feedback loops for dose control and our presence and very little industrial usage. Johnson time we questioned that approach and we flow pacing. Now the challenge was to get the County is very prosperous with commercial were pleasantly surprised. One unexpected operators to buy in to the new technology and was beneficial... areas focused primarily on retail and business result was that we ended up using lime learn how to use it smoothly and efficiently. services; Sprint and Black & Veatch are major employers in our area. This customer base WaterOne’s has historically grown by 2%, which requires The Wolcott Water Treatment Plant periodic expansion. unusual
Using a new approach to build approach the Wolcott Water Teatment Plant successfully One of our biggest challenges is that our water source is located 24 km away from our service minimised an area in other counties. That may not seem Chuck Weber like a big problem, but other counties are not excited about WaterOne building facilities “us vs. them” Chuck Weber has served as Superintendent of Operations for WaterOne for 13 years, in their jurisdiction to support our growth. overseeing the operation of WaterOne’s four treatment plants and nine pump stations. While disputes over water rights no longer narrative in During his time as Superintendent Mr Weber has implemented numerous cost saving turn violent, there are still heated debates programmes including an energy management plan that has reduced the annual energy over project development and WaterOne has the public cost by 20% saving WaterOne over a million dollars a year. Prior to operations, he worked had bad experiences obtaining water from 5 years as a facilities engineer for WaterOne. Mr Weber serves on the board of trustees for other counties in the past. With the Wolcott commentary. the Kansas Section of the American Water Works Association. He received his Bachelor’s Water Treatment Plant we wanted to make Degree in Civil Engineering and Master’s Degree in Environmental Engineering from the a concerted effort to minimise any potential opposition, so we conducted several public University of Kansas. He is a licenced Professional Engineer and a Class IV Water Treatment meetings and worked directly with governing Plant Operator. officials in other counties. In these discussions Source: WaterOne
66 Focusing on performance // The water performance challenge Chuck Weber // WaterOne: Water District No. 1 of Johnson County, Kansas, USA 67 Global Water Summit 2011 Focusing on performance
A more efficient and productive Wolcott has significantly exceeded all plant than expected performance expectations, so much so that we have pushed it beyond its original firm capacity Using this approach we were able to of 15 MGD (57,000 m³/d) all the way to 30 MGD Outward significantly reduce our manpower to (114,000 m³/d) and we are trying to maintain 3 additional operators from our original that flow rate as long as the collector well will appearances assumption of 15 operators to run the Wolcott support that flow. So even though Wolcott facility. So using the advanced technology we has only 15% of the original design capacity of can in fact be were able to reduce our labour costs. We were all our facilities, it actually carries most of the also able to reduce our power cost since the load most of the time, with Wolcott currently use of a collector well eliminated the need for a supplying 30 MGD of our annual average misleading. preset. Though this eliminated a set of pumps, demand of 60 MGD (227,000 m³/d). In addition when we added the micro-membranes we also to saving money, Wolcott has helped us reduce had to add another set of pumps back into the our carbon footprint. The combination of base system. However, the net result was Wolcott loading off of Wolcott and electrical demand required less power to transport water from the shifting under other facilities has brought down What looks source, the Missouri River, to the distribution our carbon emissions by 4,500 tonnes/yr. system than our traditional combination of intakes, presets and lime softening plant. So to return to our introduction, outward like a appearances can in fact be deceiving. What Chemical cost was also reduced using the looks like a livestock barn conceals state of livestock barn collector well approach. The need for more the art technology and provides high quality expensive chemicals like activated carbon, drinking water at a lower price and more conceals state chlorine dioxide, and ferrous chloride was efficiently than expected. Wolcott meets eliminated, saving WaterOne over $600,000/yr WaterOne’s vision and sets the standard for in chemical cost. The combined labour, power utility excellence. of the art and chemical savings using the new technology technology totalled $1.5 million/yr. and provides Wolcott WTP efficiency: Reducing manpower from 15 to 3 high quality drinking water at a lower price and more efficiently than expected.
Source: WaterOne
68 Focusing on performance // The water performance challenge Water, money and performance
When the British government was overwhelmed by the liabilities associated with upgrading its water infrastructure back in the 1980s, it took the decision to sell all the utilities in England and Wales to private investors. Tony Wray, the CEO of one of the few remaining UK utilities with international ambitions, assesses the private water proposition in the context of the current state of financial affairs.
Keynote address by [ Tony Wray ] Global Water Summit 2011 Focusing on performance Water, money and performance
Severn Trent’s story … beyond Twenty years ago, the UK was one of the worst This model has been a success in the past, but to carry the same market structure into the performers EU-wide in terms of potable water it may not work for the next 20 years. While future. Customer bills continue to rise, but at quality standards, and there was little public standards have certainly improved, customer some point customers will not be able to pay. money to invest in improving performance. At bills have exceeded inflation by around 45%. Debt has been historically low, yet the sector is Twenty years that time Severn Trent was not making a good There is industry debt of £33 billion and it is heavily indebted, and it is unclear where further job of servicing customers. unclear where future financing may come from. financing will be sourced from. More importantly, given the context of climate ago, the UK Today, Severn Trent is an FTSE 100 company, change, EU targets, and UK targets on carbon Therefore Severn Trent has set out a number covering the central UK region. We have 8 footprinting, it will probably not be possible to of ideas that we entitle Changing Course. The million customers, 46,000 km of water mains, was one of sustainably pursue the treatment solutions that publication sets out a new future direction 54,000 km of sewer mains, and 5,500 direct are currently in use in the UK today. for the UK regulatory model, which is built the worst employees delivering services to our customers around recognising the changing challenge and supply chain. On average, our customers In addition to changing carbon market prices, from quality now through to security of supply, performers pay just €1 per day for water and sanitation. there is the case of water scarcity in parts of the recognising that there are more innovative, UK – notably during the summer months – and cost-effective ways of delivering services, We also have an international business and a the over-abstraction of water in those parts of certainly looking for lower carbon, higher global workforce of 3,000. Our international EU-wide the UK where the watercourse is already under quality and lower capital solutions, and that business is headquartered in Fort Washington, pressure. Conversely, not only is water scarcity requires a change in the regulatory regime U.S., and we have 16 design centres in 11 in terms an issue but severe flooding incidents have also to ensure that the industry is incentivised countries helping to design, build, and deliver been on the increase. appropriately. high quality water and waste services. of potable In commodity markets increasing scarcity and These are questions that are already being Privatisation and… geographic disparities between low-cost and asked in many other countries, so the UK in fact water quality high-cost production options both require has to catch up with existing practices abroad. Many public utilities went through privatisation market solutions to improve efficiency and On the one hand, the last 20 years have driven standards. in the 1980s; the government did not have the delivery options. Over the next 20 years, the UK innovation and kept costs down, but in a way budget to meet new EU quality standards, while may wish to embrace a water trading regime that is clearly unsustainable. The challenge at the same time were faced with the need to akin to the Australian model, in favour of the for the future will be to cater for security of reduce both borrowing and the public deficit localised options that have been in use thus far. supply in the face of water scarcity, while at – hence the privatisation of utilities. Debts the same time maintaining quality standards, were written off, while a regulatory framework Raising quality environmental standards, a progressive was set up to attract private investment. The investment programme and low prices for our regulatory framework is important, as one of the Another key factor in UK water production is customers. main concerns with privatisation is unchecked the EU water standards framework that grows Today, Severn behaviour by private companies. ever more stringent. Though with the greatest of intentions, it is unclear whether the marginal Questions from the audience Prices in the UK are regulated by Ofwat, the gains from these increases in quality outweigh Question: Do you think that the UK model Trent is an Environment Agency is responsible for checking the resulting increase in energy expenditure, is actually based on competition, or do you environmental impacts and the Drinking Water and the elevated carbon cost. think that Ofwat is actually state controlled FTSE 100 Inspectorate monitors water quality. Finally, capitalism? customer representatives can investigate water The water framework directive is probably company, companies that are not meeting customer the most important piece of UK water quality People don’t put money into this and not needs. Prices are set every 5 years, which legislation currently in action. However, many expect a return. There is a lot of competition covering the provides financial stability and an incentive water managers are not prepared to pay there but of a certain type. The 22 companies based scheme. With a wealth of information increasing rates just to have small marginal are regulated across 22 sets of benchmarks Tony Wray coming from the 22 UK water companies, there improvements in ecological status. It may be each year, which has spurred on tremendous Tony Wray joined the board of Severn Trent in March 2005. He was appointed Chief central region is a well defined benchmark which companies more beneficial to reduce pollutants entering efficiency. are expected to meet. the catchment area, than to spend money on Executive on 2 October 2007. Prior to that, he was Director of Networks at Eircom, the of the UK. water treatment. However, this model has now run its course, Republic of Ireland’s telephone operator. He joined British Gas in 1983 and held various Over the last 20 years customer services have and we are looking at moving to more of a free managerial positions. With the establishment of the gas transportation business, Transco, improved and environmental standards are market model. At Severn Trent we have been he became Director of Asset Management, then National Operations Director, before up. Operating cost efficiencies, financing The future picture pro-competition, offering some of the highest being appointed to implement the merger integration of Lattice (Transco) and National efficiencies, capital efficiencies and process In the face of rising quality standards, standards at the lowest combined water and Grid Group into National Grid Transco. Tony is a Non-Executive Director of Energy and efficiencies are also much improved. Financing decreasing security of water supply and the waste charges in the UK. So I say bring on the has entered the market and around £85 billion effects of climate change, it is not possible competition. Utility Skills (EUS). has been invested over that period. 72 Focusing on performance // Water, money and performance Tony Wray // Severn Trent’s story 73 The smart network revolution
Utilities around the world are transforming their performance thanks to smart network technology. By overlaying an information grid over the production and distribution network, energy utilities are seeing dramatic improvements in efficiency.
Is this the future for water utilities too?
Keynote address by [ Djeevan Schiferli ] Global Water Summit 2011 Focusing on performance The smart network revolution
Innovation jam to shut down the entire network. That’s Water smart for smartphones that give customers real-time not a smart network. In a smart network, feed-back on their consumption. At the same In a three day internet brainstorming session Look at Malta as an illustrative case. A small you deploy sensors that provide real-time time, these apps change the way in which a five years ago, IBM asked our participants: island in the middle of the Mediterranean, it information to the producer, maintenance utility can connect to the customer, which “What would make a better planet, and how has few natural resources of its own and has crews and consumers. In short, you talk to eventually leads to cost savings, a higher quality can we create that together?” Some of the to import all of its fossil fuels, and desalinates each other. This allows you to spot outages of service and even a more sustainable world. answers that arose were expected, such 50% of its water. The groundwater that is earlier, and if you can get repair crews in as engaging with energy efficiency and available is at risk of rising sea levels. To Finally, the District of Columbia Water and earlier, that saves time and money. carbon reduction. However, many of the combat this, Malta has created an integrated Sewer Authority (DC Water) had an outdated answers came as a complete surprise. These Your clients will also have more input into water and power grid – the first of its kind internal filing system that, before the year were individuals asking IBM to look into the service you provide, meaning you – with 250,000 interactive meters that will 2000, was purely paper based. In addition the question of water. IBM had absolutely can engage with the end user. This will identify theft, reduce non-revenue water, and they had slim budgets with which to invest in no experience in the water sector at that encourage customers not to waste, as the establish progressive rates. future development. In response to this issue, point, but saw the importance of the water provider can experiment with variable rates, DC Water decided to invest in information In Dubuque, Iowa, USA, smart meters were sector and so invested two years into use customer segmentation for those that technology to help them monitor usage and to deployed throughout 1,200 households talking to water professionals, investors, and are wasteful, yet offer better rates for those use predictive maintenance, rather than waiting to measure water and electricity use. The practitioners in order to explore the market. that recycle their water – it can even be a for failures to occur, which may be more costly result was the deployment of smart meters source of income for some households in to repair. We discovered that the sector is very throughout the city, due to the immediate case of energy production. fragmented. It also became clear that many cost savings that were felt. The result has been a 7% increase in revenue of the organisations had solutions to the Something as simple as as being aware of through the process of customer segmentation. In the service area of Vitens, the Netherlands’ problems of another. So what IBM wanted to your usage through an advanced water Analysis of the network showed that just 0.5% largest drinking water utility, the average do was to gather the puzzle pieces together. meter that can show how much water is in of customers were heavy water users, and these water consumption per person is 0.12 m³/day use at a time helps to reduce demand-side customers now have higher rates. Predictive (120 L/day). There are sufficient quantities wastage. Similar experiments in the energy maintenance has also allowed DC Water to Smart networks of water available and tariffs are low while sector show a 12% reduction in use. notify customers of a potential leak before it the water quality is very high. The key This is not something that IBM can do alone; occurs, allowing them to deal with the problem Water theft can also be better managed – factor for the success of the Dutch drinking we need partners with the experience to in their own time, meaning call-outs are down which will have a significant effect on balance water sector lies in the excellent state of marry our technology to their knowledge. by 37%. That is where smart networks apply. Today, sheets. Maintenance costs would decrease, as the infrastructure (both the pipelines and our national grids – including nuclear power faults would be pin-pointed quickly and with treatment plants). In the implementation plants – are subject to outages and open to accuracy, and remedial work could even be of smart water networks, the presence of (R)evolution attack from computer viruses that threaten carried out before serious faults occur. a high quality infrastructure is actually not It took 21 years for the internet to progress Djeevan Schiferli beneficial to the business case. The existing from the invention of email to a network of infrastructure, tailored to the current water Djeevan Schiferli is a strong believer in establishing a collaborative ecosystem and 300,000 computers. It took six years to move a culture of trust for those who are willing to co-create the future. He advises client Audience response: Will smart networks work for the water sector? consumption, results in long-term fixed costs from the invention of the World Wide Web to executives on new business, societal and technology developments, the potential that form a significant part of the drinking a million websites. Now, Amazon is the second water tariff. Consequently, promoting largest retailer in the world, Skype is the largest impact on their business and operations and helps them enable their organisations for customers to use less water does not result in sustainable innovation. Yes 79.8% No 20.2% international voice carrier, and there have been large financial gains for those customers. 7 billion downloads from Apple’s App store – He earned a Bachelor of Science in Photonics from the Rijswijk Polytechnic Institute in Still Vitens foresees that further reduction and counting. 1993 and a Master of Science in Science and Technology Commercialization from the of water consumption will happen and According to predictions, there will be between University of Texas in Austin in 2004. that smart (water) networks and the Will smart networks 15 billion and 50 billion devices that can be In his role of Innovation Officer for IBM Global Services in Europe he has led the way in availability of advanced household water work for the connected, contacted and communicated with opening up IBM innovation programmes like the Centers for Advanced Studies and the water sector? and energy saving equipment may even through internet technology by 2020. So the top internship programme Extreme Blue for client participation. revolutionise the way in which utilities have question is not if smart networks will work in to operate. A quick-scan of current available the water sector, but what the impact will be on As of January 2007 he holds the position of Business Development Executive for Climate technology shows that a reduction of water your organisation in the near future? Change, advising and partnering with international clients in the public and private sector consumption to 50 L/day is already possible on how to address the challenges, risks and opportunities of climate change (carbon, today. Currently Vitens studies the integration energy and water) for their organisation’s business processes. of smart meters (water and power) and Source: GWI mathematical modelling to develop apps He was responsible for setting up and running IBM’s Global Center of Excellence for Water Management in February 2008, which has since then extended with expertise hubs in the Netherlands, Ireland, France, Israel, China and the USA.
76 Focusing on performance // The smart network revolution Djeevan Schiferli // Smart networks 77 A scalable for-profit approach to serving the poor
One of the big obstacles to bringing water services to low income communities is the lack of a viable business model. WaterHealth International has challenged the assumption that you can’t make a business out of selling safe water to the poor.
WHI has raised serious money from venture capitalists to scale up its activities internationally. Is this the breakthrough the bottom billion have been waiting for?
Keynote address by [ Sanjay Bhatnagar ] Global Water Summit 2011 Focusing on performance A scalable approach to serving the poor
What’s missing? 4. The issue of water quality is almost the community profits from investing the completely missing from many conversations. remaining 40%. Although we are primarily a Going forward, decentralised solutions are Most people have very little idea of what water service provider, the communities we service going to play an ever-increasing role in water quality is; if it is bottled water it is assumed to be not only benefit from clean water but from an purification systems. This is not just the case for of good quality, and if it is tap water the quality opportunity to invest: at the end of the 10-15 those that live in rural areas, but also for those in is often not even measured. year period, the centre is transferred to the the peri-urban and urban areas. community for them to run, or they can take Typically, whether populations are using out another 10-15 year service contract. centralised pipe systems, bore wells, tankers or Water Health Centres The market is huge. In India alone 100,000 plus At WHI we are point-of-use systems, there appear to be four These problems, of course, need to be units could easily be deployed. Even big cities key issues that need immediate attention: addressed, but they are not going to be solved concerned with straight away. We developed the idea of have potential markets and villages even more 1. The time to market. There are a billion decentralised water purification systems to try so. As a result, we have grown very rapidly to people around the world that do not have to resolve these issues. 450 locations worldwide, including Ghana, a sustainable access to drinking water, and we need to ask Bangladesh and the Philippines. Last year we ourselves how long can we wait to provide The solution that we came to, which we have put in 92 units and this year we’ll put in over business them with that access? been running for the last 3 to 4 years, is the 200. Next year we plan to put in over 500 units Water-Health Centre, a small water purification in a year. model rather 2. The issue of market-based pricing, which plant for populations of 5,000-10,000, that is a serious concern for any private sector takes just two weeks to set up and consists of player. People in the water business are unable a modular structure, with a water purification Our technology than selling to bring innovative solutions to the market if system mounted on a skid. All that is required Although we are not tied to any technology, we their true costs are not reflected in the price of to start the system is a source of power. do have a few proprietary solutions developed a particular water – this is especially the case in subsidised by ourselves, which we can provide to end- The size of the centres ranges from 20 m³/d environments. users at a very low cost. For instance, we have to 200 m³/d (20,000 L/d to 200,000 L/d), an ultraviolet waterworks disinfection unit that technology. 3. The issue of sustainability. It has been depending on the size of the population to be delivers some of the lowest costs of any UV unit amazing to see in the last year and a half the serviced. Water is then sold to customers in 20 worldwide. increasing, and consistent, move toward focus litre containers at an affordable rate – in India a on sustainability as a key topic in the water container costs 4 Rupees which is less than 10 But the real breakthrough technology are the debate, and one of the most important factors cents. This can be compared to the price of 15 systems that we have developed for remote in progressive investment decision-making. Rupees for just one litre of mineral water – a big monitoring, servicing and maintenance of these difference or a 20 litre container of equivalent decentralised systems and the smart water card quality which sells for Rs. 60-70. systems which our customers can use to access Water Health Centre our water either from our centres or delivery A key feature of our work is a partnership with trucks. This allows us to understand the needs of the community. Through this we get non- our customers and respond to them. monopolistic access to their dirty water source – whatever that source is – to purify and sell Above all, our focus is on water quality and to back to the community. deliver water that we would drink ourselves. While taste and colour are clearly important, water free from microbiological contamination The decentralised market model is the goal, and that differentiates our product Sanjay Bhatnagar At WHI we are concerned with a sustainable and gives it value. An example of this occurred Sanjay Bhatnagar is the Chief Executive Officer of WaterHealth International (WHI), a new business model rather than selling a particular during a cholera outbreak in Andhra Pradesh. generation water company developing decentralised, sustainable community water technology – and as long as our water meets Where all other water plants failed government purification solutions for underserved populations worldwide. WHI currently serves a WHO standards we are open to using any quality tests – including their own – the population of over 2 million people through approximately 450 purification plants in technology that delivers against the specified WaterHealth plant water passed all tests. We are India, Philippines and Africa (Ghana). parameters. The focus is on making sure that now helping the government in understanding we can operate and maintain the centre and quality control processes. Sanjay is also the founder of the THOT Capital Group. THOT Capital Group and its partners provide water quality monitoring services for 10 are active in infrastructure development, asset buy-outs and operations in Europe and the We also support our systems through an to 15 years. U.S. and also manage a foreign exchange fund. education programme around the proper The average centre cost is a one-time use and handling of safe water and hygiene Sanjay received an MBA with Honors from Harvard University in 1993, a Master’s degree investment of $20,000 or more, depending practices. in Engineering from Stanford University in 1989 and a Bachelor’s degree in Mechanical on geographic area. We find that we typically Engineering with distinction from the Indian Institute of Technology in 1983. Source: WaterHealth International finance around 60% of the centre cost, while
80 Focusing on performance // A scalable for-profit approach to serving the poor Sanjay Bhatnagar // Our technology 81 Global Water Summit 2011 Focusing on performance A scalable approach to serving the poor
Where to now? The model appears to be working. We have a working infrastructure that includes real-time automation, quality monitoring, smart cards, and ERP and CRM systems – pretty much everything that you would find in a fairly sophisticated company anywhere in the world. More importantly, we have a recognised brand name and global investment partners that include the International Finance Corporation, Dow Ventures, SAIL Ventures and the Acumen Fund. One of the interesting things about our model One of the is that we are able to take private capital and deploy it into underserved communities. We interesting have an ability to grow this model and scale and we are only constrained by the available capital. things about So, if governments, companies or individuals want to make these centres available, we can our model is do that without constraint. that given the Questions from the audience Christopher Gasson, Publisher of Global fact that we Water Intelligence: Can we just be quite clear: you’re selling containers of water. What is the are able to customer actually buying? Sanjay Bhatnagar: The customer pays for take private the water purification service and receives 20 litres of water that is delivered to him in a user capital and friendly container.The cans are recycleable so once finished we take it back, clean it and refill it so there is no waste. Typically people pay a deploy it into deposit for the container. communities, Question: Would you like to share with us some experience with respect to the social dynamics and the challenges you’ve faced in getting this we have an through? ability to grow Sanjay Bhatnagar: One challenge was simply getting people to switch from the water source this model. they were used to utilising up until that point. We ended up using a microscope which our teams would take to villages to actually show these communities bacteria visible in the water. The experience can be very emotional for women. In many cases mothers started to cry when they saw the unsafe water they were providing for their children. The challenge is greater in India than Africa, first due to greater availability of free but unsafe water in India and second, because in Africa, the population in many places is already used to purchasing water so to switch to a provider that delivers safe water is not as difficult.
82 Focusing on performance // A scalable for-profit approach to serving the poor Sanjay Bhatnagar // Where to now? 83 The 2011 Global Water Awards The best of the best in the international water & desalination industries
Award categories Water company of the year Desalination company of the year Public water agency of the year Desalination deal of the year Water reuse project of the year Desalination plant of the year Industrial water project of the year Water stewardship award Water deal of the year Water technology company of the year Water performance initiative of the year Water technology idol Awards presented by Jim Stewart lifetime achievement award [ Kofi A. Annan ] Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
Welcome to the 2011 Global Water Awards
Welcome, this is the sixth edition of the noticed is the theme for the conference this at the centre of his policy agenda, whether as Global Water Awards, the sixth time that we year. After the dinner, we will discover the part of the Millennium Development Goals, have come together to celebrate excellence 47 contestants that have been nominated through the promotion of world peace, or in the global water industry: the projects, across 11 categories, and announce the top furthering the green revolution in Africa. In the technologies, and the people who are performers. all his endeavours, our guest speaker this making a difference in the world of water evening has consistently recognised the vital In addition to the top 11 performers, we will today. importance of water. be announcing this year’s winner of the Jim The Global Water Awards are voted for by Stewart lifetime achievement award; given So, this evening we have the privilege of you. We would like to take this time to thank to someone that has made a particularly hearing the proposal of a much needed you for the record contributions made by our important contribution to the industry over vision, one that illustrates how water can be The Global Water Awards recognise what subscribers and members of the international the course of their career. managed for the good of the world rather water community. Never has it been more than as a cause of conflict, poverty, hunger This evening marks a special occasion, not important than today to come together and or despair. only because of the awards that we will senior executives across the international recognise the very best in our industry. be giving out later, but also thanks to the Please join me in offering a very warm Even more so than in previous years, we presence this evening of our special guest welcome to the former Secretary General of water industry have acknowledged as the have placed a special focus on performance, of honour. We are delighted to welcome this the United Nations, and winner of the Nobel most important achievements of 2010. which I am sure you will have already evening a man that has always placed water Peace Prize, Mr Kofi Annan.
They are chosen by way of a free vote given to all subscribers to Global Water Intelligence and Water Desalination Report, as well as to members of the International Private Water Association and the International Desalination Association. The winners were announced at a special awards dinner held at the GWI/IDA conference in Berlin on 18th April 2011 in the presence of Kofi Annan. The winners and distinctions in each category receive a crystal glass trophy encapsulating a globe emblem. All shortlisted entries, including highly commended entries, receive a framed certificate with the judges’ verdict included.
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Replacing conflict with cooperation: the path to global water security
Good evening ladies and gentlemen. Allow Two thirds of the world’s population is predicted me to begin by thanking you for inviting to live under conditions of water stress by 2025, me to join you tonight to discuss a subject a situation that will prove catastrophic, not just of utmost importance to human progress for development but also for global peace and and development. Water security stands at security. If we are not careful and fail to manage the centre of all our most pressing global water properly, the world’s future conflicts could challenges, including hunger, poverty, be about water, and not oil. infectious diseases, energy, the environment We have already seen a number of examples and climate change. of water scarcity fuelling conflict within certain The world’s nations recognised this fact in the countries. In Darfur a decline in rainfall, linked United Nations Millennium Declaration which to climate change, has reduced agricultural states that: “Achieving global water security is production in the region leading to tensions vital to successfully eradicating poverty and and conflict. In Yemen the World Food ensuring sustainable development for all”. But Programme has identified drought and water guaranteeing water security is becoming an scarcity as a key factor contributing to the increasingly difficult task. At this conference we country’s internal conflicts. have heard from many industry experts and Water stress can also lead to greater conflict leaders in the water sector about the daunting between States. There are currently 270 known challenges we face in this area. water sources that cross national borders. A look As the global population continues to grow back at the last fifty years will reveal that water and our economies continue to expand, so related international conflicts are not rare. The does our thirst. Experts predict that in the next last half century has witnessed no fewer than two decades the human demand for water 40 violent cross-border water disputes, three is expected to exceed our planet’s supply by quarters of which have occurred in the Middle 40% if the current trend of consumption is not East. A powerful example is the Arab League’s curbed. According to the UN Water Initiative, by plans to divert the Jordan River away from Israel 2025 1.8 billion people will be living in regions in the early 1960s. Historians identified this act that suffer from absolute water scarcity. as a major contributing factor in the tensions leading up to the 1967 war. As demand grows Climate change is adding to this problem and and supply decreases, we can expect such is placing our natural water sources under ever conflicts to happen with growing frequency greater strain. Extreme weather events, such and greater intensity. as floods and monsoons, will make managing water sources ever more difficult and costly. I Encouragingly, a number of nations have think we all saw on our television screens the demonstrated that an alternative path is tragedy that occurred during the recent floods possible, one that replaces conflict with to hit Pakistan; water everywhere but none to cooperation. In the same fifty years in which drink. we have witnessed 40 violent water related
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disputes, we have also seen the signing of over water scarcity must be a priority issue helped settle disputes. We must now move water management. We must not forget the 150 treaties and agreements related to water for us all; from governments, businesses, to creating a truly global approach to water commitment made by the world’s leaders in resource management. Despite the lack of multilateral organisations and civil society management in which countries not only the Millennium Development Goals (MDGs) any codified international law on water rights organisations to individuals. share best practices, but also have a common to reduce the proportion of people without and sharing, governments realise that water framework for managing transnational water sustainable access to safe drinking water Second, we need to better manage both security is a common challenge requiring a sources. and basic sanitation by 50% by 2015. This is the demand and supply of water, reducing common approach. Joint management of water a critical goal in and of itself, but considering waste and increasing efficiency. In essence, Encouragingly, we seem to be close to resources is more efficient, less costly and, quite the centrality of water for development, it is we must learn to do more with less. Allow me establishing a multilateral water framework. simply, necessary. also vital for reaching the other MDGs. to elaborate on these points, for they are vital During the next UN General Assembly in India and Pakistan’s water relations are a to finding the solutions we need to meet the the fall of 2011, governments will adopt Unfortunately, more than 800 million people good example of what is possible. Through global water challenge. a convention on transboundary rivers in the world still do not have access to the the landmark 1960 Indus Water Treaty, India’s and aquifers which will set international safe drinking water and proper sanitation Cooperation is necessary, not just to avoid and Pakistan’s water relations have proven guidelines on the joint management of they need to live healthy lives. Many experts conflict over water but to manage it in ways remarkably stable and cooperative. Brokered shared waters. This would constitute a major warn that we are poised to fail the MDG that deliver benefits to all. Governments have by the World Bank, the Treaty not only sets out step forward in recognising the need for a water targets. Achieving these targets often turned to bilateral treaties to guide each country’s legal rights to the Indus system’s global coordinated response to this issue. requires each country to create detailed their cooperation, establishing frameworks six rivers, it also establishes a joint commission national water resource management and mechanisms for joint water resource At the national level, governments will need charged with adjudicating any future disputes strategies. Fortunately, guidelines for doing management. These agreements have to exercise foresight in the creation of the over water allocation. The Treaty, which has so already exist. increased the sharing of information and necessary legal and political frameworks for been fully implemented and faithfully upheld by both countries, has survived two wars and continues to be respected, despite the ongoing dispute over Kashmir. The Indus Water Treaty serves as a powerful example of what can be achieved through cooperation. In Africa too we can see evidence of the benefits of cooperation. The Nile River Basin Initiative, for example, demonstrates how shared water sources can promote regional peace and stability. Success in the Nile River Basin provides a best practice example for similar initiatives on the Continent; for example, in the Congo and Zambezi river basins. The world will need more examples of this kind if we are going to meet the growing demand for water and at the same time avoid the associated risks of conflict. Water is a finite resource but it is one that, if properly managed, can sustainably meet our growing demands. The challenge is to ensure that all stakeholders are working together towards mutually beneficial goals, from the design of relevant policies, to the funding and implementation of water resource management mechanisms and infrastructure. This is not a simple task, requiring both ingenuity and perseverance. Compromises often have to be made and time is not on our side. The question for water managers and policymakers is, “How do we get there?” First, I believe we need to embark on a new era of cooperation in water management. Growing
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In 2004, as Secretary General of the United same country, Water Operators’ Partnerships participation in community managed water activities. Industrial pollution of surface and that we properly manage our water supplies to Nations, I established an Advisory Board on promote the vital exchange of know-how, and sanitation activities. The involvement ground water is effectively shrinking our usable meet these demands. But in the face of growing water and sanitation, chaired by the late and the transfer of management in size, skills of the private sector has helped to extend water supply. The energy and industrial sectors populations, our demand is far exceeding our former Japanese Prime Minister Ryutaro and software resources. access to water and sanitation for people need to invest in more efficient practices, as planet’s natural water supply, and to make Hashimoto; I know that today there are living in rural areas at the rate of 200,000 does agriculture, which alone accounts for 70% matters worse, apart from climate change, Yet no national water management strategy several Members of the Board at this people – over 1% of the population – per of the world’s freshwater use. manmade pollution and poor management of can be truly sustainable and effective without Conference. The Board was created to year. As a result, Ghana should attain its MDG waste has put our continued water supply at the proper engagement of all stakeholders. The technology needed to increase the provide me, as Secretary General, with advice on water by 2015. risk. Governments must foster dialogue and efficiency and productivity of water in on global water issues and to help galvanise cooperation, bringing all stakeholders But effective water management cannot agriculture already exists, and new technologies As the gap between our supply and our global action on water and sanitation. Two together to identify the best policy simply focus on supply. Integrated national are being developed every day, including new demand for water increases, the window of years later in 2006, the Board launched solutions for the greatest number of actors. water resource management must take crop varieties that thrive on less water or are opportunity to have a positive impact for the Hashimoto Plan of Action, a global Crucially, governments need to create the into account the differing demand needs drought resistant. The use of simple yet highly future generations closes very quickly. We must blueprint for advancing progress towards frameworks and incentives that will promote of a range of consumers. Households also effective technologies, such as drip irrigation, mobilise the necessary political will, along with the MDG targets on water and sanitation. greater involvement of the private sector. need to be made more aware that simple has allowed farmers in places like Israel and the economic and social support to effectively The Plan recognises that successful water Currently, 90% of the world’s piped water measures, such as harvesting rain water and Northern China to use less water while at the and sustainably manage our water resources. management strategies can only be supply is provided by publicly owned and wasting less water in daily activities such as same time increasing their productivity. Water operators need to invest in infrastructure achieved if water operators properly invest managed water operators. But public-private cooking or washing, are vital for ensuring that delivers water where it is needed, without in improving water infrastructure and This is particularly relevant for Africa, the only collaborations are crucial in order to foster that everyone has access to a fair share. leakages and at fair prices, while corporations management capacity. continent which does not produce enough greater investment in infrastructure and and industries need to drastically decrease the Operators need to create innovative and fair food to feed its own population, the result of The Board recommended the creation of innovation in technology. levels of pollution that threaten to compromise pricing mechanisms that strike a fine balance which is that there are currently about 240 Water Operators’ Partnerships, a cooperative the quality and quantity of the water available Take my own country, Ghana. Ghana provides between giving people the incentive to save million people in Sub-Saharan Africa who are mechanism that helps to build up the to us, and the ecosystems in which they are a good example of such partnerships in water, while also allowing people to afford malnourished. At the same time as these people capacity of public water operators. By found. action. Over the past decade, Ghana’s the amount they need for their consumption go hungry, Africa contains 60% of the world’s creating Partnerships between developed Community Water & Sanitation Agency and production activities. uncultivated arable land which could become As well as embracing supply management, and developing country water operators, as has been encouraging wider private sector fertile through irrigation, the application of we must also manage demand. Farms, well as big and small operators within the Businesses must limit their polluting science, the right choice of rye seed varieties companies, and households must minimise and proper treatment of the soil. their consumption and make the most of their water. We need to adopt the policy that less can We can draw on experiences in Asia and Latin be more, and move along the line of increasing America to promote a uniquely African green water efficiency. Old technologies such as revolution that will not only feed Africa, thus rainwater harvesting and newer technologies assuring the full security of the continent, but such as efficient irrigation techniques can also become an important part of the world help farmers use less water. This is why we food security system. Achieving this will require need to include all stakeholders to develop significant steps towards improving water water efficiency plans and design local level management throughout the continent. In implementation mechanisms that include all short, achieving a green revolution will also water users. demand a blue revolution. To conclude, I am optimistic. Optimistic that we It is our shared responsibility to manage our can mobilise the necessary political will, public planet’s water resources not only for our current interest and financial investment to develop the use but also in order to meet the needs of infrastructure, technology and management future generations. There is an African proverb mechanisms that are going to be necessary which says: “The earth is not ours, it is a treasure to revolutionise the way we use water. But it we hold in trust for future generations”. I hope must start with efficiency, and promoting the we will show ourselves to be worthy of that increase in the efficient use of water. The price trust. of inaction is simply too high. Our people, our There are no simple solutions but if we work industries, our farms and our environment together, I believe there will certainly be time simply cannot afford the consequences. to avoid a future water crisis. We need water Let me thank you for your leadership in helping not only to live but to irrigate our crops, fuel to start a Global Blue Revolution. I look forward our industries and generate our electricity. This to the Awards Ceremony. Thank you very much. multiplicity of interdependent uses requires
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terms of reclaiming industrial effluent plant in Kumköy in Northern Cyprus, What has it done? Water company on Singapore’s Jurong Island, and 2010 together with Caramondani. After a battle lasting nearly two years, Suez of the year bore witness to the development of a • Just months after opening a commercial Environment acquired 100% control of Agbar new WWTP to serve growing needs in office in New Delhi, Cadagua was awarded in June 2010. Observers thought that this was For the water company that has made the most the newly developed area of the island’s its first contract in India in March – a 5-year the end of the company as an independent significant contribution to the development of petrochemical manufacturing cluster. In design-build-operate deal for a 170,000m³/d entity. In fact, it proved to be the beginning of a 2010 was the international water sector during 2010. May, Sembcorp inaugurated its NEWater water treatment plant. It is judgment calls renaissance. Agbar saw revenues grow by 13.8% plant in Singapore – one of the largest like this that make a good company into a to €1.9 billion during the year. the year that water recycling plants in the world. great one. Winner What makes it special? WINNER Judges’ verdict: 2010 was the year that Global Water Awards Judges’ verdict: Implemented rapid and • 2010 was a tough year for the European Sembcorp Utilities 2011 catapulted Sembcorp into the major league of catapulted successful diversification, escaping an ailing private water market, with most companies international water operators. What is it? home market with stunning victories abroad. focusing on holding what they had in a Sembcorp into The utilities arm of Singapore-listed Sembcorp difficult political and economic climate. Industries, involved in water and energy Distinction DISTINCTION Highly commended Agbar, however, has forged ahead, netting Global Water Awards the major projects around the world. Cadagua 2011 Agbar nine new contracts (with a total backlog of nearly €1.3 billion) and eight renewals in What has it done? What is it? What is it? Spain alone. league of 2010 was in many ways an annus mirabilis Aguas de Barcelona is the water utility for the The water arm of Spanish construction giant for Sembcorp’s water business. The landmark city of Barcelona in Spain, and a subsidiary of • The company has continued to build an Ferrovial. international acquisition of Cascal helped the group to Suez Environnement. It has a well developed independent international brand outside expand its global presence to a further eight What has it done? international strategy in its own right. its traditional Spanish-speaking markets, targeting new jurisdictions such as the water operators. countries, and boosted its treatment capacity 2010 was the year when it all started to go by 50% – the group now serves close to right for Cadagua on the international stage, 5 million people globally. Sembcorp also took with the company proving time and time steps to extend its pioneering wastewater again that it can compete at the highest treatment business in China, built on its existing level of international competition – and win. footprint in the Gulf desalination market, and Increasingly scarce business opportunities strengthened its wastewater treatment and at home had combined with eroding profit water reuse business back home in Singapore. margins to leave parent Ferrovial facing a hard ¬ ¬ ¬ ¬ ¬ ¬ Implemented ¬ choice when it came to deciding whether ¬¬ What makes it special? ¬¬ “Intelligent Infrastructure” ¬¬ to remain in the water business. Instead of ¬ ¬
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of the Year year, opening new offices and scoring a series ¬ successful a profitable portfolio of long-term water ¬ ATER of stunning victories in virgin jurisdictions OBAL W GL 011 (Tert and wastewater contracts in a variety DS 2 use iary T Industrial Water T throughout the Middle East and Asia. AR Re rea t • reat AW r tm men me diversification, of jurisdictions in Europe, Africa, Latin ate ent) eat nt • Tr • W Sewage • Installatio America and Asia. The acquisition added What makes it special? l Drying • e of ns • a Op nc De rm era ena sa escaping an comprehensive municipal water expertise • The company’s footprint in the Middle East he tion & Maint lin T a to Sembcorp’s already strong track record ge tion took a marked leap forward in 2010, as • Slud Treatm Reuse • D • in the industrial water and desalination e en er es ailing home Cadagua swung to victory by winning its ag t • Wat ali segments worldwide, and paves the way for first contract in the UAE – an engineering, • Sew nation • market with broad-based growth across the portfolio. procurement and construction deal to build Nature is wise, it creates perfect structures and admirable designs. • In 2010, Sembcorp cemented its position a 45,460m³/d seawater reverse osmosis At Cadagua, we strongly believe in the need for imitating nature and have been doing as one of the Gulf’s leading developers of plant at Ajman. It swiftly followed this up so for the last 40 years, developing projects that preserve the daily aspects of our lives, taking stunning independent water and power projects, with its first deal in Oman, where it won care of the minor details. An example of this are the more than 8 million m3 of sewage reaching financial close and breaking the contract to design, build and operate treated daily at our facilities, 1.5 million m3 per day of desalinated seawater and 5 million m3 per day anniversary victories ground on the 68,200m³/d & 445MW the flagship Darsait MBR facility under Haya of drinking water delivered. Salalah IWPP in Oman in February, while Water’s Muscat Wastewater Scheme. abroad. signing an MOU in June to expand the • In 2010, Cadagua demonstrated with Our aim: to improve living standards, membrane treatment capacity of the admirable aplomb that it is not frightened bidding for the future responsibly. Fujairah 1 IWPP in the UAE. to go where others fear to tread. Early in the • Sembcorp was one of the pioneers in year, it secured the contract to design, build and operate a 24,200m³/d desalination 94 Focusing on performance // The 2011 Global Water Awards www.cadagua.com a CompanyWater company of of the year 95 Anuncio Global sangre.a 125mm x water evento210mm Berlín. Tamaño
11000 P21-07-11 Anun Cadagua Berlin_dv.indd 1 21/07/11 14:10 Global Water Summit 2011 Focusing on performance
US, Turkey, North Africa and the Gulf. It of Mitsui and Atlatec pre-qualified for the has also proven that despite competing 6th October wastewater BOT in Egypt, with its parent in some of these markets, it while the Japanese firm teamed up with remains a good Suez group team player – it local powerhouse Kharafi to pre-qualify for won the contract to build and operate a the first stage of the upcoming Az-Zour 380,000m³/d wastewater treatment plant North IWPP in Kuwait. Mitsui’s access to serving Mapocho in Chile together with its competitively priced project finance loans sister company Degrémont. from JBIC will provide a vital edge in its Harnessed • Agbar’s creativity and drive have proved future expansion efforts. a vibrant success in difficult market • Mitsui’s expansionary strategy is not conditions. It is an inspirational example to restricted to the Gulf – in August, it struck a creativity and private water operators everywhere in the major deal with Hyflux to enter the Chinese world. market, paying ¥10 billion for a 50% stake drive to spark Judges’ verdict: Harnessed creativity and drive in a new joint venture – Galaxy NewSpring to spark an international renaissance in 2010. – which will control a portfolio of water and an international wastewater treatment assets carved out of the former Hyflux Water Trust. With access Highly commended renaissance in to Mitsui’s balance sheet, the JV has the Mitsui & Co. potential to expand rapidly as more projects 2010. What is it? come up for tender. The infrastructure business division of the Judges’ verdict: Built on financial nous listed Japanese trading house, involved in and connections to create a global water power generation, water supply, energy and powerhouse. transportation. What has it done? Mitsui proved in 2010 that its 2008 acquisition Desalination company of Atlatec was not just a shot in the dark, as the group picked up the contract to build the of the year largest wastewater treatment plant in the world For the desalination plant supplier which has – the 4.3 million m³/d facility at Atotonilco in made the greatest overall contribution to the Mexico – whilst commencing construction on desalination industry in 2010. the Agua Prieta WWTP. Last year also saw Mitsui make a concerted effort to spread its wings in Winner WINNER Built on order to capitalise on opportunities in a number Global Water Awards IDE Technologies 2011 of new markets, signing a landmark deal to acquire a series of operational water assets financial nous What is it? At Ashland Hercules Water Technologies, we knowledge to design a total system approach in China from Hyflux, and pre-qualifying for An EPC contractor and developer of and connections flagship BOT contracts in Egypt and Kuwait. desalination plants, based in Israel. are proud of the innovative process and water tailored to your needs. And they are supported What makes it special? What has it done? treatment chemistries we have developed by a vast network of applications specialists to create a • Mitsui’s ownership of Atlatec has given it IDE continued to take advantage of its unique for our customers. But nothing we off er is as and research scientists, all driven by a genuine unparalleled access to large-scale contract competitive position in the global desal arena important as the knowledge and expertise of passion for chemistry — and a commitment to global water opportunities in Mexico, and it did not in 2010, winning a significant chunk of the disappoint in this respect in 2010, winning Chinese desalination business on offer, and our people. Working side by side with your plant the success of your operation. the contract to build, own and operate the powerhouse. competing strongly for tenders in the Americas personnel, our sales representative becomes 4.3 million m³/d Atotonilco wastewater and Southern Europe, as well as elsewhere in treatment plant – the largest of its kind in Asia. Significant contract wins at Soreq (Israel), familiar with your operation and applies this To learn more, visit ashland.com the world. Tianjin (China) and Chennai (India) came in • The depth of Atlatec’s experience, tandem with the commissioning of the Hadera combined with Mitsui’s vision and ambition, RO plant in Israel, meaning IDE has been is already opening up opportunities in the responsible for some of the world’s largest ® Registered trademark, Ashland or its subsidiaries, registered in various countries ™ Trademark, Ashland or its subsidiaries, registered in various countries * Trademark owned by a third party Middle East. In early 2010, a consortium desalination projects over the past year. © 2011, Ashland AD-11130
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What makes it special? Judges’ verdict: Showed complete mastery contract for the combined 1,037,000m³/d MSF/ of Tortola in the British Virgin Islands. As well • IDE was all-conquering in 2010, pulling of both membrane and thermal desalination in RO Ras Azzour project in Saudi Arabia – the as the desal component, Biwater’s winning off stunning project wins (such as 2010. biggest desalination project in the world. It proposition included two sewage treatment Chennai Nemmeli and Soreq) while at has also continued its successful diversification plants, pumping stations, pipelines and into membrane desalination: last year, Doosan reservoirs, all on the basis of a privately financed the same time showing that it can deliver Distinction DISTINCTION on its commitments, with successful Global Water Awards Heavy teamed up with project developer NSC initiative. It also won a contract to construct six Doosan 2011 Showed commissionings at Hadera and Tianjin. Agua (in which Consolidated Water holds a 50% SWRO plants in the Maldives, and ensured the stake) to pursue opportunities in the Caribbean ongoing availability of development capital by • The company has shown complete What is it? complete mastery of both membrane and thermal and Mexico. divesting itself of its remaining 58% interest in The king of Doosan Heavy Industries and Construction is Cascal, an asset-owning water business. mastery of desalination. As soon as the company involved in a range of industry sectors from What makes it special? delivered its 100,000m³/d MED facility for power generation to construction, as well • Doosan’s victory at Ras Azzour took the What makes it special? large-scale Tianjin, it was asked to build another for the as desalination and water treatment. It is a market by storm. Its success in shaving • The Tortola deal marks an important both membrane client. The Soreq project, meanwhile, will be division of Doosan Corporation, a South Korean $177 million from its bid price to come new contract approach in an area that thermal reigned the largest membrane desalination plant in conglomerate. from behind showed its hunger for growth had previously been the domain of and thermal the world. is undiminished, and winning with an MSF Consolidated Water, and showcases how a supreme in What has it done? • IDE’s success in 2010 is the result of nearly bid was the boldest possible statement of privately financed contract can be a win- 50 years of complete commitment to During the last twelve months, Doosan confidence in its technical abilities. win for both the client and the developer. desalination in has cemented its reputation as the leading 2010, with innovation. There are few technology • A contract to supply Saudi Arabia’s Saline • 2010 was the year that Biwater AEWT burst companies in any industry which can thermal EPC contractor in the Gulf desalination 2010. market, signing record-breaking contracts Water Conversion Corporation with a onto the international desalination market record-breaking honestly claim that they are greater than 68,190m³/d MED plant for Yanbu Power – the BVI deal was its first major desalination they have ever been when approaching and submitting daring technical bids. Its most notable achievement was in winning the EPC plant followed soon afterwards. The win outside the US market, and this was contracts and their 50th birthday. capacity will be delivered as a single unit, followed by a $42 million contract to build making it the largest in the world to date, six 500m³/d SWRO plants in the Maldives. daring technical and continues Doosan’s bid to push the • Biwater has been canny in playing to its envelope in the thermal desalination strengths during the last 12 months – the technology market. sale of Cascal enabled the company to bids. • In 2010, the company signed a return to its roots as a contractor, while memorandum of understanding which escaping potentially crippling debts, will see it take an EPC role alongside showing a vital ability to adapt its strategy developer NSC Agua on a joint US/Mexican to changing circumstances. desalination project with a planned capacity Judges’ verdict: Showed brilliant innovation in of up to 378,500m³/d. The deal is a glowing the face of changing circumstances. example of how cross-border synergies can be realised, and shows the kind of nerve and imagination which has taken Doosan to Highly commended the top of the league. Modern Water Judges’ verdict: The king of large-scale What is it? Showed brilliant thermal reigned supreme in 2010, with record- A publicly quoted UK company with patented breaking contracts and daring technical bids. rights to manipulated osmosis technology. innovation What has it done? in the face Highly commended In 2010, Modern Water demonstrated at its Biwater plant in Oman that manipulated osmosis can of changing What is it? reduce the amount of energy required in the A UK-based contractor which provides water desalination process by up to 30%. circumstances. and wastewater treatment services throughout What makes it special? the world, including desalination through • Manipulated osmosis, which is a variant subsidiary Biwater AEWT. of forward osmosis, is the first significant What has it done? alternative to the established desalination In 2010, Biwater developed an innovative technologies to emerge for 45 years. The package proposal for a 10,456m³/d reverse lower energy costs it promises could osmosis plant at Paraquita Bay on the island represent a new paradigm for the industry.
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• Modern Water took a great risk in backing demonstrates the global market’s belief manipulated osmosis technology, going in the Wabag brand. The shares finished so far as to buy two plants to enable it to the first day’s trading more than 30% up, pilot and perfect the technology. Last year’s valuing the company’s equity at INR17.9 successful trial is a vindication of years of billion ($405 million). work and millions of dollars of investment. • Wabag has traditionally relied on EPC work • The technology has a broad range of to drive its business forward. The proceeds applications, from osmotic power to from the IPO will enable the company Took great secondary oil recovery and evaporative to enhance its value proposition to the
cooling systems. Modern Water’s global market by branching out as a plant assure your total satisfaction. people so that, through personalized attention, we industrial. And we do this using the most qualified and for any use of water - domestic, agricultural infrastructure to provide solutions for every need We design, build and operate all types of hydraulic this in mind, we manage the entire water cycle. every day, to be more efficient and sustainable. With throughout the water-cycle process, and to strive, in order to take care of it, achieve excellence aqualia, we work with the most advanced technology life. Nevertheless, water is also scarce. That’s why at Water means everything. It is happiness, health and risks, and commitment to making forward osmosis developer. a workable reality could have broad Judges’ verdict: Flawless execution to herald implications across the industry. promises a a welcome addition to the water investment Judges’ verdict: Took great risks, and promises universe. new paradigm a new paradigm for the desal industry. Distinction DISTINCTION Global Water Awards for the desal Atotonilco WWTP financing 2011 Water deal of the year industry. For the deal, contracted in 2010, which What is it? has made the biggest contribution to the The $900 million financing package for the advancement of public-private partnerships in Atotonilco wastewater treatment plant in the international water sector. Mexico – the biggest facility of its kind in the world, with a maximum design capacity of 4.3 million m³/d. Winner WINNER Global Water Awards VA Tech Wabag IPO 2011 Who is responsible? Private sector equity holders in the project What is it? company include Acciona Agua, Atlatec, IDEAL The flotation of Indian-Austrian EPC contractor and ICA. Mexican national development bank and plant operator VA Tech Wabag on the Banobras provided a loan, while Fonadin, Bombay Stock Exchange. The deal raised a total Mexico’s national infrastructure fund, put up a Flawless of INR1.25 billion ($28 million) of fresh capital for grant. The client is Conagua. the company, whilst facilitating a partial exit for execution its private equity owners. What makes it special? • Putting together the financing for the
Who is responsible? biggest wastewater treatment plant in www.aqualia.es to herald The issue was underwritten by IDFC Capital and the world was never going to be an easy Enam Securities. Legal advice was provided by task. Given the number of parties involved, a welcome Amarchand & Mangaldas & Suresh A Shroff & Co the fact that the project reached financial of Mumbai. close just seven months after contract addition to What makes it special? signing underlines the commitment of all the parties concerned, and the urgency of • The issue made a huge splash in a market the wastewater treatment needs faced by the water starved of big-ticket pure-play investment Mexico City. opportunities in water. The share offering investment was more than 36 times subscribed at • The plant will treat up to 60% of Mexico launch, which allowed the company to City’s wastewater flows, emitting the treated universe. price the deal at the top end of the price effluent into irrigation channels for local range. farmers to use free of charge. More than 90% of Mexico City’s wastewater is currently • The strong showing by international piped north to Hidalgo state to be used investors – who took around 50% of untreated for alfalfa irrigation, which poses the shares – underscores the paucity of serious health and environmental problems. Ulises, 18 · 28043 Madrid · Spain comparable investment opportunities, and T: +34 91 703 63 32 • Banobras’ role in successfully attracting F: +34 91 703 63 64 100 Focusing on performance // The 2011 Global Water Awards Clean Water 20110714:Layout 1 7/14/2011 3:20 PM Page 1
Global Water Summit 2011 Focusing on performance Managed Aquifer Recharge
commercial bank lending into the deal deliverable on a sustained basis, and GFI cannot be underestimated. The ambitious is to be commended for its resilience in Whether for strategic storage, supply/demand balance, Cuenca del Valle de México Water keeping the programme on track as it went or disposal of excess water, always count on us for the Sustainability Program, which envisages a from strength to strength in 2010. success of your project. Contact us for A vital series of tunnels and wastewater treatment Judges’ verdict: Indisputable evidence that plants to serve the Mexican capital, will pooled financings for water infrastructure can blueprint for rely heavily on private sector funding, and work. • Site selection the successful financing of the Atotonilco plant – the largest project in the scheme • Hydrogeological characterization financing Highly commended – will provide positive momentum to the • Modeling Mexico’s wider remainder of the programme. SouthWest Water acquisition • Implementation Judges’ verdict: A vital blueprint for financing What is it? • Operation and monitoring sustainability Mexico’s wider sustainability programme. The $427 million take-over and delisting of US investor-owned water utility SouthWest Water. programme. Highly commended The deal was announced in March 2010, and Schlumberger Water Services, the subsurface experts. Colombian pooled financing completed six months later. What is it? Who is responsible? A $215 million 19-year pooled bond issue Water Asset Management LLC and JP designed to fund water and wastewater Morgan Asset Management led the group of investment in 105 municipalities in Colombia. institutional investors which took SouthWest Indisputable The bonds were issued in three fungible Water private. WAM and JP Morgan were tranches, the last of which was launched in advised by Brownstein Hyatt Farber Schreck and evidence December 2010. Macquarie Capital (USA) Inc. SouthWest Water was advised by Wells Fargo Securities, LLC. Who is responsible? that pooled What makes it special? The bonds were issued via a trust on behalf of • The take-over of SWWC represented the Grupo Financiero de Infraestructura Ltda, which first successful public-to-private deal for a financings in turn is owned by Colombia Infrastructure US investor-owned water utility in a decade, Group, LLC. Citivalores, a subsidiary of Citibank and marked the first major investment for for water Colombia, acted as underwriter. Water Asset Management, establishing a What makes it special? beachhead for regulated and non-regulated infrastructure growth in the US Southwest. • When central government transfers proved insufficient to pay for vital water • The proposal took the market by storm, can work. and wastewater infrastructure, a group of valuing the company’s equity at a 56% premium to where it had been trading, Colombian municipalities turned to the effectively precluding any rival bids. capital markets to make up the shortfall. A unique pooled financing scheme initiated • The deal marked a turnaround for SouthWest’s fortunes, following a protracted by GFI overcame the municipalities’ low results restatement process which took individual credit standing, and gave them 80% off the stock price in the dying A daring and the means to borrow at competitive rates months of 2008. The speed with which the over a long duration. deal was executed – it required approval brilliant coup • With very little in the way of stable long- from no fewer than five state public term local currency instruments to invest utility commissions – is testament to the for the smartest in, the water bonds are an ideal holding for dedication of the purchasers and their Colombian pension funds. A yield pick-up of advisory team. water.slb.com/contact investors in the around 3.5% versus Colombian government Judges’ verdict: A daring and brilliant coup for bonds provided an extra kicker. the smartest investors in the business. business. • The concept of pooled financings to fund water infrastructure in developing countries Global Expertise | Innovative Technology | Measurable Impact © 2011 Schlumberger has been around for a number of years. This is the first time it has proven to be
102 Focusing on performance // The 2011 Global Water Awards Global Water Summit 2011 Focusing on performance essels.co elv m Judges’ verdict: Financial prudence and canny b Public water agency management make it a model for the Gulf . of the year region. w For the public sector organisation that has w Distinction DISTINCTION made the greatest contribution to meeting the Global Water Awards Aigües Ter Llobregat, Spain challenges of water supply during 2010. 2011 w What is it? Financial Winner WINNER A public company in the autonomous Dubai Electricity and Water Global Water Awards 2011 government of Catalunya, supplying water to prudence Authority, UAE 5 million people in the Barcelona metropolitan More than 40 years of proven What is it? area. and canny The government-owned utility provider for What has it done? Dubai, responsible for supplying electricity and In 2010, ATLL completed a €800 million plan to experience management potable water, as well as procuring new water and power capacity. renew the security and quality of the long- make it a term water supply in the Barcelona area. The What has it done? massive and diverse building programme was During the financial turmoil that savaged carried out in a short period of time and within model for the Dubai’s economy, DEWA remained a solid budget. The rise in water treatment activity financial rock for the emirate. Its approach to has been matched with a drive to keep energy means quality a Gulf region. water pricing makes it a model for government consumption low. n bodies that are too often reliant on subsidy. t What makes it special? DEWA has also promoted water conservation d s • Within three years, ATLL has commissioned in an area with one of the highest per-capita tru usage rates in the world. three huge installations spanning the gamut of water treatment technologies What makes it special? in order to address the dual issues of local • Already a regional leader in charging water shortage and water quality. Plants at NEW...NEW sustainable rates for water, DEWA refined Barcelona (SWRO), Abrera (EDR) and Sant its tariff-setting mechanism further over Joan Despi (UF) have reduced the burden 16” Pressure the course of 2010 to match the increase in on non-renewable resources by a total of Completed a global fuel prices, with a fluctuating charge 625,000m³/d. Vessels are showing customers how much their bills are • It completed one of the world’s biggest available technologically affected by the change in oil and gas costs. reversible water tunnels to transfer water Realistic billing has made the authority free between the two major river basins in its now! ambitious to act on an independent financial footing. service area – the Ter and the Llobregat – • DEWA’s strong financials were validated and ensure a safe and manageable supply ISO 9001 water supply by two spectacularly successful bond to all parts of the region. issues in 2010, which raised a total of $3 • To offset the rise in energy consumption ASME Code Sec. X programme, billion for the utility at historically low resulting from the new treatment facilities, rates. Meanwhile, profits continued to rise ATLL completed an ambitious renewable P.E.D. 97/23/EC. with a keen steadily, despite a slackening in demand energy project, with the construction of growth for water and electricity. photovoltaic parks, wind energy plants and NSF/ANSI Standard 61 eye on the • DEWA continues to increase the flow of mini-hydraulic systems to power its assets. water to customers, with plans for extra Judges’ verdict: Completed a technologically environment. potable water capacity easily covering the ambitious water supply programme, with a projected rise in demand from the emirate’s keen eye on the environment. BEL Group Limited [email protected] growing population. 2010 saw the start BEL Composite America Inc. [email protected] of operations at the Jebel Ali Station M desalination plant, which will eventually add BEL Composite Iberica S.L. [email protected] nearly 500,000m³/d of water to the emirate’s BEL Composite Industries Ltd. [email protected] BEL network. BEL Group Limited. Central Europe Office. [email protected] 104 Focusing on performance // The 2011 Global Water Awards Global Water Summit 2011 Focusing on performance
Highly commended Highly commended Delhi Jal Board, India National Water and Sewerage Corporation, Uganda What is it? The utility responsible for water supply and What is it? sewerage services in the Indian capital. The public utility responsible for water and wastewater services in urban areas in Uganda. What has it done? DJB is taking control of its own finances and What has it done? Took a broken pushing towards a financially independent The National Water and Sewerage Corporation future, despite facing one of the most difficult (NWSC) underwent a remarkable turnaround infrastructure demographics of any water board in the world. between 1998 and 2010. Thanks to the It provides water and wastewater services for introduction of performance contracts with 13 million people – this figure is set to rise to the government and a new management team legacy and built 24 million by 2021 – and has had to deal with led by chief executive Dr William Muhairwe, a historic legacy of leaks, poor service and non- the once-fledgling company is now a thriving a modern water payment of bills. public utility: since 1998, non-revenue water has dropped from 60% to 33.3%, collection What makes it special? utility. efficiency has increased from 60% to 98%, • In the past, the lack of an independent and a UGX8 billion ($3.4 million) loss has been income and a reliance on subsidy rendered turned into a healthy profit of UGX25.4 billion DJB powerless to deal with its huge ($10.8 million). infrastructure problems. A 50% rise in water tariffs – introduced in 2010 – moved the What makes it special? agency a long way towards cost recovery • In January 2011, the Indian state of and freed up its finances for ambitious Maharashtra selected a consortium made spending plans. up of SPML Infra (80%), VA Tech Wabag • At the same time, the board fought back (10%) and NWSC (10%) as preferred bidder losses through illegal connections – for a INR10 billion ($221 million) water historically a huge problem in the city, concession in Aurangabad. This confirms A remarkable where up to 42% of water never reached its NWSC’s position as one of the most destination – by offering an amnesty and progressive and forward-thinking public performance a lower connection price for anyone who water utilities in Africa, and demonstrates had previously been tapping the network the client’s faith in NWSC’s know-how on at home illegally. distribution management. Now Sailing • The board’s new-found financial stability has • NWSC just keeps on innovating: in 2010, it has inspired given it the freedom to start an ambitious laid the groundwork for the introduction privatisation project. Several contracts of an “e-water” payment system in January for network expansion have already 2011, whereby customers will no longer Under the Pentair Flag international been awarded on a design-build-operate have to pay their bill in cash at an NWSC basis, and DJB is encouraging the use of office. Instead, billpayers have a range of ambitions. private finance in meter management, options, from mobile banking to scratch Expertise in Membrane Solutions water distribution, sewage treatment and cards to direct debits. industrial water reuse. Entire areas of the • NWSC regularly shares its expertise with As part of the Pentair fleet, X-Flow BV develops and supplies cutting-edge membrane technology to the municipal and industrial markets. A global city will eventually be offered as water and other utilities in the developing world, wastewater concessions under new plans and has partnered with organisations in network of professional sales offices, service centers, agents, and distributors works together to make Pentair X-Flow your partner of choice for currently being put together. Tanzania, Kenya, Zambia, Rwanda and India. world-class water purification solutions. In addition to full circle offerings including comprehensive service management, Pentair X-Flow provides Judges’ verdict: Took a broken infrastructure Judges’ verdict: A remarkable performance at broad industry expertise and dedication to finding new and better answers to water and wastewater challenges of all scopes and sizes. legacy and built a modern water utility. home has inspired international ambitions.
www.xflow.com 106 Focusing on performance // The 2011 Global Water Awards
Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
joining two other Omani banks in providing • With a strong balance sheet and cashflows, Who is responsible? Desalination deal of almost 20% of the overall project debt. the company can face future desalination Norwegian desalter Aqualyng is developing This provides a valuable hedge against the project opportunities with renewed the plant on a 30-year BOT basis, in partnership the year impact of currency fluctuations on local confidence. Should it need to tap the debt with Beijing Enterprises Water Group (BEWG). For the deal signed during 2010 which costs. market to fund development plans or The project company borrowed RMB294 million represents the most significant step forward Judges’ verdict: Paves the way for Chinese expansion into new markets, the robust ($44.6 million) from China Construction Bank for the industry in terms of financial innovation money to fund water infrastructure in the Gulf. capital structure and the backing of its on a non-recourse basis to cover 70% of the or in meeting the demands of challenging new majority shareholder should make it RMB420 million ($63.7 million) project cost. The circumstances. possible to source lower cost debt. term of the loan is 13 years. Distinction Paves the way DISTINCTION Judges’ verdict: Created a new powerhouse in Global Water Awards What makes it special? Winner WINNER GDF Suez/International 2011 the Gulf desalination market. • Caofeidian was truly a landmark deal, Salalah, Oman Global Water Awards Power business combination for Chinese 2011 boosting both the Chinese desalination What is it? Highly commended market and the credibility of non-recourse What is it? The reverse takeover of International Power by money to Caofeidian, China financing in the sector. The desalination An IWPP in Oman, featuring a 68,200m³/d GDF Suez Energy International. This involved market in China had long been regarded as fund water SWRO facility and 445 MW power plant. The the transfer of GDF Suez’s assets outside Europe, What is it? a dead end for foreign and domestic water $1.1 billion financing package was signed in plus some in the UK and Turkey, to the ‘new’ IP, A RMB420 million ($63.7 million) deal to finance companies seeking to invest; this deal has March 2010. along with €4.4 billion of net debt. GDF Suez a 50,000m³/d SWRO plant in the Tangshan raised hopes that desalination could finally infrastructure in took a 70% stake in the combined business, Caofeidian Industrial Development Zone in Who is responsible? be about to become the next big thing in with the remainder being re-floated on the China’s Hebei Province. the booming Chinese water market. the Gulf. The developer joint venture included London Stock Exchange. Sembcorp Utilities (60%) and Oman Investment Corporation (40%). Around 75% of the $1 billion Who is responsible? project cost was met through 17-year project France-based GDF Suez and Britain’s © loans, and the remainder through equity. International Power. JP Morgan Cazenove, International banks contributed $630 million of Nomura and Morgan Stanley acted as financial Fast Water© Fast Water © debt, split across two tranches – a stand-alone advisers and brokers for International Power, Bringing relief where it’s needed most facility and a portion backed by the Chinese with legal advice provided by Clifford Chance. Fast Bringing relief whereWater it’s needed most GDF Suez was advised by Goldman Sachs and Fast Water ECA Sinosure. Standard Chartered was the Bringing relief where it’s needed most lead arranger for the 17.5-year debt package Rothschild (financial) and Linklaters and Bredin Bringing relief where it’s needed most and put up $148.4 million, with KfW and SMBC Prat (legal). contributing $70 million and $60 million, What makes it special? respectively. Bank of China and China • When the merger received EU approval Development Bank each put up $173 million, in February 2011, it marked the bringing while the balance of the debt came in Omani together of two of the leading players rials from a trio of local banks. Created a new in the global power and water market, What makes it special? to form a new desalination powerhouse powerhouse • The Salalah funding package was an with consolidated revenues of €13.6 unusually complex piece of financial billion for 2009, EBITDA of €3.19 billion, in the Gulf engineering, and marked the first time that and an enviable combined portfolio of a Gulf IWPP took significant advantage of independent water and power projects desalination Chinese lending. stretching across the Middle East. • Despite coming at the tail end of the • With a combined portfolio involving market. financial crisis, the project’s financial team more than 5 million m³/d of contracted secured an extremely competitive level of desalination capacity, the move catapults pricing. At just 285bps over Libor, the initial the ‘new’ International Power to the number cost of the dollar debt compared favourably one spot in the table of global desalination with projects elsewhere in the region that developers. After several years of stagnation had more bankable fundamentals. in terms of IP’s business development on © © the desal side, the merged entity is now Fast Water - Fresh water, whenever, wherever! • The strong influence of the Chinese lenders Fast Water© - Fresh water, whenever, wherever! in pole position to capitalise on future Fast Water - Fresh water, whenever, wherever! was balanced by a successful mobilisation Fast Water is a series of modular reverse osmosis units from Aqualyng Water Solutions. Easy to independent water and power project © of domestic finance, with BankMuscat Fasttransport, Water Water installis a series and ofoperate, -modular Fresh Fast reverse Water water, osmosis is the perfect units whenever, from solution Aqualyng to temporary Water wherever! Solutions. water supply Easy to needs opportunities. transport,and water install supply and droughts operate, in Fastarid, Water desert is climates. the perfect Giving solution harsh to climates temporary a vital, water refreshing supply needs boost. www.aqualyng.com andFast water Water supply is a series droughts of modular in arid, desertreverse climates. osmosis Giving units harshfrom Aqualyngclimates a Watervital, refreshing Solutions. boost. Easy to www.aqualyng.com 110 Focusing on performance // The 2011 Global Water Awards transport, install and operate, Fast Water is the perfect solution to temporary water supply needs Desalination deal of the year 111 and water supply droughts in arid, desert climates. Giving harsh climates a vital, refreshing boost. www.aqualyng.com Global Water Summit 2011 Focusing on performance
• Aqualyng’s dogged persistence in pursuing of the Omani public, who own 35% of the project in a financial environment the plant through a stock listing on the that has not been traditionally open to Muscat Securities Market. ACWA will use project finance is especially commendable, the experience of working alongside public showing vision and leadership. It is not investors as a valuable test run for its own afraid to take risks and has shown other planned flotation, which is expected within companies what can be achieved. a few years. • The successful funding of the first Judges’ verdict: A unique win-win deal that 50,000m³/d of capacity at the site is a strengthened the hands of all concerned. A landmark resounding vote of confidence in the most ambitious desalination project in Asia, and Creating resources out of waste deal in the will smooth the way for further plans to Water reuse project of extend the plant up to a total capacity of Suido Kiko Middle East is a Jeddah based company that nascent Chinese 900,000m³/d. the year provides desalination, waste water treatment and recycling water Judges’ verdict: A landmark deal in the For the water reuse project that represents the treatment solutions in Saudi Arabia and the Gulf. The company desal sector. nascent Chinese desal sector. most significant achievement for the industry is a joint venture between Saudi Brothers Commercial Group in 2010. Highly commended and Suido Kiko Kaisha, Ltd., Japan. Sale of AES’s Gulf IWPP stakes Winner WINNER Sewage lake cleanup, Global Water Awards Through its pioneering techniques and revolutionary plants, What is it? 2011 Jeddah Suido Kiko Middle East focuses on reducing the impact of The sale of AES Corporation’s remaining stakes in two independent water and power projects What is it? waste water on the environment. At Suido Kiko Middle East, in the Middle East: the 91,000m³/d and 456MW The removal, treatment and reuse of nearly we see waste water as a resource and we handle it as such for our Barka 1 IWPP in Oman, and the 181,840m³/d 10 million m³ of wastewater and sludge from a commercial, industrial and municipal clients. and 756MW Ras Laffan A IWPP in Qatar. lake outside Jeddah, on Saudi Arabia’s Red Sea coast, that had been used as a dumping ground Who is responsible? for more than a decade. The project connected ACWA Power International bought the Barka existing and new treatment plants to the lake, 1 stake, while the Qatar Electricity and Water and paves the way for the redevelopment of WINNER Company bought AES Corporation’s stake in what had previously been a no-go area. Ras Laffan. AES Corp. held its stake in Barka 1 Global Water Awards through its joint venture AES Oasis, in which the Who is responsible? 2011 IDB Infrastructure Fund holds a 39% stake. Responsibility for the cleanup was given to the National Water Company (NWC) in Saudi A unique win- What makes it special? Arabia. Planning and analysis was carried out • The deal marked AES Corporation’s exit by CH2M Olayan, and engineering work by win deal that from the desalination market in the Gulf, Saudi contractor Huta-Hegerfeld. The onsite and allowed it to raise $360 million for wastewater treatment facility was designed and Suido Kiko Middle East is the winner of Global Water Award, investment in its core power business. The built by Suido Kiko Middle East. strengthened company had already effected a partial exit ‘Water Re-use Project of the Year 2011’ for the waste water from Barka 1 through a successful IPO of the What makes it special? treatment plant that treated up to 3 million m³ of Jeddah Sewage the hands of project company back in 2005. • Planners were given just a year to complete Lake during its clean-up (Aslaa Valley Lake / MISK Lake). • ACWA Power’s purchase of a 58% stake the project, after a royal decree was passed Suido Kiko Middle East takes pride in designing, building and all concerned. following public outcry over wastewater in Barka 1 marked its first investment Operating & Maintaining the largest MBR facility in Saudi outside of Saudi Arabia. The group has dumping. They had to assuage fears that big ambitions in terms of its international the tainted lake could poison other water Arabia. expansion – it aims to more than double sources in the region, particularly if the dam its desalination capacity to 5 million m³/d was breached by more floods like the ones by 2014, and is looking to move into other Jeddah has seen in recent years. foreign markets. • The work included the construction of 60,000m³/d of onsite wastewater treatment • ACWA Power’s stake in Barka 1 will require Suido Kiko Middle East, P.O. Box 11286, Jeddah 21453 capacity (including upgrading of an the company to deal with the demands Tel.: +966(2) 660 8427 • Fax: +966(2) 283 2593 • Email: [email protected] Website: www.suikime.com 112 Focusing on performance // The 2011 Global Water Awards Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
existing 30,000m³/d plant), as well as a treatment and 63 ultrafiltration membrane priority. Preliminary plans for a replacement 25km pipeline to link it to further capacity modules to reach the standards required. had anticipated more than seven years’ Comprehensive Flow Control Solutions at Jeddah airport. The continuous stream • The project was desperately needed to build-out time, but planners were told after The fast-track of trucks arriving at the lake with untreated stop industry sucking vital drinking water the disaster they now had just five years to for Water Treatment Industries – wastewater meant that the lake project was from local rivers and pumping harmful complete the project. The 25 miles of piping removal and designed so it could be integrated with an outflow back into the public supply. The and connection work between the new from one Single Source. upcoming wastewater network covering site chosen was in a polluted and crowded plant and the city cross numerous county treatment of the whole of the city. area, covering five different municipalities, lines, railways and highways, making the • Now work has finished, the remaining meaning the attached network had to project a huge logistical challenge. a decade of sediment from the lake is being dried and be constructed using expensive and • The involvement of federal money from treated with minerals to form the base completely non-destructive methods of FEMA in the project meant developers As a customer-focused project management layer for an attractive park/wilderness area pipe-laying. had to face extra regulatory hurdles before accumulated company, InterApp supplies individually tailored to be housed within a huge mixed-use • The completion of the project led to funding could be secured. Residents and flow control solutions to the water treatment development planned for the lake region. immediate relief for the surrounding environmental analysts had to be consulted wastewater. The treated water was used for irrigation. on an ongoing basis, and the client even industries around the world. environment, freeing up enough potable Judges’ verdict: The fast-track removal water to supply the equivalent of 350,000 had to hire archaeologists to excavate areas and treatment of a decade of accumulated people. Water quality in the nearby polluted of potential historic interest at the proposed wastewater. creek and river has improved dramatically plant site. since dumping from the STP ceased. • To reach the high level of treatment The largest Distinction DISTINCTION Judges’ verdict: The largest tertiary treatment required by industrial clients, the plant Global Water Awards supplier installed a five-stage biological Aquapolo Project, Brazil 2011 plant in the Southern hemisphere and a model tertiary for public-private relationships. aerobic treatment process, followed by What is it? clarification, filtration, and a disinfection stage using chlorine created onsite, treatment plant The largest tertiary wastewater treatment Highly commended further reducing the plant’s environmental plant in the southern hemisphere, built to treat Emerald Coast WWTP, US footprint. in the Southern secondary effluent from a sewage treatment Judges’ verdict: A high-tech treatment plant in São Paulo and supply up to 86,400m³/d What is it? triumph built in the aftermath of a natural of high-level treated water for use by local hemisphere and An 85,000m³/d municipal wastewater treatment disaster. industries, and to reduce river pollution and the plant built 25 miles north of Pensacola, Florida, reliance on potable water by industry in Brazil. using advanced biological treatment and a model for Highly commended Who is responsible? disinfection to clean water for sale to two nearby industrial customers. It was built on an Fulton County MBR, USA public-private A special purpose vehicle made up of Foz emergency timescale to replace a downtown What is it? do Brasil (51%) and Sabesp (49%) designed treatment plant that was crippled by Hurricane relationships. and is operating the plant. Brazilian public Ivan in 2004, spreading untreated sewage into A 93,472m³/d water reuse treatment plant bank Caixa Econômica Federal advised on the Pensacola Bay and contaminating potable and environmental campus in Fulton County, funding package, which involved a 90/10 split water supplies. Georgia, which includes the largest membrane between issued debentures and sponsor equity. bio-reactor (MBR) facility in operation in Who is responsible? We’re specialised in desalination, sewage treatment, Membranes were supplied by Koch Membrane. the United States. Local environmental requirements for the beauty spot demanded drinking water, industrial water treatment and other Design and construction was carried out by A high-tech What makes it special? the facility be zero-noise and odour-free – and applications. Among many other products, our range Baskerville-Donovan (treatment facilities) and out of sight. features valves from DN 25 to DN 1600. • The plant is a model for public-private Hatch Mott MacDonald (ancillary works) on treatment relationships, with Foz do Brasil and Sabesp behalf of the client, Emerald Coast Utilities Who is responsible? working hand-in-hand on procurement, Agency. Funding for the $268 million project Fulton County Department of Public Works is triumph built in construction and operations. Interest from was split between the Federal Emergency the client, with a design and construction team industrial clients gave the project a firm Management Association (FEMA) and municipal made up of Archer Western Contractors and the aftermath financial footing, but they rightly demanded sources. Brown and Caldwell. Membranes were supplied some of the most rigorous treatment by GE Zenon. requirements around. Cutting-edge tertiary What makes it special? of a natural treatment provided by disk filters designed • The damage caused by Hurricane Ivan to What makes it special? an AVK Group Company www.interapp.net to retain solids with a diameter larger the existing Main Street treatment plant • The plant had to be sited in a beautiful rural disaster. than 400 microns is followed by biological made the replacement project an urgent area, near to the scenic Chattahoochee
114 Focusing on performance // The 2011 Global Water Awards Water reuse project of the year 115 Global Water Summit 2011 Focusing on TM performance Calder TM DWEER ™ River, meaning that the designers went all SKM and AECOM. Flowserve Calder supplied out to make the plant’s footprint as near to the DWEER energy recovery device, and the Highest Efficiency for invisible as possible. Noise control elements membrane supplier was Dow Filmtec. resulted in the facility being effectively What makes it special? silent, and features including stormwater Energy Recovery management technology, a rainwater • The Sydney plant is the largest operating collection system, pervious paving, and SWRO desalination facility in Australia, and A four-time 2010 RO plant global award the third largest in the world. It is also the bioretention areas were installed to make winner and designed to provide a service the plant all but unnoticeable. biggest water project undertaken in the state of New South Wales for over fifty years. An • Wastewater flows into the Chattahoochee life exceeding 25 years, the DWEER is were cut by nearly two thirds, providing • The A$1.8 billion (US$1.7 billion) project to “built-to-last,” assuring high availability, drought-proof Australia’s largest city was a a desperately needed boost for the outstanding performance and low environmentally vulnerable local environment. MBR and UV shining example of efficient construction, technologies were chosen to provide the coming in A$90 million (US$90 million) maintenance costs for decades. invisible large- higher quality reuse water demanded by under budget, on time and with a safety the municipality, and to lower the energy record that exceeded all expectations. Offering very low mixing and leakage scale MBR. impact. • Energy requirements are offset with 100% rates, the DWEER provides plant • In a further boost for the plant’s renewable energy from a 67-turbine wind environmental credentials, the facility farm, and the plant employs an extensive owners and operators with high uses its own reuse water for process marine life monitoring programme. The energy recovery rates while further water, irrigation, toilet-flushing, and for fire Sydney project offers concrete evidence protection. This means the potable water that with community engagement, large- minimizing operating costs. consumption at the entire site is less than scale desalination can gain widespread that of the average family home. acceptance as a vital component of local water resource planning. Judges’ verdict: An environmentally invisible large-scale MBR. Judges’ verdict: Environmentally friendly desal, delivered on time and under budget.
Distinction Desalination plant of DISTINCTION Thames Gateway (Beckton), Global Water Awards 2011 the year UK For the desalination plant commissioned during What is it? 2010 that represents the most impressive A 150,000m³/d reverse osmosis plant in Environmentally technical achievement in the industry. Beckton, East London, drawing tidal brackish water from the Thames Estuary. It was opened friendly desal, Winner WINNER in June 2010 and can supply enough water for Sydney (Kurnell), Australia Global Water Awards 1 million people. delivered on 2011 Who is responsible? Flowserve Spain S.A. What is it? The plant was built for Thames Water by Spain’s Avenida Fuentemar, 26-28 time and under A seawater reverse osmosis plant built at Acciona Agua with Interserve Project Services. Kurnell to supply the city of Sydney in Australia. Energy recovery devices were supplied by Coslada Madrid Spain 28023 budget. It has a capacity of 250,000m³/d, expandable Flowserve Calder, with UF membranes provided Telephone: 34.91.660.4600 to 500,000m³/d using the existing intake and by Norit and RO membranes by Hydranautics. outfall structures, and is designed to provide up Telefax: 34.91.674.0433 to 15% of the city’s daily water needs. The plant What makes it special? began supplying water to customers in January • Beckton has redefined the boundaries of 2010. what is possible using RO technology – the plant features the world’s first four-stage RO Who is responsible? process, resulting in an 85% recovery rate. The plant was designed and constructed for • The project is the only facility of its kind Sydney Water by the Blue Water joint venture, in the UK, and obtains its entire power which includes Veolia Water, John Holland,
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(023-A-10102)-Calder-DWEER.indd 1 7/27/11 4:32 PM Global Water Summit 2011 Focusing on performance abengoa requirement from renewable energy desalination projects in a country badly in generated onsite from biofuels – the first need of sustainable water sources. large-scale membrane desalination plant in Judges’ verdict: Proof that India is serious the world to do so. about large-scale desal. Innovative Solutions for Reinvented • Thames Water’s determination to protect the environment and ensure sustainability is Highly commended Sustainable Water Management membrane at the heart of the Beckton project. Crushed aggregate from the remains of abandoned Tianjin MED, China desalination buildings on the site was used in the What is it? foundations, while the company secured A 100,000m³/d MED plant, currently being with impeccable special permission to withdraw water expanded to 200,000m³/d, which produces during the ebb tide when the river is at its distilled water for the Tianjin Power Plant, as well lowest salinity, in order to reduce the plant’s as for use by local residents. green energy consumption. Acoustic sound barriers and air blast systems are used to Who is responsible? credentials. drive fish away from the intake during IDE Technologies supplied a total of 8 MED units abstraction, ensuring maximum protection to China’s State Development and Investment for marine life. Corporation (SDIC). Judges’ verdict: Reinvented membrane What makes it special? desalination with impeccable green credentials. • The expansion makes Tianjin the largest thermal desalination plant in China, and Highly commended among the largest MED plants in existence Chennai Minjur, India anywhere in the world. • IDE’s keen awareness of the interplay What is it? Proof that between water and energy use was central A 100,000m³/d seawater reverse osmosis to the plant’s construction and reduced India is serious desalination plant commissioned in July 2010 in environmental footprint. Circulating Minjur, Tamil Nadu, north of Chennai. seawater as a coolant reduced the strain on about large- Who is responsible? local freshwater resources, while the use of Chennai Water Desalination Ltd. (CWDL), a waste heat from the power plant to drive scale desal. consortium of India’s IVRCL and Spain’s Befesa, the desalination process shows a new way developed the project on a build-operate- forward for co-located power and seawater transfer (BOT) basis. ILF acted as consulting desalination units. engineer, with Energy Recovery Inc. providing • Pure table salt is abstracted from the the energy recovery devices, and Hydranautics brine as a by-product, providing a shining supplying the membranes. example of enhanced sustainability through the reclamation of waste materials from the What makes it special? desalination process. • It is India’s first large-scale SWRO facility, Judges’ verdict: Carving out a bright future for spearheading a wave of further projects in thermal desal in China. Innovation The accumulated experience of this Chennai, Kutch and Mumbai. Carving out a Projects Development company in project development and • Energy consumption has been reduced in construction creates a synergy allowing for an innovative way, by the use of a variable Design the permanent improvement of bright future frequency drive (VFD) which optimises processes and knowledge. Always bearing flow through the membranes – the first Procurement in mind that our top priority is for thermal time VFD has been successfully used for a Construction desalination plant of this size. the delivery of high quality projects with desal in China. • As the first major privately financed Operation cutting-edge technology. desalination project to reach financial close in a low-income country, the Minjur project opens the way for further large-scale www.abengoa.com
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Who is responsible? oilfield, as it no longer needs to pump the level through microfiltration and reverse Industrial water A 100% managed subsidiary of Bauer Water oil/water mix long distances for treatment osmosis, before supplying it to be used project of the year designed and built the facility for Petroleum or disposal. The energy consumption of the onsite at the refinery. The first mass Development Oman (PDO). Bauer also has a reed bed facility is virtually zero. Judges’ verdict: A unique public-private For the project commissioned in 2010 that 20-year contract to operate the site. • Bauer is now investigating the numerous collaboration in one of the world’s most heavily represents the most impressive technical industrial use What makes it special? commercial opportunities generated by the industrialised areas. achievement in the field of industrial water. facility, from harvesting and selling reeds • Artificial wetland treatment has never been as biofuel, to culturing algae and using the of the zero- attempted on this scale before, but became Highly commended Winner WINNER treated water to create a crop-growing area. a crucial option when environmental issues Nimr reed beds, Oman Global Water Awards Chokyuenyong Industrial cassava plant, 2011 meant shallow water disposal was no longer Judges’ verdict: The first mass industrial use of Thailand emission an option for the oil companies active the zero-emission treatment method. What is it? in the Nimr oilfield. With high-pressure What is it? treatment A 600-hectare artificial wetland project treating deep-well disposal a prohibitively expensive Distinction An anaerobic water treatment facility, handling 45,000m³/d of oil-tainted runoff from the nearby DISTINCTION 3,200m³/d of industrial outflow from a cassava option, Bauer’s wetland plans meant a huge Richmond recycled WTP, Global Water Awards method. Nimr Oilfield, with the capability to handle financial saving for all concerned. 2011 root processing factory. The plant reduces double that capacity. The facility separates oil USA organic contamination of outflows by 95%, • As an onsite, gravity-driven, purely and water before removing dissolved solids What is it? while saving power by producing biogas to run biological solution to industrial water through the reeds and then running the boilers and generate electricity. treatment, the reed bed not only protects A 13,300m³/d MF/RO water recycling plant outflow into evaporation ponds. the environment, but led to a huge treating effluent supplied by the West County Who is responsible? Wastewater District, and delivering high-quality A unique reduction in power consumption by the Global Water Engineering, represented by local recycled water to the boilers in the Chevron agent Retech Energy, supplied and built the BWS_210x125:AD 18.05.2011 15:49 Seite 1 refinery in Richmond, California. facilities attached onto the existing factory. The public-private Who is responsible? work was carried out on behalf of the client and The East Bay Municipal Utility District (EBMUD), factory owner, Chokyuenyong Industrial. collaboration in partnership with offtaker Chevron. Design What makes it special? advisory work was undertaken by Black & Veatch, in one of PASSION FOR • More than 1,200 tonnes a day of cassava with membranes supplied by Pall Corp. and CSM. root is processed at the Thai plant every day, What makes it special? creating large volumes of polluted water, the world’s • Richmond is one of the most heavily and using huge amounts of energy. GWE’s industrialised areas in the country, and has solution not only reduced pollution levels, most heavily PROGRESS had a difficult environmental history. The but has resulted in the generation of a construction of an advanced membrane valuable source of energy for the factory. industrialised plant to recycle water for industrial • Anaerobic technology clears outflow purposes has not only reduced local pollution to less than 5% of previous levels areas. demand for natural water resources, but has through several pre-treatment steps. Biogas already been picked up as a model by two conversion units create enough gas to other entities in the same area. replace the equivalent of 21,000 litres a day • The project was a model for public-private of fuel oil used in drying and processing the partnerships, using a unique delivery cassava roots. Turns water vehicle involving collaboration between • The fuel source provides a hedge against BAUER a public entity and a private corporation. rising oil prices, and the electricity treatment into EBMUD and Chevron shared responsibility generated can be sold back into the public WATER for the design and construction of the network. Up to 2.7MW of power is sold back a source of treatment plant and network outside the to the provincial power grid. By generating refinery, while both capital and operating green energy, the treatment facility also For further information please contact: Bauer Water based in Southern Germany has been a key player in providing comprehensive and innovative costs were fully covered by Chevron. generates carbon credits under the UN power and a environmental and water services for more than 20 years. With our main focus on design, build and operation BAUER Water GmbH • The treatment plant is almost entirely climate change framework, which are of water treatment plants, we help our customers to achieve improved efficiency, gain higher profitability and Schafwiesenstraße 5 - 11 operated remotely by EBMUD staff tradeable on the international market. carbon trading 78655 Dunningen-Seedorf, Germany maintain the ability to meet the most stringent environmental considerations. Our product portfolio includes: working at the nearby North Richmond Judges’ verdict: Turns water treatment Tel.: +49 7402 9203-0 Water Reclamation Plant, further reducing opportunity. Fax: +49 7402 9203-88 . Drinking Water . Groundwater into a source of power and a carbon trading operation cost. It treats water to a tertiary opportunity. [email protected] . Process Water . Produced Water 120www.bauer-water.comFocusing on performance // . TheWaste 2011 WaterGlobal Water Awards . Constructed Wetlands Industrial water project of the year 121 Global Water Summit 2011 MAKING MODERN LIVING POSSIBLE Focusing on performance
Highly commended Water stewardship KMU dairy WWTP, Germany Instead of spreading What is it? award An expansion and upgrade of an industrial For the commercial or industrial company wastewater treatment plant through the or organisation that has made the greatest things around, we simply addition of tertiary treatment facilities, with an contribution to the sustainable management of attached combined heat and power plant. The its water cycle. plant treats 3,000m³/d of highly contaminated put them together outflow from Germany’s largest cheese factory. Winner WINNER Liquid outflow is discharged into a river, while Global Water Awards Rio Tinto 2011 solid phosphorus-heavy waste is sold as fertiliser. What is it? Who is responsible? A global mining group with operations in some The design, engineering and operation were all of the most water-stressed parts of the world, carried out by Remondis Aqua, under contract including the Namib desert, the Pilbara region from the client, the Küstenland Milchunion of Western Australia, and the state of Arizona in Creating (KMU) of Mecklenburg-Vorpommern. The the US. project was funded through a debt package put What has it done? together by a group of banks for Remondis. valuable Since 2005, Rio Tinto has adopted a strategic What makes it special? approach to water which requires the fertiliser from • The outflow from the cheese factory is both company to research and adopt the best very hot and heavily polluted with organic water management practices, to engage with a remarkably compounds, making traditional treatment others on sustainable water management, and very difficult. The Remondis solution not to understand better the value of water in its tough treatment only dealt with this problem, but turned business decisions. both issues into commercial opportunities. What makes it special? Save space, energy and situation. • The combination of high-quality anaerobic • Mining can cause greater damage to the parts. and aerobic biological treatment water environment than almost any other technologies both cleans water to a industry. Rio Tinto has put itself at the SWRO just got simpler: level where it can safely re-enter the forefront of innovation in water stewardship, river network, and produces pellets of developing new technologies for water Isobaric ERD with integrated flow control phosphorous-rich solids, which can be conservation (such as its evaporation transported and sold to the agricultural reduction modules which reduce water sector. loss in reservoirs by 90%), new approaches The new iSave™ redefines ERD by integrating an isobaric pressure exchanger, high- • Biogas from the anaerobic treatment to water risk analysis, and new methods of pressure positive displacement booster pump and electric motor into a single unit. process is used in the CHP unit to generate water accounting that take account of its For the first time ever, isobaric ERD makes high-pressure flow to the RO membrane electricity, as is the excess heat from the non-financial value. constant and fail-safe – without the use of separate high-pressure flow meters. hot factory outflow. The power generated • Rio Tinto has made impressive investments is fed back into the plant’s grid, significantly The results? iSave exchanges pressure at up to 95 % efficiency, reducing energy to protect water bodies where they might consumption by up to 60 %. And it saves more than kilowatts: with its breakthrough reducing electricity consumption and be at risk from mining operations. At the operating costs. design, the iSave footprint is the smallest of any isobaric ERD on the market, and total Argyle mine in Western Australia, the costs of ownership rank among the very best in class. Judges’ verdict: Creating valuable fertiliser company has reduced its withdrawals from from a remarkably tough treatment situation. Lake Argyle by 95% since 2005, and last In a world thirsty for fresh water and eager to reduce carbon emissions, the new iSave year was able to operate for 11 months brings it all together. Patent pending. without any withdrawal as a result of recycling and capturing water leaking from www.isave.danfoss.com the tailings. This year it hopes to avoid all withdrawals. Rio Tinto’s pro-active approach to identifying where water is most valued, and making the investment to ensure that Danfoss A/S RO Solutions DK-6430 Nordborg · Denmark · Tel: +45 7488 4024 · Telefax: +45 7445 3831 E-mail: [email protected] · www.ro-solutions.com The 2011 Global Water Awards
its operations do not impinge on that value, areas where the cost of water is so low, that sets the standard for all natural resource inactivity is economically attractive. companies. • The company last year began working • While most mining companies scarcely with the Nature Conservancy to develop a do more than what is required by the strategy for a positive water balance in areas regulators, Rio Tinto’s water impact planning of water scarcity. This is a big challenge, process goes above and beyond what the but already the company has been able to regulations require, setting an example not save 5 billion litres of water in India through Showing the only to other mining companies, but to promoting direct seeding projects covering the regulators themselves. Rio Tinto’s water 6,500 acres of farmland. way forward stewardship is the best illustration of how • PepsiCo has brought improved water and natural resources businesses can work with sanitation to 90,000 people and helped in one of the nature, rather than against it. install more than 20,000 water connections Judges’ verdict: Showing the way forward in India, thanks to its work with water.org. world’s most in one of the world’s most water-hungry It has also had a major impact on water industries. services to the poor in Ghana through its water-hungry support for the Safe Water Network. The Distinction DISTINCTION company has proved that not only can it industries. Global Water Awards think water sustainability at every level, PepsiCo 2011 but can also deliver on its promises with What is it? practical and well thought-out actions. A global leader in branded soft drinks and food, Judges’ verdict: Succeeded with an ambitious which has put water sustainability at the centre environmental strategy at the crucial ultra-local of its corporate strategy. level. What has it done? In 2010, PepsiCo committed to three water- Highly commended related goals: improving its water use efficiency AkzoNobel by 20% per unit of production by 2015; striving What is it? for a positive water balance from its operations The largest global paints and coatings company, in water-distressed areas; and providing access and a major producer of specialist chemicals. to safe water to 3 million people in developing countries by 2015. What has it done? The company was also the first of its size to AkzoNobel has turned its environmental develop guidelines to support water as a commitment into a profit centre through human right, and did so nearly a year before initiatives such as its Operational Eco-Efficiency Succeeded with the UN General Assembly ratified this in programme. Inspired by cradle-to-cradle July 2010. The elements of PepsiCo’s Human concepts, it has been looking to optimise an ambitious Right to Water approach – safety, sufficiency, recycling and waste reduction across the group, acceptability, physical accessibility and saving tens of millions of Euros a year. environmental affordability – provide the baseline for all the What makes it special? company’s water stewardship approaches. • The company has been brilliantly creative strategy at the What makes it special? in the way it has found ways to reduce • PepsiCo has recognised that the key to its water bills. In the UK, it has introduced crucial ultra- water stewardship is at the local level in rainwater capture to provide water for a every plant it manages. It created a ReCon paint factory. In the Netherlands it has (resource conservation) training programme dramatically reduced its dependence on local level. for water which was piloted in 2009 groundwater by recycling water at one of and rolled out across the group in 2010, its production facilities. It is planning to roll ensuring that there is now a champion (or out recycling across its paints division in group of champions) for water, who will future, but more than just saving water, it is take action to drive efficiencies even in saving the waste materials in water, further
Water stewardship award 125 Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
growing the profitability of the business announced that its ‘Water of Life’ initiative entrepreneurial company into a global divisions: engineered systems, and chemical while reducing its environmental impact. had extended access to clean water to corporation with no loss of creativity in and monitoring systems. four million people in Africa since 2007, and its research and development. This is a • In 2010, the company carried out What has it done? a freshwater risk audit on all of its was on course to extend access to a million transition that other water technology more people every year until 2015. companies have failed to make. For some years, GE struggled to make a 320 production facilities. Based on a coherent proposition in the water industry. spider’s web system that recognises the • Diageo has brought cutting-edge • Norit’s technologies – whether they are Then it merged its water and power divisions Pushed the interlinkages involved in water sustainability, technology in its production facilities pretreating seawater for desalination, together, scaled back its ambitions and started rather than simple data points, it is a model together with successful social outreach in providing a physical barrier to remove to focus on practicalities and projects, and boundaries that other companies concerned with water the developing world to become one of the hormones from the water cycle, or suddenly we have a brilliantly coherent water Turned sustainability should adopt. most powerful corporate drivers of better providing fish-friendly pumps for large technology company. to breathe • While water stewardship in other water for all of us. water schemes – are at the forefront of environmental companies may be driven by faddish Judges’ verdict: Pioneered the sustainable reducing man’s impact on the environment. What makes it special? new life into concerns about brand relationships, reuse of heat and water with new technology. Judges’ verdict: Pushed the boundaries to • No other company in the world has commitments AkzoNobel has made water performance breathe new life into the filtration technology the connections, the commitment to a key contributor to its profit and loss market. technological innovation and the political the filtration account, and delivered great results for clout to make such a difference in the water into brilliant Water technology space. In 2010, GE Water brought all three the environment and for its shareholders. Distinction DISTINCTION technology It is an approach that guarantees a greater Global Water Awards together, delivering successful projects, commercial company of the year GE Water 2011 dynamism and commitment for the long driving forward new water technologies (in market. For the company which has made the most the pharmaceutical industry, the ethanol term. What is it? opportunities. significant contribution in the field of water industry, and the power industry, to Judges’ verdict: Turned environmental The water technology division of the world’s technology over the past year. name but a few), and engaging in global commitments into brilliant commercial largest industrial company. It works in two sustainability issues (through its work on the opportunities. Winner WINNER Norit Global Water Awards Highly commended 2011 Executive MBA Water Specialisation Leeuwarden, 17th and 18th of October 2011 Diageo What is it? What is it? A Dutch process technology specialist which Starts January 2012 A global brewer and alcoholic drinks company started selling activated carbon for sugar refining back in 1918, but has since become a with a presence in various water-stressed For more information, locations in Africa and the Caribbean. leader in ultrafiltration membranes, specialist engineered pumps, and process technology for please contact: What has it done? the brewing industry. Hetty Brand-Boswijk WATERVENT Diageo has been at the forefront of Director Business Development technologies that treat wastewater as a valuable What has it done? Pioneered the MBA Programmes WATERVENT presents water technology resource. It has also been backing community Until 2007, Norit seemed to be passing between sustainable water initiatives in Africa. new owners every year, but since it was +31 10 4081925 entrepreneurs to investors. WATERVENT focuses acquired by Doughty Hanson, it has recovered E-mail: [email protected] financial needs of water technology entrepreneurs What makes it special? its reputation for innovation, breathing new WWW.RSM.NL/MBA reuse of heat • In 2010, the company pushed ahead with life into an old technology (activated carbon), presenting to cleantech venture capitalists, private the bio-refineries concept in its distilleries in and pushing a new technology (ultrafiltration) equity and corporate investors. Some keynotes and water with Scotland and the US Virgin Islands. Instead further than it has been taken before. and get-togethers are encompassing the event. For of disposing of wastewater into the sea, 127 new technology. the company has invested in anaerobic What makes it special? entrepreneurs WATERVENT is a real opportunity digestion technology to enable it to • In recent years, Norit X-Flow has established to get into contact with investors and customers itself as the leading global supplier of recycle not only water, but energy (in the as well. For investors and buyers WATERVENT form of biogas) and biological material (as ultrafiltration membranes. In 2010, it offers a very interesting overview of water-efficient fertiliser). The Cameronbridge distillery in showed it was still ahead of the market with Fife, which has been responsible for 60% of the launch of the Airlift MBR Megablock and technologies. the company’s global effluent, will be able the development of capillary nanofiltration to supply 100% of the heat and 85% of the membranes. www.watervent.com electricity for the distilling process. • Under Doughty Hanson, Norit has Wetsus is co-funded by: • In September 2010, the company transformed itself from being a small The Dutch Ministry of Economic Affairs, Agriculture and Innovation (IOP-TTI) The European Community (European Fund for Regional Development and Seventh Framework Programme) The ‘’Samenwerkingsverband Noord-Nederland’’ (EZ/Kompas) 126 Focusing on performance // The 2011 Global Water Awards The City of Leeuwarden and the Province of Fryslân Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
Water Index with Goldman Sachs and the innovation. Many of its technologies have energy consumption and protecting the World Resources Institute). taken more than a decade to perfect. No environment in everything it does, whether • Successful projects from last year include other company in the water sector today it is evandtec’s cooling water treatment the SunPower silicon solar manufacturing has shown such long-term commitment to systems, Enbala’s smart grid technology, facility in Malaysia, the Omnova excellence in water technology. APTwater’s waste contaminant removal Performance Chemicals facility in Wisconsin • In 2010, Paques celebrated its 50th systems, Pionetics’ point-of-use systems A true pioneer and the Kinross-La Coipa gold mine in Chile. anniversary. With a presence in 60 or FilterBoxx’s activities in the oil and gas Each one has delivered significant benefits industrialised countries and 200 staff in sector. It is making brilliant green ideas pay. in the water A brilliantly to the environment and savings to the China alone, Paques shows the world how Judges’ verdict: A true pioneer in the water client. economic growth can be compatible with technology investment space. technology coherent water • In 2010, GE made good its commitment environmental commitment. to tackle some of the world’s most difficult Judges’ verdict: Marked 50 years as world investment technology environmental challenges by putting its leaders in deriving commercial value from Water performance imagination to work. waste. space. company. Judges’ verdict: A brilliantly coherent water initiative of the year technology company. Highly commended For an initiative undertaken by a water XPV Capital utility which represents the most significant Highly commended commitment to improving the long-term What is it? performance of water services to the public. Paques A Toronto-based venture capital company which specialises in developing water What is it? Winner WINNER A family-owned Dutch wastewater technology technology companies. Its portfolio includes Global Water Awards SEAAL, Algiers 2011 Long-term company which first introduced technology to evandtec, Enbala Power Networks, FilterBoxx, APTwater, and Pionetics Corporation. capture biogas from anaerobic sludge digestion Judges’ verdict: Long-term performance performance in 1981, and has led the way in “value-from- What has it done? improvement through knowledge transfer. waste” technology ever since. Until XPV was founded by a group of Zenon improvement What has it done? refugees in 2006, there were no venture capital Distinction DISTINCTION companies of any scale focusing exclusively on Global Water Awards Paques is responsible for 6.6 million tonnes of WASA, Dhaka 2011 water. XPV has more or less created an industry through CO2 reduction per year (the equivalent of more than 50% of the reduction commitment of the in investing in water, working with larger Judges’ verdict: Signing up 300,000 new knowledge Marked 50 Netherlands’ Kyoto agreement). The biogas venture capitalists who see the opportunities in connections in a year. produced by its 830 anaerobic installations the sector, but lack the expertise. transfer. years as worldwide is equivalent to the annual natural What makes it special? Highly commended: Caesb, Brasilia gas consumption of 1.7 million households. • In 2010, XPV achieved its first significant Judges’ verdict: Making advanced wastewater world leaders What makes it special? fund closing, raising in excess of treatment a reality in Latin America. • Paques has developed an unparalleled $120 million. Its most significant investment in deriving portfolio of technologies that derive value during the year was in FilterBoxx, which Highly commended: Santan Vista, US from waste. In addition to pioneering specialises in packaged water treatment Judges’ verdict: Reducing costs through shared commercial anaerobic wastewater treatment for biogas systems for the Canadian tar sands. recovery, the company has developed • XPV brings together a unique facilities. Signing up value from technologies for nitrogen and phosphate understanding of water technologies with Highly commended: Wolcott, U.S. removal (for recycling as struvite fertiliser), sharp-edged commercial nous to back 300,000 new sulphide and sulphate removal (and companies which not only deliver improved Judges’ verdict: Improving efficiency through waste. recovery as elemental sulphur), and heavy environmental performance, but also the remote operations. metals recovery. 2010 saw the commercial promise of a strong return for investors. connections in launch of anaerobic flotation reactor The success of XPV will ensure that other Highly commended: Apa Nova Bucuresti technology which optimises biogas venture capitalists are attracted into the Judges’ verdict: Improved performance. a year. generation from effluents with high fat and sector, building momentum behind water suspended solid content. technology as an opportunity to build Highly commended: Gdansk, Poland • Paques’ leading position in the value-from- value. waste market is the result of five decades of • XPV is involved in saving water, reducing Judges’ verdict: Improved performance.
128 Focusing on performance // The 2011 Global Water Awards Water performance initiative of the year 129 Global Water Summit 2011 Focusing on performance The 2011 Global Water Awards
The Jim Stewart lifetime achievement award Winner WINNER Heinz Ludwig Global Water Awards Presented by MECO President George Gsell 2011
Good evening ladies and gentlemen. He progressed onward to become the Director Thank you, to receive this award is a great Fichtner has allowed me sufficient latitude, and of Fichtner Water Technology where today he honour for me, and it is a mark of appreciation provided me with the opportunity to become The Jim Stewart Lifetime Achievement Award remains a technical adviser to the firm. for my work in the field of desalination. involved in a large number of interesting is named in honour of Jim Stewart. For those of and challenging projects, so my professional you who didn’t have the opportunity to know Throughout his career, he has been the Throughout my professional career, what has career could develop in the way it has up to Jim, he was a pioneer in the field of desalination, desalination expert and technical adviser on always inspired me in desalination is the range the present. Many thanks for this Award; it will he was a colleague, he was a friend, and he was projects all over the world, from his native of disciplines that are brought together in occupy a place of honour in my home. a mentor to me and many others. Germany to Saudi Arabia, the UAE, Bahrain, this field to attain a specific objective, like the Egypt, Oman, Qatar, India, Africa, Singapore, and planning and realisation of a desalination plant. Looking over the award recipient’s curriculum more recently Australia. vitae tonight, I could not help but think of This begins with a huge number of technical some of Jim’s words of wisdom. He would make He is a recognised expert in both thermal and disciplines involved in the design and three points on a regular basis to us in the membrane processes, from the Al Khobar II and construction of its process components, desalination community. Taweelah thermal plants to the Singapore, Perth but right from the development phase, and Sydney SWRO plants, and the Fujairah and contributions from plant economists, lawyers His first point was: “You will never get rich in this Ras Azzour hybrid plants. and experts in contracting and contract law business so just don’t try”. His second point was: play a key role. “You will have the opportunity to see the world You will recognise those names as some of the and do many things”. His third point was: “You most significant water and power projects in In addition, for some government desalination will not starve and you will be able to provide the world. While we have only referenced a few projects, media experts likewise play a part to for your family”. of the projects here there are many more. His obtain public acceptance for the treatment curriculum vitae is nearly 100 pages long. plant and its location. I have always regarded Ladies and gentlemen, tonight’s recipient participation in such multidisciplinary teams an certainly has hit home on the second point; He has offered volumes of technical enriching part of my work. he has seen the world and done many publications and presentations to the industry. things. It is my honour and pleasure to be He has been a Board Member of the European A particular attraction of accumulating many given the opportunity to introduce this Desalination Association, and is actively years of standing in a specific field is to be evening’s recipient of the Jim Stewart lifetime involved in the IDA and the Association of able to follow technological developments achievement award. The award recognises an German Engineers. from their conception to their maturity, and to individual for a broad base of technological contribute to this process. Ladies and gentlemen, it is simply impossible understanding and expertise, and a dedication to go through his accomplishments and list In the case of desalination in particular, it is to the industry through the active development of impressive projects in one night. I am sure membrane technology which during my of the science and the industry itself. It is a you will all agree that his career has been one professional career has developed from more symbol of outstanding achievement and of leadership, innovation, and a continuous industrial oriented small and medium sized leadership. contribution from which mankind worldwide lands of a few hundred cubic metres per day, to By now you are all probably aware that tonight’s has benefited. major systems for drinking water supply with recipient, Heinz Ludwig, certainly meets all capacities of several hundred thousand cubic Ladies and gentlemen, on behalf of GWI and of these criteria. Heinz Ludwig began his metres per day. IDA, please join me in congratulating the winner career more than 40 years ago with a Degree of this year’s Jim Stewart lifetime achievement It has been gratifying for me to assist in in Chemical Engineering at the Technical award, Heinz Ludwig. adapting and establishing this technology for University for Mechanical Engineering at securing water supplies for cities and regions, Essen, here in Germany. He spent 12 years at and even for a whole continent like Australia. Hager & Elsässer designing, constructing and commissioning a variety of water treatment Successful work needs a supportive plants for industry. environment, so I would like to thank Fichtner Consulting Engineers; next year, I will have been In 1982 he joined Fichtner Consultants as Head working with them for over 30 years. of the firm’s Process Engineering Department.
130 Focusing on performance // The 2011 Global Water Awards The Jim Stewart lifetime achievement award 131 Global Water Summit 2011 Focusing on performance Water quality testing
Water quality testing for better system performance When and how to test to improve system design, prevent damage, ensure quality and improve output.
The goal of Reverse Osmosis (RO) is not just to A TDS meter is also useful for calibrating A positive reading, for example +900 mV, In colorimetric methods, determination of Myron L Company remove contaminants from water efficiently, TDS monitor/controllers and spot checking indicates a solution that is strongly oxidising, or equivalence points can be skewed by coloured but to do so without fouling the RO membrane permeate and ionic concentrations (industry has a strong potential to strip or hog electrons or turbid solutions, which make it difficult to or damaging the equipment. Managing this standard for quality control). Comparing daily from another substance. A positive ORP over discern the precise point of colour change. usually involves pretreatment that physically values to detect trends helps predict membrane +300 mV is generally considered undesirable pH control is critical to optimising system or chemically prepares the RO feed water wear and is invaluable in troubleshooting for membranes. Check your manufacturer’s performance and preventing damage. The for processing. Pretreatment can involve problems with system performance, such as specifications for tolerable ORP levels, if performance of antiscalants, corrosion inhibitors microfiltration, carbon adsorption or ion scaling. indicated. and anti-foulants changes with pH. In fact, exchange as well as the addition of chemical Myron L offers precision handheld An inline ORP monitor/controller can be placed the concentration and efficacy of all chemical Managing RO antiscalants, corrosion inhibitors or pH adjustors. Myron L instrumentation and monitor/controllers that ahead of the RO unit to automatically monitor species in solution are significantly affected Since the type of pretreatment is defined by the are reliable and cost-effective. All Ultrameter II for trends and breakthroughs, while a handheld by pH. For example, hypochlorous acid, a very without fouling characteristics of the source water, water quality Company and III digital handhelds feature the ability to meter can be used to spot check and calibrate effective species of free chlorine, is at peak testing is critical in determining a cost-effective measure conductivity and TDS in the field to the monitor/controller and check permeate and concentration at a pH of 6.5. Most chemical the membrane system design. Myron L Company manufactures manufactures ±1% of READING accuracy. Our no-frills line of concentrate ORP levels. A 720II ORP monitor/ additives specify an optimum pH range within reliable cost-effective instrumentation for monitor/controllers allows you to customise controller can be configured with bleed and which they are most effective or effective at all. measuring, monitoring and controlling water or damaging your equipment with application-specific feed switches as well as visible and audible A 720II pH monitor/controller can be employed reliable cost- quality parameters critical to the optimisation of options – so you get precisely what you need alarms. to automatically detect and divert solution that these processes. the equipment for your particular application. has pH levels outside the range of tolerance effective Some membranes are sensitive to chlorine, Total Dissolved Solds (TDS) measurement for the RO unit. A handheld instrument, such Controlling microbiological fouling is in particular, and have specified chlorine is the industry standard for determining the as an Ultrameter II 6Pfc or Ultrameter III 9PTK, is usually involves paramount for optimum system performance concentration tolerances. Myron L Company’s instrumentation best RO system and membrane type based on ideal for spot-checking the performance of the and for extending the lifetime of membranes. Ultrameter II 6Pfc and Ultrameter III 9P digital load. The easiest way to get an accurate TDS monitor/controller and during calibration and pretreatment Chlorine is the predominant sanitizer used, handheld instruments feature a free chlorine for measuring, measurement is to use a meter that combines routine maintenance activities. but bromine, chloramines, chlorine dioxide, function that converts ORP measurements accurate conductivity measurements and a peracetic acid, iodine, ozone, etc., are also (mV) to free chlorine concentrations (ppm) Most antiscalants used in chemical system that physically precise TDS conversion algorithm standardised monitoring common. Because membranes such as thin-film using a proprietary look-up table based on pH maintenance will specify a Langelier specifically to the characteristics of the type of composite membranes degrade when exposed and ORP. Myron L Company developed the Saturation Index (LSI) maximum value or chemically water being treated. and controlling to sanitizers such as chlorine, pretreatment table through extensive research and analysis below which the calcium carbonate remains prepares the A portable TDS meter, such as any Myron processes such as carbon adsorption or sodium of ORP mV readings for known concentrations suspended in solution or is unable to seed water quality L Ultrameter II or III, can be used to make bisulphate additions are indicated that must be of free chlorine (0.00 and 10.00 ppm) at or react with seeds to form crystals. LSI is an measurements directly at the source. These monitored for breakthrough. This ensures the controlled pH levels. This method increases indication of a system’s tendency to scale RO feed water instruments are programmed with TDS operator has time to respond before damage the accuracy of low-range ppm free chlorine calcium carbonate. In the absence of any parameters conversion algorithms for both seawater occurs. readings, particularly, and allows the instrument standard method for determining the proclivity for processing. (solutions with a significant NaCl component) to measure a dynamic range of free chlorine of other constituents in solution to scale, such critical to the Oxidation Reduction Potential (ORP)/ and for “natural” water such as lakes, streams concentrations that is wider than the range as silicates, many chemical manufacturers and REDOX, is a good indicator of the concentration and rivers (modelled by Myron L 442TM 3000 of a colorimetric test kit, making the 6Pfc and control systems develop their own proprietary of all oxidising and reducing sanitizers used optimisation of Natural Water Standard Solution comprised 9P ideal instruments for field analysis when methods based on solubility constants in a to control microbiological fouling because it of sodium sulphate, sodium bicarbonate chlorine is the only sanitizer in solution. defined system. However, LSI is still useful as a measures the effect of these types of sanitizers, pretreatment and sodium chloride). The Ultrameter also scaling indicator because calcium carbonate is rather than any specific chemical, through the Ultrameter ORP and free chlorine measurement compensates all readings to 25°C, providing present in most water. chemical’s ability to oxidise or reduce other methods have other advantages over a basis for comparison as measurements vary processes. substances. ORP is measured in millivolts and colorimetric methods, not the least of which is pH, alkalinity, hardness, and temperature with temperature. can be positive/oxidising or negative/reducing. eliminating subjective interpretation of results. are the major factors in LSI. pH affects the
132 Focusing on performance // Book sponsor Myron L Company // Water quality testing for better system performance 133 Global Water Summit 2011 Focusing on performance
carbonic acid equilibrium directly through Beyond calculating LSI, testing water for than 5 is required for feed water, which is the availability of the Hydrogen ion and its hardness is helpful in determining whether equivalent to an NTU less than 1. Processes interaction with bicarbonate and carbonate. or not ion exchange beds are needed to such as microfiltration, ultrafiltration and Practically, if the pH is above 7, acid additions soften the water before RO processing. The media filtration are used to remove colloidal are used to shift the equilibrium to favour main components of hardness in most water solids from the feed. Polyelectrolyte additions carbonic acid, which dissociates into water are either Calcium ions, Magnesium ions or are sometimes used and the effectiveness of and carbon dioxide. At a pH of 6, 80% of both. Testing for hardness by the Standard these additions are pH dependent, requiring the carbonate ion is converted to carbon Methods is a generic process, though, that pH testing and adjustment to achieve the dioxide gas, thus effectively lowering the is not ion-specific. Many plus 2 valence ions, greatest efficacy. concentration of the carbonate ion in or cations, will be chelated by the EDTA Testing and monitoring pressure is a good solution. Calcium hardness and alkalinity reagent, along with other molecules that way to evaluate system requirements account for the presence and propensity of fit within the EDTA configuration physically and performance over time. The pressure calcium carbonate to form. Temperature also and chemically. However, the degree of differential between the feed and the affects the solubility of calcium carbonate. chelation is dependent on the physical size concentrate stream should remain Calcium carbonate is less soluble at higher and chemical reactivity of the molecule. constant. If this differential reading temperatures unlike other scalants. Regardless, the predominant species of ions increases, investigate for scaling or ruptured measured will be the hardness ions that The 9PTK can measure alkalinity, hardness membranes. In a two-stage system if the affect qualities important to RO, such as the and pH independently or as part of an LSI pressure differential increases over the first tendency of water to scale. Check hardness titration that generates an LSI value in situ. stage, the likely cause is either biological values directly after the softening process The 9PTK features an innovative new way to fouling or sediment. If the pressure regularly with portable instrumentation such perform these titrations in the field that is differential increases over the second stage, as the 9PTK to ensure proper functioning and faster and simpler than colorimetric methods. the likely cause is scaling by insoluble salts to determine a regeneration schedule. The 9PTK conductometric titration methods are due to the dissolved solids in the feed. 9PTK conductometric method is based on chemically equivalent to Standard Methods Evaluating your LSI again and the factors that Standard Method 2340. that use the same procedure, but with pH affect it can help remediate problems. An LSI indicators. They use the same reagents in the Alkalinity is not only important in its calculator is useful when determining what same sequence with the same theoretical effect on the scaling tendency of solution, adjustments are required to bring the system approach. The difference lies in the 9PTK’s but on pH maintenance. Alkalinity is a into balance. Monitoring TDS is the simplest ability to determine the equivalence point measure of constituents in solution capable method to determine performance. based on numerical data derived from of neutralising acid. From this definition, Monitoring permeate rate is also important. conductivity measurements, rather than a standard method is defined for the A drop in transmembrane pressure usually subjective observation of a colour change. determination of alkalinity by titration. indicates fouling on the concentrate side This gives the 9PTK a distinct advantage in Bicarbonate, carbonate, and hydroxyl of the membrane. A common error made turbid or coloured solutions. alkalinity are the species most common in by new system operators is to increase the natural water, seawater, and potable water The 9PTK LSI titration calculation is based on feed pressure in an attempt to increase the due to the global presence of dolomite and a simplified version of the thermodynamic permeate rate. This only increases the rate of calcium carbonate in the shells of marine and equations for the determination of the fouling, further decreasing the permeate flow freshwater molluscs. Additions of lime are scaling tendency of water developed in 1936 and potentially damaging the system. System used to buffer pH with the addition of acid to by Dr. Wilfred Langelier. You simply titrate maintenance is indicated if there is either a prevent the formation of scale in distribution for alkalinity and hardness, then measure pH 10-15% drop in permeate rate or permeate systems. The effect of alkalinity on the scaling and temperature — the 9P generates the efficacy as measured by TDS. tendency is factored into the LSI calculation. saturation index value automatically. If LSI Excess alkalinity can also produce a soda If the system is designed correctly, modifications are required, an LSI calculator taste that is unpalatable for most people. The monitoring pretreatment and treatment is useful in determining how adjustments in 9PTK conductometric method is based on processes through water testing will ensure pH, temperature, alkalinity or hardness will Standard Method 2320. problems are dealt with proactively, saving affect water balance. The 9PTK is equipped time and money. with an LSI calculator that allows you to Silt Density Index (SDI) is measured to adjust any or all LSI factors to determine the determine what kinds of filtration are best way to make water balance corrections required to remove suspended solids that on the spot. foul RO membranes. Generally, an SDI of less
134 Focusing on performance // Book sponsor Desalination & reuse2011 in 2011 Three years ago the desalination industry was driven by Spain, the east coast of Australia, Algeria and the property boom in the Emirates. The financial crisis, continued growth of the BRIC economies and the Pacific Ocean cooling cycle have changed that.
Instead, new markets are opening up driven by the minerals boom, changing water resources strategies, and changing weather patterns. The Speakers include Halla Razak, Colorado River Programs Director, San Diego County Water Authority people behind the new generation of Dennis Gibson, Director, Dennis Gibson & Associates desalination and reuse projects explain Dr Hu Fleming, Global Managing Director, Hatch Water their strategy and objectives. Rania Zayed, Director, Egypt’s PPP central unit at the Ministry of Finance Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
Desalination projects in the U.S. – Mexico border area
Context In March 2011, Lake Mead hit its lowest level since the construction of the Hoover Dam The U.S. has The political structure surrounding water in in 1935, and was just 6 metres away from a the Bahia California area, including Mexico, is drought declaration. Had this drought been incredibly complex. The Colorado River is the numerous large declared, there was a possibility that cities main waterway in this region, which flows downstream would be cut off, the first of these through seven U.S. states and Mexico. Despite reservoirs being Las Vegas. the fact that this region was green and lush 20 in which years ago, today it is now dry and arid, though Along with the threat of climate change, the river continues to supply water to many. population pressures have grown on both sides, notably along the border with the lure of U.S. The 1944 U.S. – Mexico treaty governs the Mexico could jobs. allocation of water to each country, with store their 18,500 m³/yr (15 AFY) going to the U.S. and 1,850 m³/yr (1.5 AF/yr) going to Mexico. Comprehensive basin However, increasing demand from both sides management [desalinated] of the Mexico-U.S. border has seen an increase In response to these various impediments, Halla Razak in conflicts over the Colorado River’s resources, the decision was taken in 2007 to overhaul water. with both the U.S. and Mexico attempting to Halla Razak is the Colorado River Programs Director for the the previous methods of basin management abstract more than their agreed allocations. San Diego County Water Authority. The Water Authority is the in favour of a more holistic approach. This wholesale supplier of water to San Diego County, supplying involved discussing and measuring the at a safe and reliable water supply to support a $150 billion The Colorado River Basin times conflicting needs in agriculture, for the economy and way of life for over 3 million residents. Razak environment and for urban areas. Second, a basin-wide hydrological study was undertaken, joined the Water Authority in 2005. as a first step in recognising the important part As the Colorado River Programs Director, Razak is responsible the delta plays in the environmental integrity for administering various aspects related to the Colorado of both countries. Finally, other potential water River Program including the management of the Bi-national sources were investigated. discussions with the Republic of Mexico on Desalination A webbed interplay of organisations were projects as well as the Quantification Settlement Agreement. involved in the discussions, ranging from This includes the supervision of the Imperial Irrigation District environmental NGOs to federal government. Water Transfer agreement, oversight of the Water Authority’s The proposed projects to examine were also participation in lining the All-American and Coachella canals, highly varied, from rehabilitating the Otay coordination of an Imperial Valley community outreach connection, the All American Canal, building programme, and working closely with federal, state, and other new desalination plants, right to new water river reuse. This gives you an idea of the far-reaching water agencies that are party to, or impacted by the QSA. investigation that was undertaken and the Prior to joining the Water Authority, Razak worked for 18 complexity of the job in hand. years at the city of San Diego, most recently as Chief Deputy It was decided that desalination represented Director for the City’s Engineering and Capital Projects a positive opportunity as, despite the fact that Department. Mexico does not have reservoirs of its own, the Razak holds a Bachelor of Science degree in civil engineering U.S. has numerous large reservoirs in which from the University of Dayton and a Masters degree in Mexico could store their water. engineering from San Diego State University.
138 Focusing on performance // Desalination & reuse in 2011 Halla Razak // Desalination projects in the U.S. – Mexico border area 139 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
it was incredibly important to take the process of the political, institutional and legal barriers Proposed plant sites one step at a time, thinking carefully of all that stand in the way. There is the 1944 treaty Through a bi-national agreement, options and research questions, in order to to take into account, and legal and contractual present the results to the funding partners. agreements will be complicated. Furthermore, the U.S. and Mexico have different electoral both countries are expected to achieve The results of our feasibility study showed no cycles, both for main parties and also state by fatal flaws, whilst demonstrating the capacity state, which brings added complexity, along a win-win result, whilst having the and demand for water from both sides of with issues such as immigration that can cloud the border. However, the demand figures water issues. added benefit of improved relations were so high the decision was made to turn attention away from canvassing the needs So as you can see, there are many challenges, of end users and instead turn to the political many potential stumbling blocks that could between the U.S. and Mexico. dimension of what demand could, or should be come in the way of a project such as this, accommodated. At this stage the all important but there is also a great deal to gain. For this element of price entered into the equation. At reason, we must make sure that the scope of this point of the feasibility study we had no way this project fits into the overall context of the of knowing what the price would eventually negotiations between both countries. be, but it was clear that there was a definite demand. Questions from the audience The advantage of the proposed site for the Harry van Lier, AkzoNobel: What is your long- desalination plant is that it is situated by a term solution for concentrated brine? power station that can supply sufficient power for the plant, with intake and outtake facilities In San Diego we have a desalination plant for the sea water, and the brine water. Despite being built by Poseidon in Carlsbad, and there were in-depth discussions on what to do with Co-operating for the future some concerns from Mexico’s environmental groups, there appears to be great enthusiasm the brine. Hopefully the lessons learnt at this The current project that is underway as part of for the plant, which would be Mexico’s largest. plant can be applied to the plant at Rosarito our new strategy is based in Rosarito Beach in Beach. But the Mexican Government will have It is hoped that It has to be acknowledged, however, that Baja, California. It will be a desalination plant for their input too, and do not need to comply despite the interest in the project from use by Mexico, the United States, or for sharing. with EPA regulations. We are also looking at water will be both sides, environmental permitting will some examples from Australia, but still at the One plan is to build a 29 km pipeline direct be complicated. In the U.S. many approved feasibility stage. added to the to San Diego to carry desalinated water north projects are delayed for years in litigation, up to the U.S. side of the border, or to create while in Mexico decisions are made in a more Sam Abboud, Pioneer Point Partners LLP: What an exchange scheme with Colorado River straight-forward manner, requiring prior are the trends you are seeing concerning the Colorado Basin, water. Once the sharing arrangements have consent by all parties before approval. In this tightening or loosening of discharge quality either by direct been finalised, the placing of the pipeline way, it is hoped that the project will be running regulations? to the U.S. must be determined, taking into as soon as possible. We are trying to implement indirect potable account patterns of both population growth reuse, something that we tried to do 10 years connection and industrial growth. The complexity of these Challenges and opportunities ago. At that time there was public outcry, to decisions illustrates the need for multiple think that their drinking water had been used An innovative project, it is hoped that water will or by water stakeholder involvement, and why the U.S. and once before. But this is one of the reasons why be added to the Colorado Basin, either by direct Mexico are working in unison with each other. we eventually waste a lot of good quality water. connection or by water exchanges with Arizona exchanges with Our current goal is to build a 284,000 m³/d and Nevada. Through a bi-national agreement, Unfortunately, when water is treated in facility, in a study that is being funded by the both countries are expected to achieve a landlocked areas, there are not many Arizona and Central Arizona Water Conservation District, win-win result, whilst having the added benefit alternatives to discharge, and EPA quality the Metropolitan Water District, the San Diego of improved relations between the U.S. and regulations are stringent, so at the moment the Nevada. Water Authority and the Southern Nevada Mexico. trend appears to be that people are happy to Water Authority. Three possible sites for the treat wastewater and discharge it downstream. plant were proposed and discussed. However, However, there is no denying the complexity
140 Focusing on performance // Desalination & reuse in 2011 Halla Razak // Desalination projects in the U.S. – Mexico border area 141 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
Water and desalination in the Australian mining industry
One of the main concerns for mining industry not just domestically, but also on the companies within the context of water, and international stage. how desalination can aid them, is the potential The vital role that mining plays in the global for water to impact sustainable development and domestic economic environment has and hence shareholder value. This is the bottom necessitated that mining companies move line for the mining industry, and, as with any from the somewhat traditional “reactive” industry, what really counts is the bottom line. approach to water management to a much more forward-thinking and proactive strategic Context management of this vital resource. This is Australia as a continent is not, in fact, “water absolutely essential to protect the production of scarce” but rather suffers from a water vital mineral resources whilst balancing with the imbalance, that is, regions of water surplus environmental and social aspects of sustainable do not necessarily match areas of demand. water management in mining. In addition, it may regularly move back and forth between conditions of extreme drought, The bottom line followed by extreme flooding, with both Given the substantial impacts that water – or phenomena increasing in intensity over time. lack of it – can have on production in mining, Large scale desalination did not take off in the underlying conclusion is that if water is Australia until the mid-2000s. As recently not managed appropriately then revenues will as 2009 a National Centre of Excellence in be affected, which will impact adversely on Desalination was established in Perth to shareholder value. promote research and provide facilities into the development of new desalination technologies. Water scarcity in mining However, large-scale desalination has its detractors. There are those, such as the National Productivity Commission, that point to the high cost of desalination, both in terms of carbon footprint as well as pricing, and who would prefer to see an increase in levels of recycling and reuse. Dennis Gibson Dennis Gibson has over 30 years experience in civil engineering and In 2008 he was appointed Chair of the Australian Government team Dust into gold mining project management. He has worked in the mining industry which developed the leading practice sustainable development Mining in Australia is a significant primary since 1985 with extensive international experience including in handbook on mine water management and was a judge of the industry, with direct employment of around Southern Africa, Australia, USA, Canada, Chile, Brazil and Israel in Australian Water Alliance Awards in Adelaide in 2008. 135,000 people, with a substantial additional level of indirect employment associated with operational, technical and consulting roles. Dennis established Dennis Gibson & Associates in 2009 to the industry. Dennis pioneered the development and rollout of the leading provide specialist consulting and strategic advice to national and The revenues derived from mining are also practice risk-based water diagnostic methodology for Rio Tinto. international companies who provide products and services to extremely important for Australia, accounting This has since rolled out to over 40 Rio operations globally. In 2007 the mining sector. These include the West Australian and Israeli for 7-8% of total GDP. On a global scale, Australia Government, McKinsey & Co, Golan Plastics Israel and Leighton he was appointed to the most senior water management position leads in world production of coal; it is the Holdings. in Rio Tinto, General Manager of Water Resources for the Iron Ore second largest producer of uranium, the third Division. During this period he chaired the global team tasked with Dennis is a registered Professional Engineer and has a Bachelors largest producer of iron ore and nickel, and the the development of the five year Rio Tinto Group water targets for Degree in Civil Engineering, a Masters in Engineering and an MBA. fourth largest producer of gold. These statistics 2009-2013. He has three children and currently lives in Perth, Western Australia. demonstrate the importance of the mining Source: Dennis B. Gibson
142 Focusing on performance // Desalination & reuse in 2011 Dennis Gibson // Water and desalination in the Australian mining industry 143 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
Real-life examples of this include Energy Rio Tinto’s Australian operations. The impacts high levels of very high salinity water – known associated with the industry. Through the Resources of Australia (ERA) in the Northern of the drought that hit the area in the early as produced water – that requires treatment examples we have seen in Australia, and Territory, whose Ranger uranium mine 2000s were so severe that they came close to before it can be reused, discarded or re-injected throughout the world, whether there is water registered estimated losses of $30 to $50 significantly impacting production and resulting into the ground. The Australian Government scarcity or water surplus, whether the challenge million due to “unseasonably wet weather”. in plant closures. has provided a $4 million budget to promote is poor water management or concerns over A further example includes the Queensland the development of desalination and water the social and environmental impacts of water Close demand management was required to Coalfields, where only 7 of 57 fields were in full treatment solutions to the problem, making the in mining, impacts on production can be huge. overcome the effects of the droughts, but in production during that same period, impacting coal seam gas market an attractive proposition recent years the opposite effects of flooding Improving your water management system to on the share prices of Rio Tinto, BHP Billiton, for water treatment companies for the future. have required the development of a new set include desalination and treatment will lower Given the Xstrata and Anglo American. These are just of management tools to ensure continued exposure to risk, mitigate costs in the future, two examples of the very real and measurable production. This movement from drought ensure reliable production and as a result substantial impacts on the bottom line caused by water Significant challenges to flooding has become a characteristic of improve shareholder value. The bottom line; management. As has been demonstrated, good water impacts that Australian weather and is having a significant management is critical to mining, which in water is a critical part of the mining industry effect on investment decisions, as is power turn, is fundamental to a wealth of businesses that needs to be well managed. Current projects in mining intensity and carbon pricing. In other words, water...can have projects exposed to a high carbon cost and Citic Pacific Project, Sino Iron therefore price exposure may not be favoured on production Located in Western Australia, this is the at a board level. Any desalination technologies largest magnetite project in Australia. Water that are being developed with improved energy in mining, the production at the plant is planned to be 140 efficiency in mind, therefore, will certainly find a million m³/d (140,000 ML/d); this is in fact lucrative market. underlying greater than the combined output of the two largest desalination plants servicing the city Olympic Dam, BHP Billiton conclusion is of Perth, making this a significant investment The Olympic Dam is the largest known for Sino Iron in the supply of water to a mining uranium deposit and the fourth largest coal that if water is operation. and gold deposit, so represents a considerable Due to higher labour costs, the decision was investment opportunity. BHP Billiton, the not managed made to prefabricate the individual modules world’s largest minerals operator, is proposing of the plant in China and ship them over the a 280,000 m³/d (280 ML/d) coastal desalination Australia, where the pieces are assembled. plant to service the operation, which will appropriately Although this method of construction is cost provide 200,000 m³/d (200 ML/d) via a 320 km efficient, it has led to delays in construction. pipeline to the operation, and 80,000 m³/d then revenues However, the first water to be desalinated is (80 ML/d) which will be given back to the South expected by mid-2011. Australian Government in exchange for water will be affected, abstracted from Murray River. ERA Ranger Uranium, Rio Tinto A project of this size requires a lengthy and which will The ERA uranium operation suffers from in-depth environmental impact analysis, and so an excess supply of water, notably through is not easy to secure. At this stage, an adequacy impact adversely rainfall, as aforementioned. An investment of assessment is being prepared by the State $30 million was made in 2007 to build a water Government, and if it is approved, execution will on shareholder treatment plant in an effort to manage the wet commence in 2012. weather and flooding. Taking into account the value. fact that the ERA uranium mine is the world’s Coal seam gas second-largest uranium operation gives an idea A major growth area, especially in the eastern of the significance and the size of the water states of Australia, is the market for coal seam treatment and management challenges. gas, which it is hoped, will help to reduce Australia’s reliance on importing conventional Gladstone, Rio Tinto forms of fossil fuels, and help reduce GHG Situated on the eastern coast of Australia, emissions. the Gladstone aluminium mines at one point However, the process used to tap these gas represented the most significant asset base in deposits, known as “frac’ing”, produces very 144 Focusing on performance // Desalination & reuse in 2011 Dennis Gibson // Water and desalination in the Australian mining industry 145 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011 Desalination in the mining and metals industries
A healthy market Water requirements of gold, copper and aluminium Mining is the fourth largest global consumer of water today, and the second largest global user Metal Weight in grams (g) Water requirement (m³) of desalination plants, several of which have a Gold 28 33.7 capital expenditure greater than $300 million (two are in the region of $1 billion). Copper 450 18.2 Aluminium 450 7.95 The direct water use in mining is dramatic, not counting the water used in peripheral Source: Hatch applications (see the figure to the top right). To put this into monetary terms, the per annum investment lifespan of a mine situated in a cost of water treatment to the mining industry remote location with the need for costly water varies between $10 to $20 billion, worldwide. treatment infrastructure. In addition, there will The disparity between the two numbers exists be environmental sensitivities and resource Desalination because the higher estimates usually include competition that must be balanced within this ancillary costs such as pipelines. However, the equation. net result remains the same – the cost of water is often treatment in mining is great, and furthermore it Why desalination? is growing quickly as the sector grows. In the past, mining companies were more preferred to Given the success of commodity prices over concerned with the quantity than the quality of the last 20 years or so, with many commodities water for use in their operations. This is because using municipal doubling or tripling in value, production has the relationship between water quality rates continued to increase, as has the associated and recovery rates was not widely understood. water because water management needs of mining In addition, commodity prices were not as high companies, and the concomitant opportunities as they are today. in the majority for companies that offer water and wastewater Now, with a better understanding of how solutions. water composition affects recovery rates and of cases where commodity prices at all-time highs, recovering A different kind of market even the very last 2% of an ore is worth mines are The mining industry exhibits certain considering. Additionally, if there is another idiosyncratic characteristics concerning its process that leaves behind 0.5% but is more situated there efficient, the difference can translate into Dr Hu Fleming water profile, as compared to most other large global industries. For instance, operations are millions of dollars per day. More often than not, may be no Dr Hu Fleming is Global Managing Director of Hatch Water, a unit of Hatch, a global engineering and programme typically very large scale, situated in remote the deciding factor is the quality of the water management organisation. He received Master and Doctorate Degrees in Chemical Engineering from Cornell University, locations that may not be close to suitable used in the process. municipal water and his MBA at Harvard Business School. Hu is well known in international water and environmental circles, with more water bodies and have little or no infrastructure. Desalination is often preferred to using than a hundred publications, sixteen patents, and four books in various aspects of water management, including the Crucially where return on capital expenditure municipal water because in the majority of access. Handbook of Membrane Technology. Among professional affiliations, Hu has been chairman of the International is concerned, mining operations are short-term cases where mines are situated there may in nature, with mine lifetimes ranging from 4-5 Congress on Membranes and Membrane Processes, the Task Group on Water for World Health Organisation, EPA’s Clean be no municipal water access. In addition years to not more than 20 years. governments are sensitive to the fact that Water Act Advisory Group, the Water Reuse Association, as well as chairman of NATO’s Advisory Group on Environmental miners are using water that could be used for Management. He has also been invited speaker at the United Nations, as well as various Congressional committees on Nevertheless, water is an absolute requirement other, municipal, purposes. water and environmental issues. for mining operations. Therefore the challenge for an operator will be how to balance the short
146 Focusing on performance // Desalination & reuse in 2011 Dr Hu Fleming // Desalination in the mining and metals industries 147 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
In some cases, raw seawater is being used, trend. Water quality broken down by process not just by the coast but in mines situated in One of the major benefits of desalination is that mountainous regions; for instance there are 4 it is suitable for all types of mining operations or 5 mines in Chile and Peru that are planning Water quality Flotation Oxide leach Sulphide leach Electrowinning and processes (see top right figure). Desalination is to run pipelines from the sea to mines over the Seawater Yes Yes No No Andes. However, whether one can successfully Where this fact comes to the fore is in high use seawater depends on the individual end operations such as sulphide leaching and Brackish (well water) Yes Yes Maybe No becoming an characteristics of the mine; its chemical electrowinning that require good quality water, Desalinated seawater Yes Yes Yes No composition; what you are mining and the as these are the types of processes that allow Municipal wastewater Maybe Maybe Yes No increasingly type of mining process that is in use, making recovery of the final remnants of ore. popular tool seawater a last resort for most mining operators. Low chloride (1 or 2 pass RO) Yes Yes Yes Yes For the reasons given above, desalination Mountain desalination projects Source: Hatch is becoming an increasingly popular tool A crucial factor to keep in mind for mining of choice of choice for mining operators in order to operations in mountainous regions away from is, desalinate part of the seawater for advanced in Western Australia which produces mixed fulfil their water supply needs. Most mining the sea is that the pipeline, not the desalination purposes, and use the raw seawater for other nickel and cobalt hydroxide intermediate for mining companies around the world are now using plant, makes up the largest capital and power purposes. The principle advantage to this product (MHP). This plant has been in use desalination in their mines, notably in Australia, cost – over 90% of all power is needed to fuel method is the lower cost of running seawater since 1994, and was the first operation to take The mining operators. Peru, Chile (the most obvious example - there the pipeline in some cases. So in contrast to through a pipeline. Again, the correct method the wastewater brine stream for use in the are approaching 20 at this point), Brazil and municipal desalination plants where power will depend upon the particular characteristic beneficiation process. South Africa. This move towards desalination usage is the main concern, in inland mining and value of the mine. industry is Another example of a desalination plant in use only began in the last few years, demonstrating operations power use in the plant itself is since 1994, also located in Australia, is the BHP the increasing velocity of this rapidly growing eclipsed by the power use – and cost – related expanding, Mining and the environment Billiton Kwinana Nickel Refinery built by Hatch, to the pipeline. As with all desalination projects, environmental which is a two part desalination plant. One there is an In South America, ore bodies are typically concerns are always at the fore of objections plant supplies the feedwater, while the other is located away from the coast, in the Andes. made to proceeding with running desalination used for chloride removal, and for concentrating absolute For instance, at the Escondida project in Chile, plants for mining. Again, as with cost, the largest ammonia sulphate. with a total capital expenditure of $3-$4 billion issue for most desalination plants in the mining Finally, desalination has also been used in dollars, it is expected that around $1.5 billion shortage of industry is the pipeline, and these concerns phosphate mining in the United States. will be spent solely on the pipeline. In some comprise pipeline access and right of way, the Phosphate mining is highly water intensive, cases, a new power plant is needed simply to intake access at the shore and the impact of the but is, of course, the key component of most water, and fuel the pipeline. This means that the water effluent released into the environment. industrial fertilisers. The number of mine sites is treatment component of a mining operation is also expected to grow by a factor of four over the fact is often not a desalination plant; it is a complete One distinction that sets mining apart from the next four years. To meet its water demands, utilities installation. other industries using desalination is that there are effluent standard regulations that are the phosphate mining industry is increasingly most new There are typically three means of running specific to mining, and these differ from country turning to desalination for its feedwater needs, water to mountainous mines. First, if possible, a to country. Peru, for example, generally has whilst recycling the acid mine water generated plants or plant direct line of seawater may be used. This is the more stringent discharge regulations than Chile. in a closed loop system. cheapest, most cost effective option available, These discrepancies need to be closely factored expansions but it is liable to the aforementioned caveats. into the choice of feedwater source used, which What does this mean? in turn may affect the eventual investment Second, it is possible to put a desalination Desalination is just one instrument open to are using decision. plant on the coast, and run desalinated water mining companies to help meet their water to the mine. This presents some complicated needs. Whether it will be suitable depends upon desalination engineering problems, costs of materials and Novel uses of desalination in a range of factors, and it is not applied across high pressure pumping to name just two. mining the board. Having said that, the mining industry to meet their is expanding, there is an absolute shortage of A third option is to run seawater to an on-site Desalination in mining is not actually a water, and the fact is most new plants or plant desalination plant. This third option is most in particularly new phenomenon. Take, for expansions are using desalination to meet their needs. use, and is particularly suitable for those mines example, the Ravensthorpe Nickel Operation that wish to use a hybrid water solution – that needs.
148 Focusing on performance // Desalination & reuse in 2011 Dr Hu Fleming // Desalination in the mining and metals industries 149 Global Water Summit 2011 Focusing on performance Desalination & reuse in 2011
Wastewater treatment in the Nile Basin
Context • Alex West Plant: Will go out for pre- qualification in the middle of May 2011, and There is a In Egypt the key issue for us is actually is planned to be an 800,000 m³/d WWTP. wastewater treatment plants (WWTPs), as that pressing need is the area in which the most exciting projects A further three projects are in the pipeline, and are currently up and running. Due to the have as yet to go out to tender. Two smaller for an adequate prevalence of the Nile, desalination per se is less plants situated in rural areas, with capacities of a priority. ranging from 5,000-20,000 m³/d will be tendered out in batches – that is to say, in one wastewater With a population of 84 million, there is a geographical area five to six installations will be pressing need for an adequate wastewater built. This will be an interesting project as it will treatment treatment network in Egypt, yet this network be aimed specifically at consortia of companies as it stands covers just 13% of the population, that have experience in running smaller WWTPs. network in despite the fact that conventional water The remaining projects will be an 800,000 m³/d treatment plant coverage is approximately 94%. plant to be situated north of Giza and a 600,000 With such a striking gap between the two, it is m³/d situated in Helwan. Egypt, yet this inevitable that public-private partnership (PPP) projects should factor as a priority as we move network as it forward. Barriers to the programme Let us be frank, the economic and political stands covers The PPP programme climate in Egypt is quite unstable – a recent The PPP programme was started five years popular revolution has led to an interim just 13% of the ago in Egypt, and has attracted many of the government, and the prospect of democratic largest companies from around the world. The rule for the first time in Egypt’s history, with population... first WWTP funded through a PPP with aqualia elections planned in November 2011. and Orascom is nearing completion. The deal The tenders mentioned above are already out it is inevitable financing was closed in December 2009, and is on the market, but it has been decided that expected to be delivered by September 2011. the projects remaining in the pipeline, that that PPP There are a further three tenders out as we are yet to be put up for tender should remain speak, including: shelved until the parliamentary and presidential Rania Zayed elections are complete, and a democratic projects should • Abu Rawash Plant: A 1.2 million m³/d government is sworn in. Mrs Zayed is a senior financial executive, with all-round business experience mainly WWTP. The size of the plant is quite large, gained from working as Finance Director for 13 years in Multi-National Corporations in However, the trust that a new democratic factor as a reflecting our large population, and the the Middle East, in addition to 4 years as Group Chief Financial Officer for large Egyptian need to close the wastewater treatment government will bring, combined with private sector groups and finally a Financial and Strategic Adviser for 5 years. capacity deficit. expected changes to our out-dated pricing priority as we system will, we hope, create a better • A smaller plant of 150,000 million m³/d Since June 1st, 2006, Rania has joined the Ministry of Finance of the Egyptian Government environment for investment to take place, boost was tendered on the 6th Oct 2010, and is in the capacity of Adviser to the Minister as well as Director of the Public Private move forward. market confidence and clarify Egypt’s economic destined to be situated in the urban area Partnership Central Unit, responsible for implementing PPP initiative on a national basis. climate. outside of Cairo. Rania is a graduate of the American University in Cairo majoring in Economics. She holds an MA in Economics as well as an MBA.
150 Focusing on performance // Desalination & reuse in 2011 Rania Zayed // Wastewater treatment in the Nile Basin 151 Global Water Summit 2011 Focusing on performance
Questions from the audience
Sam Abboud, Pioneer Point Partners LLP: Who lessons learnt at this plant can be applied to Once the are your biggest competitors providing pre- and the plant at Rosarito Beach. But the Mexican post-processing water treatment services to the Government will have their input too, and mining industry? do not need to comply with EPA regulations. water is out We are also looking at some examples from Hu Fleming: Everyone is a competitor! Australia, but still at the feasibility stage. of the ground There are some key engineering companies, but in terms of equipment, they’re the same Isao Takekoh, Sumitomo Corporation: Water it is subject companies providing equipment to most produced from mining activities is highly saline, industries such as GE, Veolia, and so on. The one so rather than paying for the cost of treatment, key difference is that mining companies really why don’t you reinject it – are you worried about to the above- know about water, and provide much of their contamination of other aquifers? own input. Solutions also typically require some Hu Fleming: Aquifer storage and recharge ground water good process knowledge. is widely practiced in Western Australia by a Dennis Gibson: In stages your competitors can company called FMG, who are the third largest regulations, so often become your joint venture partners – Rio iron ore company in Australia. However, where and BHP can go from competitors to partners water quality is bad, you need to make sure you can’t just in a day! you do not push any water you have taken out downstream. Delegate: What procurement model is used by discharge it. mining companies to manage their water? Do Dennis Gibson: Once the water is out of the they hire third party firms to manage their water ground it is subject to the above-ground water needs? regulations, so you can’t just discharge it. To To reinject reinject it requires a reinjection permit and in Dennis Gibson: Mining companies prefer my experience if there is any water quality issue to do things on their own, first because they it requires a you will not get that permit, wherever you are don’t want to be price-dependent on an in the world. reinjection outside party, and second because they need to ensure a security of supply. In general Sam Abboud, Pioneer Point Partners LLP: What they design, build and manage their own are the trends you are seeing concerning the permit and in equipment, though this is occasionally carried tightening or loosening of discharge quality out in partnership with a technology company. regulations? my experience However every situation is different. Halla Razak: We are trying to implement Hu Fleming: That is definitely the model indirect potable reuse, something that we if there is any favoured by the larger mining companies, tried to do 10 years ago. At that time there was though there are some smaller operators with public outcry, to think that their drinking water water quality less strong balance sheets willing to outsource had been used once before. But this is one of a BOO or BOT. Bigger companies may directly the reasons why we eventually waste a lot of issue you will purchase a plant or offer an operations contact, good quality water. but will not contract out ownership. Unfortunately, when water is treated in not get that Harry van Lier, AkzoNobel: What is your long- landlocked areas, there are not many term solution for concentrated brine? alternatives to discharge, and EPA quality permit, wherever regulations are stringent, so at the moment the Halla Razak: In San Diego we have a trend appears to be that people are happy to desalination plant being built by Poseidon in treat wastewater and discharge it downstream. you are in the Carlsbad, and there were in-depth discussions world. on what to do with the brine. Hopefully the
152 Focusing on performance // Desalination & reuse in 2011 Desalination and reuse in 2030
The desalination industry 2030 has evolved dramatically since the first large scale distillers were introduced in the Middle East in the 1950s, but the biggest change is still to come. The potential demand for additional renewable freshwater resources is so great that it is difficult to see how it might be met by existing technologies.
Speakers include In this session we look Ross Young, Business Leader, Water, Australia, GHD into the deep future for Michael Flynn, Lead of the Water Technology Development Laboratory, NASA Ames Research Center desalination and reuse. Dr Cynthia Daniell, United States Defense Advanced Research projects Agency Dr Sherwin Gormly, HTI Global Water Summit 2011 Focusing on performance Desalination and reuse in 2030
One of the great challenges faced by desalination today is the water and energy Desalination in Australia nexus, which needs to be understood. Every desalination plant that is built or is being built in Australia is being powered by green energy sources such as wind farms or by purchasing Water challenges in Australia Desalination: green energy. This is the only way we can Australia’s I would like to outline why Australia has A climate-proof source of water get the Australian community to accept desalination, because people understand the experienced such a revolution in desalination Since early 2000, the Australian urban water nexus between CO emissions and climate challenge... technologies as a means of supplying safe and industry spent around $36 billion just on new 2 reliable drinking water. You can understand water sources. In 2007, the Australian urban change, and they think it would be the height is not the what is happening in Australia in relation to water industry was the biggest investor in of irony if we were responding to climate desalination if you understand its hydrology and Australian economy, capital-wise, followed by change in a way that was going to further dryness of the climate. If I can leave you with one message to the mining industry. exacerbate the issue. take away today, it is that Australia’s challenge General lack of acceptance of desalination in terms of water resources management is not Desalination is a source of water which is continent, but independent of rainfall: it can ensure that by the public is another issue in Australia. the dryness of the continent, but the variability Australian communities display much stronger of our rainfall patterns and unreliable climate. our cities and towns don’t run out of water. the variability There are few climate sceptics in the urban support for recycling water than they do for We have the most unpredictable and variable water industry in Australia, because data gives embracing technologies. There is a general of our rainfall rainfall patterns of all the continents, and trends an overwhelmingly clear picture of what’s misunderstanding that desalination is the only show that Australia is getting drier and hotter happening. A rapid population growth puts solution that we are looking into: we have a with higher evaporation rates. Australia was great pressures on today’s water management; wide range of water conservation and recycling patterns and one of the first countries to be impacted by rivers are stressed, and ecological health is at projects as a key component of our water climate change, and in fact you can argue that risk. Water prices have more than doubled over management strategies. unreliable the water industry was the first industry to be the past three years, and the customers are Some critics say that desalination is a waste of impacted by climate change because the first starting to question the value of water. Over money. I think, however, that desalination can climate. consequence of climate change is the reduced the past 15-20 years, there has been a 25-30% be seen as an insurance cover for cities and inflows. reduction in water consumption per capita towns against climate variability. Would you because people were terrified during the really think that household insurance was a waste dry years that they were going to run out of of money if your house does not burn down water. Many conservation groups express the Water demand of capital cities, 2007-08: % that can be met with desalination during the year? In fact, desalination is much need for water restrictions. cheaper than household insurance. 15% (potential 30%) Total water demand, 2007-08 However, we will be moving beyond restrictions 600 Water from other sources and providing a new source of water. Today 35% Towards sustainable desalination of the total water of the capital cities’ (based on Extra capacity desal plant is capable of Desalination is not the panacea, but it is a very 2007-08) is supplied by desalination, and if all 500 important, rainfall-independent source of water. Ross Young Water from desalination of the desalination plants are upgraded to the There is plenty of scope for further innovation in maximum, it will cover nearly 50% of the urban Ross Young commenced as the Executive Director of the Water Services Association of the technology, and it is a highly reliable source water requirements of the capital cities around Australia (WSAA) in 2004. WSAA is the peak body for the urban water industry and its 400 41% (potential 55%) of water which has a small footprint when Australia. members provide water services to 16 million Australians (80% of the population). In 2011, compared to dams and other kinds of water supply. In terms of the energy issues, some Ross joined GHD to lead their water business in Australia. 300 Issues and challenges of of the work that we have done shows that Ross has extensive experience in urban water management at a senior level having held 40% (potential 61%) desalination in Australia residential hot water in Australia is being heated a number of key executive positions with Melbourne Water for over a decade. Whilst at 48% using 6.5 times the amount of energy required 200 What are the virtues of desalination? When WSAA Ross raised the profile of the Australian urban water industry, representing the (Wonthaggi) for delivering urban water services across 71% people ask me if I am for or against desalination, Australian urban water industry on water policy at the national level and he regularly (Kurnell) Australia. If we can reduce the amount of hot (Binningup) I say I am for everything, but the important contributed to debates on urban water issues. 100 water heated in homes by 20% by being more Wonthaggi Binningup thing is to make sure that you evaluate all of Kurnell (2011) Tugun (2011) Port Stanvac efficient, we can wipe out the greenhouse gas Ross is the Chair of the Global Water Research Coalition Board and a Board Member of (Dec 2012) the water sources from social, economic and (completed) (completed) Kwinana footprint of the urban water industry, including WaterAid Australia. He has a Diploma of Horticultural Science, a Bachelor of Applied (completed) environmental perspectives before making a 0 all of the desalination. That is how low-hanging Science, an MBA and a Graduate Diploma in Natural Resources Law from the University of Sydney Melbourne SE Queensland Perth Adelaide decision. the fruit is. Melbourne. Source: Water Services Association of Australia
156 Focusing on performance // Desalination and reuse in 2030 Ross Young // Desalination in Australia 157 Global Water Summit 2011 Focusing on performance Desalination and reuse in 2030
Application of advanced water recycling technology in space
have to deal with – 89% of all the mass required Life support requirements Water cycle in space: Closing the loop to keep a human alive in space is water. We Gases lost to space 2.1% put a lot of effort and a lot of money into I work in a specialised field of research within developing integrated water treatment systems. Crew supplies 2.1% Systems maintenance 2.1% NASA called “advanced life support”. In other Food (dry) 2.2% words, our job is to keep the astronaut alive, In a spacecraft, outputs are not waste but instead the key to your survival. Urine is Oxygen 2.5% and the life support is everything inside the spacecraft, including the air, water, waste, recovered and mixed with condensate water spacesuits, thermal control, and power systems. from the atmosphere. We also create water from CO2, by reacting it with hydrogen sourced Water 89% Historically, NASA has taken an open loop from wastewater. All of the water produced is approach to life support systems – we purify polished to potable standard and is provided the water, then use or contaminate it, and to the crew for hygiene and drinking purposes. Life support then dump the water out of system. This is a Also, organic contaminants in the air are requirements very familiar approach which many of us take. oxidised to produce water as a by-product, However, with the advent of the space stations which will be recycled back down to the and longer duration missions, that became internal water treatment system. impossible: the cost of putting a litre of water into space is over $18,000. In longer-duration missions such as the International Space Station Challenges and future targets (ISS) and the Mir Space Station, there is no way Some technologies are easy to develop, but it you could afford to bring water up and dump could be very difficult to make them reliable, Source: NASA Ames Research Center it aside. practical and operational. We have many problems with life support hardware systems in In future missions such as the exploration of the International Space Station. Mars, resources recovery becomes critical as there is no re-supply of materials. For those For instance, urine processors have been Space station regenerative ECLSS flow diagram (baseline and scarring) systems, you must close the loop, turning all of returned to earth twice because they failed, the waste into inputs, including getting 100% and the oxygen generation system has been water recovery – if your kids want to become returned to earth once. Costs associated with astronauts, they should be prepared to drink these instances are extremely high. Most of not just their own urine but also the urine of the our future work is directed at developing an astronaut sitting next to them. extremely reliable life support system, which is absolutely critical for the future. In space, we have inputs such as water, oxygen, wastes, temperature and pressure. We also have Further efforts are required to reduce the outputs such as wastewater, carbon dioxide, amount of re-supplies required by the ISS. They organics, solid waste and heat. If you are on the currently achieve an overall water recovery Michael Flynn surface of Mars, those outputs are not waste – rate of 80%, and we aim to go higher than that, those are what are going to keep you alive. ideally to 95-97% in order to close the loop. Mr Flynn is the lead of the Water Technology Development Laboratory at NASA Ames Research Center. He has over 23 years experience in the development of advanced water Cost is another key issue faced by the space recycling technologies for NASA. He has over ninety relevant peer reviewed publications Concept of recycling industry. We don’t care about the cost of in the field. He has received two R&D 100 Awards, a Wright Brothers Medal, and an Arch T. and reusing water in space developing technologies, but we care about the launch costs. This means increased Calwell Merit Award. He has received 6 NASA Spotlight awards and four of his papers have The most important thing NASA cares about reliability (to avoid sending back to the earth) been selected by the Engineering Society For the Advancing Mobility of Land, Sea, Air, and is the “weight”, and not the cost of developing and a significant reduction in the mass of Space International’s transactions publication. He has also been involved in the start up technologies. In fact, of all the metabolic supply technologies and systems. of 3 private companies in the water technology sector. Mr Flynn has a BS in Mechanical requirements, water is the key issue that we Engineering from San Francisco State University. Source: NASA Ames Research Center
158 Focusing on performance // Desalination and reuse in 2030 Michael Flynn // Application of advanced water recycling technology in space 159 Global Water Summit 2011 Focusing on performance Desalination and reuse in 2030
Visions for the future: Integrated Conclusions will be left to future systems and reliable technologies generations Vapour Phase Catalytic Ammonia Reduction My conclusions are that there are no Clean water technologies is one of our next generation water treatment conclusions, as there is a long way to go. Development of systems. Although it is again a mechanical Development of a truly reliable and sustainable system which could break down, it is very system for the space industry is not going to effective at producing potable water, using a happen in our lifetime, primarily due to the for 2030 a truly reliable vapour phase catalytic reactor to oxidise any financial constraints. contaminants. The technology also allows us The best thing we can do is to educate the and sustainable to recycle the latent heat of vaporisation. Its Development of desalination next generation of young engineers who basic concept is to adapt natural processes of technology are actually going to develop the systems the water cycle on the earth in a small artificial Desalination started with thermal evaporation, system for the that allow us to colonise Mars and travel environment. Using this technology, we are able boiling saltwater to obtain freshwater and leave through the solar system. NASA carries out to: the salt behind. This has been going on since space industry its technology development in-house as well medieval times, when salt was known as white 1) Distil water just like the sun distils ocean as in collaboration with small companies. gold, so they were more interested in the salt is not going water. We welcome any new idea, no matter how than freshwater at that time. As you can see, 2) Turn water into vapour like in a cloud unrealistic it seems at first; we would like to times have changed in the modern era. to happen in formation. invest and see if we can get something out of it. 3) Oxidise the vapour with catalytic processes Thermal evaporation is one of the two key our lifetime, instead of with UV light of the sun. Questions from the audience technologies used in desalination, as many of 4) Replenish water through condensation like Dr Masaru Kurihara, Senior Director, Toray you are aware. It is a pretty well established rain, but in a smaller system. Industries, Inc: It is important to learn the technology. Reverse osmosis membrane primarily due desalination is another key technology, which is The only difference is that we recycle the latent lessons from the 40 years of past experiences of taking over desalination. Bioremediation could heat of vaporisation as well. You can think of membrane desalination. Everyone thinks that to the financial really be a game changer which, in 2030, could earth as a space craft. NASA is developing a FO is fantastic, but from our understanding, be at the point where we are looking at it as a truly sustainable architecture to enable human the key issue is the development of membranes realistic and actual solution to the desalination constraints. beings to exist without consuming all of the rather than the processes. Even today, we have problem. raw materials. On the earth, things are starting not been able to develop a good FO membrane. to move in the same direction. I believe in What sort of operational targets must be met for the future these directions are likely to merge it to be practical? Water provision through a together. To a large extent, I think we have the localised and decentralised system Another example of a research project is the membranes that we need, which are very My interest at DARPA is getting water to be The best thing application of forward osmosis (FO); NASA is robust and capable. What we need is for people distributed through localised systems. You can carrying out a lot of research on the technology. to understand that it is a different architecture think about it in terms of developing countries Since the separation mechanism of FO does not to conventional ones, and properly apply it. where many people are living off the grid of we can do is rely on a hydraulic pressure difference, it allows Some very interesting things are possible centralised infrastructure. There are many policy us to use biological membranes. Although the at this point in time. It is important that the and political reasons why you want people in to educate the term FO is not familiar to many of you, every community accepts the new technology like developing countries to be off the centralised Dr Cynthia Daniell one of you is an expert in FO: in fact your small this and understands that it is not like RO. infrastructure and be able to control, finance Dr Cynthia Daniell joined DARPA as a programme manager in September 2006. Her next generation intestines are lipid based, self-generating FO Comment from the audience: You need a and manage their own destiny in terms of water DARPA programmes centre on unique planar materials that enable complex separation membranes. good membrane, but unfortunately, when you and energy. processes while embodying rugged, lightweight systems. Toward that end she runs of young We are also interested in aquaporin membranes think that way you tend to ask the person to get In particular, having the localised system and the Materials with Novel Transport Properties programme for the purpose of portable due to its ability to reject urea and produce more flux, instead of whether you can run over the ability to “condition” the water is critical, water desalination and decontamination. Dr Daniell also runs a Portable Photovoltaic engineers. odourless drinking water. The conventional FO it with a truck. even if the water source cannot be taken locally. programme, among others. systems do not have aquaporin membranes, This is because in times of strife, people try to Neil McDougall, Chairman, Modern Water: She received her Bachelor’s Degree in Electrical Engineering from the University of and urea is treated through a biologically take out the central infrastructure. Rebuilding FO is not just an idea or a concept. We have South Alabama. Her Master’s Degree and Doctorate in Electrical Engineering came from inspired enzyme reactor to separate urea into the membranes working in a commercial distribution network is much easier than the California Institute of Technology, where she gathered experience in materials for CO2 and ammonia. Ammonia can then be environment and have achieved great rebuilding an expensive and large desalination used as fuel for an electrical cell to produce performance. It is already much better than plant. fabrication and analog VLSI. electricity. Dr Daniell is the author or co-author of 6 patents and 25 technical papers. existing RO technology. Water provision in my mind should be
160 Focusing on performance // Desalination and reuse in 2030 Dr Cynthia Daniell // Clean water technologies for 2030 161 Global Water Summit 2011 Focusing on performance Desalination and reuse in 2030
decentralised and localised, and it should The progamme’s vision initially started when voltage to the bacteria to provide them with I believe also be low cost and low maintenance. Low I first joined DARPA and saw our “light-weight enough energy to eat the salt in the water. maintenance is particularly key for the United water purifier”. This was a jeep weighing around I believe that, with synthetic biology and with States Department of Defense (DOD), because 500 kg (1,200 pounds) that provided 0.28 m³/ new genetic engineering, we will be able to that...we will most of the military operators that are out in hr (75 gallons/hr) of potable output from create bacteria with certain attributes that the field do not have the time or the training to seawater and consumed 3,000 watts of energy enable them to eat the salt. If this is achieved, be able to operate water treatment systems to do so. That was clearly not my vision of a the process of desalination may be just putting light-weight water purifier. We are aiming to a pill into dark water. What can be lower cost create bacteria bring it into a back-pack size, possibly by 2014. Role of desalination and lower maintenance than that? for military operations With MANTRA, we are aiming to achieve the with certain same operating capability as the conventional From my perspective (which is not necessarily system to produce 0.28 m³/hr (75 gallons/ Key for the year 2030 that of the DOD), desalination could play a major attributes that hr) from seawater, but using only 375 watts In my view, desalination will only fit a niche of role in providing localised and decentralised (instead of 3,000 watts) of energy. It is an order water, particularly with regard to brackish water. the whole water puzzle in 2030, as we will have of magnitude lower in power and logistical an integrated solution for providing water. The enable them In terms of seawater desalination, about 40% of footprint (i.e. size and weight). the population lives close to the coastlines. The most important issue we need to look at in the to eat the main challenges for desalination technologies Regarding standard RO membranes, I would next 20 years is environmental impacts, such are to make operations and logistics low cost and like to discuss the point that we are reaching as sustainable use of groundwater, safe brine salt. If this low maintenance. the thermodynamic limit. I feel that carbon discharge and greenhouse gas emissions. nanotubes and biomimetic channels are where Questions from the audience For military operations, self-sustainment is the desalination in 2030 is going. For particle key. Water provision needs to be able to be is achieved, separation we are looking at regenerating Question: In regard to your research on salt- mobile and have a very small logistical chain for membrane technology. eating bacteria, is there any publicly available whenever they are operating out in the field. the process of results? They cannot have water trucks in situations One of our performers in the programme has where, for instance, a three-man team is going come up with a self regenerating membrane I am not currently involved in that research, desalination on a special operation and will be gone for technology, which constantly regrows the but I am interested in funding in the future. 11 days. They cannot have a chain of convoys membrane and sloughs off the old skin and I am aware of two papers which have been may be just bringing them freshwater: they need to be self- foulants that could be backwashed. This published on salt-eating bacteria. There are sustaining. They are required to move quickly, provides a lower maintenance cost, and reduces some products available on the market for soil putting a pill while already carrying 50 kg (110 pounds) of the need to provide chemicals for cleaning. with high salinity. I believe they are in either pill other equipment. We would like to provide The two performers in the programme are or fertiliser forms which you can use. Bacteria into dark them with the ability to manufacture their own both developing near-frictionless membrane will eat the salt out of the soil to reduce salinity. water in the environment they are in, and not technology using carbon nanotubes. Question: Have you ever thought of the rely on outside means. water. In terms of biomimetic channels, we are bacteria in combination with membranes? In addition, desalination is an important carrying out research on aquaporins. An Yes, I have absolutely. I believe that everything element of the DOD’s humanitarian efforts. On aquaporin is a specialised protein channel, and is going to be an agglomeration of new a daily basis, we have at least a thousand troops to date, nobody has been able to mimic one. If technologies, like the combination of FO in areas that are suffering from catastrophes. we are able to mimic an aquaporin by synthetic systems with RO. Our humanitarian efforts include providing bioengineering, it will be truly revolutionary. What can be portable desalination systems to ensure safe water supply to those who are affected. Quick way of lower cost getting rid of membranes? Development of By the year 2030, we will hopefully be getting and lower new membrane technologies away from membranes due to all the problems with fouling. What we are looking toward now is The programme I am running at DARPA is about very nascent technology, bioremediation using maintenance RO membrane processes and the application salt-eating bacteria. Our research is still at a very of materials with novel transport properties early stage, where we need to apply a very high than that? (MANTRA).
162 Focusing on performance // Desalination and reuse in 2030 Dr Cynthia Daniell // Clean water technologies for 2030 163 Global Water Summit 2011 Focusing on performance Desalination and reuse in 2030
Forward osmosis and the water power nexus in 2030
Technical treads in important message is that FO can look like the energy use of MF, UF, or RO. It enables water power nexus technology reverse osmosis (RO), with similar membrane beneficial reuse of RO reject brines, as well as arrays to conventional RO. However, it dilution return to the ocean. It can be applied Firstly, you need to ask yourself a big works in very different ways, with different as an upgrade of a primary only system in question. Where are the holes in the water results and functions, and must be put developing locations. and power cycles? Currently, cheap but to different uses to provide value. Similar The starting point application for FO is limited energy and material inputs support issues exist for advanced bioreactors, use of seawater RO pretreatment. The use of FO “open loops” and unsustainable cycles. We other nanotechnology materials, and other can eliminate a lot of complexity in front of need to close that loop. How can we do this “revolutionary” rather than evolutionary a seawater RO unit. The system can loop the in a way that makes sense for the evolution systems in water treatment working at the RO reject with seawater which is run through of technology along with industry? water power nexus: FO is just the strongest an FO membrane, so that RO reject can be example and my area of expertise. diluted using the incoming seawater. What is forward osmosis? Forward osmosis (FO) is a biomimetic Application of FO FO can also be applied at the back end of an industrial methane production waste process, which can be characterised by a for 2010-2020 harvest of high energy at the microscopic digester system. The FO system enables There are several extremely robust FO level across a membrane in order to drive the production of colourless liquid fertiliser, technologies that are under a pilot phase the separation process. It involves a lot of which is rich in nutrients such as phosphorus and operating in the field. Key advantages energy: the osmotic pressure of seawater to and potassium. Another example is a of FO include a low fouling potential, and deionised water is 27.9 atm or 410 psi. The hydrofractionation pit in the Southeastern a high grade treatment of effluent without United States. Here, we must deal with some
Dr Sherwin Gormly What is forward osmosis? Dr Sherwin Gormly has over 25 years of progressive experience in advanced water recycle/reuse Used to reduce fouling in the initial stage of membrane There are research and technology development. He is a hands-on system design and process research treatment for highly contaminated wastestreams engineer in wastewater treatment and alternative energy design, as well as an accomplished several field and product development engineer. Perhaps more importantly, he has been involved in the In uent startup and development of a number of small companies that are currently generating technical (low ionic strength, extremely solutions in the area of water power nexus issues, and thus doing his science in the commercial high level of large + _ market where it can do the most good. organic foulents) robust FO Specifically, his alternative energy technology development efforts include research into forward _ + osmosis power generation to extract electric power from the osmotic potential between seawater technologies + + _ + and wastewater, while simultaneously treating the wastewater to protect fragile saltwater environments and fisheries. Other energy work includes membrane based algal culturing and _ that are under + biofuels extraction. Permeate Dr Gormly received his Ph.D. in Civil and Environmental Engineering from the University of Nevada, a pilot phase (high ionic strength receiving Reno (2005), and his M.S. in Industrial Technology (1998) and B.S. in Mechanical Engineering (1988) solution referred to as the and operating from California State University, Fresno. He also has an extensive list of peer-reviewed publications, ΔC → Osmotic Agent (OA)) as well as patents and patents pending, in advanced water recycle technology development. in the field. Source: Hydration Technology Innovations
164 Focusing on performance // Desalination and reuse in 2030 Dr Sherwin Gormly // Forward osmosis and the water power nexus in 2030 165 Global Water Summit 2011 Focusing on performance
challenging wastewater coming in to the FO Standard FO pretreatment for seawater RO membrane. The interesting thing is that we can produce the fractionation fluid by providing the high concentration near saturation salt. The system draws spend drilling mud (pit water) to the other side of the FO membrane in order to provide clean fractionation water.
Currently in research for advanced synergies (applications for 2030 and beyond) How do we apply these advanced technologies, and how can this technology evolve with greater applicability? There are many ways in which you can develop this technology, but it is important to note that this technology involves going against a fundamental force of nature called osmotic potential, on which people have built the technology of today. Although significant technical barriers to adoption still exist, system architectures are Source: Hydration Technology Innovations evolving to take advantage of closed industrial water and salt cycles to maximise water recycle, materials mass balance (salt recovery), and limit single use system input materials (treatment chemical inputs) and non-recyclable outputs. More importantly, it is likely that adoption of the Algae biofuels with FO/RO water doubling on RO reject brine currently available architectures will leverage and direct these more advanced options, and Wastewater input line Algae concentration and Flotation separation may determine their final form. waste nutrient reject loop of algae One possible future application of FO is in the production of algal biofuels. Algae in raw water can later be rejected using dissolved air flotation. With FO, we get well over 95% water recovery from concentrated algal streams, UF (optional) FO which can then be looped in the system. One Brine (draw solution) loop of the interesting things about this is that you FO membrane get back-diffusion of salt across this. If you element have a highly contaminated well, for instance RO reject brine makeup input with arsenic, it would be possible to take that water into this loop set up with an RO system, in a way that you basically transfer all of the arsenic back across that membrane and send EDC destruction and it to the fuel manufacturer, instead of sending RO disinfection step it to the stream. So, take your toxins upstream, put them in the fuel business where people are comfortable with them, instead of the water business where people are not. The key point Brine loop Drinking water behind all of these developments is to see how reserve tank we can branch off from extreme applications to Source: Hydration Technology Innovations real applications.
166 Focusing on performance // Desalination and reuse in 2030 The politics of performance The politics of performance
Introduction Politics and performance so often work against The politics of performance could be better management, efficiency and productivity. known as the politics of water in general. It is when you look at the demand and supply each other in the water sector, and doubly so in these Water is arguably the most politicised of all sides of the issue that politics comes up and infrastructure sectors, and throughout history the issue of why haven’t we moved forward in difficult financial times. Rate increases, long term capital must certainly be the most political of natural providing water, in assuring water security as resources. Historically, there has been one we should have? There must be a reason and expenditure programmes and discussions about private clearly resounding concern related to water that reason could have to do with the whole and that is the question of access. In the post- subject of water politics. sector participation are politically unattractive, but often industrial age, this concern has been solved through the construction of pipes, water Discussions on this issue only too often tend essential aspects of delivering performance. treatment plants and other forms of complex to end up polarised, and on two sides of a infrastructure in order to get people all over given table. There is very rarely a roundtable the world regular access to clean water. discussion on the subject of the politics of performance. The way that the debate splits However, the important question of access tends to be between those that view water has not been comprehensively solved and access as an unimpeachable human right, increasingly, an issue that has raised its and those that view water as an economic head in the water sector is that of scarcity. good. However, it must be nevertheless clear There simply is not enough water available to all in the industry that – however they are in the world, at least not easily available, or arrived at – arriving at sustainable solutions sustainably available. This fact has brought up to water scarcity is imperative for all countries concerns over allocation, demand around the world today.
Usha Rao-Monari Usha Rao-Monari is currently the Global Head of Water in the Infrastructure and Natural Resources Department of IFC, covering the global Utilities and Public Private Partnerships practice group. Ms Rao-Monari joined the IFC through the Young Professionals Programme in 1990, and has since gained substantial experience in the infrastructure, manufacturing and petrochemicals sectors in several countries and regions of the world. In 1998, she assumed the position of Regional Manager for Manufacturing and Services for South Asia and Country Head for India, based in IFC’s New Delhi regional office. Ms Rao-Monari assumed her current responsibility in 2001, when she returned to Washington DC. Here, the panel looks at how politics and performance Ms Rao-Monari holds an MBA from the Bajaj School of Management in Bombay, and a Masters in International Economics and Finance from the School of International and Public Affairs at can be brought into closer alignment. Columbia University. Prior to joining IFC, she was a Vice President at Prudential-Bache Capital Funding, working both in New York and London.
Usha Rao-Monari // Introduction 169 Global Water Summit 2011 Focusing on performance The politics of performance
Weighing up the debate Shayo Holloway: In developing countries politicians are known to make broad sweeping The panel was invited to state their own position Rania Zayed statements as to why water should be free. I on the debate before entering into an informal Mrs Zayed is a senior financial executive, with all-round business experience mainly gained tell the public that yes water can be free, but discussion on this vital issue. from working as Finance Director for 13 years in Multi-National Corporations in the Middle not municipal water. When there is a cost Fernando Santos-Reis: Looking back, we see inbuilt to the production of water then there East, in addition to 4 years as Group Chief Financial Officer for large Egyptian private sector that the political dimension of water has been a must be a proper pricing of that commodity. groups and finally a Financial and Strategic Adviser for 5 years. big issue. However, as we look to the future we Many municipalities focus on supply-side Since June 1st, 2006, Rania has joined the Ministry of Finance of the Egyptian Government need to ask ourselves whether the influence of management. We know that 80% of potable in the capacity of Adviser to the Minister as well as Director of the Public Private Partnership politics will threaten to diminish our ability to water is converted to wastewater. If we paid Central Unit, responsible for implementing PPP initiative on a national basis. Rania is a solve the issue of scarcity. This is because there more emphasis and more attention to demand- graduate of the American University in Cairo majoring in Economics. She holds an MA in is so much work we need to undertake to solve side management, reduction of wastage, and Economics as well as an MBA. I am convinced this issue; the question is now one of action to finding uses for treated wastewater, we would provide clean water, rather than to enter into increase performance. that the private political debate. Jennifer Hosterman: Water politics is Water ownership Rania Zayed: This question is particularly a complicated issue. For instance, in the The panel was then asked whether water was an sector has a interesting at this point in time as Egypt is U.S. municipal water is regulated by the economic good or a social good. vital role to currently undergoing great political change. Environmental Protection Agency while bottled Fernando Santos-Reis: Water is a social good Unlike the political situation, the subject water is regulated by the Food and Drink with an economic value. Human existence The word of water has always been a priority on the Administration, who are much less stringent. depends on water; however, water has to have play in water agenda. Also unlike the current situation, this There is something of an inconsistency in that an economic value which will vary depending subject has never been political. This is simply on the regional and political characteristics. “politics” because water remains such a vital necessity. provision – not thinking and I think that that is also an issue that So pricing is where the social and economic In Egypt, clean, usable water reaches 94.5% of ought to be addressed in our discussions. conflict arises. related to a unique role – our population. Our defect has always been in wastewater, where we have 30-40% coverage Marco Antonio Velázquez Holguín: In Rania Zayed: The consumption pattern of a water is usually but a vital role. only. This is why we are currently focusing on Mexico we have a roadmap called the 2030 nation determines whether it is an economic PPP programmes to bring us much-needed Water Agenda. Some of its findings show that good or not. In a heavily subsidised economy negative...but treatment plants. to satisfy current water demand the country there is always going to be waste, but subsidies uses 11.5 billion m³ from over-exploited sources. are a political tool. In essence, then, the greater Diane d’Arras: I am convinced that the private The outlook shows this gap doubling by 2030. the subsidy, the lesser water is an economic politics can sector has a vital role to play in water provision We find that taking demand-side reduction good. But the cost for this is widespread waste. – not a unique role – but a vital role. However, I measures will close 82% of the supply gap, and be helpful in am surprised that over 30 years ago we started Shayo Holloway: I do not see water as a social the measures are also cost-effective. Improving the discussion on whether water was a public good. There’s a danger in that perspective. agricultural irrigation represents 61% of the good or whether the private sector has a role Unaccounted for water in Lagos State is as putting together solution. However, the required investment in to play, and we continue that discussion now. high as 60%, while flat billing is at 90%. This the next two decades will be approximately I think this is where the political aspect has an demonstrates the merits of metering, as you the interests of $100 billion. To access these investments effect and it takes time. must give a sense of value to people. Yet requires not only financing, but also institutional governments must also support the poorest – all actors in reform. through cross-subsidisation, for example. But Fernando Santos-Reis Aranzazu Mencia Saeta: I would come back as long as there are costs involved in delivering the market and to your original question on politics and water. municipal water it is an economic good, and a Fernando Santos-Reis has been CEO of Foz do Brasil since 2008. He has a Degree in Civil The word “politics” related to water is usually proper pricing system must be attached to it. Engineering and an MBA, and started his career in construction sites in Brazil in 1984. in society. negative: politics against the industry, against Diane d’Arras: It is more in the genes of private In 1989 he was assigned to sites abroad as Project Manager, having acquired a large private enterprise. But politics can be helpful companies to develop knowledge, innovation experience in developing, structuring, financing and implementing large infrastructure in putting together the interests of all actors and human resource management. But there projects. In the early 2000’s he became CEO of some of Odebrecht’s operations abroad, such in the market and in society. Negative politics are still political decisions, such as choosing as Ecuador & Panama. speaks about large numbers, and problems in a billing method. For example, you may want the market. Positive politics promotes private to offer separate tariffs depending on ability In 2006, Santos-Reis returned to Brazil as Exports and Project Financing VP at Construtora companies to provide new technologies and to pay. Dividing the responsibility between Norberto Odebrecht SA, being responsible for structuring infrastructure projects, assessing expertise to deliver water efficiently. enterprise and governments is also another investment and finance both to Odebrecht and its clients. extremely important question. It must be clear
170 Focusing on performance // The politics of performance Water ownership 171 Global Water Summit 2011 Focusing on performance The politics of performance
BOT/BOOT – that is to say they build, own and creative, more aggressive and with a different Water rights, allocations and there is genuine scarcity. operate the asset for a fixed period at which risk assessment of a project. By bringing restrictions Fernando Santos-Reis: There will always point it is returned to the government – or these elements together, PPP projects utilise be a way to deliver water, through improved through management contracts, whereby the the strengths of both sectors. One of the most pernicious issues in technologies, better efficiency, and pricing. state pays a fee for private sector management water politics is the question of rights and Marco Antonio Velázquez Holguín: In terms of population pressures, people will services. With either model, a regulatory body allocations. The panel was asked to consider When creating a large-scale investment eventually choose not to live where tariffs is always established to protect the interests of this issue. programme in public infrastructure, a long are high. The main issue is with agriculture the public, who are essentially investors. process of consultation must take place. This Jennifer Hosterman: There is a huge body because it is not always possible to choose Rania Zayed: A PPP is a performance-based necessarily involves a wide cross-section of of law on water rights, yet there are certain where to place an agricultural activity. contract with agreed outputs specified under society, encompassing many different types hotspots where rights have been disputed Governments, legislators and regulators contract. A state regulator is an integral part of organisations, businesses and affected over many years. A good example of this is have a role, but not through assigning rights. of this process, as is the establishment of clear, communities. At this point it is also to make the Californian delta. This region features Eventually, allocations will be determined measurable performance indicators to ensure sure that roles are not simply being divided, growing abstractions by a high population, through prices. that agreed outputs are met. The content but also how each actor views the problem combined with needs from an important Shayo Holloway: Scarcity must be the of the initial agreement must be clear and itself, and therefore its resolution. agriculture and fisheries industry. Over first issue to address, before embracing carefully planned, to avoid any future shocks; for the years these industries have seen job Diane d’Arras: Governance is the major complicated regulations that assign rights instance, the transfer back, under a BOT/BOOT losses and declines in revenue, while the problem, and the regulatory framework that and allocations. Again, one needs to look at agreement, of an asset that is now nearing the population continues to increase. The result is is needed to govern a 20-year contract, for the level of wastage in the system. There is end of its life. that disputes over water have also increased. example, is complex and often not given no reason why there need be such heavy Aranzazu Mencia Saeta: Private companies enough thought. There is no one single Diane d’Arras: If there is genuine scarcity competition between potable, agricultural should not, and mostly do not, want to model for the introduction of the private then there may be little other option than to and industrial water if the increasing use of take over public companies, policies, or sector, but simply selling off utilities invites impose water allocations, as in the Australian wastewater could be encouraged. Treated responsibilities. However, private companies are major problems for the future. Therefore, model. Yet, the precedent this sets on a wastewater could be used for watering some Jennifer Hosterman ready and willing to help public utilities achieve, when entering into these agreements it is global scale must be considered before any types of crop, or in plant cooling systems, for Mayor Jennifer Hosterman is presently that private companies provide know-how, at a lower price and a higher rate of efficiency, vital that one considers them in the long- actions are taken. So the question of rights example, increasing the total water available and allocations should only be looked at if serving her third term as Mayor of the while governments create policies. optimal results. And I think, listening to all of term. to all. our colleagues here, both public and private, City of Pleasanton, California, preceded Jennifer Hosterman: We must also take into that we all share that view. In the past mistakes by one term on the Pleasanton City account the distinction between central and have been made through badly-conceived Council. She has a Bachelor of Science local government. Often, there may be laws privatisation deals which have confused the role Degree from the University of San and regulations in a country from central of the private and the public sector. Diane d’Arras Francisco and a Juris Doctorate from the government that restrict local government Since January 2011, Diane d’Arras has been John F. Kennedy School of Law. Mayor from acting with flexibility. In the U.S. over Jennifer Hosterman: Transparency is vital in Senior Executive Vice President in charge of Water Hosterman currently Co-Chairs the U.S. a 50-year period, $1.4 trillion was spent on all public discussions, and I think that one of the infrastructural improvements. In the next 20 big issues is that elected officials are supposed Europe, especially Italy, Germany and Greece. Conference of Mayors Water Council, years an investment of $2.5 to $4.5 trillion will to be taking care of public budgets. Given this serving as well on both the International From 2003 until the end of 2010, she had been have to be made. The only way this can be fact, when governments propose to involve the Technology and Research Senior Vice President Affairs and Energy Committees. achieved is if the public and private sector private sector, the taxpayer is usually concerned. for Suez Environnement, in charge of the Environmental issues are also at cooperate. This is why any dialogue must be open and why Operations, Research and Environment Division the forefront of Mayor Hosterman’s in the beginning of a PPP programme, it is best specialising in Operations support, Research local efforts. She serves on the Local to start with some smaller projects first, to see Public-private partnerships which arrangements work and which of those and Development and Technology network Government Advisory Committee of the What role can public-private partnerships do not. But this step involves with it a huge management. U.S. Environmental Protection Agency, (PPPs) play in the future provision of municipal process of education. In Suez Group, she was Technology and Research the Alameda County Congestion water? Management Agency, the Association Fernando Santos-Reis: The public sector Senior Vice President for Degrémont, a company Shayo Holloway: With ageing infrastructure of Bay Area Governments Regional focused on regulations, laws and public specialising in the construction of drinking water and increasing population it is imperative provision; concerns that the private sector Planning Committee, the Bay Area and wastewater treatment plants. Previously, she that one remains realistic, which is why does not have to address. Private enterprise was Operation Manager for Aguas Argentinas, Air Quality Management District, many PPPs are being pursued. This must be is essentially concerned with returns on a company specialising in the distribution of and numerous other regional panels distinguished from “privatisation” in the classic investment and efficiency. If you can combine drinking water and wastewater treatment in dedicated to environmental protection sense; governments selling off assets. The state these characteristics then the private sector Buenos Aires. and management. still retains overall ownership, but the private can enter into a public investment being more sector enters either through concession, 172 Focusing on performance // The politics of performance Water rights, allocations and restrictions 173 Global Water Summit 2011 Focusing on performance The politics of performance
Rania Zayed: The world of water is divided political issue. The world believes that water is a by understanding the benefits of using recycled between developing economies that feature fundamental human right, so for the very poor water. Therefore the government and the The essence heavy subsidies and market economies that do some subsidies have to exist. In Bangladesh, for private sector need to reach out to consumers not. However, the politician that is favoured in example, while there are some PPP projects, and focus groups lobbying utilities. the eyes of the electorate is the politician that actual cost recovery is impossible. As a result, of politics Aranzazu Mencia Saeta: While many are offers the lowest tariff. we need government subsidies to ensure that under the impression that water is both a everyone has some access. Payment for water is concerned Jennifer Hosterman: While most citizens social, and an economic good, not everyone could be tiered – say, according to income – cannot go to their central governments to is ready to embrace this concept and take it but some subsidies still need to exist. with service complain about high water prices, they can visit to its conclusion. While private companies are their local representatives. Most simply want Delegate: People are dealing with water in ready and willing to take on this challenge, an explanation as to why they are now paying a changing way. With the pressure of growth governments and politicians are more reluctant. provision...it is more for their water. If they understand and can under a changing climate we need to think Marco Antonio Velázquez Holguín: Without see the wisdom in paying slightly more most about change management and take a holistic important to a permanent improvement in the way that will do so. Therefore what this political battle approach, rather than focusing on single issues. water is used, finding a sustainable solution will really concerns is education, which takes some The best way to start the process of change is prove to be impossible. And without realistic remember that time. But by demonstrating a clear, reasonable education, as people do need to understand pricing systems changes in users are impossible. message the majority of the public will accept what they have to pay. Climate change is also an issue. These individual most people are increases in the cost of their water. Diane d’Arras: Some subsidies are probably aspects all form part of a greater problem, Why won’t the public pay? possible, and these would encompass a social one that is caused by both supply-side and willing to pay, price for the poor. I would add that we need to demand-side failures. Roddy McKenzie, Lawyer: Why are people be clear that any subsidy must be granted on prepared to pay more for mobile phones as long as that the understanding that it is for one sector only, than for water? Do we need to look to other and not a global trend. Closing remarks Shayo Holloway industries to see why they get pricing correct? What we must remind ourselves, everywhere, service provision Input from the audience Mohsen Mortada, Malcolm Pirnie: What Shayo Holloway: People would rather pay is that the essence of politics is concerned with Shayo Holloway is a duel degree Who will pay for water? we are trying to do is superimpose political for desirable goods than for vital ones. They service provision, in whatever guise that may aspect is there. engineering graduate of Morehouse solutions onto a social problem. The consumer David Zetland, Professor and author: The pay more for mobiles than for water because be. And this is why it is important to remember College and Georgia Institute of has to understand the importance of using less, politics of performance is an important issue, politicians routinely promise their public that that most people are willing to pay, as long as Technology. and also diversifying the water used, principally one that can be regulated, but the greater they will provide water at a low tariff, which is that service provision aspect is there. In the year 2000, in line with the question is over who pays for the cost of what people are now used to. It is important providing water, and isn’t this the greatest Lagos State Government’s intention that we change this structural issue and the Aranzazu Mencia Saeta Marco Antonio of private sector participation in political battle? truth about water prices and how they affect the water sector, he was appointed Fernando Santos-Reis: While it is true that provision is understood. Velázquez Holguín General Manager of the team from price is probably the fundamental issue at hand, Diane d’Arras: The public are not ready Marco Antonio Velázquez Holguín the private sector to steer the there are many variables that affect prices. For to pay, and most politicians do not really has been Deputy Director General Lagos Water Corporation towards this reason, an appropriate mechanism must understand the issues at hand. Eventually, for Planning at the National Water privatisation. be selected to determine the cost of water. years of under-investment will take effect and Commission in Mexico (CONAGUA) Without considering some degree of feasibility, future generations will be left with the cost of In December 2006 he was appointed since May 2009. Prior to this he was the adverse consequences may arise. regenerating a crumbling infrastructure. Yet, Group Managing Director of Coordinator of Advisers to the Director while subsidies have distorted perceptions, the the Lagos Water Corporation, Aranzazu Mencia Saeta: One of the chief General’s Office at CONAGUA and public concerns with the introduction of private sector has to do more to communicate responsible for the management Deputy Director General for Micro- technologies such as desalination is the price why prices need to increase. of the corporation and its ongoing Regional Planning at SEDESOL’s Micro- of water. But thought must be given to the Errol Edwards, Basics: The reason why people World Bank Project, development of Regions Unit. effect that choices now will have in the future. pay more for mobiles than for water is that a 10-year water sector Master Plan He has a Degree in Agronomical Going for the cheapest solution for your water mobile phone companies use marketing and with emphasis on private sector needs in the short term may very well result communication tools to talk to their customers. Engineering, with a Major in Forestry, participation to meet expected water in polluted ground and surface water in the The water industry needs to ask itself if it is really from the Chapingo Autonomous demand by 2020 when Lagos State medium to long term. Despite the short-term communicating with end-users. University, and a Degree in Social and will have a projected population of gain for both governments and their public, Political Philosophy from the Pan- Should subsidies exist? 29 million. eventually, cheaper pricing may not be in the American University. public interest. Taqsem Khan, Dhaka, WASA: Water is a
174 Focusing on performance // The politics of performance Closing remarks 175 Water performance in industry… …are we asking the right questions?
Water scarcity threatens both ecosystems and businesses. Although driven by very different motives, investors and environmentalists alike are pushing industries towards improved water efficiency and better risk assessments.
Speakers include Dr Ashok Chapagain, Senior Water But what are the best Adviser, WWF Laurent Auguste, ways of measuring President and CEO, Veolia Americas Marcus Norton, water performance Carbon Disclosure Project Dr Liese Dallbauman, Director of and of ensuring the Water Stewardship, PepsiCo water sustainability Martijn Kruisweg, AkzoNobel Carlo Galli, Technical and Strategic of industrial activities? Adviser on Water Resources, Nestlé Chaired by Roger Harrabin, [ BBC Environment Analyst ] Global Water Summit 2011 Focusing on performance Water performance in industry
From operational efficiency to water stewardship Water risk management: A business priority Water risk has become a management priority Understanding for companies globally, since it determines not only the performance, but also the survival and responding to of the firm itself. An extreme example of poor water risk management comes from water risks is very the Peruvian asparagus industry. Asparagus cultivations are located near the desert and rely on groundwater abstraction for irrigation. complex. Production of asparagus has increased but, despite having reduced water consumption by improving operational efficiency, the water table is inevitably falling. As the rate of There is a push towards trying to abstraction is temporarily sustained with the use of ever increasing higher capacity water gauge such complexity through the pumps, the decline in the water table is creating massive problems to local people to continue use of simple indicators. using it as the source of their daily water uses. The bigger problem is for the businesses who will probably not survive in the long run, and livelihoods will also suffer in return. Audience response: Best approach to measuring the impact of industrial water usage Water risk can hit a company’s direct operations as well as its supply chain, ultimately affecting operational costs, profits, and future growth. 4.2% A more complex indicator which Risks can take many forms. Besides physical risks related to lack of water availability or poor water 12.5% takes into account local water Dr Ashok K. Chapagain scarcity & the quality of wastewater quality, as in the Peruvian example, there are returned also reputational risks: increased competition for Dr Ashok K. Chapagain is an international researcher and works as a water can lead to potential conflicts with other senior water adviser at WWF-UK. He has a civil engineering background water users and local communities, which could Measuring water impact is and a decade long work experience in water resources management Best approach to put a company under scrutiny and affect its essentially futile - it is better in Nepal before he received an MSc Degree in Water Resources and measure the impact social licence to operate. to price water correctly Environmental Management in 2000 and a PhD in 2006. During his PhD of water usage Increased physical and reputational pressure at UNESCO-IHE, he refined and co-developed the concept of ‘Water by industry An agreed standard of disclosure can also lead to price increases, more Footprint’. Before joining WWF-UK in 2007, he worked as a post doc which gives a qualitative regulation, and potentially the loss of licences researcher at the University of Twente in the Netherlands. statement of water risks (regulatory risks). Moreover, water scarcity may affect insurance and credit costs, undermining Chapagain has significantly contributed to the development of various 35.4% 47.9% A simple volumetric indicator investor confidence and business profitability, tools and methods to account and analyse the water footprint of nations, such as the water footprint and eventually increase the business costs businesses and individuals. His list of publications includes 2 books, 14 (financial risks). To make matters more papers in scientific journals, and 17 technical reports. He is the co-author complicated, understanding the risks cannot of the WFN manual on water footprint. Source: GWI be limited to the local context; future climate
178 Focusing on performance // Water performance in industry… are we asking the right questions? Dr Ashok K. Chapagain // From operational efficiency to water stewardship 179 Global Water Summit 2011 Focusing on performance Water performance in industry
• The amount of water required to assimilate provide a better understanding of the local risks. A water stewardship journey the load of pollutants resulting from the But the impact of one company going green production process (grey water). Sustainable river basin and reducing its water consumption is not A water stewardship journey management • The location of water resources abstraction sufficient for sustainable water management. Strengthening (global, national, and catchment level). All companies in a specific watershed share governance • The timeframe of the production process the same risks, and are involved in their Active participation Public policy / (from multi-annual to daily). minimisation. For this reason, there needs to regulatory will be collaboration among them and the whole & capacity However, it does not take into account the Watershed hydrological, social, economic and political supply chain needs to be taken into account. assessment Stakeholder Understanding of risks context in which production happens, and it At the same time, local communities and other WF engagement does not provide a measure of the impacts stakeholders located in different sections of Survey Engaging Watershed upstream of production. Recently the Water Footprint the basin need to be engaged in a dialogue, WBCSD rehabilitation users Network (WFN) has published a set of together with the government authorities. tool Payment to guidelines on how to establish water footprint The purpose of water stewardship initiatives replant forest to Reducing shared risk shared Reducing In uencing accounts, measure the impacts and formulate such as the CEO Water Mandate and the Water Operational avoid soil supply chain appropriate responses. Using LCA is one of Stewardship campaign is to create certified e ciencies erosion Reducing the possible options to quantify the impacts. Reducing standards and methods to help businesses irrigation use However, LCA fails to include the critical factory water use in this journey towards sustainable water temporal and local scarcity dimensions of water management. use, while the coefficient for weighting the Time impacts is still subject to interpretation. Source: WWF-UK Questions from the Chair The responses that the water footprint and Is WWF advocating both water footprinting and the LCA methods can trigger are also limited Life Cycle Assessment? change scenarios, population changes and to the company’s operational environment, global trade dynamics also need to be taken and cannot influence the whole river basin. WWF would never support product labelling into account. While the former can help to address strategic based on either volumetric ‘water footprint’ risks to operations and supply chains, the latter or weighted LCA ‘water index’. Labelling has Understanding and responding to water risks is is good for prioritising management efforts positive effects in terms of raising awareness, Water very complex. However, as the results of today’s and setting strategic goals. Consequently, but for a more comprehensive approach we survey support (see figure to the left), there is a besides helping the company’s image and its would throw our weight behind a holistic footprinting push towards trying to gauge such complexity marketing, they can only improve short-term approach such as helping businesses to move through the use of a single indicator that can operational efficiency: neither instrument will on a ‘water stewardship journey’, and the need or Life Cycle measure and take into account the complex be able to mitigate all of the water related risks. to provide a comprehensive set of information. production environment. Unfortunately, in my However, WWF believes that understanding and What is the best measure for consumers to opinion, the usefulness of these instruments accounting for water is the first and a necessary understand the impact of the production of Assessment is limited and that will not resolve the real step towards better water stewardship. (LCA) are challenge. goods on water resources? The limitations of water Water stewardship for sustainable I believe that consumers are the major driver Though the use of a ‘water index’ or a ‘water footprinting and LCA for businesses to enhance their environmental footprint’ might give some internal targets for limited, water management performances. However, in the quest of companies to take action, it should not be used Water footprinting and LCA are limited in An assessment of a company’s water reducing one specific risk category, ‘reputational as a product labelling as the issues are far more and will terms of the risk they can actually measure. The consumption using footprinting and LCA can risk’, businesses should not forget the other complex and no single indicator is capable of water footprint is an indicator of freshwater be seen as the beginning of a journey towards three strands of water risks, physical, regulatory presenting the complexity of water. resources appropriation, which can successfully effective water management at the watershed and financial. Unlike the carbon footprint, I think not resolve Which method would you suggest for businesses determine: level (see figure to the left). As a second step, that the use of water footprint as a product and companies? companies can begin assessing risks, using label will confuse consumers, as the impacts the real • The quantity of water used in a specific instruments such as the World Business Council of each unit of water footprint are different. I think that one of the ways forward is industrial activity (direct volume) or in the for Sustainable Development (WBCSD) water While the consequences of a tonne of carbon certification. I would suggest businesses to whole value chain (indirect volume). challenges. risk assessment tool, and then start improving emitted anywhere in the world are the same engage in initiatives such as the Alliance for • The type of water used according to its their operational efficiency. At this stage everywhere, the impact of a cubic metre of Water Stewardship or the CEO Water Mandate. source: surface or groundwater (blue water), catchment level indicators, measuring river water consumed differs according to the local and rainwater (green water). flows and groundwater levels are necessary to characteristics of the area where it is abstracted.
180 Focusing on performance // Water performance in industry… are we asking the right questions? Dr Ashok K. Chapagain // From operational efficiency to water stewardship 181 Global Water Summit 2011 Focusing on performance Water performance in industry
A new metric to assess water impacts
Why the water footprint Questions from the Chair Water stress in 2010 and 2050 is not enough Towards which audience is the WII targeted? How many people live How much GDP is generated Pressure over water resources is growing and The WII is mainly targeted towards businesses in water-scarce regions? in water-scarce regions? water may become the next biggest challenge and municipalities. However, it would also be 100% 100% for economic growth. According to a study a useful tool for financial institutions, since it by Veolia Water, today 36% of the global would help them to assess the extent to which population and 22% of worldwide GDP are businesses are exposed to water risks. Water will 80% 80% located in water scarce regions. By 2050, under be an increasingly relevant issue for companies business as usual conditions, these figures will in the near future. reach 52% and 45%, but with a much larger 60% 60% population and economy. Do you think that the WII is too complicated for the general public? Effective decision-making in the water sector is 40% 40%
becoming vital, but first of all we need the right I don’t think so. The outcome of the index is a % of global GDP simple number, which could even be used to 90% numerical tools to understand the specific impacts of our % of global population increase activities on freshwater resources. The water label products and compare them. Different 20% 20% footprint method is too limited for this purpose. products would have different water indexes 570% numerical increase Although measuring the volume of water according to different factors: the relative scarcity of water resources in the production 0% 0% abstracted in a production process is important, 2010 2050 2010 2050 other aspects need to be taken into account, location, the presence of water reuse facilities, Water scarcity, % of renewable water withdrawn such as the impact of production on water or the quality of wastewater treatment in <20% 20-40% >40% quality and local water availability. production plants. In addition, the WII would also help companies decide where production Source: Veolia should take place and whether the chosen The Water Impact Index (WII) location would be sustainable in terms of water The index we have designed incorporates three consumption. major components into a simple formula: WII = WSI x [(Vabst x Qabst) – (Vreal x Qreal)]. WSI stands for Water Stress Index, which takes Direct and indirect WII into account the level of stress on the water resource. V represents the volume of water Industrial activity Laurent Auguste abstracted and released into the environment Appointed President and CEO for Veolia Water Americas in 2008, Mr Auguste leads Veolia after the production process, while Q represents Direct Water Impact WII = WSI x [(Vabstr x Qabstr) - (Vreal x Qreal)] Water’s activities in North and South America. He is a member of the Executive Committee the quality of water abstracted and released Index: back into the environment. WII can be applied for Veolia Water, the world’s largest private water operator. to study the direct influences of an industrial The company’s North American operations serve 270 municipal and industrial customers activity, and it also includes indirect elements and a population of 15 million. South American activities are largely performed through from the production chain, such as waste Proactiva Media Ambiente, a joint venture with FCC, a Spanish construction company. generated, energy and raw materials used. It is designed to complement other environmental A graduate of the engineering school École Centrale de Lyon, Mr Auguste began his Indirect Water Impact decision making tools such as carbon environmental services career in Tokyo in 1991. He joined Veolia Water as a branch Index: footprinting, as well as traditional economic Energy director in France in 1995. In 1999, he established the company’s foothold in South Korea, considerations such as the profitability of WII = WSI x [(Vabstr x Qabstr) - (Vreal x Qreal)] developing some of parent company Veolia Environnement’s largest industrial contract investments. Waste and landing large wastewater build-operate-transfer projects. In 2002, he became Cotton WII = WSI x [(Vabstr x Qabstr) - (Vreal x Qreal)] President of Veolia Water Japan, which represents the only substantial foreign water WII = WSI x [(Vabstr x Qabstr) - (Vreal x Qreal)] services company operating in Japan. Source: Veolia
182 Focusing on performance // Water performance in industry… are we asking the right questions? Laurent Auguste // A new metric to assess water impacts 183 Global Water Summit 2011 Focusing on performance Water performance in industry
The Carbon Disclosure Project’s water initiative
Who are we and why are we Are we asking the right Questions from the Chair interested in water? questions? Is the CDP Water Disclosure a tool for CDP is a UK based NGO. Our mission is to accelerate We are asking questions in three broad areas: companies to examine their water performance, solutions to climate change and corporate water or is it more of a tool for investors and • Water management and governance. management by putting relevant information at the environmentalists to beat businesses with? Or heart of business, policy and investment decisions. • Risks and opportunities. is it both? In 2010 over 3,000 of the world’s largest corporations • Water accounting. I certainly don’t see it as a tool for investors reported through us their greenhouse gas emissions Our questions are both quantitative and to beat businesses, but rather as a tool for and strategies for dealing with climate change. qualitative, because with water it is important engagement and for investors to enter into In the same year, through CDP Water Disclosure, to give context to any numbers. What we are a constructive dialogue with the companies our new water initiative, 175 of the world’s largest trying to do is not only to understand where a they invest in. Equally importantly, the process companies reported on their water management company’s water risks and opportunities are, of responding to the CDP questionnaire and governance and on their water usage. what actions it is taking to respond to these encourages companies to implement processes Participants came from water-intensive industries risks and to seize these opportunities. for measuring and managing water where they including food & beverage, chemicals, metals & are not already in place and to think about Our questionnaire is not perfect: water is mining, and oil & gas. In 2011 we have added a water in a strategic way. Companies can also complicated and messy and we could have sample of the 100 largest companies in Australia see where they are falling behind their peers easily worked for another five years on its and South Africa to our Global sample and the and the questionnaire itself is thus a tool for development and it still wouldn’t be perfect. programme will continue to expand in the future. improving performance. But it was important to start the process and to The reason why we are interested in water is simple. ‘learn by doing’ and we are making significant Does one of the CDP questions ask whether An investment analyst based in Cape Town told me strides towards achieving our short term goal firms have opposed an increase in water prices earlier this year, “If you don’t have water, you don’t of raising business’ and investors’ awareness of in the country where they are operating? Such have a business”. It is easy to realise that, especially water issues. We are also contributing to the a question would be quite provocative to a in a country already suffering from water stress such sharing of water management best practices firm, and it may help a company to understand as South Africa, it is unwise to invest in a company if among businesses and, by doing so, we are whether or not it is being honest and genuine in you don’t have a good understanding of the water enabling less advanced companies to build its activities. resources available to it. Water scarcity and quality their capacity and to understand appropriate We don’t ask specifically about water pricing problems do not just add to operating costs but can mechanisms to improve their performance. affect a company’s ability to operate at all. but I agree that it is an important mechanism. There is a strong correlation between water price and availability and, ironically, where Marcus Norton water is priced very highly there tends to be more of it. We want to encourage companies Marcus Norton joined the Carbon Disclosure Project in 2009 to launch and It is unwise to invest Our short to participate in CDP Water Disclosure - even manage CDP Water Disclosure, a programme that helps institutional investors those at the beginning of their journey on better understand the business risks and opportunities associated with water in a company if you term goal is water management - and we anticipate that scarcity and other water-related issues by increasing the availability of high as sophistication in this area grows it will be quality business information on this critical issue. He also now heads Investor CDP. appropriate to ask increasingly challenging don’t have a good raising business’ questions. Marcus’ background is in corporate law (with Allen & Overy and Gibson, Dunn & Crutcher) and in government with the UK Department for Environment, Food understanding of and investors’ & Rural Affairs where he wrote environmental laws and advised ministers and officials on matters of EC and public law. the water resources awareness of He holds an MA from the University of St Andrews, an LL.M from University College London and an MBA from the Tuck School of Business at Dartmouth. available to it. water issues.
184 Focusing on performance // Water performance in industry… are we asking the right questions? Marcus Norton // The Carbon Disclosure Project’s water initiative 185 Global Water Summit 2011 Focusing on performance Water performance in industry
PepsiCo’s commitment to responsible water governance
Simple questions, and more Secondly, we are working with partners Finding the complicated ones including Safe Water Network, Water.org, and the Columbia Earth Institute Water Center PepsiCo is a water intensive corporation: to improve access to water in communities right questions water is fundamental to all of our products. worldwide. Historically, the essential water management and trying to concerns of the company revolved around Thirdly, we engage in a dialogue with the understanding how much water was used communities where we operate through answer them and its quality. However, we soon realised that partnerships with these same organisations. We quantity and quality issues were meaningless are also part of the CEO Water Mandate. correctly is without taking into account the context in which water was abstracted and released after Questions from the Chair use. a continuous Which initiatives is PepsiCo involved For this reason, we have started asking more in regarding the reporting of its water challenge. sophisticated questions such as: what is the performance? How many of these are truly impact of water abstraction, taking into account necessary or useful? the context? Who else is using the water? What does the ecosystem look like? Finding the right Currently we are in the middle of doing our questions and trying to answer them correctly Dow Jones Sustainability Index (DJSI) report is a continuous challenge, but PepsiCo is and the CDP Water Initiative report, and we are PepsiCo committed to doing this right. finding both of them a strenuous but useful exercise. We are also partners with the Water Footprint Network and we report for the Global has made a PepsiCo’s five pillars Reporting Initiative (GRI). commitment PepsiCo has made a commitment to respect How many of these initiatives are an exercise in the human right to water, and we are working keeping environmentalists off your corporate to integrate that commitment in our operations back? to respect the by: Dr Liese Dallbauman I don’t feel any of them are. The first year doing Liese Dallbauman is Director of Water Stewardship for PepsiCo’s global food and beverage businesses. Her human right to • Assessing the quantity and quality of the the CDP Water survey was difficult, but it gets water we use and release. easier year by year. responsibilities include water use tracking, global water risk assessment and mitigation, and water footprint • Involving communities in plans to develop strategy development. She represents PepsiCo in the World Business Council for Sustainable Development, water, and we water resources. Can you genuinely measure any difference in the Beverage Industry Environmental Roundtable, and other organisations. From 2005-2008, she was a attitude within the corporation through the member of an interdisciplinary team focused on reducing energy and water used to manufacture PepsiCo’s • Making sure that our operations do not process of filling in these forms? are working to impact community water access. Quaker, Gatorade, and Tropicana products. • Advocating that safe water supplies should We have learnt that this is a valuable exercise. Before joining PepsiCo, Liese worked in development and analysis of environmental separations processes for integrate that For example in the first year we did the CDP be available and affordable. NASA Johnson Space Center, Honeywell, and the Gas Technology Institute. She holds a Bachelor’s Degree in water initiative there were some questions on Chemical Engineering from the University of Colorado and Master’s and Doctoral Degrees, also in Chemical commitment in In order to fulfil these commitments PepsiCo supply chains that we were not able to answer, engages in a series of activities. Firstly, we are and this pointed out a gap for us. Engineering, from the University of Notre Dame. She has held leadership positions in the American Institute our operations. committed to reducing our manufacturing of Chemical Engineers Separations Division and served as a Director of the Institute from 2006-2009. She was water use intensity by 20% before 2015, and we named a Fellow of AIChE in 2008. have already reached the 19% target.
186 Focusing on performance // Water performance in industry… are we asking the right questions? Dr Liese Dallbauman // PepsiCo’s commitment to responsible water governance 187 Global Water Summit 2011 Focusing on performance Water performance in industry
AkzoNobel’s efforts to improve water efficiency
What is AkzoNobel doing? Questions from the Chair Assessing AkzoNobel’s main strategy to improve water If you are working in an area where there was management is twofold. Firstly, we are trying really a big problem with water scarcity or risk, water risks in to measure our water risks correctly through would your company feel comfortable about our Sustainable Freshwater Risk Assessment disclosing it to the stock market? Methodology. This system was introduced three our production We collaborate with several disclosure activities years ago in all of our 320 production locations like CDP and CEO Water Mandate, and try to globally. It consists of a spider diagram with disclose as much as possible. It would be very plants is several axes, each indicating a different water difficult to foresee the consequences of going risk factor. Every year the results of the spider directly public on specific issues. a way of diagram are published and by 2015 all the axes values will be required to be within a certain I could foresee a plant manager identifying a managing limit, or “green zone”. water risk for his/her plant. He wouldn’t like to Martijn Kruisweg go public. our liabilities The other element of the strategy is the Martijn Kruisweg leads a global Operational Eco- Operational Eco-Efficiency programme, which Normally you should solve the problem Efficiency (OEE) improvement programme for looks at how we can improve our efficiency internally, but ideally we should aim to the Dutch multinational AkzoNobel. With its head effectively. in water use, energy, waste disposal and collaborate with all stakeholders. That’s why I office in Amsterdam, AkzoNobel is the largest management of volatile organic compounds. am very happy that this conference has brought global paints and coatings company, and a major A Water Working Group has set up various together industries, purification companies and projects worldwide and, if successful, the NGOs. This helps us to team up, making it easier producer of specialist chemicals. improvements are implemented in each facility. to open up. The programme aims to significantly reduce the Are NGOs always helpful? environmental footprint from its 300 production Why is AkzoNobel doing it? facilities. The three large focus areas are energy, Always is a big word, but the same could be water and waste. Our only Three reasons motivate us to improve our water said about the industry. We should be more management. First of all we want to do the right helpful towards everybody involved at the local Before joining AkzoNobel in 2007, Martijn worked question now thing for the environment in which our 60,000 level. for Shell International (oil & gas) and Norit X-Flow employees and their families live. Secondly, (water purification technology). is: how can we assessing water risks in our production plants is a way of managing our liabilities effectively. After graduating in Technical Business Science Thirdly, it is an opportunity to save costs and in 1998 at the University of Groningen, The move faster become more competitive. Netherlands, Martijn started with Shell where he worked as project consultant on international For example, we have recently found a way on the water oil projects in West Africa and Bangladesh, after to recover heat from cooling water: this performance has allowed us to free money at the end of which he spent 4 years in marketing and sales for our value chain to make investments at the the European Oil Products business. track? beginning of it. We get a lot of support in the Driven by his interest in the water industry, he company for our efforts towards efficiency. Our continued his career with Norit X-Flow in global only question now is: how can we move faster business development for water purification on the water performance track? systems, before joining AkzoNobel late 2007. Martijn is married and has three daughters.
188 Focusing on performance // Water performance in industry… are we asking the right questions? Martijn Kruisweg // AkzoNobel’s efforts to improve water efficiency 189 Global Water Summit 2011 Focusing on performance Water performance in industry
For the sake of stakeholders The question of water pricing is fundamental, and shareholders especially in water-stressed areas. Although we recognise that water is a human right, we think Water initiatives in Nestlé: Water is taken very seriously at Nestlé, as our that water allocation decisions should take into advocacy of water stewardship and governance, account the economic and social value that an especially at the World Economic Forum, shows. additional cubic metre of water could bring to In food and beverage companies water is a certain context. This could also have positive Creating share value embedded in the whole value chain: farmers effects on innovation: in the agricultural sector use water to produce our inputs, we use water we have seen water price increases bring huge in our processes, and consumers need water improvements in efficiency. to prepare our products. Water creates both risks and opportunities in the value chain for us Water creates and we have come to realise that addressing Questions from the Chair water issues is not only part of our corporate Do you think there should be differential social responsibility; it also helps us to create pricing between the domestic, agricultural and both risks and shared value. All water activities profit both our industrial sectors? shareholders and our stakeholders. It’s not only opportunities philanthropy. In the industrial sector we are already paying higher prices than at household level, while in the value agriculture in many places around the world The challenges ahead pays little or almost nothing for its water and We are already leaders in improving water energy consumption. I think that the different chain for us efficiency: in the last 10 years, in our 450 sectors cannot bear the same water costs. If this production plants, we have decreased water was the case water costs in agriculture would and we have use by 33% while increasing production by be easily above the net income of a farmer. 72%. However, more needs to be done. Having come to realise Carlo C. Galli Would farmers pass the extra water charge to analysed our future water consumption and your company? Carlo C. Galli is the Technical and Strategic Adviser availability, we know that in the next 20 years that addressing on Water Resources at Nestlé in Vevey, Switzerland. demand will outstrip supply by 40%. We do not own farms. We support farmers in many ways in order to improve their livelihoods As such, Mr Galli is responsible for the improvement We think that agriculture, the upstream part water issues of water resources management practices in Nestle and incomes. We wiil be ready to discuss and of our value chain, needs particular attention. engage with think tanks and platforms such as Operations and in the agriculture raw material supply 5 million farmers provide agricultural inputs to the Alliance for Water Stewardship in order to is not only chain, developing corporate strategy and projects Nestlé, and 10% of them deal with us directly on promote responsible and efficient use of water aimed to minimise the threat on long term water and a daily basis, selling milk, cocoa and coffee. The by all stakehlders in the various watersheds . I part of our agriculture raw material availability. consumptive water use of this part of the value think the most important question now is: who chain is 1,000 times bigger than our production After 2 years of experience as Project Manager for is a responsible user and who is not? part. We need to guide and influence the farmers corporate social water resources supply programmes and geological to improve their water management practices Do you think that firms like yours should all be surveys for an engineering consultant in the Republic and reduce their water impact. filling in standardised forms so that outsiders responsibility; of Kenya, in 1991 he started his journey in the bottled would know what you’re doing and compare water business in Italy as Water Resources Manager The way forward your performance with other companies? it also helps us for Sanpellegrino S.p.A. Our water management can improve further Reporting is important. It helps companies to create shared In 2005 he moved to the Nestle Waters Headquarters by using a series of tools and innovations. adjust to challenges, understand problems and in France to head the Corporate Water Resources For example, I think that the water footprint find areas for improvement. I think that water Group. In these 3 years he has been responsible, concept, although a misleading concept footprinting is a valuable tool to measure and value. among other tasks, for setting up the new global for consumer labelling, can help companies assess impacts and we are already using it. But unlike the carbon footprint, it is a misleading WR organisation, setting up and implementing measure their impacts at the watershed level. Reporting is also very important and we concept for consumers due to the complexity the strategy for water supply according to Global of water issues. Another thing to take into Business Strategy, elaborating new company policies, are currently asking ourselves whether it is more useful to report water withdrawals or account, however, is that water consumption standards, guidelines and deploying a new Water consumptive water use. In addition, we are shouldn’t always be seen as having a negative Resources Audit Programme in all NW operations. trying to improve the quality and decrease the impact: there are also positive externalities in quantity of effluents from our factories. using water, such as the investments that it can bring to farmers to improve their watersheds.
190 Focusing on performance // Water performance in industry… are we asking the right questions? Carlo C. Galli // Water initiatives in Nestlé: Creating share value 191 Global Water Summit 2011 Focusing on performance Water performance in industry
Questions from the audience
Sam Abboud, Partner, Pioneer Private Equity: but on the raw material price, and we would dairy factories” by using the water contained GDP per drop ratio, are heading in the right Usually Among your three companies, is there a trend in rather have direct control of this process in the milk, which will be processed (1 million direction: they represent another useful way of deciding whether to outsource your wastewater ourselves. However, the idea of outsourcing m³ of milk is brought to the dairy factories, and comparing one country with another in order and trying to push wastewater treatment costs wastewater treatment has been received very milk is 80% water). We are also providing treated to move towards water efficiency. the burden down as much as possible? well in the company: if it is not part of the core wastewater effluent to farmers for irrigation. Valerie Issumo, Designer of the Ethical Value business, let’s leave it to the experts! Moreover, Liese Dallbauman: Since PepsiCo is a Mark Fletcher, Director, Arup & Partners Ltd.: Stock Exchange, Prana Sustainable Water: Why of diffuse outsourcing can also help free additional decentralised company, outsourcing decisions Your company has a supply chain of five million are practices which are only geared towards resources for capital expenditure. pollution rests are decided locally. For example in our Casa farmers: who pays for their diffuse pollution? improving business operational efficiency called Grande Plant in Phoenix, Arizona and at the Carlo Galli: In our factories a fixed part of the Are you doing anything in terms of sustainable “best practices”? Isn’t this green washing? Tingalpa plant in Australia, wastewater reuse total capex is devoted to sustainability-related farming practices to try to mitigate that? Marcus Norton: I was not trying to imply that on taxpayers allows us to recover around 75% of total water investments. Overall, this sustainability envelope Usually the burden of diffuse pollution rests companies that are operating better than their used, and in these cases we have no interest amounts to Swiss franc (CHF) 220 million per on taxpayers or water bill payers. Are we all peers can’t be better. The message that I was or water bill in outsourcing wastewater treatment. Yet, I year, 19 million of which is usually invested into indirectly subsidising your farmers? trying to convey is that some companies at would not rule out this possibility in production water-related projects such as reuse. Usually, our Carlo Galli: Nestlé doesn’t own any plantations the moment are better at identifying risk and locations where water is more abundant. For us actions are compliant with local regulation and, payers. Are we or any type of agricultural activities. 90% of the mitigating it than others. And call it how you it is really a case by case decision. in case regulations are not available, we follow agricultural inputs delivered to us go through want, I think it is helpful for these examples to our internal standards. Most of our factories all indirectly Martijn Kruisweg: Wastewater reuse is a conventional trade: we do not even know who be shared. have a wastewater treatment plant and in process and strategy that is currently being the farmers are. Only 500,000 farmers interact certain cases we pipe into municipal sewers. Valerie Issumo, Designer of the Ethical Value developed in our company. In our white paints with us on a daily basis and these farmers are subsidising Although we should be even more ambitious, Stock Exchange, Prana Sustainable Water: Is the plants we are already reusing all of the water not part of our organisation. However, despite we are increasingly reclaiming water within our WII already used and if so, where? employed for cleaning up the facilities. In this our indirect responsibility, we are running a your farmers? factory processes, such as in cooling towers. way we are not saving on the cost of water, significant number of projects with farmers Laurent Auguste: We started using the WII We are planning to have “zero water withdrawal to minimise water quantity use in agriculture last year in the city of Milwaukee, U.S. and and improve wastewater quality. For example, since then this method has quickly spread to a we have established 20-30,000 small scale number of municipalities and industries across bio-digesters for manure management through the globe. Even within Veolia Water in North micro-credits. The aim is to improve manure America we have started measuring all of our disposal by destroying the pathogens, produce plants in terms of WII and carbon footprint in cooking gas and reduce greenhouse gas order to improve our sustainability impact. emissions by converting methane into CO . 2 Emily Bolon, Director of Greenhouse Gas Sanjay Bhatnagar, CEO WaterHealth Management and Emerging Environmental International: Do you think that a simple Risks for BP: Have you already created metrics in measurement of how much water a company order to assess water risks and water efficiency uses in a year would be useful to bring down when screening possible new investment consumption and compare among different projects or when doing monitoring and firms? evaluation activities? This could be useful to compare against other factors affecting Laurent Auguste: Having a sheer measure investment decisions such as speed, costs and of the quantity would not be useful for do-ability. guiding consumers, nor would it be useful for comparing the impact of production Martijn Kruisweg: Water efficiency is already among different places. Indeed, the impact part of our investment process. However, we are of consumption in a water abundant area is partially reviewing that to update it according different from that in a water scarce area. So I to our most recent findings. We are aiming at don’t think water volume alone will be sufficient keeping these models as simple as possible in to drive the right behaviour. Initiatives such as order for our workers at the production plant the Growing Blue website, which shows the to understand them fully: they are the ones
192 Focusing on performance // Water performance in industry… are we asking the right questions? Questions from the audience 193 Global Water Summit 2011 Focusing on performance Water performance in industry
coming up with ideas to reduce the water Emilie Filou, North African Correspondent of Marcus Norton: Bloomberg is now setting Roger Harrabin, Chair: One final question for Are your footprint in the region they work. I also want GWI: Are your companies’ water efficiency and up a water programme. We have been talking the audience: what is the way ahead? Are you to tell you about a plant that we have recently reporting measures more driven by investor with them on the carbon aspects and they have 1. Companies should report their corporate acquired, which has suboptimal environmental pressures, or by a push towards cutting costs? been an excellent way for us to reach the widest Water Footprint. companies’ characteristics. I am sure that we will be possible number of users. I am sure there is dismayed that Martijn Kruisweg: I don’t see the investor punished by the investors for having done so. work to be done with Bloomberg on water too. 2. Companies should incorporate Water Impact pressure, although this might be a consequence water efficiency However, I would rather have us working at Index. 57% of the of me working on the production side of the Roger Harrabin: Are you dismayed that 57% that site than some other companies that do company. of the people think there will be more than 20 3. Companies should be urged to use tools such and reporting not have our resources or our environmental audience think water initiatives on measuring water use in as the Water Impact Index when investing in standards. Liese Dallbauman: Investor pressure. I am business in the next five years? How would you new plants or upgrading existing ones. not aware that we are getting beaten about measures Liese Dallbauman: Although I am not able like that to be? there will be the head and neck with it. I know that we are 4. Companies should report on water risks in to tell you exactly at which step in the process very pleased to be on the DJSI and we are very Marcus Norton: I am not dismayed at all. Water a more general fashion with the objective of more driven sustainability is factored in, once the purchase more than 20 conscious that we need to stay there. problems are incredibly complex and there isn’t informing stakeholders of the risks which are is made, there is a task force to address the going to be one organisation that can solve potentially relevant. sustainability problem. For example, two years Carlo Galli: Positive pressure from investors. We by investor them all. What I would like to see is just one water initiatives ago we bought a juice company in Russia have frequent discussions with the investors, 5. Companies should audit their supply chains standard, to avoid duplication and the reporting which could shift the whole corporation’s water and we see that water is becoming a priority and ensure that suppliers also monitor and act pressures, or by of similar things in a different way. However, on measuring efficiency level: it became immediately our in issues such where we have our production to reduce their water risks. there is room for a number of different tools concern. Siting new plants is also important. facilities and where we foresee water stress. addressing different aspects. 6. Companies should support efforts to price a push towards We are partnering with the Nature Conservancy Regarding production siting, it is important to water use in water to reflect its cost. to create a methodology on how to assess and mention that 10% of our factories are located in Roger Harrabin, Chair: Christopher cutting costs? react to water stressors in different watersheds. a water stressed area, such as in Punjab, and this commented that some NGOs are making money 7. Companies should audit their production business in the At the moment it is just a pilot project for is not necessarily a bad thing. For us it means out of creating business models, obtaining facilities and disclose where there is a significant existing plants, but we can fully anticipate that it that we are in a country where population, money from water companies. Ashok, would risk of water scarcity affecting operations. next five years? will be taken into account for siting new plants nutrition needs and business are growing. you like to comment on that? as well. Assessing what the stress points are, and Moreover, I think that in those places, we can be 8. Companies should audit their production Ashok Chapagain: What would be the how you can react to them is very important. part of the solution to water scarcity, not part facilities and determine whether the risk is such best way to make businesses improve their of the problem. I am not scared of discussing that it justifies investment in improving water Carlo Galli: Embedding environmental water impact? Is it better to stand outside these issues with investors and normally, even efficiency. awareness in M&E and siting is really key for us. and dictate what to do, or to engage in a with NGOs, this is positively rewarded. discussion from within? I think the second Christopher Gasson, Publisher of Global option would be more effective. As for the Audience response: How many water measurement initiatives in five years’ time? Water Intelligence: One of the reasons why financing opportunities for NGOs, some might Audience response: What is the way ahead? I wanted to organise this session was the have benefited from this, but WWF is a large complexity of the water measurement debate. member-based organisation and we get money There are too many ways to measure water from our supporters. Option 2: 4.2% 1 tool: 7.8% performance in industry, and at the same time Roger Harrabin, Chair: You and WWF were the nexus between the industry and the world Option 8: 12.5% forerunners in the water footprint concept Option 7: 33.3% of NGOs creates a viable business model for which has been quite successful. Do you think it 5 tools: 10.4% 20+ tools: 57.1% the latter to receive funding from the former. is helpful to have 20+ indexes or do you think it These two factors push me to ask the audience Option 4: 16.7% would be better that it would collapse down to another question: how many similar water just a few? How many water water measurement initiatives do you think What is the way measurement tools there are going to be in five years’ time? Ashok Chapagain: As Marcus said, different ahead for companies? will there be in tools can have a different focus. For example, a (For the audience vote on this question, see 5 years time? chemical factory might have different aspects figure to the left.) Option 3: 20.8% Option 5: 25% of water management to take care of and Kathy Shandling, Executive Director, use specific kinds of tools or indexes for this 10 tools: 24.7% International Private Water Association: purpose. I am not worried about the number What has been the reaction of the Bloomberg of tools, I am more worried about people Option 1: 20.8% New Energy Finance Group to the CDP Water duplicating terminology. Option 6: 25% Initiative?
Source: GWI Source: GWI
194 Focusing on performance // Water performance in industry… are we asking the right questions? Questions from the audience 195 The food and beverage sector uses Water performance more water in its supply chain than any other industry. It is also more in the food exposed to consumer concerns about and beverage water usage and sustainability. Here, we find out about the industries various water challenges and sustainability efforts in the sector.
Speakers include Claudia Ringler, Senior Research Fellow, International Food Policy Research Institute Johan Raap, Royal Cosun Klaus Stadler, Director Environmental & Water Resources, Coca-Cola Europa Chaired by Patrick Regan, Global Brewing Industry David McBain of Veolia Leader, GE Energy Richard Bedford, Supply Director, Diageo [ ] Global Water Summit 2011 Focusing on performance Food and beverage industries
The global food & water nexus
Drivers of change affecting water and food There are various factors which can affect Growing water scarcity can lead to higher be brought to bear on agriculture. In addition, the demand for and availability of water and food prices; this in turn would lead to reduced research efforts are required in crop breeding We could food. These include, among many, population affordability of food, hence, increased for drought and salinity tolerant crops, and growth, economic growth, urbanisation, malnutrition and diseases, childhood morbidity for increased nitrogen use efficiency. Rural climate change, but also levels of investment and mortality. Water scarcity is a significant infrastructure investments are also important, produce an in agricultural development and water storage, limiting factor for global food production. including improved access to markets, risk and management. Higher energy prices are For instance, we could produce an additional insurance and credit inputs. additional 400 also an important factor, as energy cost directly 400 million metric tonnes of grain by 2050 if affects the amount of groundwater that can sufficient water were available. This will not be Questions from the audience million metric be pumped for irrigation. The slowing of the case though due to competing demands population growth makes it a less significant for domestic and industrial consumption. David McBain, Veolia: Are you intending your tonnes of grain driver after 2050 globally; importantly all research to help us in the water industry to see I believe that the key to sustainability, and what the growth is happening in the group of the trends of water usage? For instance, the we should be focusing on, is to improve our by 2050 if developing countries. Declining water quality meat industry is known to be water-intensive. water use efficiency for irrigation, industrial and is a further driver that will increasingly affect domestic uses, which can make more water I have never worked with the meat industry water and food, particularly in many developing sufficient water available for food production. directly, but we have been asked to do quite a countries that lack the regulatory capacity to bit of work on behavioural changes towards less monitor and protect water resources. meaty diets. However, we believe in consumer were available. The global water and food nexus: A very large recent threat has been the growing choice. Meat price will eventually go up as demand for non-food crops, particularly Issues and policy conclusions water becomes scarcer. biofuels. In the case of the United States, Water policies should focus, first and foremost, around 25% of the corn crop has been diverted on formalising water rights for users. Water use to biofuels. Globally, production of biofuels rights will confer responsibilities and rights on consumes 1-3% of the water resources, with users, so that farmers are aware of the amount Reduction in grain production potential due to water scarcity in developing countries adverse impacts on water availability and of water they are using, and compensations quality. are made if water is transferred to other Reduction in grain production potential sectors. Another key policy is to increase 500 due to water scarcity (business as usual) water prices for households and industry. Impacts on water resources and Increasing water prices in agriculture is more food: Declining supplies and challenging. Growing water scarcity and the 400 increasing demand thrive for sustainability increases the urgency Water scarcity today poses potential risks to any to remove wasteful subsidies. In developing type of investment and business, particularly in countries, investments are needed in urban/ 300 Claudia Ringler large countries where most of the population rural sanitation, smart water quality monitoring lives, such as India, China and the United programmes and increased water storage to Claudia Ringler is a senior research fellow at the International Food Policy Research States. According to the Water Stress Index as counteract climate change. 200 Institute where she co-leads the water research programme of the Environment and million tonnes of 2010, 22% of global GDP and 39% of global Regarding the food and beverage sector, Production Technology Division. Her research interests are water resources management grain production are produced in water-short improving crop productivity is the key to - in particular, river basin management - and agricultural and natural resource policies for areas. Predictions for 2050 (under business-as- reducing water usage in agriculture. There are 100 developing countries. Over the last five years she has undertaken research on the impacts usual water productivity and medium growth) various measures that can be used to reduce of global warming for developing countries and on appropriate adaptation options at the suggest that 45% of GDP and 49% of global water usage in food production, including local and national levels. She has published widely in the areas of water management, grain production will be in water-short areas. enhanced water harvesting and soil fertility This means that businesses will be exposed 0 global food and water security, natural resource constraints to global food production, management. Incentives and awareness- to much greater risks associated with water 1995 2025 BAU 2050 BAU and adaptation to climate change. raising are essential mechanisms that need to scarcity. Source: IFPRI IMPACT Business as Usual Projections
198 Focusing on performance // Water performance in the food and beverage industries Claudia Ringler // The global food & water nexus 199 Global Water Summit 2011 Focusing on performance Food and beverage industries
An industrial approach to sustainable water treatment: Stimulating methane production From waste towards digestion (oxidation) which costs energy, Energy from solids: See water as a packing material or anaerobic digestion (reduction) which energy recovery Biomass digestion My message is to see water as a packing generates energy in the form of methane. material, for warmth, nutrients, and carbon We should create a new lens to look at things Aerobic digestion consumes 1-2 megajoules Let’s look at methane production from solid dioxide. For instance, water from beet differently: I suggest that we forget the word per kg of TOD, while anaerobic digestion biomass. One of the issues is judicial. If I feed, processing can be used for horticulture which “waste”. There needs to be a conceptual shift delivers 12 megajoules per kg of COD. for instance, beet pulp to cattle, they will be requires water and also nutrients such as from today’s “pollution prevention” towards Anaerobic treatment is not easy, however, digested into manure which can be a fertilizer. nitrogen, potassium and phosphorus. However, “resources recovery”. For instance, organics due to the presence of intermediates that Alternatively, I can put them in digesters. this can be difficult due to current regulations (COD) in water can be used as a source of are not easily converted, such as propionate. These are environmentally the same process, and easy access to artificial fertilizers containing methane, rather than having them destroyed It requires different bacteria to work and although digester effluent is not considered harmful substances such as uranium, cadmium, aerobically by adding fossil energy. The same grow together: we call it “obligate syntrophic to be a fertilizer, but it is considered a “waste” and zinc. We need clear guidance to establish concept can be applied to nutrients such as consortia”. The operational challenges are according to our Dutch laws. phosphorus, nitrogen and potassium. Rather a sustainable cycle where energy from the sun significant – to decrease COD/N ratio in What about beet leaves? Current practices for than removing or draining nutrients, we can is harvested, and the remains are eventually aerobic purification and operate it with harvesting beets can be modified to also collect make products out of them. returned back to the soil. small deviation, as well as maintain effluent the leaves, an organic material that is easily Energy recovery is an open door for many discharge standards. biodegradeable to produce methane gas. people. You can treat water through aerobic Questions from the audience Question: Has the Dutch government carried Outline: beet processing water treatment out a study to assess the long-term impacts of using the fertilizer from your beets compared to artificial fertilizers? Beet Juice Di usion Evaporation Crystallisation Sugar We made fertilizers such as struvite, but they washing puri cation were seen as a waste by law. Therefore, we could not use them and needed to export them to Germany. This situation needs to be changed. We have started asking for support in the Wash circuit Netherlands and in other countries to promote Settling necessary changes. Surplus Water condensate cooling Methane Beet soil Question: Isn’t it also beneficial for the soil Reactor conditions to plough back the beet leaves rather Water puri cation than harvesting them along with the beets? In the case of beet leaves that are so easily Johan Raap convertible organic material, it is not necessary Johan Raap is an environmentalist with specialisation in water treatment and biomass for the soil as it will be gone in a few months. fermentation. He has worked for Royal Cosun since 2008. Before that he worked for CSM Aerobic treatment Soil storage What soil needs is humic components or Suiker and various other CSM groups since 1996. Before CSM he worked in the field of Discharge to compost rather than easily biodegradable sewage treatment technology for a regional governmental organisation. Prior to this he Carbon source surface water materials. The idea is that we take out or “borrow” beet leaves and give them back to the soil in the was a lecturer in polytechnic civil engineering, in the field of water technology and water quality. Source: Royal Cosun form of humic components and fertilizers.
200 Focusing on performance // Water performance in the food and beverage industries Johan Raap // An industrial approach to sustainable water treatment: Stimulating methane production 201 Global Water Summit 2011 Focusing on performance Food and beverage industries
Water sustainability in beverage production
Water as a key element of risk assessments in 2004. The water used messages on our bottles and within our daily sustainable business for production, whether from local wells or business activities. municipal supply, is crucial to us. We see Coca-Cola has consumers in more than 200 efficiency as the key: we can start thinking countries, consuming our beverages at a rate about water for cleaning, preparing syrup Water conservation goal of nearly 1.6 billion a day. Water is one of our and production “in loops” and reuse water We have three main goals: to reduce, recycle key ingredients and an essential element where we can. Then we expanded our and replenish water. We work in partnership in our manufacturing processes. Our whole scope to watershed protection, working in with WWF and we are committed to organisation identifies water as one of the collaboration with experts to fully understand improving our water efficiency by 20% by key areas where we are committed to act in the water situation in the area where we the year 2012 (compared to 2004 data). We order to sustain our business and our planet. operate. After that, we looked at sustainable are currently committed to treating all of the communities who are also using water in the wastewater to a quality that is sufficient for Our journey to an same areas. aquifer recharge. On a global basis, we aim to expand support for healthy watersheds and informed strategy The next obvious step is to move into an sustainable community water programmes We first considered how we are using water enhanced strategy which is even more so that, for every single drop of water we for our production process. We started engaged in global awareness and actions. We put in a bottle, we replenish water through by looking at the performance of our strongly believe that, with our brands, we can projects around the world and help people production facilities through our quantitative easily make a difference by putting the right get access to clean water. Together with WWF, we have created the Water footprint of a 500ml regular Coke Water Efficiency Tool, which provides a benchmark for each individual plant based PET bottle Tray shrink lm on its system configuration. This system Packaging HDPE - closure Pallet stretch wrap enables us to harvest best practices and inputs PP - label Pallet identify opportunities for improvements. As Tray carton a result, our water use ratio has improved Packaging water footprint significantly, with an increase of over 24% in Green 13% our global water efficiency between 2002 71 Blue litres 4% and 2009. Grey 83% Total water footprint of a 500ml bottle of coke Bottling water footprint Grey Green 44% Communities and water sheds Bottling Blue 100% 33% Klaus Stadler 0.4 Covering over 70 countries, we are engaged litres 351 in 250 community water projects relating Klaus Stadler has been Director of Environmental & Water Resources at Coca-Cola Europa since June litres to watershed restorations and water access, 2007. He is also Technical Director for Germany. Contents water footprint as well as education, policies, research and Green In 1997 he started as Head of Quality Management. He was a member of the board at the German Sugar beet Grey planning. It has truly been a great experience 20% 52% Coca-Cola bottler Coca-Cola Erfrischungsgetränke AG from 2002 until the end of 2004 and responsible Phosphorate acid Blue 23% to be involved in the communities, and Contents 281 for operations, procurement and logistics. Ca eine people are happy to see that a company inputs Caramel litres like Coca-Cola is helping them to get access Before he worked for Coca-Cola, he was with BASF SE for eleven years at the global headquarters Carbon dioxide } Blue 28% to water, instead of just coming to sell their and at the U.S. headquarters in New Jersey/USA. Klaus Stadler is President of the German Softdrink products. Association and active in other associations in Germany and Europe. Source: The Coca-Cola Company
202 Focusing on performance // Water performance in the food and beverage industries Klaus Stadler // Water sustainability in beverage production 203 Global Water Summit 2011 Focusing on performance Food and beverage industries
Driving change in the brewery industry: GE’s perspective
What drives plant efficiency? Smart wastewater system dissolved oxygen level, and nitrates and We are not going to get there alone, ammonia levels, in addition to the typical however. Although we have the technology, The brewery industry faces financial, regulatory Innovation is critical in the brewery industry, components that are measured today such leadership and experience, ultimately we also and safety challenges, as well as the issue but what is even more important is the as flow rate, pH and temperature. Based need to conduct research across the industry of product performance. In particular, the ability to use data to run the processes more on the analysis of the feed composition to enable us to leverage our understanding quality of the product is vital, as it is really what smartly, and to use water more intelligently. and system condition, appropriate actions of the treatment at multiple levels and shapes your company’s brand. Some of the Our smart wastewater system is currently can then be taken in order to optimise the leverage our scale as a global provider. In the drivers behind that are cost of operation, cost under development through a partnership digestion processes and to maintain the future, this will allow us to partner not only of energy and water, tougher regulation, and with the U.S. Department of Energy, Cornell biogas and effluent water quality. with other suppliers, but also with NGOs and resources limitation. University and one of the largest global our customers to get to the point where we brewers. What we would like to deliver is The metrics and targets held by companies are can run plants in a more intelligent way. a more intelligent way to run the energy fairly consistent in terms of water consumption Towards smart recovery of their anaerobic digester process. and carbon emission reductions. For instance, water management Heineken aims to reduce their water usage The system has three elements: sensing, I would say that a smart brewery will be able
by 25%, and also reduce the CO2 emissions by analysing the data, and enabling actions to connect systems and identify problems, 25% by 2020. Both InBev and SABMiller aim to based on the analysis. The sensing allow operators to make their own decisions
achieve water efficiency of 3.5 hl/hl, and 2CO component will enable measurements of based on integrated information, anticipate reductions of 10% by 2012 and 20% by 2010, new components such as total organic problems to reduce loss, and increase the respectively. and inorganic carbons, gas composition, reliability and overall quality of the product. Who are the biggest beer consumers today, and who will be in the future? By 2012, China will be the biggest consumer – consuming 1 in every 4 beers globally. However, the United Smart water system States consumes the most in terms of per capita, with 81 litres, whereas in China, it is only 22 litres. In Russia and Brazil, it is 58 litres and 47 Additives O -gas Additives Biogas Additives E uent litres, respectively. India’s level of consumption is still low, but the growth of beer consumption since the year 2000 is over 90%.
Turning waste into value: The Meduri Farms in Oregon Aerobic/ Patrick Regan We partnered with Meduri Farms, a dried fruit Mixing PA Mixing AD Mixing Anoxic + Aerobic Membrane producer in Oregon, to provide a complete Patrick Regan is GE Energy’s Global Brewing Industry Leader. With over 14 years in the waste to energy solution, which comprised of water industry in various customer facing roles, he is currently responsible for partnering an anaerobic digester to produce biogas with with worldwide clients to meet their water and energy sustainability goals. a CHP system, as well as an integrated UF/ In 2008 he led the creation of the GE Water Footprint Handbook which provided MBR/RO system to produce pure water for the Recycle customers with a long-term strategy on how to evaluate and reduce water usage. Patrick plant. There were two things that were really exciting about the system. Firstly, from a water Recycle is also a key member GE’s “water footprint reduction initiative”, aimed at reducing water perspective, as the system ran more efficiently, MBR consumption globally by 20% by 2012. it was able to make cleaner water come out of Digester Patrick holds a B.S. in Chemistry from Bradley University and an MBA in Finance from the digester which could be used back in the Aeration Sludge DePaul University in Chicago. He is a member of the Master Brewers Association of the plant. Secondly, with the CHP system, we were Americas. able to produce surplus power to meet the needs of the plant and the community. Source: GE
204 Focusing on performance // Water performance in the food and beverage industries Patrick Regan // Driving change in the brewery industry: GE’s perspective 205 Global Water Summit 2011 Focusing on performance Food and beverage industries
Diageo’s approach to responsible water use: The state-of-the-art bioenergy plant
Distillation of grain spirits energy bill, high water usage and high effluent discharge levels, which presented a barrier to This project Diageo takes its social responsibilities very Since June any future expansion of the distillery. Gas and seriously, with two key priority areas: electricity for processes cost around £6 million/ represents • Development of sustainable local yr, and with peaking gas prices in 2007 we saw 2006, Diageo a major communities. a potential increase to over £10 million/yr. The has taken over • Minimisation of our own environmental high effluent discharge to sea (a total of 20,000 footprints. tonnes of BOD per year) gave the distillery the contribution to reputation as a big polluter in Scotland. 150 “water of Since June 2006, Diageo has taken over 150 “water of life” projects to 14 countries, mostly in The combined opportunities of energy Diageo’s global Africa, which have already brought safe drinking generation from waste, water reclamation, life” projects water to 4 million people. Our target is 8 million effluent reduction and increased distilling environmental people by 2015. capacity became too overwhelmingly attractive to 14 countries, for us to ignore any further. The construction of Our environmental sustainability strategy sets a bioenergy plant started in January 2009, and performance, a number of reduction targets for water usage mostly in now it is approaching completion. Anaerobic and CO emissions. For the period 2007-2015, 2 reactors are designed to remove 100 tons of reducing its our targets include: 30% improvements in Africa, which COD per day to generate 40,000 m³ of biogas, water use efficiency; 50% reduction of water equivalent to 10,000 pounds worth of natural wastage in water-stressed sites; 60% reduction total polluting gas per day. The bioenergy plant should provide have already in polluting power in wastewater; and 50% 100% of distillery steam power, around 80% reduction in CO emissions. power in 2 of the electrical power and around 30% of brought safe the water requirements for the distillery, after wastewater by Case study: Cameronbridge covering the consumption at the bioenergy drinking water plant itself. It will reduce the distillery’s CO Distillery 2 emissions by about 56,000 tonnes per year and 65%, total Cameronbridge Distillery in Fife is the to 4 million distillery effluent to sea by 99%. largest distillery in Scotland. It was originally CO2 emissions established in 1824 to produce grain whisky, people. which forms a major component of our famous Lessons learnt so far by 8%, and blended whiskies such as Johnnie Walker and This project represents a major contribution to Richard Bedford J&B. Current production is around 70,000 m³ Diageo’s global environmental performance, Our target is 8 (70 million litres) of whisky and 44,000 m³ (44 Richard Bedford is Diageo Scotland’s Supply Director responsible for distillation of grain improving total reducing its total polluting power in million litres) of gins and vodkas, which equate wastewater by 65%, total CO emissions by million people whiskies, gin and vodka and for maturation and blending of Diageo’s Scotch whiskies. He 2 to around 407 million bottles of spirit of year. 8%, and improving total water efficiency by has worked for Diageo for 17 years in a variety of roles, most recently in Guinness Brewing water efficiency In 2007, we identified that the distillery faced a 2%. In my 17 years with Diageo, I had never by 2015. and European spirits production. He is also responsible for the current expansion, water number of strategic issues that would stand in had an investment project which received treatment and bioenergy projects at Cameronbridge distillery – Scotland’s largest distillery. by 2%. the way of its future for being a leading distillery such overwhelming support and attracted in the industry. These included a very heavy so much attention and genuine interests. The
206 Focusing on performance // Water performance in the food and beverage industries Richard Bedford // Diageo’s approach to responsible water use: The state-of-the-art bioenergy plant 207 Global Water Summit 2011 Focusing on performance
Outline process diagram Wheat malt/yeast/water Ash “Salt” water Steam Milling / Steam Mashing Electricity turbine
Water Steam Water recovery CO2 Biomass Fermentation boiler “Grey” Biogas water
Spent wash Anaerobic Distillation Belt press Liquid digestion
Grain whisky Source: Diageo
interest and support this project has received Questions from the audience was absolutely driven by the environmental credentials of this project and for its clear Emilie Filou, Freelance Journalist: In terms of strategic advantages, rather than for any the financial break-even point which you expect compelling economic gains; although I do from this project, how replicable do you think The most expect the cost of the project to at least break this type of facility will be across your business? even for Diageo against the cost of purchasing The question of economics is a very simple important thing energy. question with a very complex answer. The The most important thing that I learned from project is going very well for us, as it removes that I learned the project is the importance of partnerships, various constraints to enable a future expansion as we are not wastewater treatment or energy of our facility and future growth. In terms from the generation experts and never will be. We need of energy, the plant can more than pay for to rely on expertise and support to design, itself, compared to the cost of purchasing project is the build and operate a huge and complex distillery energy. Cost-benefit balance is also highly alongside a huge and complex wastewater dependent on factors such as energy prices treatment and energy generation operation. and commodity prices. The system will look importance of The project also shows the potential that exists more attractive if energy prices increase. I for new environmental solutions in the food feel that the project can be replicated, mainly partnerships. and beverage industry and beyond. I hope that because distillery is an industry which has been the cooperation between our industries in the increasingly constrained by more stringent near future will help us to create a far more effluent standards. sustainable way of producing and conserving Question: What would be your ideal financing scarce resources. approach to the projects at other plants? Our priority is not to outlay cash ourselves and we require the financing to be off-balance- sheet. We can progress with projects through a lease or other forms of funding.
208 Focusing on performance // Water performance in the food and beverage industries Africa’s moment in water
Africa used to be the backwater of the water sector where high political risk, lack of financing and many other obstacles made it hard to achieve much. Over the course of the last decade, progress has been made: between 2000 & 2008, the proportion of people with access to improved water supply increased from 55% to 60%.
Speakers include This may finally be Africa’s Joseph Karanja, Nairobi City Water and Sewerage Company Petrus Du Pisani, Strategic Executive, Infrastructure, Water and Waste moment in water; when asked Management, The City of Windhoek, Namibia whether Africa was a better place Chaired by Alexander McPhail Dr William Muhairwe, Managing Director, National Water and of the World Bank Sewerage Company, Uganda to invest today than in 2000, Aladji Dieng, Technical Director, Sénégalaise Des Eaux 84.2% of the audience agreed. [ ] Global Water Summit 2011 Focusing on performance Africa’s moment in water
Improving water provision in Nairobi through control of non-revenue water Nairobi’s water supply and be around 675,000 m³/d. This leaves the city a hours), and we’re applying new technologies By reducing demand gap deficit of 190,500 m³/d. in pipe laying. We’re also supervising the works to ensure they’re done to the best The city of Nairobi gets its water supply from standards and we’re planning to install zone NRW, we could two main dams north of the capital: the Thika Non-revenue water: from loss to and district meters to get a more accurate and Sasumua. The total capacity of these dams opportunity picture of where the leaks are. We’re also meet some of is 89.6 million m³. Kenya suffers from high levels of non-revenue dealing with illegal connections and cases of Water is then treated in four water treatment water (NRW); 40-60% on average. The Nairobi vandalism and we’ve run a massive campaign the capital’s plants (WTPs) with a total design capacity Water Company (NWC) is no exception. So by of awareness on NRW. reducing NRW, we could meet some of the of 525,500 m³/d, producing on average Our efforts have paid off: over the last five capital’s unmet demand, enhance our revenues unmet demand, 484,500 m³/d of water. years, since the inception of the company and defer future capital expenditure to develop (water services used to be provided by the But with a population of 3.8 million people (this additional supply. Addressing NRW is basically a enhance our municipality), we’ve managed to reduce NRW is the official resident population at night from cheaper way of increasing water supply. the 2010 census – population during the day from 50% to 40%, thus making more water revenues... swells to 5.8 million with people commuting Much of our NRW is due to physical losses available to our customers and improving our to work), current water demand is estimated to because of Nairobi’s ageing infrastructure (it revenues at the same time. goes back to the 1920s), although commercial We plan to continue focusing on NRW, losses are also an issue (illegal connections, Nairobi Water Company’s revenue and non revenue water notably by replacing old infrastructure. water theft, authorised non-billed water for And we’re currently running studies with services such as fire fighting and mains flushing, the World Bank to look at how to provide 200 see figure below). Unbilled 900,000 m³/d of water by 2016-2017. consumption Aside from the leaks, the main challenges we face are vandalism, which is rampant in Commercial slums (Kibera is the largest slum in Africa), 150 losses and unintentional damage by other service Non-revenue providers such as road contractors, and ... and defer water Physical power and telecom companies (there is no losses coordinated approach between contractors) future capital Joseph Karanja 100 System input Joseph Karanja’s current duties at Nairobi Water Company involve taking charge of water million m³ volume Successful initiatives expenditure resource planning, including allocation of water to the treatment works, monitoring Billed We decided to make NRW a key performance losses, and implementing measures that would minimise water loss throughout the Revenue to develop consumption indicator for line managers. We set up a leakage Nairobi water system. 50 water (revenue water) control unit and we need to strengthen its additional He has a Bachelor of Science Degree in Geography and in Chemistry from Egerton capacity. We have established a call centre with University and thereafter studied Postgraduate studies in Applied Hydrology and Water a toll free line so that our customers can report Information Systems for Management in 1999 at the University of Nairobi. Between 2007 0 leaks promptly; we have an aggressive leak supply. repair programme with repair response time and 2009 while working for Nairobi Water Company he completed postgraduate studies in Integrated Water Resources Management at the University of Nairobi. Source: Nairobi Water Company (our target is to reduce it from 72 hours to 24
212 Focusing on performance // Africa’s moment in water Joseph Karanja // Improving water provision in Nairobi through control of non-revenue water 213 Global Water Summit 2011 Focusing on performance Africa’s moment in water
Reuse in irrigation and aquifer recharge Windhoek Namibia: Since 1993, Windhoek has replaced 5.8% of the water it uses for watering green spaces with reclaimed effluents. The water comes from the old A case study in water supply Goreangab plant and is treated at secondary level. The latest project we’re working on is aquifer recharge. The Windhoek aquifer has for over a in an arid African country 100 years been over-exploited by around 20 million m³. Average natural recharge is very low, at 1.73 million m³; if we could replenish it, it would provide valuable storage, much Extreme water scarcity is heavily overused, and potable reclaimed better than our three open-storage dams where water from treated sewage. Namibia is one of the most arid places on earth. we lose more water to evaporation than we Windhoek, the capital, has a population of consume. If we could store the water in a safe We discharge 340,000, growing at 5% per annum, so the task Wastewater for drinking water place, it means that in times of drought, we could rely heavily on the aquifer. It’s pretty well of providing drinking water to residents has Windhoek was first created as a small contained geologically and losses would be been an ongoing challenge. settlement in 1840, thanks to the presence of less than 5% small (2%). We calculate that, once replenished, springs from groundwater. By 1911, the water Average rainfall in the capital is 360 mm/ we could survive up to two years from these table had subsided to the extent that boreholes of our daily yr (although this past summer has been the stored reserves. Since 2006, we’ve drilled deep had to be drilled. Two small dams were built at wettest on record, with 1,000 mm), with an abstraction and injection holes up to 470 m. the time, and the first time wastewater reuse average evaporation of 3,400 mm/yr. The At these depths, the 10 wells we’ve drilled will demand, was considered was back in 1954. nearest perennial river, the Okavango River, provide as much water as the 54 boreholes everything else is 750 km away and Windhoek lies 360 km By 1960 Windhoek started piloting the we’ve been using until now. inland at an altitude of 1,600 m. The country reclamation of drinking water from sewage is bordered by the Kalahari Desert to the east effluent. The Goreangab Plant was converted Politics matters is reclaimed. and the Namib Desert to the west. Windhoek in 1968 to treat secondary sewage effluent therefore relies on surface reservoirs on for potable reuse with a capacity of 4,300 Windhoek is a city where all planning decisions ephemeral rivers, a groundwater aquifer, which m³/d. Since then, direct potable reuse has should be based on water availability; they have been accepted as an integral part of our water to be. Not long ago, through political pressure supply strategy. As they say, when there are no to create jobs, we were forced to accept a huge Water mix predictions for Windhoek alternatives, the choice becomes a lot easier. textile factory in our city, which not only used a lot of water but also has, in an inland setting, Irrigation Between 1969 and 1992, Goreangab underwent a saline wastewater footprint we couldn’t 30 AR abstraction four upgrades and its capacity increased to deal with. The plant was closed down due to Reclaimed 7,500 m³/d. But given that total water demand various other reasons, but these are the kind of Petrus du Pisani Surface water in Windhoek at the time was 60,000 m³/d, this 25 pressures we deal with on a daily basis. Petrus du Pisani heads the Department of Infrastructure Water and Waste Management in Boreholes was a fraction of the city’s needs. After three the City of Windhoek, Namibia. severe droughts in a decade (1986, 1991 and Windhoek has worked hard to optimise its resources: we now discharge less than 5% of He graduated from the University of Stellenbosch (RSA) in 1979 as a Civil Engineer. He 20 1996), the city authorities decided in 1996 to increase the amount of reclaimed water used in our daily demand, everything else is reclaimed. spent the first five years of his career with then South African Railways in the design and drinking water supply to a maximum of 35% of We aim to keep increasing our reliance on Construction of railway infrastructure. 15 total supply. unconventional resources: our goal is that by 2019, if faced with drought, the City should In 1992, Petrus du Pisani joined the City of Windhoek as Assistant City Engineer and subsequently, since 1998, as Strategic Executive Infrastructure, Water and Waste million m³/yr The new 21,000 m³/d Goreangab Reclamation be able to survive with only 17% of our water 10 Plant started operating in 2002. It currently supply coming from conventional sources, Management. As Head of this City Department, he is now responsible for water produces 16,000 m³/d of reclaimed water which boreholes and surface water (see the figure production and supply, wastewater treatment and reclamation, solid waste management, In 2011, constitutes 25% of its drinking water supply. to the left). I would like to conclude by saying building infrastructure, scientific services and engineering services. 5 31.3% of The plant is run on a 20-year quality-based that although climate change is a growing water demand During the period 1998 to date, he has been responsible and intimately involved with O&M contract by a consortium including Veolia concern worldwide, attitude change towards was reinjected the construction and commissioning of Windhoek’s New Goreangab Reclamation plant Water, VA Tech Wabag and Berlin Water. It uses reuse might be as important to those living in 0 a multiple barrier system, with membrane ultra and the implementation of the aquifer artificial recharge scheme undertaken by City of 2005 2011 2014 2019 the dry countries of our world in deciding what filtration as final polishing step. resources are available to us or not. Windhoek.
214 Focusing on performance // Africa’s moment in water Petrus du Pisani // Windhoek Namibia: A case study in water supply in an arid African country 215 Global Water Summit 2011 Focusing on performance Africa’s moment in water
Turning around a public utility: the 10-year experience of the National Water and Sewerage Corporation (NWSC), Uganda
Audience response: Why are water utilities in the developing world failing? The sorry state of African utilities Millions of children die of diarrhoea and water- related diseases every day, so the cost of failing to provide water and wastewater is significantly Inadequate nancing 3% higher than addressing it. So why are we failing External interference 6.1% to provide these basic services in Africa? Question for the audience: Why do you think Attitudinal issues 9.1% Poor governance utilities in the third world are lagging behind? Is and accountability 54.5% it because of:
Why are water • Poor leadership: Lack of foresighted Poor leadership utilities in the people, who have a vision and can plan? 12.1% developing world • Poor management: We have managers failing? in Africa. They go to America, and they all receive training, but can they really do the job? Poor management • Poor governance and accountability: 15.2% Corruption is a big problem. Everyone wants to be rich from the minute they’re made manager.
Source: GWI • Attitude issues: Mr du Pisani told us the issue was not climate change, but attitude change. People want to do as their Dr William Muhairwe forefathers did: if your forefather sat down, you should sit down too. How can you go Dr William Muhairwe is a Management have successfully turned round NWSC Management”. The cost of failing to provide water against the spirit of your forefathers? Specialist trained in Economic and Business from a loss making organisation to a profit Formerly Dr Muhairwe worked for the • External interference (political, Management and has been managing making government parastatal which is Uganda Investment Authority as its Deputy and wastewater is significantly higher financial crisis): The minister or prime public companies for the last 19 years in now a benchmark for best practice both and eventually Executive Director for 3 years minister wants you to employ his son, and if Uganda and abroad. Since 1998 he has nationally and internationally among water and was responsible for attracting inward than addressing it. you don’t, you’re dead. been the Managing Director of the National utility organisations. The organisation was private investments in Uganda. He was • Inadequate financing: Many people say Water and Sewerage Corporation, a State named “Employer of the Year 2003 for Ethics also, at one time, the MD of the East African So why are we failing to provide these that’s the main problem. Corporation that was almost collapsing due and Corporate Social Responsibility” and Steel Corporation, a Joint Venture Company I would argue that the lack of people with vision to mismanagement. Out of his initiatives, again got a Golden Award for Management between the government of Uganda and a basic services in Africa? is the biggest issue and that finance isn’t a Dr Muhairwe has implemented innovative Excellence in June 2004 and Employer of the private company (The Madhvani Group). problem: there is plenty of money around. But change management programmes that Year 2004 for “Productivity and Performance what do you think?
216 Focusing on performance // Africa’s moment in water Dr William Muhairwe // Turning around a public utility: the 10-year experience of the National Water and Sewerage Corporation (NWSC), Uganda 217 Global Water Summit 2011 Focusing on performance Africa’s moment in water
Question for the audience: If you were faced NWSC, the basket case know what I planned to do. So I bound myself After 10 years’ work, we have had good results with a typical third world utility (intermittent and my team to the government. We drew a (see the figure below). We are WHO compliant NWSC is a Ugandan parastatal company that water service, low operational efficiency, poor strategic plan and started off with short-term and ISO certified too. was set up in 1972. It manages water and customer service, a running deficit, expensive performance improvement programmes. wastewater services in the country’s 23 largest We decided to open an external service labour force, high burden debt etc), what would urban areas, including the capital Kampala. Our Strengths, Weaknesses, Opportunities department to share our experience. I believe you do? and Threats (SWOT) analysis showed that the that knowledge isn’t the monopoly of one When I took over in 1998, NWSC was not in • Dissolve the company: Get rid of it! investments from the World Bank had paid person. We’ve had contracts in Kenya, Tanzania, very good shape. A quote from the World off: they had trained many engineers and Mozambique, and most recently Mumbai in • Full privatisation: Call someone local Bank at the time said: “Over the last 10 years, accountants, and the infrastructure was sound. India as part of a consortium, the first African or foreign to do it. If the locals can’t do it, the Government of Uganda in partnership However, we had too many staff and our billing utility to get an international contract. someone else will. with the World Bank and other donors has was really behind. • Public-private partnership: Bring in a made significant investments (over $100 m) in private partner and join forces. the urban water and sewerage sector. These In 1998, the vision of my predecessor at • Internal reforms: It may be impossible if investments have contributed immensely in NWSC was “to be the pride of the water sector you’ve seen how they’re run! rehabilitating the existing infrastructure under in Uganda”. So I asked him: “It’s a national By the end of our 100-day the NWSC management. Unfortunately, these company, with who are you going to compete?” • Maintain the status-quo investments have not been matched with the That vision was not encouraging enough. We programme, we had reduced our • No idea necessary efficient commercial and financial agreed to change the word Uganda for Africa management capacity that can ensure the because there were many utilities in Senegal $300,000 deficit to break-even point. delivery of sustainable services in the medium and North Africa that were doing well and we Audience response: What would you do to turn around a failing utility? to long-term”. wanted to emulate them. The company had a really inefficient workforce The first programme I rolled out was the 100- (we had about 2,000 employees, servicing day programme and we looked at five priority No idea 6.8% 50,000 connections). Unaccounted-for water areas: NWSC’s key achievements Public sector participation (UFW) was 50-60%, we ran a deficit of $300,000 • Water production (because water wasn’t (50/50 share) 37.8% per month, we had a high debt burden and Performance indicator 1998 2010 available 24/7) Full privatisation a poor organisational culture (late-coming, Service coverage 48% 74% (foreign/local) 23% drunkenness etc). It was a typical African, third • Unaccounted-for water world utility. • Revenue generation Total connections 50,826 246,459 What would you We decided we would turn it around with • Customer care New connections per year 3,317 25,000 do to turn around internal reforms. We thought: it’s the cat in the a failing utility? • Cost reduction. Metered connections 37,217 245,199 house who knows where the mice are. If you By the end of it, we had reduced our $300,000 Staff per 1,000 connections 36 6 brought a cat from the outside, it might get deficit to break-even point. eaten by the mice! Collection efficiency 60% 98% Our next priority was the organisational culture. NRW 60% 33.3% I was inspired by Jack Welsh’s management NWSC, the turnaround style at GE and we also learnt from our peers Proportion metered accounts 65% 99% Internal reforms 32.4% When I was recruited, I insisted on having a in Senegal and elsewhere. We introduced Annual turnover (Billion Shs) 21 112 performance contract with the government management contracts for all our employees, Profit (Before. Dep) (Billions Shs) 8.0 (loss) 25.4 (surplus) because I wanted to know exactly what they with goals and a vision so that they would feel Source: GWI expected me to do and I also wanted them to involved and committed. Source: Audited Accounts
The vision of my predecessor was “to be That vision was not encouraging enough the pride of the water sector in Uganda”. so we changed the word Uganda to Africa.
218 Focusing on performance // Africa’s moment in water Dr William Muhairwe // Turning around a public utility: the 10-year experience of the National Water and Sewerage Corporation (NWSC), Uganda 219 Global Water Summit 2011 Focusing on performance Africa’s moment in water
Africa: Already performing, and full of promises
Africa and the water Millennium network within African utilities that shows the 2006. The company manages the production, SDE developed Development Goals growing desire to learn. treatment and distribution of drinking water in 56 cities in Senegal, including Dakar. As An increasing number of countries are also About 330 million people in sub-Saharan of December 2010, we had nearly 520,000 thinking about doing institutional reforms in a comprehensive Africa do not have access to improved sources customers with 1,136 employees. of drinking water. There has been an 11% their water sector (for example, Ghana, Benin, pro-poor increase in the number of people with access to Togo, Mali, DRC, Zambia, Tanzania and Guinea). SDE decided to implement the ISO 9001 version improved water supply since 1990, but at this 2000 Quality Management System to achieve strategy to rate, only 26 countries out of 53 will reach their Sénégalaise des Eaux, our targets. We assigned each department, unit Millennium Development Goal (MDG). and employee their own targets and contract, a PPP success story to be assessed at the end of each year. We also boost water The main constraints to achieving these targets made public commitments each year. are: Sweeping sector reforms access coverage • Growing demand (population increase and In 1995, Senegal launched a reform programme Customer service, a priority area of the urban water sector. The programme had economic development). Customer service was one of the most crucial several objectives: [via] social • Increasing scarcity in some regions. areas to address within our performance connections and • Climate change. • Solve the water shortages in Dakar, the contract. The ISO 9001 version 2000 and • The international financial crisis and a capital. then version 2008 certifications helped us social tariffs. decrease in support for the water and • Improve the sector’s financial sustainability revolutionise the way we dealt with customers. wastewater sector. (banks wouldn’t lend to the sector because We organised customer surveys (we do a • Weak governance in many utilities. of fear of defaulting). weekly survey of 100 customers on service However, there are some great performers on • Reinvigorate the sector by involving a and water quality), and we hold two annual the continent (Côte d’Ivoire, Burkina Faso, Niger, private sector entity through a performance meetings with customer associations. We also Uganda) and there is an active benchmarking contract, while leaving assets and sector opened new offices in poor neighbourhoods policy in the hands of the government (see that used to be neglected, generalised the use the figure to the left). of registration books where customers could Organisation of the water sector in Senegal • Rehabilitating the water infrastructure leave comments or suggestions and created a without increasing the average price of toll-free number. International water by more than 3%. SDE also received the OHSAS 18001 certification State donors The government included specific contractual for occupational health and safety in 2008 non-revenue water and billing collection targets and ISO 14001 certification in environmental Concession contract and with a penalty for non-compliance. We also practices in 2010. performance contract 23/04/2006 included targets on water quality and service standards. SDE’s pro-poor strategy SONES Performance at SDE developed a comprehensive pro-poor Asset company Sénégalaise des Eaux (SDE) strategy to boost water access coverage. There are two main initiatives: social connections and SDE is a private company that was created social tariffs. Social connections are free (the in 1995. The main shareholder is a French SDE user just pays a deposit). In total, SDE installed Performance contract company called Finagestion (57%). Senegalese Private partner some 155,000 social connections between 1996 investors own 33%, the government 5% and we and 2010, which made up 71.2% of all new kept 5% for employee shares. connections installed during that period. Safe Aladji Dieng SDE won a 10-year lease affermage (lease access to water therefore jumped from 80% in Aladji Dieng is Technical Director at Sénégalaise des Eaux (SDE), Customers type) and performance contract through 1996 to 99% in 2010. a privately owned company which was established in 1995, international competitive tender in 1996. The Social tariffs then apply to households where and which serves almost 520,000 customers in Senegal. contract was extended for another five years in Source: Sénégalaise des Eaux
220 Focusing on performance // Africa’s moment in water Aladji Dieng // Africa: Already performing, and full of promises 221 Global Water Summit 2011 Focusing on performance Africa’s moment in water
will have to be a combination of all three. Key performance indicators But there is widespread recognition that Indicator 1996 2010 we won’t get that money and that not all countries will meet their water MDGs. But this Population with access to 80% 99% session shows the role that the private sector drinking water can play; there is a track record now so we Access by private connections 58% 87% can move forward. Access by standpipes 22% 12% Erik Gothlin, VA Tech Wabag: Would reuse Water produced 96.3 million m³ 146.97 million m³ be another option for additional supply in Senegal, along with long-distance water Water sold 65.15 million m³ 116.3 million m³ transfer and desalination? Revenue water 68.2% 79.3% Aladji Dieng: We treat sewage but the Quality compliance 94% 99.5% water is only reused for landscaping. Bill collection ratio 94% 98% Desalination is now the favourite option for additional supply because the transfer option Number of connections 241,167 519,756 would cost three times more than building Staff per 1,000 connections 6.1 2.2 a desalination plant. The problem we’ll have, Revenues €111.4 million however, is power supply, since the power sector is poorly managed in Senegal. Source: Sénégalaise des Eaux Emilie Filou, GWI: Is there much south- consumption is less than 10 m³/month. such as the World Bank, KfW and AFD, and south cooperation going on in the continent? The tariffs work as a cross-subsidy between debt is entirely serviced by SONES (the asset Alexander McPhail: All major utilities in customer categories. Households that company) thanks to the fees paid by SDE. Africa know the experience of these four consume less than 20m³/month are VAT utilities. The Association of Water Utility exempt. Smaller consumers also get bi- Meeting the challenges ahead Managers in Africa meets periodically and monthly instead of monthly billing. We still At the current growth rate, Dakar will face there is increasing south-south cooperation. have standpipes too, mostly in the poorer water shortages from the year 2015. Huge The stories on this panel are not just for and informal settlements. They are being investments will be required to secure this room – they have been told many gradually replaced by individual connections. additional water supply for the region. Our times before. The trend is going in the right SDE’s achievements options are either a water transfer from a direction. The leaders here are setting the lake 250 km away, or seawater desalination. example for the whole continent. Overall, SDE has made some great progress A decision should be made in the next over the last 15 years (see figure above). few months but we think it’s likely to be Amit Agrawal, A2Z Maintenance & The changes in management improved our desalination: it is cheaper in terms of capex Engineering Services Ltd: What are your transparency and our relationship with the but running costs are higher. main sources of revenue at NWSC? And who government. SDE also achieved a complete is deciding water tariff levels? turnaround with customer service: customers Questions from the audience William Muhairwe: There is a lot of now feel listened to and recognise the Valérie Issumo, Ethical Water Stock money being squandered in the system. improvements we have made. Employees Exchange: We need $10 billion/yr to achieve If you look at NRW, it is enough to pay are now proud of their company too and we the MDGs by 2015. Where will the money for all investments. We must stop looking have signed a three-year peace protocol with come from? for money elsewhere. Officially, it’s the the trade unions. We also restored financial government who fixes the price but actually credibility in the sector: for the first 10 years, Alexander McPhail, session chair: The it’s us: we know what’s going on. We advise capex was financed through concessionary money can come from the tax payers, rate them and they validate it, because they trust credit from development finance institutions payers or outside investors and clearly it our judgement.
222 Focusing on performance // Africa’s moment in water Aladji Dieng // Africa: Already performing, and full of promises 223 Accessing the Chaired by John Veil of produced water market [ Veil Environmental LLC ]
Vast volumes of water produced from oil and gas activities are generated worldwide. This provides a fantastic opportunity for water technology companies to enter this growing market and design and develop management strategies to handle this water.
With insider knowledge from produced water experts working in the oil and gas industry, this session looks at the inherent Speakers include John Veil, Founder/CEO, Veil Environmental LLC challenges facing Brent Halldorson, Chief Operating Officer, technology companies Fountain Quail Dr Roman Breuer, Head of International attempting to enter this Division, Bauer Environmental Group lucrative market, and Ed Steele, Environmental Adviser, Swift Worldwide Services provides their insight into Dr Ted Frankiewicz, Division Manager of Oil & Gas Production Facilities, SPEC Services Inc. successful market entry. Global Water Summit 2011 Focusing on performance Accessing the produced water market
Produced water overview
Introduction concentrations that vary from one location to the next. Oil and gas activities such as enhanced oil recovery via water flooding and steam flooding, The main contaminants found in produced hydraulic fracturing activities and make-up of water can be broadly grouped into four drilling fluids require large quantities of water. categories: The oil and gas The oil and gas industry is not only a major user • Salinity of water, it is also a major producer of water. • Oil and grease industry is not This session will showcase the various roles of • Toxicity water in relation to oil and gas activities, and only a major will introduce the nature of produced water • Naturally Occurring Radioactive Materials and flowback water generated from oil and gas The nature of produced water evolves over user of water, activities. We will also highlight available water time, so a new well will produce smaller management strategies, and give insight into volumes of water than an older well. In the it is also a effective market entry for water technology U.S., the ratio of water produced per barrel of companies. oil is estimated at 8 to 1. This water to oil ratio John Veil can be as high as 100 to 1 in very mature oil major producer Produced water is water that occurs in the John Veil founded Veil Environmental, LLC, a consulting well fields. Globally, oil fields are newer and the same underground formation as the oil and gas practice specialising in water issues affecting the energy water to oil ratios are estimated at 3 to 1. In the resource that is brought to the surface as the industries, upon his retirement from Argonne National of water. United States the volume of produced water hydrocarbon resource is produced. Produced Laboratory in January 2011. Mr Veil spent more than 20 generated annually has been estimated to be water is highly variable, as it is composed of years as the manager of the Water Policy Programme for 333 million m³. numerous chemicals that occur in differing Argonne National Laboratory in Washington, DC, where he was a senior scientist. Mr Veil has a B.A. in Earth and Planetary Science from John Hopkins University, and two M.S. Degrees – in Zoology and Civil Engineering – from the University of Maryland. Before joining Argonne, Mr Veil managed Maryland’s programmes for industrial water pollution control permitting through the National Pollutant Discharge Elimination System (NPDES) and Underground Injection Control (UIC). Mr Veil has been recognised by the Society of Petroleum Engineers as a Distinguished Lecturer in 2008-2009, and as the recipient of the 2009 international award for Health, Safety, Security, Environment and Social Responsibility.
226 Focusing on performance // Accessing the produced water market John Veil // Produced water overview 227 Global Water Summit 2011 Focusing on performance Accessing the produced water market
Making oil and water mix Introduction Disposal Delivering water treatment solutions to the oil Regarding the first issue, the main option and gas industry is a challenge. Producers and available is using deep saltwater disposal wells, technology firms not only speak two different where the water is pumped underground away languages, but they also have very different from aquifers and completely removed from the mentalities. Water technology firms need to hydrological cycle. The long-term sustainability address short-term concerns of producers due of this disposal method affects the overall water to the timescales that operators work to, as management strategy due to the availability We need well as having to adapt to changing needs at and type of disposal wells permitted in that different production stages. Water treatment region. to get an companies have not traditionally understood Freshwater oilfield thinking, and until they adapt their Issues related to freshwater are the availability approach to fully understand the changing of resources needed to perform the requisite emulsion of needs of the producers, a disconnect between oilfield operations, and dealing with competing “oil and water” will persist. We need to get an water needs from other sectors of society. oil and water emulsion of oil and water thinking. Regulation and community thinking. This includes the media, federal, state and Key water issues in shale plays local municipal regulations and negative The primary water issues that affect the public perceptions of oil and gas activities. management of produced water can be placed The management options selected become into five categories. The water management significant when weighed against how the options selected in shale plays vary due to the public will perceive the activities. different water issues that dominate in that region (see the figure below).
Key water issues
Availability and type of SWDs Disposal Sustainability
Logistics Availability Terrain, Climate Competing needs Brent Halldorson Transport Freshwater Brent Halldorson is Chief Operating Officer for Aqua-Pure, a Canadian public company that specialises in oilfield related water treatment. Aqua-Pure pioneered the use of evaporator technology in Alberta’s heavy oil industry. Mr Halldorson also manages Aqua-Pure’s U.S.-based service company, Fountain Quail Water Management. Mr Halldorson is a professional engineer and has been with the company since 1999. He has been instrumental in the development of Aqua-Pure’s mobile NOMAD evaporator treatment system for shale gas operations and other mobile treatment Flowback/PW Composition Municipal , State, Federal solutions for oil and gas operations throughout North America. Fountain Quail has recycled close to a billion gallons Reuse speci cation Recycling & Regulatory & NIMBY of shale gas wastewater back into freshwater for reuse in the Barnett Shale and has recently expanded operations into Reuse Community Pennsylvania and Arkansas. Brent currently lives in Ft Worth Texas with his wife and three children. Source: Aqua-Pure
228 Focusing on performance // Accessing the produced water market Brent Halldorson // Making oil and water mix 229 Global Water Summit 2011 Focusing on performance Accessing the produced water market
Water management drivers and solutions in shale plays
Shale Water management drivers Possible solutions Case study: The Nimr WTP Urban drilling. Utilise low cost disposal. Barnett (TX) Abundant disposal wells. Pipeline water to reduce trucking costs. Dry climate. Very limited disposal capacity. Reuse of salt brine preferred for initial Marcellus (PA) Difficult terrain and climate. development of field. Treat for environmental discharge. Fresh water has minimal value. FQWM has first ever NPDES discharge Fayetteville (AR) Disposal is problematic (recent earthquakes permit for treatment of Fayetteville shale near shallow sandstone SWDs). wastewater. Limited fresh water supply. Pipeline distribution and on-site treatment Haynesville (LA) Disposal marginal. being used. The Nimr water FQWM is setting up sites to provide fresh Very limited fresh water. treatment plant Eagle Ford (TX) water and concentrated brine, which have Heavy (concentrated) brine used for drilling. value for drilling. in Oman can Source: Aqua-Pure address the issues of loss of revenue Recycling and reuse capacity for deep injection wells, with only Knowing that Recycling and reuse is a major issue, as the 6 permitted wells in Pennsylvania. This from oil left in variability of the water can result in salt levels necessitates the use of alternative water economics and ranging from 15,000mg/l to 200,000mg/l. management strategies, primarily reuse where The water can also contain oil and other the flowback water is treated and used for produced water, hydrocarbons. It is necessary to know the fracturing new wells. regulations initial water composition and the quality stricter regulations, The Eagle Ford shale has limited freshwater specifications needed for reuse. drive water sources, and concentrated brine is used for drilling activities. This is a driver, as using an high energy costs Transportation evaporator system or reuse options creates management In terms of transporting the water, the main both freshwater and concentrated brine, and the footprint issue is the logistics involved in moving vast thereby providing two assets from a waste is crucial to amounts of water from one location to another. stream liability (see the above figure). associated with The terrain and the climate in the location affect the management strategy that is selected. staying viable The way forward deep disposal wells. in the market. Water management in shale plays To successfully access this market, a common Dr Roman Breuer Different factors drive the suitability of available sense approach is needed to consider the Dr Roman Breuer joined BAUER Environment in 2004 as a Project Manager. In water management options. In the Barnett overall water management picture, as knowing 2005 he moved to Abu Dhabi as Regional Manager. In the past 5 years he has shale, Texas, there is an abundance of urban that economics and regulations drive water been responsible for establishing two subsidiaries as well as numerous projects management is crucial to staying viable in drilling operations and disposal wells, and also a in six Middle Eastern countries, including the Nimr Water Treatment Project in the market. Having a wide range of solutions suitable climate. With over 50,000 disposal wells Oman. permitted in Texas, and a low disposal cost, this available, and being flexible and able to adapt option dominates in the Barnett shale. to new requests is key; and we really believe in From 2011 he has been based in Germany for BAUER Environment and their new cooperation, sharing all of our results, whether Company BAUER Water, to head their International Division. In the Marcellus shale there is limited disposal they be good or bad.
230 Focusing on performance // Accessing the produced water market Dr Roman Breuer // Case study: The Nimr WTP 231 Global Water Summit 2011 Focusing on performance Accessing the produced water market
from the oil and gas producer. The composition Introduction Operational energy requirements for reed bed plant and deep disposal wells of the produced water from the Nimr oilfield This project The Nimr water treatment plant (WTP) project is brackish, with total dissolved solids (TDS) is based in the south of Muscat in Oman. The ranging between 7,000 mg/l and 8,000 mg/l. Disposal options Power required Total power used in project CO climate in the region can be as high as 60°C 2 is able to The oil in the water is approximately 150 mg/l, in the summer months, making it a harsh Deep well disposal Up to 5.5 kWh/m³ 3,630,000 MWh 1,960,000 t which is quite high for us to manage. recover as environment to work in. This water treatment Reed bed 0.1 kWh/m³ 66,000 MWh 35,700 t project was co-executed by Bauer Environment The plant layout includes a pipeline, which much as and Petroleum Development Oman (PDO). The enters the WTP system and leads to an oil and Source: BAUER Environmental Group plant came online in late 2010 and has been water separator. The water is then distributed treating water since 18th December 2010. The over a polishing wetland facility. The water is 161 bbl/d Nimr oilfield requires 250,000 m³/d of water channelled through a wetland of four wetland to be managed to keep oil production going. terraces on a gravity feed over a 2.3 million m² using a gravity flow system plant design. Project success and outlook of oil from Deep disposal wells were the main option but area. Finally, there are evaporation ponds used Intermediate pumping is not used in the plant, The use of a mineral sealing layer rather than the Nimr WTP can address the issues of loss of for salt recovery for use by the oilfield for drilling reducing energy needs. To protect underground a HDPE liner has also reduced the energy revenue from oil left in produced water, stricter operations. The figures below show the gravity the produced aquifers, the wetland area is lined with a mineral footprint by 80%. The oil content in the regulations, high-energy costs and the footprint flow reed bed. produced water is reduced from 200 mg/l associated with disposal wells. sealing layer rather than a HDPE liner, which water. is used typically. The climate and large surface when entering the WTP to less than 1 mg/l Reducing the environmental area made using HDPE liners unfeasible. Local when leaving the wetland system. Despite Project overview footprint materials were sourced to integrate the sealing the hot climate, the winter months provide layer. For added value the project will also a temperature of 10°C, which is suitable for The Nimr WTP is designed to treat 45,000 m³/d, The Nimr WTP project is reducing the research how to reuse the biomass that the the growth of Phragmites australis plants. which is less than a fifth of the daily volume of environmental footprint. This project is able to wetland will produce over time. The project has generated revenues from produced water generated by the oilfield. It is a recover as much as 161 bbl/d of oil from the oil recovered from the produced water and build-own-operate (BOO) project, and is under produced water. Since the start of the project, Compared to deep disposal wells, this reed bed has provided major savings by generating a 20-year operation and maintenance contract. 9,000 barrels of oil have been recovered from approach has lower energy requirements and salt from the evaporation ponds. Petroleum This is a unique model, for we designed and the produced water stream. The concept of less carbon footprint. The table below shows Development Oman will increase the WTP built the facility and are now operating it, and the plant was to have zero energy used for the the energy and carbon footprint associated capacity to 95,000 m³/d. have taken full liability for managing the water water treatment, thus reducing the footprint by with the two methods.
Gravity flow reed bed … … Gravity flow reed bed continued
Source: BAUER Environmental Group Source: BAUER Environmental Group
232 Focusing on performance // Accessing the produced water market Dr Roman Breuer // Case study: The Nimr WTP 233 Global Water Summit 2011 Focusing on performance Accessing the produced water market
Water management challenges Water use in the Haynesville shale area Fracturing projected use 0.1% Livestock 4% for unconventional gas resources Irrigation & aquaculture 8.6% Public supply 46.3% Introduction Water consumption Historically, the oil and gas industry has and reuse options Power generation 13.6% approached water as an afterthought. In the Haynesville area 2.14 billion bbl/yr of Water use in the However, the paradigm has changed as the water are consumed by various water use Haynesville shale area oil and gas industry has moved towards sectors. Water for fracturing accounts for only unconventional reservoirs. Unconventional 0.1% of this total use at 2.14 million bbl/yr. gas reservoirs include the popular shale plays, Although the water use is considerably less than the tight sands and coal bed methane (CBM). other sectors, producers will still face opposition With CBM large volumes of water are to the allocation of this water. Industrial & mining pumped out of the coal seam to reduce There are several opportunities to reuse water for 27.5% hydrostatic pressure and allow economical beneficial applications, e.g. crop irrigation, dust gas production, which can take up to a year. control, road de-icing and drilling operations The low permeability tight sands need to be reuse. Dust control and road de-icing are Sources: USGA “Water Use in Louisiana”, 2005, TWDB Water Use Database, 2004 fractured, which generates large quantities common applications, but reuse for drilling of water over a long period of time. Shale operations is the best application from a formations require 10-15 times as much sustainability standpoint, and also because of the water for hydraulic fracturing. Anywhere from risk of liability. 5% to 60% or more of this water flows back to the surface. Vision for the future Map showing the chemistry of produced water in the United States The TDS levels in produced water differ Water management strategy according to the reservoir type and the In the short term, the first step is to build geographic location. CBM produced water can a solid information base by performing be as low as 1,200 mg/l TDS, while flowback from a comprehensive hydrological study, the Marcellus shale can be as high as 180,000 addressing the project needs and assessing mg/l TDS. Therefore one treatment option for all infrastructure capabilities. The information is unlikely. The map to the bottom right shows will shed light on the quality of the available the chemistry of produced water in the US. water sources, seasonal variations, wells to Ed Steele be drilled, logistics issues and transportation Looking to the future, as treatment options will vary, producers must determine when Ed began his career as a hydrogeologist for the State of Pennsylvania. Following this, he spent feasibility to ensure water is secured to meet operational needs. The available reuse is economically viable and maximise a number of years as an environmental consultant and as the environmental manager for an water treatment technologies must also be the reuse of their flowback and produced international chemical manufacturing company. Prior to his current role with Swift Worldwide assessed and evaluated on the basis of cost water streams. Producers need to develop Services providing environmental consulting services for the company’s clients, he spent and effectiveness by verifying track records of a better understanding of the formations to 20 years with major international oil and gas companies. During this time he had overall successful projects. increase fracturing efficiencies and reduce responsibility for providing strategic direction, building and overseeing implementation of water use. They need to explore alternative By knowing the capital cost, the number environmental programmes as well as providing technical advice on water management water resources and research green additives of wells to be drilled and the drilling and methods for fracturing fluids to curb the and water treatment technology. In the past few years he has acted as a technical adviser to programme, a long-term perspective can concern over the numerous chemicals used a number of programmes including the Advanced Water Technology Center at the Colorado be developed to define the water needs for hydraulic fracturing. It is also important School of Mines, the Center for Multiphase Transport Phenomena at Michigan State University, forecast. This will involve developing to provide simpler and cheaper treatment the Global Petroleum Research Institute at Texas A&M University, and the Environmentally technology plans, determining sourcing and technologies. Using the appropriate water and Friendly Drilling Program at the Houston Advanced Research Center. disposal options and implementing a long- formulation for fracturing, increased production term water management solution. and better economics are possible. 234 Focusing on performance // Accessing the produced water market Ed Steele // Water management challenges for unconventional gas resources 235 Global Water Summit 2011 Focusing on performance Accessing the produced water market
The character and opportunities of oilfield produced water
Introduction generation or for fracture fluid. Produced water is rarely treated for beneficial uses. Produced water has many unique Most treatment systems target the removal of characteristics. It comes out of the well in dispersed contaminants only and do not target a reducing atmosphere and at very high Most treatment the removal of dissolved components. The temperatures ranging from 24°C to 120°C. figure below shows some technologies and This water is saturated with methane, carbon systems target average costs associated with their use. dioxide, and at times has hydrogen sulphide dissolved in it. There are also low and high Initial separation technologies reduce the oil the removal molecular weight acids, hydrocarbons and and grease to 300-1,000 mg/l and primary aromatics dissolved in the produced water treatments reduce oil and grease to 50-300 of dispersed stream. There is a potential for anaerobic mg/l. Induced gas and dissolved gas flotation bacteria, which can result in corrosion issues. are secondary treatments that reduce oil and There are salts, scale forming minerals and grease to 10-30 mg/l. Polishing treatments such contaminants dispersed oil in produced water. Solids like as reed beds reduce oil and grease to 1-10 mg/l. silicates, clays and carbonates are also produced Environmental regulations to date are mainly only and do from the formation. based on using dissolved gas flotation for cleaning produced water. not target Treatment options and Technology opportunities opportunities the removal For a treatment technology to be effective in Traditionally, treatment technologies are used the produced water market, it must be robust of dissolved to meet environmental regulations for disposal to work efficiently under varying conditions and or discharge to navigable waters. The water with variable flow rates. It must be versatile to components. is also treated before pumping into disposal remove a variety of contaminants and process wells, when reusing for water floods, steam a wide range of waters. It must be serviceable
Technologies and associated costs
Technology Particle removal Treatment tier Cost ($)/daily Ted Frankiewicz (microns) barrel of capacity arsenic as well as residual oil from produced systems and equipment for Venoco, THUMS, Ted Frankiewicz has more than 30 years’ API gravity separator >150 Initial separation 1 - 3 experience with Occidental Petroleum, water. At Natco Group he developed an Tidelands, Occidental Elk Hills, and Chevron Long residence tanks >50 Initial separation 1 - 3 Unocal Corp., Natco Group, and, currently, effective vertical column flotation vessel (Alaska), as well as for several additional SPEC Services. He has a Ph.D. in Physical design and used Computational Fluid companies. Plate pack separator >30 Primary 5 Chemistry from the University of Chicago, Dynamics to diagnose problems with Ted was an SPE (Society of Petroleum Deoiling hydrocyclone >10 Primary 5 holds 15 patents, and has written more than existing water treatment equipment, as well Engineers) Distinguished Lecturer 2009- Desanding hydrocyclone >5 Primary 5 25 professional publications. At Unocal, he as to design new equipment. 2010 and has traveled extensively to Induced gas flotation >25 Secondary 15 was responsible for developing the water At SPEC Services he has been responsible for deliver lectures on the treatment of oilfield treatment systems that were installed in the the design of oil & gas production process produced water. Membrane filters 15 - 50 Gulf of Thailand to remove mercury and Source: SPEC Services
236 Focusing on performance // Accessing the produced water market Ted Frankiewicz // The character and opportunities of oilfield produced water 237 Global Water Summit 2011 Focusing on performance Accessing the produced water market
for easy operation and maintenance and most Technology opportunities importantly it must be economical. Technology Treatment role There are numerous opportunities for Water challenges in the shale technologies to meet differing oilfield needs Nano-filtration Removes sulphate and dissolved organics such as sterilisation, filtration and sulphate Ultra-filtration Removes sulphate and dissolved organics removal to remove dissolved organics and Presented by John Veil UV oxidation Sterilisation prevent well scaling and souring. The figure to the top left of the page shows the technology Ozone Sterilisation opportunities available. Introduction Site preparation involves construction activities, Peroxide treatment Sterilisation which require erosion control and stormwater There are opportunities in developing compact The importance of the shale plays as a resource management practices. Water is used for Oxidation Removes dissolved organics systems for offshore use and in remote is significant in the U.S. and globally. In the making up drilling fluids for well drilling. In the locations, reducing the need for manpower U.S. between December 2009 and 2010, the Bio-treatment Removes dissolved organics Marcellus about 303 m³ of water are used per to use a technology and improving the projection of the importance of shale gas well. The main water use is during hydraulic Ion exchange Deionisation and demineralisation performance of conventional equipment while up to 2035 doubled from 5-6 tcf to 10-12 tcf. fracturing with volumes ranging between Reverse osmosis Deionisation and demineralisation reducing the cost. Treating alternative water Worldwide, 48 shale gas basins have been 3,785 m³ and 18,927 m³ for each frac job. The sources such as seawater, source water and surveyed in 32 countries in Europe, North Africa, Mechanical vapour compression Deionisation and demineralisation water used is sourced from surface water municipal wastewater are all opportunities, South America and Asia, covering almost 70 supplies, wells and purchased public water Evaporator technologies Deionisation and demineralisation as they will require some level of treatment shale formations. This shale gas commodity is supplies and transported onsite by trucks or via including filtration and treatments to remove set to increase in popularity globally. Source: SPEC Services bioactivity to prevent souring, scaling and pipelines. formation plugging. Process steps for shale gas The water pumped into the formation during fracturing is only in the ground for 1-3 hours. production Technology access When the pressure is released, some of this The four main process steps that involve water “flowback” water comes back to the surface To successfully bring a technology to this use include: over a few days at high velocity and pressure market, operators will be expecting relevant and is collected in a large pond. The water is • Site preparation oilfield experience and a track record of then treated, disposed or moved offsite. In Business models for market entry successful projects. Operators will need to see • Well drilling the Marcellus shale flowback is managed by evidence of technical expertise to guarantee its • Well preparation (hydraulic fracturing) using filtration to remove sand grains and scale Business model Revenue stream efficiency and ability to provide onsite technical • Gas production and water management. particles to remove clogging elements. The Provide the technology-based equipment to support. Capital sale the end user. The business model selection is critical. There Build, install, and commission equipment for are four main business models that water Increasing importance of shale gas reservoirs in the U.S. from 2009 to 2035 Operations and capital sale an end user with a delayed sale. technology companies can use to enter the market (see the bottom left figure). 30 Build and lease equipment to an end user. Based on terms of lease Actual Projected Shale gas Build and operate equipment for an end user. Operating income Other models include forming a joint venture Tight gas with an experienced supplier, establishing a 25 Source: SPEC Services contractual participative marketing relationship Coalbed methane with an experienced supplier or selling them Net imports 20 the technology outright, which is rarely done. Non-associated Entering the market as a newcomer (although conventional difficult) is possible, butAEO2011 succeeding Early will take Release a Overview 15 Non-associated o shore long time. TCF/yr Alaska 10 Associated with oil Entering the market as a newcomer (although difficult) is 5
0 possible, but succeeding will take a long time. 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
Source: Annual Energy Outlook 2011, Reference case, U.S. Energy Information Agency
238 Focusing on performance // Accessing the produced water market John Veil // Water challenges in the shale 239 Global Water Summit 2011 Focusing on performance Accessing the produced water market
Questions from the audience
flowback is mixed with freshwater to make up Pennsylvania, West Virginia and New York are Paul O’Callaghan, O2 environmental: Ted Frankiewicz: If you are an equipment them. So we will work with companies the entire fracturing fluids for the next well. the main producing states in the Marcellus There was little mention of bacteria as a supplier and you have the capital, you can like Schlumberger, MI Swaco and Layne Disposal options include injection wells, moving shale. The year with the maximum number of contaminant of produced water; is it an issue, negotiate a service by providing a service, Christensen. There is advantages and risk to the flowback to offsite commercial wastewater wells drilled are taken and doubled for each and are there any regulations that require but you own the equipment. Right now partnering because they can layer up your treatment facilities and sewage treatment state. The number of wells in New York was that to be dealt with? oil companies have a lot of money and are costs by introducing high margins and make plants. Injection wells are not viable in the taken from the West Virginia estimate. This is willing to buy the equipment or technology the partnership uneconomical. Ted Frankiewicz: Bacteria are an issue, Marcellus as the geology does not support it. because no shale gas drilling has occurred over and operate it themselves where they have particularly sulphate bacteria. Other bacteria Question: You mentioned the percentage Injection the last few years because of governmental control over it. generate biosolids which could foul a well so of water required compared to all the other restrictions, but drilling may resume in the Water use estimates in shale plays if you are going to be re-injecting the water Question: What business model would you industries, does that take into account the wells are not future. To estimate the maximum water volumes and you are not re-injecting into a fractured recommend, in terms of the kind of company growth projected as you move forward? Assuming 5 million gallons (18,927 m³) of water formation then bacterial activity has to be that would be ideal for a water investor needed for hydraulic fracturing, estimates of the John Veil: I estimated a maximum viable in the is needed to fracture each well, the annual very low. company to invest in? water volumes used per well and the maximum production year for the entire region, I didn’t and daily water volumes for each state can be number of wells drilled in a year must be made. Robert Wright, WaterVap: Regarding the use Brent Halldorson: Service companies take the highest year to date, I took the Marcellus as calculated. The total daily water withdrawals for of deep well injection, isn’t there a limitation understand drilling, frac’ing and chemicals highest year and doubled it. If done for all of There are caveats to this method though, as the three states in 2005 are used to compare and a concern about what you can put into but they do not understand the water. But three states and added it probably gives a estimates of the maximum wells drilled could the estimated daily needs for fracturing the geology that well as far as chemical make up and they have key relationships with the gas good estimate of what a maximum is. From significantly overestimate or underestimate with the actual daily water withdrawals in concentration? producers. We have tried to forge alliances these two examples, there is plenty of water the actual quantity. The estimated maximum 2005. Fracturing only accounts for 0.22% of does not with the service companies to work with to go around. number in one state will not necessarily daily withdrawals in the Marcellus shale. This Ed Steele: The question is about the correspond to the maximum in each of the estimation can also be performed for other suspended solids, which is why people support it. other states and as gas companies improve shale plays, and in the case of the Fayetteville use filtration. Highly concentrated water their recycling and reuse efforts, the water shale in Arkansas, fracturing accounts for 0.6% will produce a lot of solids that need to needed per well may decrease. But if operators of daily withdrawals. What I can conclude from be disposed. The cost of disposal must be drill longer horizontal wells with more frac this is there should be enough water available evaluated to determine the volume of solid stages, the volume needed per well could to do fracturing. waste that will be produced by performing increase. filtration and concentrating versus the cost of disposing that material. Guillaume Clairet, H2O Innovation: Assuming that oil companies have lower costs of capital than most of the smaller Water use estimates for fracturing activities in selected shale plays water treatment specialised companies, do you think there is a trend in the model of Estimates Daily use contracts that are going to be won in your Number Volume Volume Actual total use estimate for industry? Is there going to be more of a BOT Shale play States of wells (m³/yr) (m³/d) in 2005 (m³/d) fracturing (%) or straight capital equipment sales? PA 2,908 55,039,888 150,794 38,944,317 0.39 Roman Breuer: This was the first kind of BOT model the oil company has used and now for WV 548 10,400,000 28,417 35,878,133 0.08 Marcellus shale the second project phase they are moving NY 548 10,372,028 28,417 18,211,616 0.16 back to their old model. It is a very traditional industry, they like to explore these models Total 4,004 75,811,916 207,628 93,034,066 0.22 but I think it will take more time to increase Fayetteville shale Arkansas 1,724 32,630,250 89,398 14,838,814 0.60 the number of BOT models in the oil and gas industry. Source: Veil Environmental, LLC
240 Focusing on performance // Accessing the produced water market Questions from the audience 241 New initiatives in private sector participation
The combination of the public sector financing crisis in Europe and North America, the challenges of water scarcity in the Middle East, and the financial confidence of the developing world, means that private sector participation in the water sector is back on the agenda.
Here we bring together some of those looking to bring in private sector expertise and money to drive Speakers include performance in the sector. Shayo Holloway, General Manager, Lagos Water Corporation Chaired by Gérard Payen of Aquafed Allard Nooy, CEO, JITF Water Infrastructure Ltd. Omar Al Wahaibi, CEO, HAYA Water, Oman [ ] Lesego Raditsebe, of the Department of Water Affairs, Botswana Global Water Summit 2011 Focusing on performance New initiatives
Opening comments Public-private partnerships Presented by the Chair Gérard Payen in the Lagos water sector Introduction Introduction All over the world there are many private Lagos state is the commercial and economic utilities and many operators, both public and centre of Nigeria, with a population of private, but for several reasons more is known 18 million. This total is expected to increase about private operators. This is because they significantly, and by 2020 Lagos is projected to are more heavily regulated, have contracts or become the third largest city in the world with licences, and compete against each other. For a population of 29 million. This illustrates the this reason there is more academic research challenges that we face, though we prefer to on private companies. This provides useful see these challenges as opportunities waiting information and in practice World Bank research to be tapped. shows that private operators have grown year after year in almost all continents. Water supply in Lagos The Lagos Water Corporation is the What’s new in the industry? governmental agency charged with supplying Last year in September 2010 the UN and the urban population of Lagos State with member governments recognised the human potable water. Over the years, however, the right to drinking water and sanitation. In the line between “rural” and “urban” has blurred same resolution the UN embedded the right to significantly, and as it now stands, our water into international law and international operations cover most of the state. treaties. They also acknowledged the fact that There is currently a demand gap of 1.50 million private sector provision is compatible with this m³/d (330 MGD) that must be filled, and we right. believe that public-private partnerships (PPPs) The only study on private sector participation are the best way of addressing this demand to this date was conducted by the World Bank gap. In 1999, as a gesture of the will of the and showed that the private sector is delivering government, a PPP office was installed as part interesting achievements for populations and of the office of the state government with the governments across the developing world, intention of accelerating public infrastructure with improved quality of services, improved delivery. efficiency, and at a cost footprint that is similar to public utilities. Lagos PPP institutions Shayo Holloway The PPP office works as a project adviser, Shayo Holloway is a dual degree engineering graduate of Morehouse College and Gérard Payen working closely with key agencies, defining best Georgia Institute of Technology. practices, and acting as a one-stop shop for Gérard Payen has been working for more delivering water and wastewater services. Council of the International Water In the year 2000, in line with the Lagos State Government’s intention of private sector private partners. participation in the water sector, he was appointed General Manager of the team from than 20 years to solve water issues in Today, he works to mobilise better the Association. In the UN Secretary General’s the private sector to steer the Lagos Water Corporation towards privatisation. many countries all around the globe. After international community towards improving Advisory Board on water and Sanitation In 2004, the Lagos water law was enacted to create an enabling environment in which having participated in the management of water and sanitation services mainly as (UNSGAB) he chairs the Monitoring and In December 2006 he was appointed Group Managing Director of the Lagos Water the private sector could engage with the Degrémont, he headed all water activities Financing working groups. He has taken Corporation, responsible for the management of the corporation and its ongoing World adviser to the UN Secretary General and development of the water sector. We are now part in all World Water Forums and in most Bank Project, development of a 10-year water sector Master Plan with emphasis on of the business group that was named as President of AquaFed, the International in the process of establishing a regulatory of recent intergovernmental conferences Lyonnaise des Eaux then Suez to make them Federation of Private Water Operators. He is commission to safeguard the investments private sector participation to meet expected water demand by 2020 when Lagos State (with the brand ONDEO) the world leader in also director and chair of the Strategic relating to water. made by the private sector, while at the same will have a projected population of 29 million.
244 Focusing on performance // New initiatives in private sector participation Shayo Holloway // Public-private partnerships in the Lagos water sector 245 Global Water Summit 2011 Focusing on performance New initiatives
the IPP power purchase agreement already in intend to procure for the future. time protecting public interests related to tariff Supply and demand place whereby Lagos buys its bulk power. Studies have setting and water quality. Presently, we are installing bulk water meters A water master plan was developed for Lagos, Lagos Water Corporation across our water network as a first step, which broken down into the short, medium, and long will allow us to carry out a water audit at any shown that Investment opportunities term. The plan identifies projected changes in The Lagos Water Corporation has a total asset time. In this way, each operator will know how The vectors that drive PPP investment water demand across the period 2010-2020, base that is valued at $222.7 million and much bulk water is entering the part of the if water can opportunities are population, willingness to pay, and defines the changes in water production operates over 10 service areas. There are 3 network under his or her jurisdiction. and water resources. Population is the primary that need to be made in order to accommodate major water treatment plants (WTPs) with a be delivered driver of demand for water, while willingness to changes in demand, and at the same time close combined output of 541,000 m³/d (119 MGD) pay is determined predominantly by incomes. the existing demand gap (see the upper right and a total of 50 mini WTPs spread throughout Opportunities regularly, Lagos has a large socio-economic growth with figure). the city with a total output of 418,000 m³/d Africa is a rapidly emerging market for water relatively high disposable incomes, comprising In the short term, we intend to use existing (91.9 MGD). We are currently engaging private and wastewater treatment. Lagos state is and at a 40% of Nigeria’s high and middle income resources to boost production and begin companies under management contracts in especially well placed, given our human earners. to close the existing demand gap. In the order to boost the robustness of our demand- resources, the political will that has already medium term we are going to procure new side management. The intention will be to been demonstrated by the state government, good quality, Due to the uneven distribution of infrastructure encourage private operators downstream to and supported with funds from the federal and water delivery, the informal sector is able water schemes and this will have the effect of significantly boosting water production. engage in the production, distribution and government. Lagos also has one of the to sell water at $0.033 per m³, around 500 times commercial activities across the 10 service areas. best rates of return on investment, again willingness to the official rate. Studies have shown that if Finally, in the longer term we hope to be able to eliminate the demand gap entirely through We feel that engaging with private operators predominantly driven by population, as has water can be delivered regularly, and at a good under management contract will be one of the been witnessed by the success of PPP in the pay increases. quality, willingness to pay increases, and there aggressive demand-side management (see the lower right figure). essential steps toward cost-recovery, and will telecommunications sector. should be no need to defer to informal water help to fund the large-scale water schemes we sources. The terms under which the proposed master Finally, of course, adequate raw water resources plan projects are procured under PPP are flexible. We are looking at a situation under Engaging are needed. Lagos has three major rivers that Lagos water supply master plan estimates all run into the Lagos Lagoon. There is also a which private companies will sell bulk water downstream to the Lagos Water Corporation, huge aquifer that feeds the 15 mini-waterworks Water demand Water production Demand gap to be executed under a water purchase Year Population with private dotted around the city. (MGD / million m³) (MGD / million m³) (MGD / million m³) agreement. This arrangement will be similar to operators 2010 18,000,000 540 / 2.45 210 / 0.95 330 / 1.50 2010 - 2013 20,837,250 625 / 2.84 362 / 1.65 263 / 1.20 Vectors driving investment under 2014 - 2017 25,327,808 633 / 2.88 622 / 2.83 11 / 0.05 management 2018 - 2020 29,320,103 733 / 3.33 745 / 3.39 (12) / (0.05) Source: Lagos Water Supply Masterplan (2010 - 2020) contract... will Population help to fund the large-scale Proposed master plan PPP projects Short term Medium term Long term water schemes (2010 - 2013) (2014 - 2017) (2018 - 2020) Adiyan II Odomola II (desalination) Yewa II (desalination) we intend to Odomola I Adiyan III Odomola III (desalination) Water resources Willingness to pay Ishasi expansion to 54,600 m³/d Upgrading Ishasi Yewa I (desalination) procure for (12 MGD) 54,600 - 159,000 m³/d (12 - 35 MGD) the future. Ota Ikosi Waterworks Ibeshe (desalination) Note: All plant construction will go along with associated network construction. Source: Lagos Water Supply masterplan (2010 - 2020)
246 Focusing on performance // New initiatives in private sector participation Shayo Holloway // Public-private partnerships in the Lagos water sector 247 Global Water Summit 2011 Focusing on performance New initiatives
Privatisation and reform in the Indian market Introduction to the world’s population with inadequate access In addition to poor supply, water storage O.P. Jindal Group to water supply and wastewater services. capacity in India is also quite poor, with less With approx. Current expenditure in the sector is estimated than a quarter of the per capita storage capacity JITF Aquasource is the water services arm of the at $80 billion/yr, and as demand for water of China. It is estimated that around $6 billion O.P. Jindal group, which was formed in 1952. services continues to grow, governments are would be required to meet growing demand. 16% of The group’s turnover is about $12 billion, with increasingly finding themselves under pressure The last three decades have seen many key a market capitalisation of approximately $30 to meet the additional investment needed. the world’s billion. The company employs around 85,000 developments in the regulatory framework people in many locations across all continents, governing water policy in India. However, population, but including the Americas, Asia, and Europe. The Indian scenario there are still inconsistencies between different With approximately 16% of the world’s government departments, and a lack of There are four distinct capital investment arms only 4% of population, but only 4% of global water communication and coordination between in the group. Jindal SAW is a manufacturer of resources, there is a definite demand gap in ministries. Still, legislation continues to be pipes. Jindal ITF, which is part of Jindal SAW, is Indian water needs. This creates a huge pressure developed, and that is a good sign. global water further divided into three groups; I am in charge to ensure that existing resources are further of the infrastructure division. developed, conserved, and used efficiently. Government initiatives and resources, there We currently have two joint ventures running Despite this need, average annual per capita the JNNURM under the water infrastructure division. One availability of water has decreased significantly is a definite company, which we have set up in partnership There are a number of initiatives currently since the 1950s and continues to drop. There with Manila Water, aims to reduce non-revenue aimed at enhancing PPPs in water and is a high proportion of non-revenue and demand gap in water production and increase 24/7 water sanitation, spearheaded by central government, unaccounted for water, estimated at around supply through public-private partnerships and aimed at providing “gap-funding” to ensure 60%, low levels of metering and a lack of Indian water (PPPs). The other joint venture, with Japanese the financial viability of water projects. incentives for public utilities to address these firm Kobelco, is looking at industrial water and issues. In some states, industrialisation is already The primary objective for the government is wastewater. These two companies were formed needs. being held back by inadequate water supply. that there will be planned development under with the objective of providing first class water and wastewater services. In addition JITF Ecopolis is active in solid waste management Projects sanctioned under JNNURM and renewable energy.
Challenges and opportunities Roads/Flyovers 8% Where we work, there is a growing requirement Roads/Flyovers 30% Water supply 20% for water and wastewater services. This is related Drainage/Stormwater in particular to increasing levels of urbanisation, drainage 18% middle class growth, and increasing Water supply 30% industrialisation. Our challenge is how to deliver these capital intensive assets, taking into account various environmental concerns, JNNURM projects JNNURM projects Allard Nooy legislation, and meeting quality standards. 2008 - 2009 2009 - 2010 Sewerage 17% Mr Allard Nooy is Chief Executive Officer of Jindal Water Infrastructure Ltd. and Jindal Part of the solution to the problem is to enlist Urban Infrastructure Ltd. Both companies are part of the O.P. Jindal Group, a $12 bn the private sector to deliver these outputs in a Other 9% conglomerate with established leadership positions in steel, mining, power, energy, given time frame and at cost. In my view, the infrastructure, water, wastewater and solid waste management. In his capacity Mr Allard private sector is best placed to deliver the best Solid waste Drainage/Stormwater Solid waste Nooy is P&L and operationally responsible for Jindal Water Infrastructure and Jindal Urban value in a short time frame, due to the fact management 9% drainage 15% management 1% Infrastructure and leads the development and implementation of the growth strategy. that the private sector takes a project life cost Sewerage 26% Other 17% Allard Nooy holds a Bachelor of Science (Eng) in Engineering Management and an MBA in approach, rather than the capex and recurrent budget approach used by the public sector. International Business. Globally, there is still a large part of the Source: Jindal Water Infrastructure Ltd. 248 Focusing on performance // New initiatives in private sector participation Allard Nooy // Privatisation and reform in the Indian market 249 Global Water Summit 2011 Focusing on performance New initiatives
the Jawaharlal Nehru National Urban Renewal Tariff reforms using PPPs is relatively new to India. Recommendations Mission (JNNURM), and that this initiative will The first key Just five or six years ago, private sector My advice, therefore, would be to try to get for structured PPPs We recommend be coordinated across departments and across participation in the water sector was not at all the right advisers, who already have project states. Key performance indicators (KPIs) should be set step to ensure encouraged. While some foreign consultancy experience from other countries with similar to realistic levels, and should conform to world that a capex Experience over recent years has shown services were allowed by the Indian backgrounds, and learning from the mistakes best-practice standards. Planned construction the successful that a significant proportion of the projects government, actual project implementation that have been made elsewhere – particularly in periods should also be set to realistic levels, review be sanctioned under the JNNURM have been was a purely domestic undertaking. the developing world. depending on the complexity of the project. focused specifically on improving water and adoption of That situation has completely changed, with The main problems currently are that minimum Disconnection policies must be made clear undertaken sanitation. PPPs being actively sought, driven in part by offtake obligations are not being documented from the outset, in order to discourage non- a PPP project the experience of the transport sector, where and met and thorough market analysis is payment. every 5 years Wastewater in India PPPs have been shown to deliver projects not being carried out. There are widespread We recommend that a capex review be is the twin As much as 30% of India’s wastewater is actually successfully, on time, and within budget. tariff payment shortfalls which need to be undertaken every 5 years in connection with in connection addressed, either through improved collection being discharged without any treatment. There is still, however, a problem with tariffs, achieving and maintaining KPIs, with tariff or through subsidisation for the sector of Wastewater treatment coverage is poor, with which are set at a regional level, in a very adjustments. Risks should be well defined, and promotion of the population that is genuinely unable to with achieving a gap between wastewater generated and fragmented market. Tariffs are currently very apportioned to the party that is best able to pay. Tariff adjustments also need to be better wastewater treated that has been widening low, leading to poor cost recovery. This in turn manage them. If these principles are adhered the user pay defined in contractual agreements. Finally, and maintaining over time (see the figure below). leads to insufficient income, which leads to to then the public-private partnerships can be creditworthiness needs to be better established, underinvestment in the water and wastewater a successful and rewarding experience for all and financial risks better shared across the and polluter infrastructure, which results in poor service parties concerned. KPIs, with tariff board. pay principles. delivery (see the figure to the bottom right). adjustments. Bringing in a user pay principle, with affordable tariffs, improved collection methods and a Wastewater generation and treatment levels in India more commercial mindset, would result in an The tariff reform process overall better service for the customer – notably through the provision of 24/7 water supply – 50 Wastewater and would in the long run reduce costs. Low cost generated 45 recovery Wastewater The problem The result 40 Key PPP success factors treated The first key step to ensure the successful 35 adoption of a PPP project is the twin promotion Low cost A ordable Cost recovery of the user pay and polluter pay principles. To recovery tari s tari charges 30 achieve this, supporting regulation is required, Poor with enforced cut-off policies where customers Management Improve Insu cient 25 service do not pay. These principles must be reflected change collection income 20 in clear contractual agreements that are Poor Good Improved Insu cient put in place, and that identify the roles and service Reduce management level of Quantity million m³/d 15 income responsibilities of all parties. costs service 10 Indian PPP project experience 5 What we have seen in recent experience is 0 that advisers have been retained by state Planned governments, municipal corporations and other Low annual government bodies but have not been setting investment The solution investment 2003-04 2005-06 2007-08 2008-09 2009-10 2010-11 2011-12 the right performance indicators, or have not instituted the correct contractual models. This is Source: Jindal Water Infrastructure Ltd. Source: Jindal Water Infrastructure Ltd. not wholly surprising, as the whole concept of
250 Focusing on performance // New initiatives in private sector participation Allard Nooy // Privatisation and reform in the Indian market 251 Global Water Summit 2011 Focusing on performance New initiatives
Wastewater treatment and reuse in Oman About Haya Water Integrated water resource management has involved the creation of wetlands. This not only I am going to present to you the experience Our overarching protects water resources, but also provides that Haya Water have had in the wastewater other environmental benefits, by providing treatment sector in Muscat, the capital of Oman. a habitat for local wildlife. This brings with it vision... is to Haya Water is a wholly government-owned increased revenues for the tourism industry, as company, established in December 2002, birdwatchers come from around the world to turn Muscat into following a 10-year process of debate experience the local flora and fauna. concerning the privatisation process in Oman. a world-class Haya currently holds a 30-year concession Other projects to build and operate Muscat’s wastewater city by building collection, treatment and reuse systems. The bio-solids composting plant is now Our overarching vision, and the vision of the operational, producing 40,000 tons/yr of Class and operating municipal government, is to turn Muscat into A compost, and the facility came to a total cost a world-class city by building and operating a of $6.2 million. This has solved the dilemma revolutionary water reuse system that connects of what to do with the sludge produced at a revolutionary at least 80% of residential properties by 2018. our wastewater treatment plants, and has also solved a problem for the municipality, who now water reuse The existing water reuse system in Muscat is have a treatment outlet for the green waste dependent on a fleet of tankers that transfer generated by the city. the water to a central facility, where it is treated, system. and then used throughout the city as irrigation water. The new water reuse infrastructure will be built-up to include a network of sewage Projected capital costs of $4.2 billion treatment plants, a series of pumping stations, treated effluent networks and a composting plant which will generate compost to be sold Other costs 3% on the commercial market. Telecom 7% We estimate a sharp increase in the amount of water that will become available due to the reuse network, increasing from around 50,000-60,000 m³/d at present to approximately Networks 76% STP 14% 160,000 m³/d by 2018. Omar Al-Wahaibi Projected capital costs Omar Khalfan Naser Al Wahaibi is CEO of HAYA Water, the Oman Treated water reuse options $4.2 billion Wastewater Services Company. Treated water is already being reused in Muscat for public landscaping and the beautification He joined Oman Wastewater Services Company (OWSC) in 2003 of green spaces such as parks and roadsides. as a General Manager and later as a CEO. His initial tasks included However, at Haya Water we hope that in the the creation of the company and to develop the master plan for future we may supply treated water for reuse the Muscat Wastewater Project. in higher-value projects, including large private Currently OWSC is executing a $3 billion wastewater infrastructure developments such as golf courses, and for project and serving about 100,000 connected customers. tourism, in agriculture for watering crops, and in aquifer storage and recovery. Source: HAYA Water
252 Focusing on performance // New initiatives in private sector participation Omar Al-Wahaibi // Wastewater treatment and reuse in Oman 253 Global Water Summit 2011 Focusing on performance New initiatives
Projected operating costs of $2.1 billion and revenues of $1.9 billion (2011 - 2035)
Operational overheads 3% Other 1% Chemicals/consumables/ Tanker revenue 1% spares 8% Asset usage fee 14%
Selling Manpower 44% & distribution 8%
General Projected operating Projected revenues & administration 8% costs 2011-2035 2011-2035 $2.1 billion $1.9 billion
Repairs & maintenance & insurance 14% Treated e uent 35% Operation & maintenance fee (OMF) 50% Power 14%
Note: Projected operating costs Note: For residential properties, the asset usage fee is exclude asset depreciation $5.2/property, and the operation and maintenance fee is $0.4/m³
Source: HAYA Water
As we install this wastewater treatment m³. These charges are integrated with the Haya Water. The company also manages infrastructure we have been taking the existing water billing structure in place in the operations and maintenance of opportunity to install fibre-optic telecom Muscat, despite the fact that Haya Water is a existing and new infrastructure and has lines. This will hopefully boost the national separate entity to the Muscat Water Supply a management services contract with economy in the years to come, by providing Department. Veolia water. The company is linked to a state-of-the-art telecommunications the government through three separate Billing and collection rates are high in network (see the figure below). agreements: a concession agreement, Muscat, but there will still be around a third a take or pay agreement for the treated Before Haya Water was created in 2002, there of projected revenues that will need to effluent, and a funding agreement whereby was an existing wastewater network that be generated through the sale of treated the infrastructure is all owned by the supplied around 13% of the population of effluent. We have take or pay agreements government, with Haya Water shouldering Muscat. However, this network was fairly with the municipality and the golf courses the project management and the operational limited, and much construction has gone around the city which we hope to further aspects of the water reuse system. Therefore, underway since then. We hope that by develop towards the future. the gap that exists between projected next year we will be providing 50-60% of Another potential source of income would revenues and projected costs is debt funded the population with wastewater treatment be the supply of the fibre-optic telecom by the government. services. network to homes around Muscat. However, With such an important role played by In discussing privatisation, one of the most the telecoms regulator has yet to finalise the government in the funding of the important factors is the projected operating a broadband policy for the city, which will wastewater network, and the heavy subsidy costs and revenues (see the figure above). determine the terms of what Haya Water can requirements that must be accommodated, charge for the network, and how broadband Projected revenues are expected to be lower it would appear unlikely that the government will be delivered to the population of the than operating costs, because revenues are would be ready to hand controls over municipality. Now that the wastewater network is being put into set by the government in terms of what Haya to the private sector in the immediate Water is allowed to charge the public for its Overall, we estimate that the total outlay future. However, now that the wastewater services. There are two types of fees charged will amount to $4.2 billion, 76% of which network is being put into place, and the place, and the organisational structure of Haya water is to the public: a fixed asset usage fee of $5.2/ will be the capex involved in creating the organisational structure of Haya water is property/month (Haya does not charge network. This work will all be undertaken more like that of a private company, it is very more like that of a private company, it is very possible a fixed fee for connection) and a variable by the private sector, though it will be paid possible that privatisation will take place in operation and maintenance fee of $0.40/ for by the government and managed by the future. that privatisation will take place in the future.
254 Focusing on performance // New initiatives in private sector participation Omar Al-Wahaibi // Wastewater treatment and reuse in Oman 255 Global Water Summit 2011 Focusing on performance New initiatives
problem in the recent credit crunch, due to government departments and ministries Botswana’s heavy reliance on the diamond were consolidated into one aggregate service Botswana’s water sector export trade. As a result in the fall in diamond provider, the Water Utilities Corporation (WUC). markets, Botswana’s GDP has been decreasing At first, there was public outcry at the by an average of 3%/yr since 2008, leading to a prospect of these water sector reforms due depressed capex in the water sector. Structure of the water sector to the founding statutes of the WUC, which in Botswana Given our reliance on the diamond trade, and maintain that the corporation must operate The Department of Water Affairs, which is the knock-on effect that performance in the along commercial lines. It was feared that Prior to the charged with the planning and development diamond market has on the public balance the corporation would exercise its monopoly of water resources in Botswana, is part of sheet, it seems clear to many in the government power, setting tariffs that are unsustainably reforms, tariff the Ministry of Minerals, Energy and Water that offering such subsidies will not be a high for certain sections of the population, who Resources. In addition to this department, the sustainable option in the future. The private would therefore be unable to access water setting was Ministry comprises the Water Appointment sector therefore has a significant role to play in services. Board, which is responsible for the allocation of closing this investment gap, and providing the One of the key driving factors behind the approved at a water rights, and the Water Utilities Corporation, water services that have so far been provided reforms was the need to depoliticise the a government-owned corporate entity that by the public sector. tariff setting process. Prior to the reforms, works on a full cost recovery basis, supplying cabinet level. Despite the heavy subsidisation of the industry, tariff setting was approved at a cabinet level. water and sanitation services throughout security of supply is highly uneven, as are levels The result has been that tariffs have been set Botswana. The result has of water quality. This is especially the case in the consistently below cost recovery levels by Despite having a small population, Botswana arid region to the west of the country, where approximately 20%. Independent regulatory has a land mass roughly the size of France. The most water is supplied in bowsers and water powers are therefore required to ensure that been that tariffs population distribution is also highly uneven, tankers. the tariff setting process does not get co- with the bulk of the population concentrated opted by political concerns; however, the have been set Finally, there is a certain level of incoherence in the south-east of the country, making WUC still maintains an open dialogue with in the roles and responsibilities of different consistent service provision throughout the the government where social objectives departments, with many departments consistently country a difficult challenge. and subsidies for the poorest sector of the overlapping with each other, and duplicating population are concerned. work. The roles of different players within the below cost Current problems for the water sector need clarification in order to Given the population distribution in Botswana, water sector improve overall efficiency. the decision was made to integrate water recovery levels and power regulation into one single entity, The major challenge facing the water sector in the Botswana Energy and Water Regulation Botswana is overcoming environmental and by approx. 20% The water master plan Authority (BEWRA). The Authority will be physical constraints. Botswana is a land-locked The first national water master plan was responsible for regulating the WUC, the country that shares its watercourses with initiated in 1991, and a review was carried Botswana Power Corporation (the single surrounding states, and has a climate with very out in 2006, taking into account the current buyer of electricity in the country), and smaller erratic rainfall. Due to the fact that we share problems the sector now faces. Further impetus independent power producers that are just our watercourses, in order to undertake any for reform in the sector came from the results beginning to enter into the market. development on our watercourses we must first of a review of the need for regulatory reform in enlist the cooperation of surrounding riparian the infrastructure and utility sectors, carried out states. by the consultancy Stone and Webster in 2005. Proposed structure of the Botswana Energy and Water Regulation Authority Lesego Raditsebe Also, our population is not distributed Finally, in 2008/09 Botswana secured a loan from the World Bank with which to develop Lesego Raditsebe began his career as junior consultant for a consulting firm based according to the distribution of water resources. Jurisdiction Secondary legislation concerning energy and water resources its coal industry, as up until then we were in Gaborone called Water Resource Consultants after earning a Bachelor’s Degree in This means that water transfer schemes have Power of appeal Independent power of appeal through the judiciary. to be instituted, notably from the north of the over-reliant on energy imported from South Hydrology from the University of Arizona in Tucson. Decision-making body made up of 8 board members, 4 executive country to the south, which is where the major Africa, and were experiencing regular power Autonomy Since 2004 he has worked for the Department of Water Affairs in Botswana, where he was population hubs are. shortages. One of the conditions of this loan (full-time) and 4 non-executive (part-time). involved with the National Water Master Plan for Botswana. In 2007 he enrolled for Msc was the institution of an independent regulator Funding cap set at 1.5% of the gross licence fees, with an additional The water sector in Botswana is highly Budget Hydroinformatics at the University of Newcastle Upon Tyne (UK), and upon his return he to make decisions on tariff setting, which had start-up budget supplied by government. subsidised, with government subsidies previously been the role of the government. was assigned to be part of the unit currently implementing the recommendations of the Regular reports made by the board to parliament through the accounting for approximately 40% of all Governance National Water Master Plan Review which among other thing calls for the establishment operations and management expenditure. In response to the above recommendations, Minister in charge of Minerals, Energy & Water Resources. of an independent Water Regulator. Reliance on subsidies has been a particular water and sanitation services that had previously been provided by a range of 256 Focusing on performance // New initiatives in private sector participation Lesego Raditsebe // Botswana’s water sector 257 Global Water Summit 2011 Focusing on performance New initiatives
Private sector participation in sector participation in the liberalised telecoms Probably one Botswana’s water sector sector, thus proving Botswana’s suitability for the liberalisation of public sector industries. The single most important factor for private Questions from the audience of the most sector participation in the water services In terms of barriers to entry, the main challenge industry is to ensure that it generates a for the private sector will be overcoming the Valerie Issumo, Prana Sustainable Water: Shayo Holloway: Given the population that promising reasonable rate of return on its investment, spatial distribution of such a small population Now that we see wastewater as a resource, we are dealing with in Lagos, overall it is more Our experience which must be commensurate with the risks over such a large area of land. and not just as a cost, do you think that BOT cost-effective to have a centralised system – contract periods will be shortened? that is, large water schemes catering for large arenas for involved in making that investment. Minimising Some of the most valuable projects for the sectors of the population. Cost per capita in India is that this risk will involve creating a stable and large multinational private sector will probably Allard Nooy: Our experience in India is is much lower. We have many water works predictable regulatory environment with be concerned with the large water transfer that the terms of the contract – at least for private sector dotting the landscape of the state. However, the terms of robust institutions that are independent of the schemes that run from the North to the greenfield projects – need to be 25 to 30 these are fairly small-scale localised projects, incumbent government. South of the country. There will also be an years. This is due to the capital intensive participation providing water for around 500 people at a the contract opportunity for small village operations, but nature of these projects. Although we are Botswana exhibits a range of positive qualities time. In contrast, 90% of the water consumed these are going to be more suitable for small getting the sewer effluent delivered free which it can offer to the private sector. First, in Lagos state is provided by just two large- will be in local entrepreneurs. With its highly developed of charge to our treatment plants, and – at least it is ranked by Transparency International as scale water treatment plants, illustrating the tourism industry, Botswana has a real need for potential industrial customers to sell that the least corrupt country in Africa, creating a economies of scale from larger plants. So for a the supply of investment into wastewater treatment facilities, water to, the quality of the treated water is for greenfield stable environment in which to do business. large population you are better off with large, in order to meet international environmental such that to recover our capex, and retain Botswana is also one of the few countries in centralised schemes. bulk water to Africa to be ranked a middle income country, standards. Finally, probably one of the most competitiveness with other groundwater projects – need therefore meaning that willingness to pay is promising arenas for private sector participation resources requires terms of this timescale. Omar Al Wahaibi: With regard to the mining generally higher than in surrounding states. The will be in the supply of bulk water to the mining Again, in the Indian context, tender terms wastewater I am not sure of the exact to be 25 to rule of law is robust in Botswana, and general industry, which is also highly developed in tend to be relatively short, so whereas in answer to each situation, but the first thing industry. compliance is overall quite high. Finally, there Botswana, and constantly growing. China it is easy to get tender terms that are to take into account is the topography of 30 years. This has been a successful precedent set for private 15 years in length, in India that is almost the land, and the planning of the city. It impossible. is also important to consider what will be done with the wastewater – is it going to is due to the Dominique Demessence, Agbar: What is be dumped, or treated and reused? All of Proposed structure of the BEWRA the financial viability of PPPs that encompass these considerations will have to enter the capital intensive greenfield and brownfield projects, given the equation, and the economics will indicate major infrastructural constraints, and the low to you the right decision. For Muscat, we tariff settings? nature of these Non-Executive Non-Executive decided on 5 catchment areas to start with, Board Member Board Member Allard Nooy: Both greenfield and brownfield though this may increase over time, based on projects. developments have their pros and cons. the topography of the city. Chairman If you conduct a proper due diligence study on a brownfield facility, and are able (Executive) Non-Executive Non-Executive to get access to the network, billing and Urban population served by private water operators in developing countries Board Member Board Member collection, the most important consideration is minimising some of your risks. Taking a 175 commercial view on how you can improve Middle East and North Africa the services, coverage area and demand- 150 Europe and Central Asia Executive Board Executive Board Executive Board side requirements, greenfield projects that Latin America Member Member Member are ringfenced with a take or pay scheme 125 East Asia and Paci c are easier to structure. However, there is also Sub-Saharan Africa usually more competition for greenfield 100 projects. 75 Mohsen Mortada, Malcolm Pirnie: Given 50 that all of the countries covered in the Manager Manager Manager Manager Manager Manager presentation are playing catch up with low 25 Tari & Price served (millions) Population Legal & Licensing Technical & Compliance Technical & Compliance Customer Protection Admin & Finance levels of infrastructure development, what are Control the differences between small decentralised 0 Monitoring (Water) Monitoring (Energy) 1991 1993 1995 1997 1999 2001 2003 2005 2007 systems compared to centralised infrastructure? Source: World Bank, 2009
258 Focusing on performance // New initiatives in private sector participation Questions from the audience 259 Water technology idol
Following its success at previous conferences, Water technology idol returned to showcase five emerging technologies. The contest is based on the established American Idol / Pop Idol format, where the winner is decided by an audience vote.
Each finalist is given ten minutes to convince everyone of their technology’s merits, and its potential to change the world of water. This is followed by a grilling, by the audience and panel, about Speakers include Dr Sung Jae Kim, Research the technical and commercial aspects Scientist, Massachusetts Institute of Technology of each technology. Dr Dileep Agnihotri, CEO, Advanced Hydro Inc. Dr Richard Stover, Executive Vice President, Desalitech, Ltd. Robert Wright, Partner, Panel members: Watervap, LLC Tom Pankratz, WDR Debra Coy, Svanda & Coy Consulting Lisa Henthorne, Water Standard Company [ John Tonner, Water Consultants International] Global Water Summit 2011 Focusing on performance Water technology idol
Massachusetts Institute of Technology: A portable water desalination & purification system
Introduction Portable, self powered system The development The accessibility to potable water is a major issue, particularly in developing countries and Seawater WINNER of a portable in some developed nations following natural Global Water Awards disasters. The development of a portable 2011 desalination desalination system is a small-scale approach to address the big water problem. The availability Pre lters/control stack of a portable, self powered clean water system is a system will potentially save lives by meeting the basic drinking water needs for survival small-scale of around 2.5L/d per person. The technology both desalinated and purifies water, and was ICP stack approach to presented by Dr Sung Jae Kim, a research scientist from the department of Electrical address the big Engineering at MIT. Canister water problem. Technology overview This technology achieves membrane-less direct desalination of seawater using nano-fluidics and ion concentration polarisation (ICP). The Fresh water Brine drain process uses an electrical potential to generate Source: MIT The portable a zone of repulsion, allowing charged particles to separate from seawater. The device includes desalination a nano-junction that connects to very small Fundamentals of ICP micro-channels and bifurcated channels. These device can channels are used to separate the salted and Microchannel + - desalted streams. The nano-junction pore - - + - + + - - - size is very small and the high ionic strength ~O(100)µm V - V achieve up to - Ion depletion+ zone- - - + - conditions allow them to remain selective to + + - + Dr Sung Jae Kim cations. The potential for fouling is eliminated - 99.4% removal because other charged species present in the 0 Dr Sung Jae Kim earned his PhD Degree in Chemical Engineering and Mechanical and Nanojunction Industrial Engineering from Pohang University of Science and Technology (POSTECH), water are driven from the membrane. ~O(10)nm Korea in 2005. Then, he joined Prof Jongyoon Han’s Micro/Nanofluidic BioMEMS group with 50% -ζ at MIT as a post doctoral researcher. Now he is working at the same group as Research Costs recovery. - + Scientist. He published more than 10 high profile journal articles including Nature - - According to Kim, the cost to manufacture + Electrical double - Microchannel - - - Nanotechnology, Physical Review Letters and Nano Letters and is listed as an inventor each portable device is around $500 and the Layer Overlap + + - Ion+ enrichment zone ~O(100)µm - - on 15 international and domestic patents. His current research focused on both cost of the replaceable ICP stack is less than ground -- + + - ground - + - fundamentals and engineering applications of the nonlinear electrokinetic phenomena $5 per stack, similar to the price of disposable occurred by the ion concentration polarisation near nanofluidic structures. Brita® filter cartridges. The technology can be powered by a photovoltaic cell or small battery. Source: MIT
262 Focusing on performance // Water technology idol Dr Sung Jae Kim // Massachusetts Institute of Technology: A portable water desalination & purification system 263 Global Water Summit 2011 Focusing on performance Water technology idol
Advantages, optimisation Technospeak and challenges ICP is a phenomenon that occurs when an ion current is passed through ion-selective mem- branes, due to the mismatch of charge carriers at the membrane interface. The membrane, which The portable desalination device can achieve Kim: Yes, the junction where I showed the chip can be either a nanochannel or nanoporous membrane preferentially conducts cations that do up to 99.4% removal with 50% recovery. The device is actually one that is inch by inch; the not match the ion conductivities in the bulk electrolyte. Ion concentration gradients are thus unit micro-fluidic device can be optimised separation occurs only at the few microns. So generated on both sides of the membrane. As the ICP is triggered near the cation exchange by integrating the microelectrodes to apply there is a lot of loss when the current is passing membrane, ion depletion occurs on the anodic side of the junction when the concentrations of voltages near the nano-junction to significantly through the unnecessary channel, but in the cations and anions decrease. On the cathodic side of the junction, ion enrichment occurs as the decrease the voltage and enhance power system I am just working on it is quite tightly concentrations of the cations and anions increases. efficiency. This allows for compatibility with closed. I think the 3.5 will be better in future The ICP layer acts as a virtual barrier for any charged particles found in seawater such as solid par- existing battery technologies or small-scale demonstrations. ticles, microorganisms and biomolecules. As most water-borne microorganisms and micropar- solar power systems. The length of the nano- Lisa Henthorne: This is portable and self- ticles have a non-zero zeta potential, small salt ions and large microorganisms can be removed junction can be controlled, to reduce power powered and you have got multiple use devices simultaneously from the desalted output stream. This makes the process effective for the direct losses that arise from initiating and maintaining on it. Is this the sized system that you say is $1? desalination of seawater from natural sources. the ion-depletion zone. In addition, to achieve According to Kim, the inlet micro-channel has a width of 500 µm and depth of 100 µm. The maximum parallelisation within a given system Kim: Yes last year I made that device. Other nano-junction is connected to two micro-channels and bifurcated channels with a width of 250 size, minimising the overall size of the unit chip than the multiplication I also tried to reduce the µm and depth of 100 µm, which are used to separate the salted and desalted streams. This allows improves the design of the main/brine channel. cost of the manufacturing. The first year I had to a continuous and steady state of desalination to be achieved. Strong ICP zones are therefore go back to the clean room and last year I had to established under high ionic strength conditions as the nano-junction pore size is small at 5 nm, According to Kim, the flow rate of the seawater purchase materials, tools, flexiglass, etc. from a allowing them to remain cation-selective. entering the channels is very slow at 10µl/min. hardware store. So that is why I probably say this He plans to drive the water via gravity (in a number is only $5 and actually the last portion manner similar to that used in Brita® filter of this presentation has this as $500. systems), passing through the ICP stack and then being collected. The ICP stack will be Debra Coy: The $5 or the $1 cost, that is for a massive multiplication of the device with scaled up production of lots of units; How many the goal to generate a water flow rate of units? Or can you really do small production at 300ml/min. a low cost? Kim: The important one is actually that $5 Questions from the panel cost estimation for that stack. I am not talking Tom Pankratz: How long would you expect one about the encloser. The first stack is a pre filter of these small devices to last and is it something and control stack. The control stack should that could be cleaned and used for years? have some kind of level sensor, pH sensor and concentration sensor and also some other Sung Jae Kim: The longest period that we mechanics should be involved. But this system tested it is 1 month, but the price of this device, ICP stack, I think it is replaceable like the Brita® the ICP stack and the filter is less than $1 so you filter so that the price is less than $5. That is my can just dispose of it after 1 month. estimation. John Tonner: Does the process only work Coy: So is this the total cost of production for on charged species? Do you know what making one unit or for making a million units? mechanisms are stopping the energy consumption from being even lower? Is it a Kim: The estimation actually includes the Practicalities materials and machine fee at the MIT level, not configuration issue or is it the physics that you The pH of the desalted output stream falls within the World Health Organization’s recommended are dealing with? mass production not including software and range of acidity for drinking water (7-7.5) because most ions are removed from the desalted labour costs. stream. Desalination operation of the device can be maintained for over 1 hour without mem- brane clogging, after which, the reservoir at the end of the brine channel becomes concentrated with particles and dyes, while the reservoir of the desalted channel remains free from debris. Salt ions and other charged debris are also driven away from the membrane, thereby eliminating the potential to foul the membrane/nano-junction.
264 Focusing on performance // Water technology idol Dr Sung Jae Kim // Massachusetts Institute of Technology: A portable water desalination & purification system 265 Global Water Summit 2011 Focusing on performance Water technology idol
Pilot data According to Agnihotri, compared to uncoated Advanced Hydro: membranes, “we have seen consistently, all the way from MF to UF, significant changes in the trans-membrane pressure (TMP) and the flux through the membrane” . The improvements in Polymeric membrane coatings the TMP and the flux through the membrane occur without the use of chemicals. • Data from the UF post bioreactor pilot, Introduction The technology in a nutshell: which filters dead bacteria, shows the TMP The Achilles heel of membranes is fouling. post bioreactor treatment pilot has also been was 30-40% lower, with higher TMP stability A polymeric coating with anti-fouling This technology aims to address this by using completed. across the membrane. properties to enhance the protection of wetted parts in a membrane system. polydopamine and PEG-amine polymers to • The outside-in UF produced water pilot coat the surface of membranes. The process Technology overview showed 40-50% higher flux, 30% lower TMP involves post-production coding or modifying and 80-90% higher specific flux. the surface of the membranes to make them The membrane market is very large and is • The RO produced water pilot showed antifouling. Dr Dileep Agnihotri, Principal and estimated at up to $10 billion/yr. However, over improved salt rejection, no significant Acting CEO of Advanced Hydro presented the a membrane’s working lifetime its efficiency fouling over 30 days of operation and allows technology. decreases as it becomes clogged and fouled, with massive cost implications for cleaning or multistage RO for high TDS streams. Advanced Hydro, the start up company replacement. This coating technology addresses • In the MF desalination pilot, the coated developing the technology, was established these issues for the entire membrane range., membranes operated for 35 days without in December 2008 by licensing three pending from MF to RO. the use of chemicals before a reduction of patents out of the University of Texas. The flux (40 to 25 GFD) occurred. The uncoated The technology involves applying polymer company is currently conducting revenue- membranes required daily EFM cleaning coatings to membranes. The first polymer generating field pilots. They have also obtained with chemicals. funding from the U.S. Navy for a seawater pilot is applied to make the membrane surface where the coatings are tested on MF, UF and hydrophilic. It serves as an adhesive to allow RO membranes. A produced water pilot in the second polymer, which has anti-fouling Costs and challenges the Barnett Shale funded by GTI/RPSEA was properties, to stick to the membrane surface. Agnihotri explains that “at this point we are completed in December 2010. A UF expecting to reduce the capital expense by 20% for a plant where you are dealing with MF and UF, with almost 30% reduction in your operating Coating chemistry costs”. A major challenge is in managing sales times. This is because the time from first contact Uncoated membrane fouling Coated membrane with the client to actually achieving a sale can Colloidal or particulate material take several months, as every sale requires conducting a pilot. According to Agnihotri, they also have warranty issues with the membrane Bulk solution suppliers and to overcome this problem, Advanced Hydro aims to work with customers Dr Dileep Agnihotri that don’t buy a warranty, go to applications Dr Agnihotri is CEO of Advanced Hydro Inc (AHI), a spin-off from the UT-Austin Surface fouling where membranes are highly consumed and for commercialisation of anti-fouling membrane coatings. These coatings have then sell the membranes without a warranty. applications in desalination, wastewater and produced treatment. Besides AHI, Dr Agnihotri advises 21 Ventures, a CleanTech focused venture capital firm for new Advantages and applications investments, turnarounds and ongoing investment activity. Internal membrane Dopamine coating can be used in a wide range Prior to his current responsibilities, Dileep spent 8 years with a successful technology of applications where fouling management is a fouling start-up (Jordan Valley Semiconductors, JVS) as Director and Global Manager. major challenge. These include produced water management, desalination, traditional water Dileep has a PhD in Nuclear Chemistry and an MS in Physical Chemistry from the treatment plants, beer filtration systems and all University of Rochester in New York. He has published over 30 articles and holds nearly Hydrophilic coating and PEG graft - other filtration systems. The specific membrane a dozen patents. Dileep’s interests and expertise include commercialisation of new and Advanced Hydro technology applications include: disruptive technologies in water, energy storage, solar, nuclear, and semiconductors. Source: Advanced Hydro
266 Focusing on performance // Water technology idol Dr Dileep Agnihotri // Advanced Hydro: Polymeric membrane coatings 267 Global Water Summit 2011 Focusing on performance Water technology idol
• Polysulphone UF improves the permeability of the membrane. Technospeak • Polyamide RO and NF With RO it is more difficult because RO is not a The coating is chemically added porous membrane, so when we add a coating • Polypropylene MF Desalitech: to the membrane in a soak-based you impact on the permeability of the RO process. The process involves flowing • Polytetrafluoroethylene MF membranes. But our optimised coating for RO a specialised solution through the Dopamine coating technology effectively only reduces flux by 5-7% on new membranes. module and the ease of application reduces fouling by 30-50%, and from field And within a couple of hours of use, our flux is TM allows a wide variety of existing pilots this technology has shown 25-40% better than the non-coated membranes even Closed Circuit Desalination membrane systems to be modified improvements with costs, which will be less on RO. without any additional infrastructure. than 10% for the end user. Agnihotri is hoping The dopamine polymer used acts as Debra Coy: Is there a recurring revenue stream? to impact a big market at a sum of about $1 bn an adhesive and is inspired by nature How often are coatings added to the system? as it uses secretions from mussels. It is and is currently looking for more partners to applied to the membrane surface in a demonstrate the technology and raise capital. Agnihotri: Yes, we are expecting to provide thin 5-10 nm layer, making the surface one-time coatings for certain applications and hydrophilic. This allows a “microhairs” periodic coatings for other types of applications. of a thin PEG-amine polymer layer Questions from the panel It would be beneficial to remove the coating to be added, which has antifouling Tom Pankratz: Have you addressed the NSF and reapply it in certain cases, and this coating properties. issue or other approvals that must be solved will allow you to reach to the membrane The hydrophilic surface draws water before this can be used in a potable water native surface. An additional benefit is that to the surface and eventually reduces application? we can remove it easily. We are expecting a the TMP across the membrane. Overall Dileep Agnihotri: Currently our coating has model where we do one-time coatings for there is 10-100 times reduction in been certified NSF 61 for RO membranes. We certain applications, then we never touch the Dr Richard L. Stover protein adhesion and 5-10 times membrane again until the membrane dies. In reduction in oil adhesion and bacte- are processing the NSF 61 for MF and UF and Dr Rick Stover has twenty-five years of research, other applications we will clean the membrane rial adhesion. This leads to a 4-5 times we don’t see any issues in getting that. development and marketing experience and has gained and reapply the coating so there will be reduction in membrane cleaning John Tonner: You tested it on different kinds of international recognition for innovation, expertise and frequency. ongoing revenue. membranes; did you find significant differences success in the desalination market. He currently serves between different membrane materials, or any Tonner: You mentioned that you have got 3 as Executive Vice President for Desalitech, Ltd., a startup improved benefits when you use it on a certain patents; would you broadly classify them as 3 company leading the next generation of reverse osmosis different technologies or essentially the same type of membrane? desalination and water purification with its Closed-Circuit technology but applied to 3 different markets? Agnihotri: Lots of membrane suppliers Desalination process. Agnihotri: The first patent is the fundamental are trying to address the issue of fouling by Prior to joining Desalitech, Dr Stover served as Energy coating process and applying it to the modifying their membranes. There is a wide Recovery, Inc.’s Chief Technical Officer. ERI is the market membrane area. For the second patent we are range of membranes in the market. We have leader in energy recovery devices and has been the looked at several of these and the benefits of able to add additional coatings on top of the biggest technological and commercial success story in the modified membranes are in a very limited base polymer polydopamine, for example silver. range, 25-40% for most membranes, so our So we can add silver to the membranes and if the desalination sector in the last decade, culminating technology falls in that range. you are looking for certain functionality we can with its IPO in 2008. Dr Stover led the development and achieve that. At this point we are not practicing launch of a full line of PX Pressure Exchanger devices and Lisa Henthorne: Most coatings cause a it, but we have that as a second patent in place. pumps for seawater reverse osmosis. decrease in the permeability of membranes, In the third patent we have new materials to while yours is showing an increase in put more coats around the core technologies so Dr Stover also served as Vice President of Engineering permeability; can you describe the mechanism others don’t compete with us. for Oasys Water, a startup company developing forward by which you think that is actually occurring? osmosis processes for desalination, water reuse and Audience: Is the coating permanent for RO osmotic power. He previously held technical positions Agnihotri: When you add anything to the membranes? membrane you impart a mass resistance with IBM and 3M. to the membrane. But this coating is make Agnihotri: The periodic coating will not apply Dr Stover obtained his Doctorate Degree in Chemical to RO membranes. The coating has material membranes more hydrophilic, so the water Engineering from the University of California at Berkeley molecules are attracted to the surface. The properties that are very similar to polyamide films, and we cannot remove it once we apply it. in 1996. His Bachelor’s Degree in Chemical Engineering is coating it is helping water to be “sucked from the University of Texas at Austin. He was co-recipient through” the membrane. That is how it of the European Desalination Society’s 2006 Sidney Loeb award for outstanding innovation.
268 Focusing on performance // Water technology idol Dr Richard L. Stover // Desalitech: Closed Circuit Desalination TM 269 Global Water Summit 2011 Focusing on performance Water technology idol
Introduction the water from the pump goes on to become outlook is for retrofitting existing systems and all go to the same place. The quality is generally The technology in a nutshell: permeate. As no pressurised brine stream is direct sales of smaller units. In the next year they the same as a regular RO system. Salt passage Technospeak The closed circuit desalination (CCD™) process A single-stage RO process that does released, no energy recovery device is necessary. will look mainly at larger systems through OEMs is diffusion driven, so the concentration of the The CCD process works by was presented as “next generation RO”—a giant not produce a pressurised brine stream, and licensing the technology globally. feed stream drives the salt passage. If we go recirculating feedwater until the leap rather than an incremental improvement— eliminating the need for an energy with the same recovery then on average we desired recovery level is reached. by Dr Richard Stover, Executive Vice President recovery device. Energy costs get the same permeate quality. However we Brine is replaced with fresh feed of Desalitech. The company was founded to A study using highly saline Mediterranean Questions from the panel are running at higher flux, which dilutes the without stopping the flow of feed commercialise the CCD™ process and has had seawater was carried out to compare energy Tom Pankratz: Is this only applicable to new permeate and we get much better quality. or permeate. The low initial pressure over 70 patents granted. The technology was consumption for CCD™ and RO with isobaric installations? Could you retrofit and install of each CCD sequence means a invented by Professor Avi Efraty. Research began energy recovery (the best available technology without doing a major rebuild of the system? Henthorne: Will you blend across all different lower average operating pressure in the late 1990s and Efraty had been working with very similar membranes). For a seawater systems that are in different regimes at any time and less pump energy than required Rick Stover: Yes, and retrofitting is the model in conventional RO systems. Since on the technology as a solo project for over 15 flux of 13 l/m²/hr, CCD™ consumed 30% less so that there is an average permeate quality? we will prefer for this year for several reasons. permeate recovery is related only years. energy. If the same CCD™ system is run in Firstly it is possible to do a retrofit very quickly, Stover: My understanding is that most plants to the duration of the recirculation lower salinity ocean water at the same flux as most of the equipment is already there and don’t do split permeate takeoff now. It is a sequence and not to the number of and recovery, the energy consumption is just Technology overview we just add a few pressure vessels and valves. relatively new concept. If our feedwater is very membrane elements per housing 1.65 KWhr/m³, which is very low. CCD™ is a continuous hydrostatic membrane Secondly it allows us to do an A/B comparison high salinity, and it is advantageous to use split or per system, the CCD process can water treatment technology. A high-pressure The high cross flow and even flux distribution on how the system ran before and how it runs permeate takeoff, you would do it on a time reach any desired recovery percent- age in a single stage. pump is used to create a permeate stream in the CCD process enable higher average with our configuration. Thirdly it is low risk, as basis instead of on a position basis. So instead through membranes, and the reject/ fluxes than in conventional RO. This reduces the system can be converted back. of taking off the head of the vessel from the first In a conventional RO process, a high concentrate from the membranes is returned to the system footprint and associated capital cost few elements, the valve will cut permeate to pressure needs to be applied to the John Tonner: If you are optimising a better head membrane element in order feed the process in a closed loop. with very little increase in energy consumption. one side at the beginning of a cycle and to the average flux, with only 3 elements in a vessel, other side towards the end of a cycle. to make to make the tail elements A continuous batch process structure is used. what do you think that is going to do for productive. This is because both Feed water is circulated by a pump and as Advantages and applications membrane replacement strategies and the Debra Coy: You make some of your own units the osmotic pressure of the highest for direct sales; what is the advantage of doing concentrate and the pressure drop permeate is generated, salinity and pressure CCD™ technology provides numerous membrane lifetime? It might be fair to say that? Why would you take on manufacturing along the membrane array both builds up in the closed loop. At the desired advantages, such as: reduced energy that you would get slightly less life out of them costs internally? need to be overcome. recovery, brine is replaced with feedwater consumption; improved membrane because most of them are working harder? without depressurising. A pressurised brine However, the closed circuit process performance; maximum recovery in a single Stover: Although the average flux is higher, we Stover: Well it is assembly so it is integration, stream is not generated in this process and all starts at just above the osmotic stage; low energy without use of energy don’t over-flux the head element. In a typical using it is largely off the shelf equipment. We pressure of the feedwater. Pres- recovery devices; reduced CAPEX; and flexible RO process the head element is running at have a shop where we can build systems and sure then builds up to meet the Schematic of the technology operation. It is applicable to most current RO this 51 l/m²/h; we never go that high. So we sell them. Eventually, we won’t be a system ultimate pressure of a conventional applications including seawater and brackish expect not to wear out head elements as fast manufacturer. Initially though it generates some RO process. This can reduce the water desalination, water treatment for as the conventional process would. The short cash flow and some top line revenue. Also as maximum pressure requirement by industrial and municipal waters and a new class arrays make for more even flux distribution, proof of the technology we are able to offer a 20-30 bar in a seawater system, with of high efficiency flexible and robust small RO and we expect great long-term membrane full package along with a guarantee so there is a corresponding reduction in energy requirements. systems. performance. some advantage to doing this initially. In a conventional system the head Coy: This is essentially licensing a configuration Tonner: Are you using longer vessels for a elements would experience an Market and commercialisation particular reason? rather than selling new equipment. How are excessive flux of around 51 l/m²/h, According to Stover, “our objective is to lower you going to set your licensing fees? How are with high fouling potential. In con- Stover: The larger the volume of the loop, the the cost of RO water treatment universally”. you going to get market adoption through the trast, The tail elements experiences longer you can run before having to go through We offer a proprietary process technology by licensing process? high salinity, low flux conditions, the flush regime. We generally use 3 or 4 directly selling RO units we build. Desalitech with high scaling potential. This membrane elements in a 6 m or 7 m vessel. Stover: A typical licence is some percent of also offers indirect sales through OEMs and means that the two ends of the sys- revenues, so we would set it at some percent tem need to be carefully balanced. EPCs, where they build their systems using Lisa Henthorne: How are you managing the and go with that. Certainly revenues would be However in the CCD™ process, our technology. All cases involve technology dynamics of the permeate quality? Are you based on water tariffs, or in the case of an EPC licences. Our markets include desalination, blending from the whole system? Will it operate 3 head elements can be put in a plant the cost of the plant. We would need to closed circuit where the pump industrial and municipal RO and NF water in different regimes at the same time? index, based on capacity, how much water the treatment applications. The company has generates a crossflow that results in unit is going to sell and what the pressure is an even flux distribution. The short recently entered into a joint research and Stover: In a simple system all the permeate going to be. If it was a brackish unit there would membrane array allows a much development collaboration with General goes into the same pipe. It is possible to time it so you take off your early permeate like a split be a different kind of benefit, but potentially not higher average flux, without over- Electric. Our collaboration is sponsored by the as many savings as would be achieved with a fluxing the membrane elements. Source: Desalitech permeate design, but for the most part it would BIRD foundation. The current commercialisation seawater unit.
270 Focusing on performance // Water technology idol Dr Richard L. Stover // Desalitech: Closed Circuit Desalination TM 271 Global Water Summit 2011 Focusing on performance Water technology idol
Watervap: Brine disposal system Introduction dissolved solids (TDS) in the wastewater stream The technology in a nutshell: being treated. Watervap is a startup company that was A multi-stage process that achieves high quality water with ZLD from high incorporated in 2004. The company has • Stage 1 is optional, and involves using TDS feedwater. developed a 3-stage brine disposal system membrane distillation to desalinate low for the desalination of brine water streams TDS waters. When dealing with very high The key technology is a non-scaling, to generate potable water. This technology self-cleaning heat exchanger. TDS concentrations, this initial stage is This technology is able to achieve zero liquid discharge insufficient and is bypassed. (ZLD). It has overcome the major issue of • Stage 2 receives either the concentrated is able to fouling, which affects the majority of brine outflow generated in stage 1, or high concentrator systems due to the presence of TDS feedwater. This stage includes a achieve zero scaling contaminants such as silica and calcium flash evaporator, a mechanical vapour sulphate in the brine streams. compressor and a non-scaling, self-cleaning liquid discharge The brine disposal system was presented by fluidised bed heat exchanger (FBHX). Robert Wright, a founding partner of Watervap. Stage 2 is the best option to meet volume reduction needs. (ZLD) and has Technology overview • Stage 3 is where ZLD is achieved. The concentrate stream, which has a very high overcome the The brine disposal system involves a 3-stage TDS, is dried in a fluidised bed spray dryer technology process. The stages selected to generate a dry salt (see the figure to the major issue depend on the concentration of the total bottom left). of fouling The water cycle Advantages and applications Advantages of the process include: which affects • Ability to handle wastewaters and brines the majority Brine or Concentrate Concentrate with TDS in excess of 50,000 mg/l. wastewater • Ability to handle concentrator outputs in excess of 300,000 mg/l. of brine • 10-fold reduction in the volume of the input liquid stream. concentrator Stage 2: Stage 3: Optional stage 1: • Recovery of all dissolved salts as dry solids. Robert R. Wright Fluidised bed Fluidised bed systems. Membrane distillation Mr Robert Wright is a registered professional engineer with almost 50 years of work heat exchanger spray dryer • Satisfies ZLD requirements. • Produces distilled quality water with a TDS experience in the fields of water and wastewater treatment systems. His employment has of less than 50 mg/l. been both in the government and private sectors. He is the author of over 20 technical publications. Mr Wright is currently a partner of Watervap, LLC, a licensing technology • No chemical addition or pre-treatment is Dry salt required. firm specialising in desalination. He is the inventor of a recently U.S. patented desalination & minerals process owned by his company. In 2006 he was the winner of the Dow Jones/General Potable water This technology is focused on treating very high Potable water Electric Environmental Business Plan competition. Mr Wright received his Undergraduate Potable TDS waters, and becomes very competitive water when handling TDS over 50,000 mg/l. It can Degree in Civil Engineering from Missouri Science and Technology University, a Master of be applied in numerous industrial markets to Science Degree in Environmental Engineering from Washington University, and a Master treat saline wastewater streams. These markets of Science Degree in Hydraulic Engineering from Georgia Tech.
272 Focusing on performance // Water technology idol Robert R. Wright // Watervap: Brine disposal system 273 Global Water Summit 2011 Focusing on performance Water technology idol
include oil and gas wells, mining operations, Wright: Yes we are, but also if they want to just Wright: We have made some previous Coy: If you are looking at a business plan and According to the food processing industry, agriculture, RO buy it, or if they want to be a distributor or just a presentations to oil and gas companies. They you want to commercialise within 3 years, what plant concentrates, landfill leachate and certain passive investor. We are open to any possibility. had worked with a membrane distillation is your cost to go to market, manufacturing and industrial wastewaters. The biggest potential company and were extremely interested in the sales? John Tonner: Regarding the advantages of Wright, the market is treating produced water from the oil use of membrane distillations for the treatment this equipment, such as the portability, a lot of Wright: Right now we are undercapitalised and gas industry. of frac water. This is because of the variability the configurations you showed require vertical from the standpoint of doing what we need cost of the of the TDS - it changes over time. We really evaporators or heat exchangers as well. How to do to make a serious entry into the market. don’t need it. We can do the same thing, but Costs do you overcome that by having a device that is We obviously need to have a reason just to technology we thought that if it really got down to serious portable? build the units. We have to wait until there According to Wright, the cost of the technology energy conservation we would use it as a pre- will be revenue coming in from the sales, but ranges between $2.21 and $3.70 per barrel Wright: We really don’t intend to promote that concentrator just to save energy. ranges between meanwhile our expenses continue. So we are of water treated. This cost includes energy 50 barrel/d demonstration unit. Right now, we Henthorne: Do you see your market mainly in talking about probably assuming that it would (at $0.10/kWh), labour and maturisation of are set to start out with our smallest unit being $2.21 and produced water, or flowback or frac water, or take us over a year just to have any revenue capital. The projected costs are much higher our 500 barrel/d unit. The reason our focus is just all together? coming in. $2 million or more is what we are if ZLD is to be achieved, due to the increase on smaller units at this time is that we have to looking for now and we are willing to sell equity $3.70 per in energy consumption by the FBHX. (Volume cut our teeth on something that we can feel Wright: We might as well just do it all together. in the company so we will give up more for reduction by concentrating waste streams is comfortable handling. We see the advantage That way you just bring it in and set the unit more money. barrel of water less expensive to achieve.) of our units being that they will be fabricated down at the very beginning and never have to In comparison, trucking and injection well at the plant, and skid mounted. It will all be move it. Coy: You said you are not tied to any transportable on maybe 2 or 3 trucks, then set manufacturing, so this is something that you treated. disposal costs in the oil and gas industry can Debra Coy: Do you envision that this will be the on pads at the well site. could outsource? be much higher, ranging from $3.00-$9.00 per only water treatment at the facility to handle barrel of produced water. The majority of this Tonner: Do you see your combination of not just the volumes, but also the changes in Wright: Yes we outsource the pilot unit that is cost is haulage fees. technology as having advantages over your water composition? located at a manufacturing unit company. We competition on one specific application or don’t do the detailed drawings that a fabricator Wright: Yes. Market and commercialisation chemistry? Does the chemistry from e.g. the would need to build it, so we outsource. Marcellus shale favour you or something else? In comparison, According to Wright’s calculations, treating 1% of produced water from oil and gas represents Wright: What is going to set us apart from the Water Technology Idol: Result of the audience vote trucking and a $625 million market. The technology is proven competition is our feature of a non-scaling and ready to be introduced to the market. unit. They are all using some form of thermal injection well Watervap can demonstrate that commercial technology. We have already been contacted by 30 unit design of the technology is ready for several of our competitors, who are interested disposal costs manufacturing and sale. However, the company as they are having problems with scaling of is undercapitalised and currently seeking their heat exchangers. They’re interested in our 25 investors, OEMs and service companies for technology from that standpoint. in the oil and commercialisation support. Tonner: Perhaps you could explain further what 20 gas industry creates the fluidised bed and what is the media Questions from the panel used? 15 can be much Tom Pankratz: As you are interested in selling Wright: In our fluidised bed we continuously equipment, do you plan on leasing this or circulate a media inside the shell that scours higher, ranging offering it on a BOT basis? the heat tubes and self-cleans, so there is never % of audience vote % of audience 10 Robert Wright: Yes, we are definitely very any scale build up. We have two choices of from $3.00- willing to cooperate with what the customer media depending on the characteristics of the water. Right now, for produced water, we use wants. We are even willing to set up a leasing 5 $9.00 per company separate from Watervap. One of my something that is called a radial chopped wire; partners has his own leasing company but he it’s about an eighth of an inch maximum in a slurry. The other possible medium is glass beads doesn’t lease yet. 0 barrel of but that is for softer scale. Pankratz: Are you primarily looking for Dr Sung Jae Kim Cees Buisman Dr Dileep Agnihotri Dr Richard L. Stover Robert R. Wright produced water. someone to partner with that will take this to Lisa Henthorne: Is there a membrane MIT WETSUS* Advanced Hydro Desalitech Watervap market? distillation system in the pilot that you mentioned? Source: GWI. * Cees Buisman did not give permission for details of WETSUS’ technology to be reproduced in this publication.
274 Focusing on performance // Water technology idol Robert R. Wright // Watervap: Brine disposal system 275 Market preview
Global Water Intelligence publisher Christopher Gasson is joined by industry experts Frank Rogalla of aqualia, and Neil Reynolds of CH2M Hill, to present their views on the top business propositions for 2011.
Speakers include Christopher Gasson, Publisher of Global Water Intelligence Frank Rogalla, Director of Innovation and Technology, aqualia Neil Reynolds, Director, CH2M Hill Global Water Summit 2011 Focusing on performance Market preview
GWI market preview: Top 10 business propositions for 2011 My suspicion 1. Water in oil and gas 100 The oil and gas sector may appear very 90 appealing to many of those who are not yet is that the oil in the market. My suspicion though is that it is 80 difficult to enter, due to the fact that the players 72% 70 and gas sector are oilfield service companies rather than water companies. It is therefore difficult for water 60 companies to build references and crack the is difficult to market. 50 enter, due to Question for the audience: Do you think that 40 the oil and gas industry is hot, or not? 30 the fact that And 72% of the audience think that the oil and 20 gas sector is a top business proposition for 2011. the players are 10 oilfield service 0 companies rather North American produced water treatment equipment market by resource type, 2007-2025 than water 1,200 Conventional oil companies. Oil sands 1,000 Conventional & tight gas Shale gas 800 Coalbed methane
600 $ million
400 Christopher Gasson Christopher Gasson is an authority on water finance and markets. After a Degree in Politics and 200 Economics at Oxford University, he worked as a financial journalist and broker, before acquiring Global Water Intelligence in 2002. 0 Over the past nine years, he has written a number of specialist reports on the water sector. He
2007 2010 2015 2020 2025 is also publisher of Water Desalination Report, the IDA Worldwide Desalting Plant Inventory and DesalData. Source:: Produced Water Market, GWI, 2011
278 Focusing on performance // Market preview Christopher Gasson // GWI market preview: Top 10 business propositions for 2011 279 Global Water Summit 2011 Focusing on performance Market preview
As the oil price 2. Energy from waste 100 4. Sludge management 100 Brazil, the As the oil price increases, the whole equation 90 There has been a significant roll out of 90 of energy recovery from waste becomes more wastewater treatment around the world: 80 increases, the attractive. Companies with technologies such 78% 80 countries such as Brazil, the Middle East, and Middle East, as anaerobic digestion are likely to be more especially China have been introducing a lot 70 69% 70 whole equation attractive to industrial customers. I believe that more wastewater treatment than there has ever and especially there will be more innovation in this area, which 60 been in the past. This means that there will be 60 will spread the range of applications for energy a greater amount of sludge which needs to be of energy recovery from wastewater. 50 dealt with, particularly in densely populated 50 China have been areas. Sludge management will entail strategies Let’s see what the audience think: 40 40 recovery from such as production of fertilisers, plastics and so introducing a lot Question for the audience: 30 on. 30 waste becomes Is energy recovery from waste hot, or not? more wastewater 20 Question for the audience: 20 According to the audience, energy recovery Is sludge management hot, or not? 10 10 more attractive. from waste is slightly hotter than oil and gas, treatment than Hotter than smart networks, but not too hot, with 78% of the audience vote. 0 0 with 69% of the vote. there has ever been in the past.
3. Smart networks Global sludge management forecast, 2008-2016 Smart network Smart network technologies such as AMR and 100 This means that AMI have been around for some years, and did 6,000 Europe, Middle East & Africa 90 technologies well in the electricity and gas sectors. However, Asia Paci c there will be a these technologies never really took off in the 80 seem to water industry, and this is mainly because the 5,000 Americas greater amount value of metering water was not considered 70 nearly as high as the value of metering gas be making 60 4,000 of sludge which and electricity. However, when the network 54% incorporates monitoring and control systems 50 headway. across the whole utility, and you start needs to be 40 3,000 considering capital asset management, smart $ million network technologies seem to be making 30 dealt with. headway. 2,000 20 Question for the audience: Are smart networks hot, or not? 10 1,000 Cooler and cooler: only 54% of the audience 0 think that smart networks are a hot business proposition for 2011. 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: Global Water Market 2011, GWI
280 Focusing on performance // Market preview Christopher Gasson // GWI market preview: Top 10 business propositions for 2011 281 Global Water Summit 2011 Focusing on performance Market preview
5. Beyond the BRICs 6. Private finance for the PIGs 7. Technology as a service I think that one of the problems faced by The key issue here is that Southern European Sometimes, rebranding can change the international water businesses is that countries countries typically used government debt to perception of a service or product – a simple like Brazil, India, and China already have quite finance their water sector, and only covered buzzword can make things seem more well-developed local water industries, making the proportion of their operating costs from attractive. APTwater, an American company market entry not as easy as you would wish. the tariffs. Now these countries are going that actively pursues water BOT projects in Foreign companies are therefore likely to face to the EU for bailouts, and will have to drop the United States, promotes their business significant competition from local players, while as many central government liabilities as as “selling technology as a service”, rather having to operate on their terms. possible. This means dropping government than using terms such as outsourcing and liabilities for bringing their water systems up privatisation. Such a rebranding strategy, On the other hand, market entry is likely to be to EU drinking standards. We are likely to see I believe, has enabled the company to easier in countries such as Peru, Vietnam and some decentralisation of financing in Southern successfully crack the market, which wouldn’t Indonesia, where water industries are less well- Europe and also in Ireland, which may create have been possible otherwise. developed and are without the solutions they some opportunities for private water companies need. In fact, in terms of percentage growth, I feel that similar things could be said about with financial capability. For instance, Japanese these markets are actually growing faster than technology and services such as smart firms might be able to take the advantage and the likes of the BRICs. networking and cloud computing. The key benefit from this situation, if they can establish trend is that people are opening their minds Question for the audience: relationships in these countries. In theory, to outsourcing in a way that they had not Beyond the BRICs, hot or not? Japanese companies have financial resources previously. In the water market, the BOT which would enable them to do better than the model is certainly becoming stronger than a 100 French, but the effectiveness of their marketing concession model or other forms of private is a different question. 90 finance in individual assets, which was actually 80 Question for the audience: a strong growth market until the financial crash. Is private finance for the PIGS hot or not? Now the problems in the financial sector have 70 been transferred from the private sector to 100 the public sector. I think the BOT model, with 61% 60 90 rebranding and so forth, is going to take off 50 again. So let’s see what the audience think: 80 40 Question for the audience: Do you think 70 technology as a service is hot, or not? 30 60 20 100 50 90 10 44% 0 40 80 30 68% 70 20 60
With 61% of the vote, the audience likes this 10 50 better than smart metering, but still not as much as energy from waste or oil and gas. 0 40 30
20 The audience is We’ve fallen below 50%, with only 44% of 10 reasonably in favour the audience vote. Let’s move onto the next 0 of that, with 68% of business proposition, technology as a service. the vote.
282 Focusing on performance // Market preview Christopher Gasson // GWI market preview: Top 10 business propositions for 2011 283 Global Water Summit 2011 Focusing on performance Market preview
8. Desalination cost breakthrough 9. Water for mining Between, say, Archimedes’ time and 2003, the Question for the audience: Commodity prices for metals such as gold and Question for the audience: From 2003- cost of desalinated water continually fell as The desalination cost breakthrough, hot or not? copper prices are at all-time highs again, and Do you think water for mining is hot, or not? Commodity more efficient technologies were developed. miners are actively extracting the metals. From However, based on experience since 2003, it is 100 a water industry perspective, this presents 100 2007, the difficult to argue that the cost of desalination great opportunities. Mining is a water-intensive prices for has moved in the right direction. Costs have 90 industry, and is often located in places without 90 desalination been added as a result of both environmental adequate water resources. In terms of quantity, 83% metals such 80 80 protection and higher energy costs. a large amount of water is required for boom attracted 70 spraying the rock surface, dissolving minerals, 70 as gold and From 2003-2007, the desalination boom and washing equipment. Regarding quality, attracted a great deal of investment into new 60 60 environmental regulations covering mining a great deal technologies, which is beginning to bear fruit. copper prices 53% activities have become more stringent. For For instance, the U.S. based company NanoH2O 50 50 instance, water treatment was traditionally not of investment is now open for real commercial orders with are at all-time 40 an issue for Codelco, Chile’s state-owned mining 40 their nano-engineered membranes, which company, but it now needs to invest a lot in based on pilot testing, can deliver 20% energy 30 30 into new water treatment technologies. highs again, savings on RO processes. Indeed, the company 20 technologies, received a lot of capital backing for developing 20 The key advantage of the mining market is that and miners this new technology. Another example is the FO 10 the sorts of companies that get contracts in 10 membrane technology of Modern Water. this area are companies that we recognis=e. For which is 0 example, at the Escondida Mine in Chile, Fluor is 0 are actively My suspicion, however, is that the core the main contractor and they have contracted functioning technology such as membranes has beginning to out the water side to Degrémont, which extracting the become such a tiny proportion (typically >10%) makes market access much easier for foreign of the total cost of desalination. Significant bear fruit. Very marginal there, with 53% of the vote. companies. In contrast, people from the oil and I think that is the highest result yet, with 83% of metals. cost is associated with things such as intakes gas sector contract out to companies such as the vote. nowadays. Even with the latest technological Cameron and other oilfield service companies advances; it might be very difficult to see the and equipment suppliers, making it difficult to level of impacts seen historically. establish relationships. Water prices from desalination projects, 2003-2010 Global mining water market forecast: 2012 peak, 2014 peak and supercycle models From a water 2.50 SWRO 15,000 2012 peak MSF 2014 peak industry MED Supercycle 2.00 12,000 perspective, this Hybrid presents great 1.50 9,000 opportunities.
$ million 6,000 1.00 Water cost ($/m³) cost Water
3,000 0.50
0 0.00 2003 2004 2005 2006 2007 2008 2009 2010 2009 2010 2011 2012 2013 2014 2015 2016 Soucre: Desalination Markets 2010, GWI Source: Water for Mining, GWI, 2011
284 Focusing on performance // Market preview Christopher Gasson // GWI market preview: Top 10 business propositions for 2011 285 Global Water Summit 2011 Focusing on performance Market preview
Hot or not: Summary of audience votes
10. China exporting money Many of us have given up trying to sell the Question for the audience: Water Energy Water in Sludge Technology rest of the world to China, because it is China exporting money, hot or not? for mining from waste oil and gas management as a service extraordinarily difficult to make money there. It has probably been getting even more difficult, 100 100 100 100 100 100 as the Chinese stimulus package seems to have 90 90 90 90 90 90 squeezed out a lot of the private companies 83% that were operating in China. 80 80 78% 80 80 80 80 72% If I were to look at the situation from a cold- 70 70 70 70 69% 70 68% 70 hearted businessman’s point of view, what we 60 60 60 60 60 60 need to do is to sell China to the rest of the world rather than selling the rest of the world 49% 50 50 50 50 50 50 to China. The first way that China is going to gain global access is by putting money out 40 40 40 40 40 40 there, taking positions in projects and investing 30 30 30 30 30 30 first. At this point in time, I do not feel that Chinese companies possess the competitive 20 20 20 20 20 20 advantages that would pose a threat to the 10 10 10 10 10 10 rest of the world. EPC contractors tend to be too dependent on design institutes, without 0 0 0 0 0 0 the ability to do the design themselves, and equipment suppliers are also very ill-equipped to break into international markets under their own name. The only company that may have Slightly in the minority here, with 49% of the a chance is ROPV, but it does not seem to be audience vote. Beyond Smart Desalination cost China Private finance focused on international expansion right now. the BRICs networks breakthrough exporting money for the PIGs There is a pile of money lying in China, and smart people are going to be the ones who get 100 100 100 100 100 their hands on it. So let’s go to the audience vote one last time: 90 90 90 90 90 80 80 80 80 80
70 70 70 70 70
61% 60 60 60 60 60 54% 53% 50 50 50 49% 50 50 44% 40 40 40 40 40
30 30 30 30 30
20 20 20 20 20
10 10 10 10 10
0 0 0 0 0
Source: GWI
286 Focusing on performance // Market preview Christopher Gasson // GWI market preview: Top 10 business propositions for 2011 287 Global Water Summit 2011 Focusing on performance Market preview
Wastewater as a resource: Harvesting energy & nutrients
Exploration for sustainable Desalination versus reuse: nitrogen are used for growing algae, which In many water management Energy perspective is converted into biodiesel. For this specific objective, aqualia has received €12 million from For us in Spain, development and research Being involved in many aspects of water, our the EU for a demonstration project situated in countries, of new technologies is like Christopher general priority goals are to maintain high the south of Spain. This 0.1 km² project aims Columbus’ journey of exploration; he used quality standards and to ensure customer to implement the new technology to convert around 50% of the government’s money without knowing satisfaction. Considering the much higher wastewater directly into biogas, and use the where he was headed. As private researchers, cost of desalination, water reuse has become nutrients to produce diesel fuel. Recent research the phosphorus aqualia obviously needs to be more focused on the last resort which should always work in results show that there are many algae which what we do, and we have a large playground parallel with wastewater treatment systems. have a high lipid content of 30-50%, regardless required in for innovation. Being the third largest private In terms of energy balance, desalination of whether the resource is pure algae media or operator in the world, aqualia operates requires 4 kWh/m³. If we multiply that by the wastewater. over 100 water treatment plants and 250 common price of energy, $0.1/ kWh, the cost of agriculture wastewater treatment plants, which serve as a desalinated water is $0.4/m³. useful resource for technology and energy. Preliminary balance of wastewater is present in Energy recovery from waste: treatment with algae production Smart way of dealing with Case study In a little town of 25,000 people with a wastewater. wastewater: Nutrient recovery 5,000 m³/d WWTP, it is possible to generate Energy efficiency has been central in aqualia’s 1,500 m³/d of methane, which is equivalent Resources recovery is one of the key areas we long-term strategy. Our main effort is directed to the fuel requirement of 200-300 cars. In are focused on. In particular, I would like to at conserving energy and harvesting energy addition, the subsequent biomass production highlight the potential for nutrient recovery from our resources; sludge and residual with nutrients will yield one ton of biodiesel, from wastewater. The energy requirement management have been our main focus in this which can fuel another 200-300 cars. Hence, for destroying nitrogen to meet discharge respect. Currently, aqualia is building a pilot with 25,000 people we can fuel around 500 We are very standards is equivalent to the energy required facility in Salamanca, Spain to better digest car engines. Of course, this is certainly not a for obtaining nitrogen from the atmosphere for hydrolyzed organic matter and increase biogas solution to the whole world, but it is a small focused on artificial fertilisers. There is a potential benefit production by 30%. step towards being autonomous at a local level. here, if we can harvest nutrients in a smart way We are very focused on harvesting everything rather than destroying them. harvesting we can out of the wastewater. We harvest Phosphorus is often a limited resource, but it is organic matter for biogas, and there is a everything we often the case in many countries that around technology that allows us to transform organic 50% of the phosphorus required in agriculture matter to biogas directly from the liquid source is present in wastewater. What we should be containing both soluble and suspended Frank Rogalla can out of the focusing on now is systematically recovering organic matter, so we do not need to produce Frank Rogalla is Director of Innovation and Technology at aqualia in Madrid, Spain. Previously he was Global Process and Technology Leader for the phosphorus from wastewater and using it the sludge to digest it. The technology is Black & Veatch, based in London, UK. wastewater. to cover requirements for our food production. called an upflow anaerobic sludge blanket After his studies of Environmental Engineering in Germany he obtained a MSc Degree as a Fulbright student in the U.S., and worked for almost In addition, the phosphorus requirement is (UASB), and it is commonly used in Brazil. The likely to be tripled with the increasing demand use of UASB allows 76% reduction of organic ten years at the Research Centre of Veolia (then Compagnie Generale des Eaux, CGE) near Paris, France. Later he was stationed in New York for biofuels, and our resources will diminish matter through transformation into biogas. for Metcalf and Eddy, and for Severn Trent Services in Sao Paulo, Brazil, working on technology transfer and large municipal and industrial even further. Remaining nutrients such as phosphorus and infrastructure projects. His specialty is advanced water and wastewater technology, where he holds a handful of patents and was instrumental in bringing a few high rate treatment systems to full scale for the first time. The consortium he compiled and is leading, All-Gas, was just awarded one of the large projects of the EU to demonstrate ´Algae to Biofuel´ implementation of a scale of 10 ha.
288 Focusing on performance // Market preview Frank Rogalla // Wastewater as a resource: Harvesting energy & nutrients 289 Global Water Summit 2011 Focusing on performance Market preview
Looking to the future: Final thoughts: Key water market drivers Putting the pieces together
Regulation as a driver much the whole of Asia will join that list. Christopher Gasson, Publisher, Global One key message I would like to emphasise efficiency. For instance, if you are trying to What does this mean for water supply and Water Intelligence: Managing agricultural is the importance of crossover between drive efficiency, you are more likely to ask I think that regulation is a key driver in the sanitation? It means business, basically. pollution has been the central part of the water, waste and energy. We should not only your customers to save more electricity by water market. One important factor I would Water Framework Directive challenge for consider the use of energy for treatment, minimising the use of hot water rather than like to highlight is that there will be more good water quality in river basins. The but also reducing footprints and costs on simply asking them to use less water. regulations in place in many parts of the world, Water scarcity as a business risk speakers have emphasised the benefits of the customer side by generating process which certainly means more business for us. Another driver is the growing concern of recovering nitrogen and phosphorus from Very often the issues had been focused financial or business risks associated with water. wastewater for practical applications. With on biodiversity loss and so forth. However, Companies such as McKinsey and Goldman the diffusive nature of agricultural pollution, what is happening today is the creation of Sachs actively engage themselves in the water would you say that nutrient recovery from hypoxic zones, particularly in countries that sector, and look into the effects of industries agricultural wastewater is possible? If so, how are highly populated such as the United such as petroleum and food and beverage. A can we do this? Kingdom, the East Coast of the United States, concept such as virtual water has been widely Tony Wray: One of the reactions we have Japan and Brazil, and even some parts of used today as part of understanding global to that is to move away from end-of-pipe Australia. I believe that there are great business water trade, and there will certainly be more and technology-driven solutions towards opportunities in these countries, especially for business opportunities coming out of that area. catchment management. Over the next managing water pollution by nutrients as well 5 years in the UK, we have around 40 as emerging contaminants that are not fully Demand for water reuse catchment management schemes working measured today. We see water reuse as another growing sector. with not only the agricultural sector, but also Singapore has established a very strong with the industrial sector to see what can be Sustainable cities position with a product called NEWater, which done to remove diffuse pollution at source. We are seeing a lot of sustainable cities today is effectively indirect potable reuse. Other There are various farming and manufacturing in the Middle East, India and China. If you look measures such as rainwater harvesting, water techniques that can produce just the same back to the 1950s, there were very few cities recycling, wastewater reclamation and shallow quality output, while using different forms that exceeded 5 million people; if we look aquifer recharge offer important business of input. I think these alternative farming forward to 2015, cities in Africa and pretty chances to provide additional water for various methods would yield some positive impacts uses, and even possibly a source of heat. to the environment, although there will still be those components getting in the Sanitation as the next priority watercourse. Neil Reynolds Probably the greatest opportunity in the future I think the overall theme here is the security Neil Reynolds is employed by CH2M Hill as Vice President, International Operations will be in sanitation, which has been so far of supply. This is not limited to water use, Director of their Water Business Group. Neil has over 30 years of international experience behind drinking water supply. but also to what goes into the waste stream, what can be recycled from the waste stream, with both contractors and consultants involved in water infrastructure development and what can be sequestered as a valuable internationally, and has gained a strong knowledge and understanding of water issues New emerging markets commodity and so forth. I think that the and doing business in a wide diversity of geographies including Europe, ASEAN, China, In terms of geographical markets, many next chapter of innovation in the technical MENA, Sub Saharan Africa, Australia and the Americas. companies are directing their efforts towards processes will be about greater capture of Neil received a Bachelor of Science Degree with Honours in Civil Engineering from the CIVETS (Colombia, Indonesia, Vietnam, energy and nutrients. I think catchment the University of Glamorgan and is a Chartered Civil Engineer and a Chartered Egypt*, Turkey and Saudi Arabia). management and minimising diffuse Environmentalist. As a Chartered Environmentalist Neil is a champion of a sustainable pollution plays an important role, but it is not a complete solution. environment and helps aid business decisions that are low impact but not low output. *pre Arab spring but the needs remain and the market will return.
290 Focusing on performance // Market preview Neil Reynolds // Final thoughts: Putting the pieces together 291 The great water debate Is cost recovery pricing the best way to ensure the poor have access to good water services?
Supporting the motion
Wenonah Hauter
Dr David Zetland
Anil Naidoo the motion
Opposing Dr William Muhairwe Global Water Summit 2011 Focusing on performance The great water debate
Subsidies expose water services to the vagaries of government fate
When governance fails, the poor lose. The So I’m turning to our debate partners. urban growth decisions. sustainable by definition. Government failure rich can always buy water, that’s what they Wenonah, you’re an anthropologist by can lead to an interruption of funds and Anil argues that “inadequate government use their money and their power for. What training; perhaps you know of this book, services. Eventually the poor will suffer and policies lead, in many countries, to a loss of we know, and we have lots of experience, Weapons of the Weak by James Scott, in the shock will be greater when previously access to adequate water and sanitation and is that corruption and subsidies can lead to which he discusses the dynamics within an running taps go dry, as we saw in the USSR thus violate the right to water.” By the way cheap water for the rich and no water for the agricultural community where relatively rich when it fell apart. The separation of water we’re not really talking about the right to poor, who end up buying water from water farmers exploit their poorer neighbours. In service from government subsidy means that water but I’m sure this will come up. I think trucks at a multiple of the price the rich pay. this situation of limited resources, those with government failure need not affect water I should rephrase that and say “inadequate power take the resources and leave the poor service. If you want to help the poor, you should give governance”, not government policies, “leads destitute. them income subsidies. The poor will decide to a loss of access to adequate water and Let’s keep water agencies, whether they’re how to spend that money, whether it be We heard Chandran Nair explaining that sanitation, and thus violates the right to private, public or communal, separate from on education, housing, water, food, etc. The mobile phones are spreading faster than water.” government subsidy and interference, Bolsa Familia in Brazil or the Oportunidades water service around the world. That is but let’s use appropriate and transparent I wanted to know more about the in Mexico are good examples. Chile directly because there are for-profit providers of regulation to make them pay full cost and connection between governance and subsidises the poor, and those poor turn mobile phone service who compete for see good water service help the poor. provision, so I made a quick analysis of the around that money and pay full cost for their customers. The case for full cost water pricing relationship between governance and access water provision. is the same; if anybody can get water by to water – a Millennium Development Goal paying the price, then anybody will get Questions from the Chair Subsidies are destabilising and unfair. If they indicator. It turns out there’s a 66% correlation water. If water prices are subsidised or they’re Chair: Progress in water and sanitation in are removed, the water system suddenly between these two variables. The better the constrained in some artificial way, the only urban environments is losing ground at the has a huge loss of revenue so someone else governance – and I mean quality, rule of law, people typically who end up with water moment; how would you explain that, given needs to be taxed. lack of corruption, etc, – the better the water service are the richer people. all the efforts that have been made? provision people receive in the 170 countries Subsidies also increase political interference. Anil is a historian and he may know I sampled. David Zetland: That has to do with urban The people who provide subsidies want a how historic subsidies for infrastructure population growth outpacing the capacity return on their investment so they’ll start This debate will not be won on examples. It in California have massively distorted of utilities to deliver water services. It’s an interfering with the water company, tell will be decided on a sustainable model for agricultural decisions, housing decisions and interesting problem: it doesn’t show up, for them what to do and distract the manager’s operating a water service. Subsidies are not example, with the delivery of Coca-Cola. attention. We know that when people pay The problem has to do with water service taxes, the government pays attention to Audience response: Should the water sector be managed independently? providers not having the capacity, and its citizens. But when the government has potentially not having the funding, to bring revenue from oil or diamonds, for example, on new customers. I am obviously going to it can ignore them because it has its own claim that if water prices are subsidised, they revenue stream. The same is true with water. can’t get enough revenue per customer to No 21.7% We need water services and we should pay add to the network. people a fair price to provide this service. Chair: So for you it’s more a question of We can’t tell them to do the job for less investment? than the cost. Full cost pricing leads to Yes 78.3% Dr David Zetland Should the water Zetland: It’s a question of: “We don’t have financially, operationally and environmentally Dr David Zetland is a senior water economist in the Department of sector be managed enough money to invest in our clients, yes, sustainable operations, and there are many Environmental Economics and Natural Resources at Wageningen University examples of efficient and functioning full independently? but we don’t care because it’s subsidised and in the Netherlands where he is working on an EU-funded project, “Evaluating cost recovery operations that serve the poor: they’re not giving us money”. Economic Policy Instruments for Sustainable Water Management in Europe.” in Chile, Singapore (although not exactly My question to the audience would be: David received his PhD in Agricultural and Resource Economics from UC Davis poor), and Phnom Penh [Cambodia], in should the water sector be managed in 2008. He was a S.v. Ciriacy-Wantrup Postdoctoral Fellow in Natural Resource contrast with places that try to subsidise independently of all other sectors? (see the Economics and Political Economy at UC Berkeley from 2008 to 2010. He blogs water and provide miserable service, such figure to the left). as India. You can pick your list of countries on water, economics and politics at aguanomics.com and is the author of The where it’s not working out. End of Abundance: economic solutions to water scarcity (2011). Source: GWI
294 Focusing on performance // The great water debate Dr David Zetland // Subsidies expose water services to the vagaries of government fate 295 Global Water Summit 2011 Focusing on performance The great water debate
The money is here, it’s just been misspent
Pricing water like a widget is one more providing water to the poor is to ensure I think we need a global movement for no taxes. That’s why there’s no money in callous scheme that’s been cooked up to that significant taxes are raised to finance corporations to stop avoiding taxes. I know resource-rich countries like Ghana. redistribute wealth upward. The only solution infrastructure investment. It’s time for in the U.S., and in the Global Water Justice The pressure that the Global Water for achieving universal access to water is to international finance institutions to create movement, we’re going to start hammering Movement put on the World Bank changed make it government policy to use tax dollars an honest development strategy. They home that the money is there, it’s just not their strategy. That’s why we’ve seen these in a progressive tax system to finance water should strongly advocate that some of the being spent correctly. big privatisation failures. It wasn’t their own infrastructure, and to use cross-subsidies to wealth from extracting resources from the greed. It’s because citizens organised in make water access affordable. That’s why 70% developing world should be used to benefit these countries, and started holding the of utilities in the world use cross-subsidies and the citizens there. For instance, mining Questions from the Chair water industry accountable for raising rates, don’t use full cost recovery. companies across Africa are failing to pay Chair: Now that the UN has voted for the for polluting our local waterways, and that’s royalties and are avoiding billions of dollars of right to water, what proposals could you Europe, the U.S. and Japan did not build the what we have to do. Democracy is messy – taxes. This is well documented. make to turn that into a practical tool to help public water and sewers on the backs of the more poor people access water? it’s imperfect but we need it, and we, in the poor through cost recovery. Our governments The IMF could stop forcing countries to Public Interest Movement and the Global distributed the costs through taxes and structure their economies in a way that Wenonah Hauter: Well, I think that it’s Water Movement, need to try to make our cross-subsidies. There are good subsidies and allows foreign corporations to not pay an organising tool, and the Water Justice democracy work better. there are bad subsidies. Providing access to taxes. They should enforce an international Movement is active in almost every country My question for the audience is: should water is an essential role for government. It accounting standard that requires reporting in the world on the ground. We have to international finance institutions start prevents disease; it’s needed for public safety by multinationals on royalties, profits and hold the international finance institutions working on tax avoidance and taxing services; it’s necessary for industry, agriculture, taxes. If even a fraction of this money was accountable for what they’ve done, for issues around resource depletion, so that and services that drive economic growth. collected, we could provide basic services for the policies they’ve promoted in the past. the developing world has its own money Investment in infrastructure strengthens the everyone, not just water. Ghana is a good example: the IMF forced the for providing basic services? (see the figure economic development, it sustains growth country to structure their budget in a way As for water scarcity, if we really wanted below). and it generates jobs. As we sit here benefiting so that the cocoa and gold industry paid to deal with that problem, we’d begin by from the fruits of public investment in water making public investments in fixing leaky infrastructure, it’s distasteful to hear that the pipes. For example, the U.S. has more than a poor should use their meagre earnings to quarter of a million burst pipes a year, which Audience response: Should international finance institutions work on tax avoidance and access water. waste about a fifth of municipal water. This resource depletion? One fifth of the world’s population makes a would help stimulate the economy too; every $1.25 a day. Using a 2011 World Bank figure on billion spent on infrastructure generates the impacts of a pricing regime, those making 44,000 jobs. that small amount of money would pay 10% Pricing focused on household water usage of their incomes on a hundred litres of water, can’t significantly reduce scarcity. Three Wenonah Hauter double what experts in development agencies quarters of the literature on pricing only No 37% tell us they can pay. What should they do? Go Wenonah Hauter is the Executive Director of Food & Water Watch. She has worked looks at residential use. But household use is without food? Go without education for their extensively on energy, food, water and environmental issues at the national, state less than 10% of consumption, and it is nearly Yes 63% children? Without housing? and local level. Experienced in developing policy positions and legislative strategies, unresponsive to price. A U.S. environmental institutions work on she is also a skilled and accomplished organiser, having lobbied and developed A Bank analysis found significant full cost pricing protection agency study estimates on the tax avoidance & grassroots field strategy and action plans. From 1997 to 2005 she served as Director would place unsustainable burdens on the other hand that industry can be twice as resource depletion? of the Public Citizen‚ Energy and Environment Programme, which focused on water, majority of households in the developing world. price responsive as households. The Bank estimates that low income countries food, and energy policy. From 1996 to 1997, she was environmental policy director Block rates are very regressive too, would have to impose a tenfold increase in incomprehensible for consumers and for Citizen Action, where she worked with the organisation’s 30 state-based groups. water prices to achieve full cost pricing, raising therefore ineffective: it’s difficult, if not From 1989 to 1995 she was at the Union of Concerned Scientists where as a senior prices so steeply that as many as 7% more of impossible, for them to know which twist of organiser, she coordinated broad-based, grassroots sustainable energy campaigns the world’s population would be pushed into the tap will transition cheap water into more in several states. She has an M.S. in Applied Anthropology from the University of poverty. expensive blocks. Maryland. The real solution for financing water and Source: GWI
296 Focusing on performance // The great water debate Wenonah Hauter // The money is here, it’s just been misspent 297 Global Water Summit 2011 Focusing on performance The great water debate
Full cost recovery is the New Testament
I will start with a small story by Michel on his face. tomato producer and you went to the market for it, of course you cannot ask the price for it. Camdessus. We had a similar debate on this knowing that you would only get half the So we go to the government, because In conclusion, ladies and gentleman, my view issue a while back. He was on the opposing price of what it cost you to produce them, my sister Wenonah was saying here that is that we should not politicise this good. Let’s side. As he talked, a lady from the audience you would have no incentive to produce. governments must put money on the table ask for the price that it’s worth. That’s when you asked: “What has gone wrong since you left and provide water, but these governments Full cost recovery encourages efficiency know that the good is very important. the IMF? Have you switched sides? Are you are bankrupt, they have no money at all. and service sustainability. It allows you to suggesting the government should pay for They’re fighting wars; they’re fighting maintain equipment and train staff. It also all this work?” Camdessus replied: “I used to Questions from the Chair whatever it is. Relying on subsidies is the Old reduces excessive demand. If you buy a really preach the Old Testament; now I preach the Testament. The New Testament is full cost nice, expensive suit, you’ll keep it in the safest Chair: If you didn’t make enough profit, how New Testament. Believe in that if you want.” recovery. corner of your house; you’ll make sure that much of a hindrance would it be to provide Those of you who know me may be surprised the rats don’t get it. But if you only pay $1 for more access to water for poor people? Full cost recovery ensures that the cost to see me diverging from the Old Testament it, what goes for $1 will only disappear also of operation and maintenance and the William Muhairwe: As a business man, when to the New Testament. Why am I coming to for $1. expansion of the system are fully catered for. I do business I try to generate a surplus profit. the New Testament? Let me tell you. As I said It’s like going to the market: you want to buy Full cost recovery reduces the unique cost If I see the market growing, as soon as I make this morning, more than one billion people tomatoes, you want to buy rice; if you offer of water to the poor by increasing the water the profit, I’ll put it back into the system to don’t have access to water; 2.6 billion people half the price, you might only get half the supply. By making sure that water is available, expand. That’s what happens. I work for a public are without sanitation services, and most of quantity you asked for. The same goes for you take away the vendors who profit from company and every single profit I make, I put it those are in Africa. We were told yesterday by water. government subsidies and exploit the poor. back into the system. Kofi Annan that we need billions of dollars to provide water and sanitation services Full cost recovery increases water supply. Experience shows that customers are not just But if you wanted me to charge a half cost to these people. I know many of you think There’s money available because you’re interested in the price. You don’t just look recovery, whatever you want to call it, then of donors have money. But every day I knock on producing the goods knowing that the at the price when you go to the market, do course I’d have to look for the subsidies, and the door of the donor and I see donor fatigue customer will pay full price for it. If you were a you? You are interested in the reliability of the I’ve told you that governments don’t have the supply, the quality and the access. Full cost money for subsidies, so I’d have to go to donors, recovery guarantees the quality, guarantees and I’ve told you the donors have donor fatigue, Audience response: Should we concentrate on making utilities more efficient rather the access and also guarantees the reliability. they don’t have the money. That’s why we must than look for external financing? charge the full price. In any case, poor people are already paying full cost recovery cost. If you get a jerry can I’d like to ask: should we concentrate on making our institutions more efficient, instead No 11.3% of water from a vendor, it’ll cost about 20 shillings, about five times the cost of water of begging for handouts from donors and we provide. So in actual fact, poor people subsidies from governments? (see figure to the already pay $3 or $4 for a cubic metre of left). water. Poor people are currently subsidising Yes 88.7% the rich. So what is the debate about? Let’s Dr William Muhairwe Should we focus on just make sure that they get what they pay Dr William Muhairwe is a Management management programmes that have Year 2004 for “Productivity and Performance for. making utilities more Specialist trained in Economic and Business successfully turned round NWSC from a Management”. Full cost recovery may be justified and, Management and has been managing loss making organisation to a profit making Formerly Dr Muhairwe worked for the look for external those of you who are pleading for an end public companies for the last 19 years in government parastatal which is now a Uganda Investment Authority as its Deputy to full cost recovery are basing yourselves Uganda and abroad. Since 1998 he has benchmark for best practice both nationally and eventually Executive Director for 3 years on incomplete, simplistic knowledge of the been the Managing Director of the National and internationally among water utility and was responsible for attracting inward often complicated lives of poor people. Water and Sewerage Corporation, a State organisations. The organisation was named private investments in Uganda. He was Companies who sell mobile phones Corporation that was almost collapsing due “Employer of the Year 2003 for Ethics and also, at one time, the MD of the East African or toothpaste spend a lot of money in to mismanagement. Out of his initiatives, Corporate Social Responsibility” and again Steel Corporation, a Joint Venture Company advertising and research. How many of Dr William Muhairwe has implemented got a Golden Award for Management between the government of Uganda and a our companies, how many of our utilities innovative change Excellence in June 2004 and Employer of the private company (The Madhvani Group). Source: GWI advertise water on TV? If you don’t advertise
298 Focusing on performance // The great water debate Dr William Muhairwe // Full cost recovery is the New Testament 299 Global Water Summit 2011 Focusing on performance The great water debate
There is now a human right to water and sanitation
I would like you to do a little thought exercise been talking about this for twenty years. If it cost; is it environmental cost? These are rest, because we now live in a world where with me. Imagine you are one of those 1.2 was such a compelling argument, you can big questions and the answer is different if the human right to water and sanitation is billion people who don’t have access to clean be sure that there would be actual, hard you talk to the EU, the World Bank, private recognised. And you should know this in this water, or you’re one of the 1.5 billion people evidence. Instead we’re meant to believe in companies, or even individual countries. room. You should know your responsibilities living on less than €1 per day. Imagine you faith, the New Testament. There’s still no clarity on this after 20 years of and that you will be held accountable. Because are asked the question: is full cost recovery discussions. before the 28th July 2010 you could get away Why does this idea of full cost pricing still pricing the best way to ensure you have with claiming there was no obligation: now come up 20 years later? It should be dead The kicker is that this will not get rid of access to good water services? you need effective monitoring systems if you’re but it has become the zombie of the water subsidies. Markets regularly fail, and we die going to privatise water. You need to be able to You would say no because why would you world. I think it lingers on because of the without water. So, of course, governments make sure that there’s legal redress if you cut agree to pay dramatically more when you’re promise of revenue. need to act unless they’re totally abrogating people off water. Change is coming. already barely scraping by? You already have their responsibility. Will there be more investment in water under to make choices between your children’s I want to end by talking about the global this regime? Probably, but it will surely not go I actually believe in subsidies. I believe we shoes and food. You’re more likely go to downturn. It hit a small sector, the people to help the poor, because they can’t afford have to subsidise water more than anything the streets and change your government; at Goldman Sachs and AIG. We bailed those water under a full cost pricing regime, and else. Because we subsidise a lot of things: we you’ll kick out the private company, or you’ll companies out and now you have crises in peak if you can’t pay, you can’t play. They can’t subsidise roads, wars, fossil fuel extractions, engage in any manner of social unrest to deal food, peak oil, etc. Five years ago Mubarak tried pay the $300 or so to connect to the grid, arts and culture. So why not water? It is a with what is patently unfair. to privatise water and increase the price to full let alone the ongoing cost of paying for the human right, a foundational right. cost pricing; he had to back down. We know As Wenonah has pointed out, there’s a infrastructure. The Romans and the Ottomans built that the reason why the people stood up is definite double-standard being foisted by It’s not even clear what full cost pricing aqueducts in Italy and Istanbul; public because they could not take any more. If you those who built their systems on public includes. Is it operations and management infrastructure that people were very happy want to see more regime change, if you want money, on cross-subsidies, and who continue only; is it new capital costs; or previously their government built. Water is also a good to see more turmoil in the world, then please to manage their water in this manner. We’ve existing infrastructure amortised for the investment. The benefits of clean water implement full cost pricing. had twenty minutes of discussion about existing life of the asset; is it opportunity and effective sanitation are massive. Even full cost pricing but no real examples. We’ve on health alone, $1 invested returns $4-12 Questions from the Chair according to the WHO. Chair: Last night Kofi Annan talked about a new Audience response: Should the human right to water trump full cost pricing? What if you added the benefits of education, era of cooperation between public and private, development, gender equity, security, and all and between different countries. What would the intangibles that flow from access to water that mean for you? and sanitation, what is that worth? I think far Anil Naidoo: Well, I think the private sector more than we can even begin to quantify in certainly has some thinking to do about how No 40.2% our woefully lacking accounting systems. it wants to engage in the future. I think that The other thing to remember is that water the days of full concessions are gone. But they Yes 59.8% is now a human right: 250 days ago the UN could offer services to governments such as recognised the human right to water and technical services or network installations, but Anil Naidoo Should the human sanitation, and this has massive implications if there’s going to be cooperation, it has to Anil is the Blue Planet Project Organiser for the Council of Canadians. The Blue Planet right to water trump for the implementation of full cost pricing, happen from the bottom-up in communities, Project is a global initiative with partners around the world focused on securing water full cost pricing? because you can be sure that full cost across borders at grass-roots level. pricing will interfere with the enjoyment of justice. He is a founding member of Red Vida (the Americas Water Network), the African The state is part of the problem when it the human right to water and sanitation, Water Network, Our Water Commons and the Reclaiming Public Water Network. Anil has colludes with companies. Companies have especially if there aren’t systems in place to been involved with the water movement since the Kyoto World Water Forum in 2003. a role to play, but when you’re talking about deal with affordability. You need effective something as fundamental as water, we have to He was an expert adviser to the High Commissioner for Human Rights and the Human monitoring systems. We also know that the be very careful about handing over control of Rights Council, contributing to key reports related to implementation and securing water Ruggie Framework has said that corporations something so basic. and sanitation as human rights. Anil was the lead civil-society organiser in the successful have obligations under human rights, even campaign to secure UN recognition for the human right to water and sanitation, achieved though the state is the primary duty bearer. So my question would be: should the human on July 28th, 2010, with the adoption of General Assembly resolution 64/292. right to water trump full cost pricing? Source: GWI So I think it’s time the zombie be put to 300 Focusing on performance // The great water debate Anil Naidoo // There is now a human right to water and sanitation 301 Global Water Summit 2011 Focusing on performance The great water debate
obligation not to put people into those kinds of Question: Anil Naidoo said we needed more situations. Of course we can charge much more investment. You can either get your investment Questions from the audience for water because people have no choice, but it financed by the government or through private is a question of ethics. sector participation. We have all come to the realisation that most governments can no Zetland: In the developing world, people Question: Why should governments spend Zetland: I don’t think we can have a global support to make sure that access is available. longer afford to foot the bill for water. They buy water from street vendors; when people money on those who benefit from public policy to improve local water management. After that, people should pay the price in full. have contending demands: health, security, services and ignore the remaining 50%? For the same reason that people watch come on the grid, their water price drops by Naidoo: I think it’s not an either/or. I education to contend with. So there’s a need for different TV shows, and use different types 80%. So in that sense not only is full cost saving Naidoo: No-one is saying that we should don’t think that you just leave it to local full cost recovery. of transport; everything changes from place them money, full cost is bringing them water, ignore the other 50%. If you look at the idea governance. If there are violations of human to place. compared to subsidies which means they pay Naidoo: It’s definitely a fact that water has to of fairer taxation so that governments in rights, the world cannot put up with them. If more and they don’t get service. be paid one way or another. But before the Africa can generate their own wealth, there Hauter: I think there are some things that you think of a child dying every three and a financial crisis in 2008, governments were Question: The Water & Engineering would certainly be more investment, and you can be done globally. For instance, food half seconds from treatable and preventable already crying poverty, and yet they found Development Centre at Loughborough would be able to do more for the remaining production and agriculture use 80% of water. water-borne disease, this is a crisis like no trillions of dollars to bail out companies. And University led academic research on the impact 50%. By encouraging countries to get in line with other, and we have intervene. prior to that, they’d deregulated the market World Trade Organisation rules, there has of full cost recovery through small-scale leases Hauter: I think we need a new paradigm. Question: Is the human right to water a right and allowed all kinds of financial voodoo to been a growth in commodities such as corn in rural communities in Uganda (not serviced At the moment, it’s all about donor aid, to free water or should one pay for it? go on. Who pays in the end? It’s the people on and soy that are water-intensive and also by NWSC). These are places where small-scale it’s charity. We need a new vision where the ground. If we cannot pay for water, what pollute water resources. I think that some Naidoo: You can’t pay for human rights. private sector participation, not privatisation, governments in Africa and resource-rich can we pay for? There are many other sectors issues, like agriculture, can and should be The human right to water is for personal, has actually delivered water at below the cost countries actually benefit from these that governments are putting money into; we dealt with internationally. domestic consumption, it’s for a lifeline of bottled water. They’ve done straightforward resources, because we all know that’s not have to re-assign our priorities to something as amount. There are rules about affordability comparisons, similar to those in the power happening. It’s our job to talk about a new Muhairwe: I think there could be a global fundamental as water. There is money for this. and quality of water and accessibility. These sector showing that grid electricity is cheaper vision and stop being afraid of supporting policy in supporting institutions to perform rules need to be written, but we have already than generators. It’s exactly the same in water. Chair: We’re now going to ask the room what a progressive tax system. We should tax better. There could be a global policy seen court cases, like the Kalahari Bushmen they think. So the proposal is: Is cost recovery multinationals who benefit from operating in promoting training, in getting rid of Naidoo: I would hope so. I would hope we can [of Botswana] who have been allowed back pricing the best way to ensure the poor have in developing countries and from misusing corruption etc. But when it comes to price, stop the extortion of poor people but I don’t on their ancestral land where they had been access to good water services? (see the figure water in many of those places. The same this is a localised issue. I know best what see full cost pricing being the magic panacea denied access to their wells. But it’s not free below). should be true in the developed world. happens in my kitchen. There should be that will do that. Even Gérard Payen [president water. We know water has to be paid for. It’s a policy to ensure that access to water is of Aquafed] thinks that half the people would Question: Do you think we could succeed in a question of how you do it, and you cannot provided, but it shouldn’t be for a long- be left out. It’s not full cost pricing that’s going achieving a global water policy? do it in such a manner that it excludes term commitment. It should be a one-time to do that. And how does one decide what full Audience response: Is cost recovery pricing the best way to ensure the poor have people from having enough to survive on. cost pricing is? access to good water services? Hauter: I think it’s a question of ethics. Audience: Regulators. Obviously people have to have water, and they will do without a lot of other things Naidoo: Regulators in Africa? Look how many to have water. The question is whether it’s tens of millions they spend in the UK to regulate right? Whether it’s good public policy for that system. How many other countries can No 24.6% somebody who makes $1.25 a day, or a little possibly have that kind of regulation? Not many. more, to have to make a draconian decision Audience: I’m talking about an Indian region Yes 75.4% like that. In Uganda, people only use 20 litres where 70% of the population is poor, and more Cost recovery a day when the WHO recommends 100 litres. than 45% of the population lives below the pricing: Best way to Muhairwe: Water consumption in Uganda is poverty line. I feel that there should be strategies ensure the poor have not limited because of the price, it’s because / policies where a person who can pay taxes access to good of water availability. If the water were pays for the water. If not, it’s our responsibility to water services? available on people’s compounds, people provide the safe water. would be able to pay the price, but it’s not Naidoo: I agree, people shouldn’t be cut available. Instead they are buying from off arbitrarily. There has to be a system and vendors who charge a hell of a lot of money. mechanism for deciding that. Right now in Naidoo: You don’t have to charge much Detroit you’ve got 70,000 families being cut more for water before people decide to get off and children being taken away from their water from a cholera ridden river or choose families. This is in the wealthiest country in the not to send their kids to school. We have an world. Source: GWI 302 Focusing on performance // The great water debate Questions from the audience 303 Global Water Summit 2011 Focusing on performance The great water debate
Closing remarks
Dr David Zetland: I agree with Anil that governments are often corrupt, and I think that the conclusion from that is that we should not have the government involved in water provision. It should be pro- vided by companies, private, public, community that are run- ning on a sustainable and autonomous basis, and serving their customers to make sure that they have a good water supply.
Anil Naidoo: Full cost recovery is a very regressive way to pay for water, and it will hurt the poor. The world does not need more bur- den on the poorest.
Dr William Muhairwe: If we’re talking about access for the poor, it should not be about whether full cost recovery is the best way to ensure they have access to good water services. We should think about a tariff that the poor can afford so that we all enjoy good services. I read both the Old and the New Testament and I believe in both of them.
Wenonah Hauter: Pricing water like a widget is inhumane, inappropriate and subjects the essential human need for water to the indif- ference of the marketplace. The only long-term solution for achieving universal access to water is to make it a public ser- vice and to use tax dollars to finance water infrastructure. It’s an appropriate, necessary, and common role for government.
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ACCIONA Agua ACWA Power International ACCIONA Agua provides tailor made water solutions consortium. And recently, in Mexico, we have been ACWA Power International is a lead developer, owner team then brings it all together to submit the most which contribute to sustainable development in awarded with the world´s biggest WWTP , as part of and operator of independent water and power projects competitive and comprehensive solution to the client. the water sector through focusing on cutting edge the consortium formed by Mexicans and international structured on a concession or utility outsourcing To date, this strategy has resulted in the award of the innovation in the design, construction and operation companies. In the UK, ACCIONA is building the first contract model. ACWA Power is incorporated in Saudi following concession projects: of water treatment plants in addition to advances in desalination plant for brackish water in the estuary of Arabia with a capital of $1.2 billion. It holds equity membrane technology. the Thames River and will be finished next summer. We ownership in a portfolio of contracted assets made • Rabigh IWSPP have offices in the five continents. up of 6,485 MW of power generation plants and We are one of the world´s leading companies in RO • Shuaibah IWPP 2.31 million m³/day of desalinated water production desalination and water and wastewater treatment, Our core business activities are: • Shuaibah Expansion IWP plants, all with a cumulative value in excess of $12 and our capability is demonstrated by 70 reference • Design, construction and commissioning billion. As a principal in its sector, ACWA Power is • Marafiq Jubail IWPP projects in the desalination sector (with a total capacity now growing beyond its core MENA region into • Shuqaiq IWPP of 1.8 million MLD), and in excess of 400 water, • Operation and maintenance international markets. wastewater and sludge treatment projects, positioning • Integrated water resources management • Rabigh IPP us as the market leader in the construction of water In the following sectors: ACWA Power has a multi disciplinary team with In addition, ACWA Power has also developed the treatment plants in Spain, Italy and Portugal. Around all the necessary professional skills ranging from world’s first two sea going barge mounted, self the world, ACCIONA Agua has rebuilt the largest SWRO • Reverse osmosis (RO) desalination technical, legal, environmental, insurance to tax and contained desalination plants each capable of plant in Tampa, Florida (U.S). Also, we have under • Drinking water financial expertise to undertake the Lead Developer producing 25,000 m³/day of water. The barges can construction a 120m³/day SWRO in Fouka, Argelia, and • Wastewater role. For each new opportunity, ACWA Power be rapidly relocated to provide fresh water to coastal projects under construction in Brazil and Dominican deploys this specialist team to select the optimum cities facing shortfall. Most recently ACWA Power was • Reuse Republic. technical solution and identify the best EPC and O&M successful in financially closing and acquiring a joint For more information: www.acciona.es. partnerships. In collaboration with our partners, ACWA stake of 58% in the Barka 1 IWPP in the Sultanate of In Australia the company is building the 300 MLD Power prepares a robust business case, financial model Oman. Barka 1 has a contracted capacity of 427 MW of SWRO plant in Adelaide as part AdelaidaAqua and a structure for equity and debt financing. Our power and 91,000 m³/day of water.
AECOM AECOM’s water professionals provide a high level of range of markets, including transportation, facilities, expertise in water and wastewater treatment, water environmental, energy, water and government. With resources and community infrastructure serving approximately 45,000 employees around the world, local, municipal and federal government clients to AECOM is a leader in all of the key markets that it address the world’s need for clean water. Through serves. AECOM provides a blend of global reach, local these disciplines, our professionals offer integrated knowledge, innovation and technical excellence in services for total project delivery, covering everything delivering solutions that create, enhance and sustain from initial environmental planning studies to detailed the world’s built, natural and social environments. A design, construction management, and operations and Fortune 500 company, AECOM serves clients in more maintenance training. than 100 countries and has annual revenue in excess of $7 billion. More information on AECOM and its services AECOM is a global provider of professional, technical can be found at www.aecom.com. and management support services to a broad
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aqualia aqualia is the water management subsidiary of the industrial water uses. It also works in 16 countries environmental services and infrastructure company throughout Europe, Africa and Asia, including Spain, FCC, one of the main citizen services companies in Italy, the Czech Republic, Portugal, Algeria, Egypt, Befesa Abeima Europe, and operating in more than 50 countries. China and Mexico. In the past few months, aqualia With more than 60 years of experience and a require specific knowledge while securing a return BEFESA has been awarded with new contracts in Chile and aqualia specialises in managing all water-related continuous investment in R&D and innovation, Befesa on investment. KSA, which strengthen its international expansion and activities and is one of the few companies in the world Agua has become one of the key players in the diversification. The company currently serves more • Abeima is heading the EPC section which has ABEIMA that is capable of providing advanced solutions in international water treatment market. Indeed, Befesa than 27 million people in around 1,100 cities. moved into Abeinsa, Abengoa’s Engineering and water usages, including domestic, agricultural and Agua has been recognised by prestigious organisations Industrial Construction which is ranked among the industrial purposes. A global market vision, with a aqualia’s efforts have been recognised internationally, and has won numerous awards in the last few years first 50 Top International Contractors by ENR. strong local commitment, has turned aqualia into a being chosen as the Water Company of the Year, and has been ranked among the Top 10 leading Abeima leads the design, engineering, and world benchmark company in the management of the 2007, by Global Water Intelligence, and awarded desalination companies. construction of hydraulic, environmental entire water cycle. with “Customer Service Leader of the Year”, by Frost With the aim of meeting the new challenges required infrastructures, desalination and wastewater & Sullivan (2007); and Best of European Business, by or waste treatment plants, and other works for aqualia’s businesses are focused on three key areas: by the sector and as a result of Abengoa’s dedication Roland Berger (2006). In the past edition of GWI´s environmental improvement. Plants using the the management of public water services, hydraulic to strengthen its water commitment, the same scheme Awards, the magazine named the New Cairo WWTP reverse osmosis technology built by Abeima have infrastructure, and comprehensive solutions for already in use by Abengoa Solar, which has proven to financial close “Water Deal of the Year”. be highly successful, has been applied to restructure the capacity to desalinate more than 1.3 million Befesa Agua as follows: cubic meters of water per day. Abeima has built projects in Latin America, Spain, • Befesa Water, within Abengoa’s Environmental North of Africa, India and China among others. Its Services Befesa Medio Ambiente is heading wide experience and professionalism combined the promotion, investment, development and with Abeinsa acknowledgement makes Abeima a operation of membrane-technology based key player in the international scene. plants with strong technological development. It Aquatech manages and operates water infrastructures and Befesa Water and Abeima, two world leading facilities under concession agreements. These companies, will collaborate closely on all water Aquatech strives to provide technology leadership and • Effluent treatment include large desalination projects in Maghreb, projects, sharing their own specialisation; Befesa Water employing its know-how in technologies and performance excellence to the global water industry. • Zero liquid discharge. China and India and Western Africa for a total We aim to support our clients with cutting edge capacity of up to 800,000 m³/d. Abeima its strong capacities in EPC. The accumulated The company is headquartered in the United experience of both companies in project development sustainable solutions, minimising their life cycle cost, as Befesa Water is also concentrating all its attention States, has offices throughout North America, and a and construction creates a synergy that allows the well as their carbon and water footprint. on R&D and innovation by dedicating a significant significant presence worldwide through subsidiaries permanent improvement of processes and knowledge. Established in 1981, Aquatech is a global leader in Europe, the United Arab Emirates, India, and China. amount to research projects. This know-how, in water purification technology for industrial and Aquatech is uniquely positioned to offer its clients combined with its prior knowledge in plant And always bearing in mind the target: to achieve high infrastructure markets with a focus on water scarcity complete integrated solutions through its vast depth operation, enables the company to make feasible quality projects with leading edge technologies. solutions such as desalination, water reuse, and zero and breadth of technology offerings which include solutions on marked value-added projects which liquid discharge, and provides integrated solutions, physical/chemical treatment, ion exchange, membrane turnkey projects, products, and services in the processes, biological, electrochemical, thermal, and following market areas: advanced oxidation. • Industrial process water Some of the notable technologies in Aquatech’s • Membrane desalination portfolio include MED (multiple effect distillation), high recovery and efficiency reverse osmosis systems, and • Thermal desalination Aqua-EM BR (enhanced membrane bio-reactor). • Wastewater recycle and reuse
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BKG Water Solutions - BK Giulini GmbH Black & Veatch BKG Water Solutions, a division of BK Giulini GmbH, Our specialty chemicals combined with our services Why do Black & Veatch clients return, again and again? comprehend the issues, identify your best choices and provides customised solutions, chemicals and service enable us to inhibit scaling, deposits, corrosion and Because we take on the toughest challenges and then make decisions that are right for you today, and in the for the conditioning of drinking water, industrial control microbiological growth, thus increasing the deliver results as promised. long run. water and for the purification of wastewater. Part of efficiency of systems, optimising processes, saving Black & Veatch is a leading global engineering, Founded in 1915, Black & Veatch develops tailored ICL worldwide group and headquartered in Germany, energy and water. 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Our application targeting site specific issues and help them products comply with various key standards, e.g. KIWA, CH2M HILL reuse water, achieve the greatest economy and long- NSF, FDA. With more than 50 years of experience in term operational reliability of their water processes. Our the water treatment field, BKG Water Solutions goes As a global leader in full-service engineering, Risk Assessment and Water System Adaptation • comprehensive and innovative product range covers on investing, to improve the efficiency of the water procurement, construction, and operations, CH2M HILL Conveyance and Tunneling Services (including water all needs: processes and save natural resources. provides water, wastewater and water resource storage and transmission infrastructure) • Desalination services to clients worldwide. With $6.4 billion in and Reuse • Program Management • Master Planning • Conditioning of make-up water Visit our website www.bkgwater.com for more revenue and 23,000 employees worldwide, CH2M HILL • Management Consulting • Operations and • Cooling and process water information about our technologies, e.g.: delivers innovative, practical, sustainable solutions – Maintenance • Asset Management • EPC-Contractor • Boiler and steam systems helping clients develop and manage infrastructure and • Our new oxidising biocide Ferrocid® 4601 for Full-Service Global Resources: • Heating systems industrial water systems facilities that improve efficiency, safety, and quality of life. Working with our clients, we deliver customised Australia/New Zealand • South East Asia and India • • Drinking water • Our innovative film-forming technology Cetamine® solutions in a flexible and responsive manner. for boiler water treatment. Northern Asia • Middle East/North Africa • Central/ • Swimming-pools Eastern Europe • Western Europe • South America • Areas of Expertise: • Membrane filtration units Northern Latin America • United States of America • • Wastewater. Drinking Water • Wastewater • Water Resources Canada and Ecosystem Management • Climate Change
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Danfoss Foz do Brasil Danfoss RO Solutions has a clear mission: develop and fully integrated with its own positive displacement The environmental engineering company of energy generation and reused water production market the best possible range of high-pressure APP booster pump and electric motor. Like for the APP Odebrecht, Brazil’s fifth largest private group, services to large companies. pumps, iSave energy recovery devices and accessories pumps the iSave is characterised by having one of Foz do Brasil invests in, and operates, projects that Foz Environmental performs remediation services, in for seawater RO applications. The products are sold the highest efficiencies in the market. The unit is easy benefit over 7 million people, operating in three addition to projects designed to increase the value of for both land based, marine and off-shore as well as to maintain, is small and compact and can be placed segments: urban solid wastes for energy generation purposes. mobile and containerized applications. both vertically and horizontally. The rotor and other key Water, Industrial and Environmental components are made of super duplex. In 2011, Foz do Brasil will produce over 200 million The APP pumps are all characterised by having some Heading Brazil’s first private water and sewage litres of treated water per day and will be responsible of the highest efficiencies in the market. The pumps The iSave 21, with a flow range of 7 to 21 m³/h (30.8 to concession since 1995 in a market marked by strong for preventing 110 tons of organic matter per day from are very easy to maintain, they have the smallest 92.5 gpm), has been in the market for some time. The growth in developing countries, Foz Water brings being released into the environment. footprints on the market and can be placed vertically next size to be introduced is the iSave 40 with a flow quality of life to millions of people, in partnership with and horizontally. The pump is lubricated by the media range of 22 to 40 m³/h (96.9 to 176.1 gpm). public companies, helping to ensure universal access These are the results of an investment of over it is pumping, i.e. no oil lubrication is required at all. All to basic sanitation services, one of the main shortages $2.5 billion since its creation. Over the upcoming years, The range of APP pumps will together with the iSave pumps are made in duplex and super duplex materials in the Southern hemisphere. the company plans to invest an additional $4.8 billion. range be displayed at the Danfoss RO Solutions making them the perfect choice for high salinity sea This year, its net earnings should total more than stand at the upcoming IDA World Congress in Perth, Foz Industrial provides waste and effluent treatment, water reverse osmosis applications. $780 million. September 2011. RO Solutions offers an extensive range of APP high- RO Solutions is a fast-growing division of the Danfoss pressure pumps and expands the product programme Group. Danfoss A/S is one of the largest industrial for the pumps continuously. The next version, coming companies in Denmark. It has approximately 27,000 up very soon, covers the range from 15 to 21 m³/h (66 employees and factories and sales companies, agents to 92.5 gpm). The total range of APP pumps covers GE Water & Process Technologies and distributors in more than 100 countries. Danfoss is from 0.6 to 30 m³/h (2.6 to 136 gpm). world leader in the development and production of a With operations in 130 countries and employing nearly looking technologies, leveraging the best practices RO Solutions also offers the energy recovery device wide range of mechanical and electronic products and 8,000 worldwide, GE’s Water & Process Technologies of ecomagination, to help customers balance iSave. It is an isobaric energy recovery device that is controls. business is an integrated part of GE Power & Water. The environmental and economic goals. Our innovative company brings together experienced professionals team develops partnerships and delivers reliable, long- and advanced technologies to solve the world’s most term solutions for communities, governments and complex challenges related to water availability and industry that maximise water and energy resources. quality, increased productivity and cost reduction, Learn more by visiting www.gewater.com and environmental regulations. We invest in forward- Doosan Doosan Heavy Industries & Construction is a leading under construction, our plants are producing more EPC contractor for plant projects around the globe. Our than 815 MIGD of water for use by more than 12 business portfolio includes power plants, ranging from million people around the globe. Grundfos coal-fired, combined-cycle, nuclear to wind power; Our proven capabilities in executing various scales seawater desalination and water treatment plants; Grundfos develops sustainable solutions to some of approximately 50 per cent of the world market. of projects, along with our current list of RO (Reverse castings and forgings; as well as construction and the major challenges that the world is facing. Osmosis) plant references, have established Doosan as material handling. Coming from this background and being aware of the the leading EPC contractor that delivers all three main Grundfos continuously strives to meet future world’s future challenges, Grundfos expanded in 2005 Over the past four decades, Doosan has played a desalination technologies: MSF, MED, and RO, which challenges within the areas of global climate, into the water treatment sector and now also offers key role in building more than 300 power and water are continuously being developed by our R&D Centers environment, and energy. Grundfos wants to make water treatment solutions from dosing and disinfection projects around the globe, and today we are pushing in Changwon, Tampa, and Dubai. a difference by using its numerous competencies to systems up to turnkey projects in drinking water, our technical expertise and innovation initiatives to develop trend-setting and high-technology solutions process water and waste water applications. Doosan has now expanded its portfolio into the the next level in order to enhance the value of our that are at the same time environmentally sustainable advanced water treatment sector, and Doosan’s Furthermore, Grundfos manufactures a wide range of solutions. for the benefit of people around the world. wide spectrum of products and services are actively reliable pumps in the water supply and wastewater Doosan has held a commanding lead in the global marketed by our 8 regional offices in the Americas, the With an annual production of more than 16 million segment, e.g. for irrigation, green houses and golf desalination market since commissioning our first Middle East, and Southeast Asia along with our U.S. pump units, Grundfos is one of the world’s leading courses, for municipal, private and industrial water turnkey project in 1989. In addition to the 426 million subsidiary Doosan Hydro Technology. pump manufacturers. Today, Grundfos is the world’s supply as well as sewage applications. imperial gallons per day (MIGD) of capacity currently largest manufacturer of circulator pumps, covering
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Hitachi The Hitachi group of companies is a Japanese creating sophisticated social infrastructures based on conglomerate headquartered in Tokyo, Japan. The information technologies. IDE Hitachi group consists of over 900 subsidiaries. The Hitachi group covers water and wastewater IDE – A Water Desalination Leader • Top RO Plant Supplier 2009-2010 (GWI, There are seven business units with total revenues related products such as water purification systems, September 2010) of about $100 billion. The Group employs about IDE is a world leader in the development, engineering, pumping systems, distribution management systems • One of the largest MED suppliers worldwide 360,000 employees. The Hitachi group marked construction and operation of water desalination etc. The water environment solutions division has the 100th anniversary of its founding in 2010. As it plants, industrial evaporators, refrigeration and • Supplier of the largest desalination plants, been established in Hitachi, Ltd. in June 2010, and begins the next 100 years, Hitachi will pursue growth snowmaking solutions. worldwide: the division is in charge of creating a water solution in both global and Japanese markets, focusing on Tianjin SDIC: China’s largest desalination plant business by not only selling hardware, but also Over the last four decades, IDE has installed 400 plants the social innovation business, which is aimed at A state-of-the-art electric plant with four IDE MED units providing operations and maintenance services. in 40 countries, worldwide. and a total capacity of 100,000 m³/day. IDE is set to IDE’s solution portfolio comprises: provide four additional units to double the capacity to InterApp • Thermal Distillation: Low temperature thermal 200,000 m³/day. distillation units producing boiler feed water Reliance Industries: India’s largest desalination InterApp, an AVK Group Company: Leading organisations benefit from InterApp’s from sea water using multi effect distillation and plant Understanding Water Treatment Industries. experience in large scale projects mechanical vapour compression. Located at India’s largest oil refinery, nine IDE MED Worldwide leading companies such as Degrémont, • Membrane Desalination: Reverse osmosis plants desalination units provide ~160,000 m³/day high- With more than 40 years of experience, InterApp Veolia, Hyflux etc. benefit from InterApp’s longtime used for treating tap water, brackish water and sea quality drinking water for local residents and for boilers. develops, manufactures, delivers and implements experience, their expertise in engineering and water. state-of-the-art flow control solutions for various Hadera, Israel: World’s largest operating SWRO manufacturing as well as their project management industries and applications around the world. • Industrial Evaporators: Energy efficient, plant; 127 million m³/year capabilities in the water treatment industries. Thanks Headquartered in Switzerland, with subsidiaries environmentally friendly industrial evaporation Winner of the Euromoney Project Finance ‘Deal of the to a sophisticated modular just-in-time manufacturing in Austria, Italy, Spain and Singapore and a rep solutions also known as zero liquid discharge Year Award’ 2007, the plant produces high quality system as well as the AVK Group’s far reaching network, office in France, the company operates their solutions. desalinated water with substantially lower electricity InterApp is capable of supplying their products own research and development as well as their consumption. individually adapted to customer specifications to any • Snowmaking & Refrigeration: Vacuum ice- manufacturing, assembly and testing facilities in making technology to generate ice and snow location in the world. Sorek, Israel: World’s largest planned SWRO Switzerland and Spain. at any ambient temperature for energy efficient, plant; 150 million m³/year A product portfolio for the most demanding lower cost, environmental friendly solutions. Comprehensive solutions from one single source Scheduled for completion in 2013 and one of the most requirements As a member of Denmark based AVK Group, InterApp Winner of the ‘Desalination Company of the Year’ economical SWRO installations currently built, the InterApp’s product portfolio includes valves with offers one of the most comprehensive range of Award plant continues IDE’s tradition of leading global mega- diameters from DN 10 to DN 3,200. InterApp offers products and solutions in the industry. Working size RO plants both in capacity and lower water cost. the following products: Rubber and Plastomer lined IDE Technologies is proud to have been named together within the group and creating synergies, the centric butterfly valves, double and triple eccentric ‘Desalination Company of the Year’ by Global Water Cape Preston, Australia: One of the world’s affiliated group members also benefit from a global butterfly valves, damper valves, ball valves, globe and Intelligence for “The greatest overall contribution largest SWRO plants organisation. With sales and distribution organisations diaphragm valves, gate and knife gate valves, check to the desalination industry in 2010”, with An advanced membrane desalination plant on an in 50 countries, the AVK group supplies its products valves, strainers, air valves, flanges, flange adaptors, achievements including: engineering, procurement and construction support and services to over 80 countries around the world. By dismantling joints, couplings, fittings hydrants, services basis. Set to supply 140,000 m³ of fresh water tailoring perfect packages with products and know- • Innovative technology – Industry first actuators and accessories. per day. how from across the entire group, InterApp clients • Competitive pricing – Low water costs benefit from seamlessly integrated solutions through InterApp solutions are ideal for the following • Leading thermal & membrane desalination IDE continues to provide innovative, cost-effective one single source. applications: solutions solutions for the world’s clean water challenges. Water treatment as one of InterApp’s major fields • Desalination of expertise • Drinking water treatment While InterApp and the AVK group companies supply • Sewage treatment their products and services to a variety of industries such as power generation, chemical process and • Industrial water treatment life sciences, water treatment has always been • High purity water (semiconductor, solar) one of their major fields of expertise. InterApp is • District cooling and heating systems specialised in desalination, sewage treatment, drinking • HVAC and swimming pools water, industrial water treatment and many other applications. • and many applications in the chemical and life science industries.
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ITT Koch Membrane Systems ITT Corporation is a global water leader deeply services around the world, ITT is “Engineered for life.” Koch Membrane Systems, Inc. is a global leader in systems, KMS is specified for some of the most involved in every stage of the cycle of water – membrane filtration technology and engineering demanding applications. Through its philanthropic arm, Watermark, the transporting, treating, and testing it, then returning support for close to half a century. KMS offers a wide company offers critical assistance in water emergencies KMS offers comprehensive process engineering design, it to the environment. Serving the municipal range of products and engineering services which and helps provide safe water, sanitation and hygiene piloting and field service expertise. With an installed water, wastewater, residential and commercial span industrial applications in food and life sciences, education for children and families through school- base approaching 20,000 systems throughout the building services and industrial markets, it produces industrial processes and water & wastewater. As based programs in developing countries. world, KMS is setting the standard as a comprehensive highly efficient products and systems that require a designer and manufacturer of state-of-the-art solutions provider for membrane technology. less maintenance, use less energy and provide In January 2011, ITT announced its intent to separate membrane elements as well as complete membrane environmental benefits to users and communities. the corporation into three standalone publicly traded companies by the end of 2011. ITT’s water- Doing business in more than 140 countries, ITT plays related businesses will form a new yet to be named an important role in improving quality of life, helping standalone water company, and will retain its industry communities to grow, farms to prosper and industries leading product brands such as Flygt, Goulds, Bell & to thrive. Providing mission-critical technology and Gossett and Lowara. Myron L Company Myron L Company Offers Innovative New Water Quality in the field. Based on the tried and tested design Instrumentation from a Company You Can Trust of the Ultrameter II, the 9P features fast, one-touch measurements for conductivity, resistivity, TDS, ORP, For over 50 years, the Myron L Company has worked Jindal free chlorine, pH and temperature. Derived from relentlessly to produce quality tools you can depend standard methods, the 9P adds the unique ability to on. Some of our instruments have been in continuous Jindal Water Infrastructure Limited is a 100% subsidiary Current projects include: perform in-cell conductometric titrations for alkalinity, use since they were manufactured – more than 45 of Jindal ITF, which is an infrastructure arm of Jindal hardness and LSI — making fast field analysis of these • JSPL Project at Angul years ago. That’s why professionals around the world SAW Ltd. parameters possible. A convenient LSI calculator • Naya Raipur Development Authority Project at trust us to deliver the results they need in diverse, determines the effects of water balance adjustments Jindal Aquasource, a brand of Jindal Water Naya Raipur, Chattisgarh demanding water quality applications. Infrastructure Limited, provides total water solutions. It on the spot. Data logging and Bluetooth® capabilities • Barmer Raw Water Conveyance Project, Rajasthan is committed towards providing innovative processes We are proud to offer innovative new technologies reduce the potential for human error and allow for efficient optimisation of water and wastewater • Sitarganj Common Effluent Treatment Plant (BOOT) that add new levels of performance and convenience seamless integration with record-keeping applications. Project, Uttarakhand to our existing line of water quality instrumentation: management on EPC and PPP models. The core areas Ultrameter II 6Pfc is our latest model in our popular of work encompass the following: • Rajkot 45 MLD STP (BOOT) Project ULTRAPEN™ PT1 is Myron L’s groundbreaking new Ultrameter II line. The 6Pfc features the same stability • Identification & reduction of non revenue water • Bhavnagar 45 MLD STP (BOOT) Project Conductivity/TDS/Salinity tester. The PT1 pen features and accuracy of the 6P in conductivity, resistivity, TDS, (NRW) Various services rendered by Jindal Aquasource the accuracy and stability of benchtop lab equipment pH, ORP and temperature measurements but with with the convenience of a pen. Constructed of durable enhanced free chlorine readings developed through • Identification & reduction of unaccounted for include: aircraft aluminum, this pen is fully potted for extra extensive bench testing at the Myron L Company. With water (UFW) • Intake systems, conveyance and water transmission protection with an easy to read LCD and one-button this new feature, the 6Pfc is able to measure a dynamic • Distribution & networking pipeline functions. Unlike any other instrument in its class, range of sanitizer concentrations that is wider than • Metering, billing & revenue collection • Desalination plants the PT1 allows the user to select from 3 of the most the range of a colorimentric test kit. Results are easy to • Long term operation, maintenance and • Pretreatment, demineraliser, CPU commonly used solution standards: KCl, NaCl, and read, digital, numerical and require no interpretation Myron L’s 442 proprietary standard for Natural Water™. by the user, making the 6Pfc the ideal instrument for management contracts • Industrial water & wastewater treatment The PT1 is an indispensable instrument in the water turbid or coloured solutions. No additional chemicals • Expertise in providing 24x7 water supply Wastewater management: quality professional’s toolkit. or reagents are required. Projects are executed on: • Treatment plants - STP/ ETP/CETP Ultrameter III 9P Titration Kit is Myron L’s innovative Visit our website to learn more! • Concessions/EPC with long term O&M • Recycling and reuse of wastewater new solution to comprehensive water quality testing www.myronl.com
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Pentair X-Flow Schneider Electric X-Flow X-Flow, a Pentair company, has broad know-how and service centres, agents and distributors that work Wherever you are around the globe, water has become environment for your energy, process and machine, a proud history in the development and application together to make Pentair X-Flow leading in purification. a strategic resource. However, the specific challenges server room, building system, and building access of innovative membrane filtration technologies. Together with the extensive application know-how for surrounding water stewardship and management vary management needs. Built on open standards, The company develops and supplies membrane projects of all sizes, this guarantees the best available from one country to another: EcoStruxure guarantees compatibility between technology to global municipal and industrial markets. water purification solutions. Proof can be found major applications and facilitates the integration • Access to clean drinking water The product portfolio contains numerous standard worldwide: operational solutions among the largest of third-party solutions. In short, EcoStruxure is a membranes, modules and units for filtration and in capacity of their kind, realised by leading principals • Water pollution and treatment holistic, integrated architecture designed for the purification processes. Throughout the years Pentair in many different areas in the industry. More than • Regulatory, environmental, and cost issues realities of today’s digital economy. EcoStruxure X-Flow has especially gained expertise and experience 9 percent of the world’s population - over half a billion This challenging environment is further compounded integrates management of electrical distribution, in water purification, ranging from producing potable people - already consumes water purified by Pentair by increasing pressure to: motor and pump control, treatment, safety, and water to treating wastewater and the pre-treatment X-Flow! monitoring for optimised management across your of seawater, but also in the food, beverage and • Reduce operating expenses entire infrastructure. EcoStruxure pulls in data like For additional information, visit the website pharmaceutical industries. Worldwide, Pentair X-Flow • Curb energy consumption geographical limitations, asset-management needs, lab www.x-flow.com. has an extensive network of professional sales offices, • Provide a reliable drinking water supply test results, customer interfaces, and energy supply so you can make smarter energy management decisions. • Bolster equipment safety • Align processes with shifting regulations As a global specialist in energy management with operations in more than 100 countries, Schneider • Ensure long-term effectiveness over the lifetime of Electric offers integrated solutions across multiple your equipment. market segments, with leadership positions in public Remondis Schneider Electric offers a wide range of solutions in utilities and infrastructure, industry and OEMs, non- water and wastewater management from the smallest residential buildings, data centres and networks, and Being the largest water and environmental services industrial customers on a large scale. pumping station to the most complex treatment plant. residential applications. Focused on making energy company in Germany and in 26 countries across the With natural resources becoming scarcer and scarcer, Smart water safe, reliable, efficient and clean, the Company’s more world, REMONDIS makes an important contribution the private-sector environmental service branch is With Ecostruxure, an integrated systems architecture than 110,000 employees achieved sales of €19.6 billion towards conserving natural resources and supplying playing an ever more important role in supplying raw unifying process management, energy management in 2010 through an active commitment to help raw materials with its facilities and services. Over materials around the globe and in preventing climate and security management, Schneider Electric is individuals and organisations “Make the most of their the last few years, it has made massive investments change. REMONDIS – a family run company founded in building smart water management systems to answer energy.” in state-of-the-art technologies and know-how 1934 with an annual turnover of 5.4 billion euros (2010) these challenges. demonstrating just how important the subjects of To learn more about our water solutions, visit our – focuses on creating partnership concepts and new environmental protection and resource conservation EcoStruxure brings together five of Schneider Electric’s website: ideas and opening up future perspectives in order to as well as water management are at REMONDIS. Since flagship business lines under a single architecture. www.schneider-electric.com/water continue to make an important contribution towards 1993, more than 20 billion euros have been invested This innovative platform lets you build a unified the supply of raw materials and water in the future, too. in developing and building new water supply and treatment facilities as well as sorting, composting, REMONDIS is one of the world’s largest privately run emission filter, waste incineration and biomass-fired water and environmental services companies and plants. One of its current areas of strategic growth is provides services for more than 20 million people. With Central and Eastern Europe where REMONDIS already its branches and associated companies, REMONDIS runs a large number of plants and provides water is active in 21 European countries as well as in China, and environmental services for local authorities and India, Taiwan, Australia and New Zealand.
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Sumitomo Mitsui Banking Corporation VAG-Armaturen GmbH SMBC is one of the largest banks worldwide by asset of these projects. We also offer a wide diversity of For more than 130 years, VAG-Armaturen GmbH, the • Control valves size, with over $1,300 billion in assets. Headquartered foreign language speakers within our teams and a modern company with a long tradition, has been • House Connection valves in Tokyo, SMBC employs 22,000 staff worldwide in 51 local presence in most major markets. For public sector operating wherever water is treated, stored and • Hydrants different locations*. procured projects, we have many years of experience distributed. With more than 1,000 employees world- in working with public sector bodies and are wide, the valve manufacturer is a global player and as • Non-return valves SMBC’s long term credit ratings are A+ (S&P) and Aa2 committed to working in partnership with the public a provider of systems and solutions sets new standards VAG develops cost-effective and durable solutions (Moody’s) sector during the procurement phases of projects. In in water and waste water technology. With its over that reach far beyond proven standard products, such As well as an extensive presence throughout Japan, situations where the proposed facility remains publicly 180 sales representatives, 17 sales agencies and 4 as swing check valves for surge protection, butterfly Asia Pacific and the Americas, SMBC group has owned, SMBC will also lend directly to municipal production facilities, VAG is at home all over the world. valves and plunger valves for pipe burst safety and branches, offices and subsidiaries in New York, London, water authorities and other governmental entities. quick-open and/or quick-close valves with hydraulic The product range of the VAG-Group contains: Paris, Dubai, Doha, Dublin, Brussels, Dusseldorf, Milan, In cases, for example in the United States, where break and lift cylinder for pump shafts. With its Madrid, Moscow, Johannesburg, Cairo and Bahrain. municipal water entities directly issue debt, SMBC will • Gate valves consumption-driven pressure adjustment technology, SMBC group’s operations in Europe, the Middle East also provide supporting letters of credit and liquidity • Butterfly valves VAG is making a significant contribution to reducing and Africa are run from its UK subsidiary in London, facilities. SMBC has a global capability and appetite • Air valves water loss. which employs nearly 700 staff. to fund water and waste projects and a long-term commitment to the sector. SMBC group is recognised as a global leader in structured finance with strong product knowledge In addition to the provision of project finance advisory Valtimet and dedicated professionals in financial centres and lending, we are active in corporate banking, around the globe. We seek to offer global sponsors a acquisition finance and corporate advisory in the water Valtimet is leader in premium titanium and stainless lightweight and titanium tubes’ thinness. Titanium worldwide service on the full range of debt products and waste sectors and have considerable experience steel welded tubular solutions serving energy, is used extensively in several installations in the from advisory to derivatives with particular emphasis in this on the global stage. Through our strong desalination and process markets. Middle East and North African regions with excellent on water & waste, infrastructure, transport, energy and presence in the Japanese market, we can facilitate operational results. Our tubes satisfy many application requirements for natural resources. SMBC group has advised, arranged M&A discussions with Japanese companies involved the water desalination industry. Evaporative processes, Valtimet is proud to have delivered tubes for more than and provided finance for well over 300 projects in in the water & waste sectors. Through our investment such as MSF and MED used in thermal desalination 90 desalination projects. EMEA and the Americas. We act as the lead arranger banking subsidiary, SMBC Nikko Capital Markets, we plants, demand tubing that resists erosion and and agent bank on more than 35 new transactions a offer global M&A advisory services, bond issuance, Valtimet boasts high manufacturing capacities, with saltwater corrosion, as well as elevated temperatures. year in project finance. derivatives and currency services. production mills on three continents, Asia, North Valtimet’s welded titanium tubing can easily meet the America and Europe, (namely in China, France, India, With specific reference to the water & waste sector, Contacts: most stringent criteria in desalination. South-Korea, the USA) as well as a secured access to SMBC has extensive experience globally of advisory, London : Mr Laughlan Waterston (laughlan_ superior quality titanium strip. lead arranging, underwriting and lending to water and Titanium resists chloride ion attacks and avoids salt [email protected] (+44 207 786 1040)) waste treatment projects, sewage treatment projects, buildup in the tubing : any residue is flushed away with Valtimet can supply substantial volumes for any major desalination projects and independent water and New York : Mr Adam Sherman (asherman@smbclf. the sea water. In addition to the lowest maintenance desalination project. power projects, with our most recent closing being com (+1 212 224 4859)) level imaginable, titanium tubes are economical, For further details, feel free to contact us and visit our the Tuaspring Desalination project in Singapore where with a low initial structural cost thanks to titanium’s Singapore : Mr Mark Giblett ([email protected]. website: www.valtimet.com SMBC was MLA and Documentation, Coordinating co.jp (+65 6882 0277)) and Modelling Bank. The strengths we can offer include expertise in market trends, regulation, funding Sydney : Mr David Sidoti ([email protected]. structures and funding availability in various global co.jp (+61 2 9376 1810)) Veolia Water markets, and high levels of technical expertise and Tokyo : Mr Tomofumi Watanabe (watanabe_ understanding of the various technologies employed Veolia Water, the water division of Veolia Veolia Water Solutions & Technologies (VWS), [email protected] (+81 3 4333 6301)) in water and waste projects together with a detailed Environnement, is the world leader in water and subsidiary of Veolia Water, is a leading design & build wastewater services. Specialised in outsourcing company and a specialised provider of technological knowledge of the specifications and parameters www.smbcgroup.com involved in the input, treatment and output stages services for municipal authorities, as well as solutions in water treatment. With over 9,658 * Information as at 1 June 2011 industrial and service companies, it is also one of the employees in 57 countries, Veolia Water Solutions & world’s major designers of technological solutions Technologies recorded revenue of €2.15 billion in 2010. and constructor of facilities needed in water and wastewater services. With 96,260 employees in 67 countries, Veolia Water provides water services to 100 million people and wastewater services to 71 million. Its 2010 revenue amounted to €12.1 billion.
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The GWI conference team
Left to right: Emilie Filou, Heather Lang, Charlotte Massey, Fabiola Alvarado-Revilla, Tom Scotney, Jablanka Uzelac, Christopher Gasson, Sharmilla Goodhur, Max Richardson, Alex Cheetham, Jack Ceadel, Clara González-Manchon, Rhys Owen, Max Borchardt, Clair Blakeway, Jessica Underwood, Emma Welsh, Jenny Yeulet, Mark Kelleher, Hiroko Kasama, Ankit Patel, Lola Arowoshola, Sivan Tal, Kasia Lechowska.
Focusing on performance // The GWI conference team // 323 322 :Announcing Global Water Summit 2012
At the magnifi cent Cavalieri Hilton, Rome
Monday 30th April and Tuesday 1st May 2012
Includes the Global Water Awards 2012
Save the date and fi nd out more on our website soon
www.watermeetsmoney.com 325 //