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Practical Policy Guidance for Implementing the Global Programme of Action for the Protection of the Marine Environment from Land-based Activities (GPA) on Sewage
Developed in collaboration with the World Health Organisation (WHO),
the United Nations Centre for Human Settlements (UNCHS–Habitat), and the Water Supply and Sanitation Collaborative Council (WSSCC).
Version 10 November 2000
UNEP/GPA COORDINATION OFFICE
P.O. Box 16227
2500 BE The Hague, The Netherlands
gpa@unep.nl
http://www.gpa.unep.org
TABLE OF CONTENTS
INTRODUCTION 7
KEY ISSUES AND RECOMMENDATIONS 9
GLOSSARY OF TERMS 13
ACRONYMS 15
CHAPTER 1: MANAGING MUNICIPAL WASTEWATER: A GROWING CHALLENGE 17
1.1 Wastewater in our environment
1.2 Main constraints to addressing wastewater
1.2.1 Out of sight, out of mind…?
1.2.2 High costs demand clearer priorities
1.3 Origin and type of water pollution
1.4 The cost of inaction
1.5 A new priority and a new agenda
CHAPTER 2: APPROACHES AND POLICY STEPS TO MANAGE MUNICIPAL WASTEWATER 27
2.1 Finding an appropriate approach
2.1.1 Supply-driven approach
2.1.2 Demand-driven approach
2.1.3 Opportunity-driven approach
2.2 Policy steps for wastewater management
2.2.1 Problem identification
2.2.2 Planning
2.2.3 Implementation
2.2.4 Enforcement and evaluation
CHAPTER 3: TECHNICAL OPTIONS 35
3.1 Selection of technology
3.2 Technological strategies
3.2.1 Step 1: Pollution prevention
3.2.2 Step 2: On-site treatment
3.2.3 Step 3: Off-site transportation: Sewerage and stormwater drainage
3.2.4 Step 4a: Natural treatment systems
3.2.5 Step 4b: Reuse options and waste valorisation
3.2.6 Step 5: Conventional treatment
3.3 Evaluation
CHAPTER 4: INSTITUTIONAL ARRANGEMENTS 45
4.1 Types of partners and institutional arrangements
4.2 Design of institutional arrangements
4.3 Building institutional capacity
4.4 Advocacy and public awareness
4.4.1 Understanding attitudes and behaviour change
4.4.2 Strategies, approaches, and steps
CHAPTER 5: FINANCING OPTIONS 57
5.1 Introduction
5.2 Cost recovery mechanisms
5.2.1 Consumption-based user charges
5.2.2 Effluent charges
5.2.3 Indirect local taxes
5.2.4 Discharge permits
5.3 Willingness to pay and cost sharing
5.4 Investment options for infrastructure
5.4.1 Grant finance
5.4.2 Loan finance through government or multilateral institutions
5.4.3 Market financing
5.4.4 Attracting private capital
5.5 Public–private partnerships
5.6 Evaluation
REFERENCES 70
LIST OF FIGURES
Figure 1.1 Access to safe water and sanitation services in developing countries; percentage of the population served and unserved.
Figure 1.2 Components of municipal wastewater.
Figure 3.1 Example of a decision tree for the selection of wastewater technology.
Figure 4.1 Communication planning model.
LIST OF TABLES
Table 1.1 Cost range per capita for on-site and sewered (with conventional treatment) options.
Table 1.2 Variation in domestic wastewater composition.
Table 1.3 Constituents of wastewater and their impacts on the marine environment.
Table 3.1 Steps in a sustainable approach to wastewater management, in declining order of preference.
Table 3.2 Classification of common and advanced wastewater treatment processes.
Table 3.3 Typical removal capabilities of various treatment processes, effluent concentration or removal efficiency.
Table 3.4 Estimated time needed to meet European Union effluent standards at an investment level of 1.5 percent of gross national product.
Table 4.1 Organisational arrangements for the different functions in water pollution control in four countries.
Table 5.1 Allocation of key responsibilities under the main options for private sector participation.
Table 5.2 Prerequisites for successful private participation.
Table 5.3 Type of contracts operational in middle- and low-income countries.
Table 5.4 Lead international contractors involved in public–private partnerships in water and sanitation projects in middle- and low-income countries.
LIST OF BOXES
Box 1.1 Types of economic benefits: A case study on Izmir Bay, Turkey.
Box 2.1 Strategic sanitation approach.
Box 2.2 Summary of an email conference on the strategic sanitation approach.
Box 2.3 Characteristics of integrated coastal zone management.
Box 2.4 Examples of management instruments.
Box 3.1 Reducing wastewater in Korea.
Box 3.2 Ecological engineering: Wastewater–fed aquaculture.
Box 3.3 Ecological engineering: Duckweed-based sewage treatment and resource recovery in Bangladesh.
Box 4.1 Institutional changes in England and Wales.
Box 4.2 Regulation and treatment in the United States of America.
Box 4.3 Integration with land use planning.
Box 4.4 Diarrhoea epidemic as catalyst to improve wastewater management.
Box 4.5 The preparation of an environmental profile as a public awareness tool.
Box 4.6 Willingness to pay for a clean Lake Ohrid, Macedonia.
Box 4.7 Colombia’s water pollution charge initiative.
Box 5.1 Cost sharing in the Orangi Pilot Project in Karachi, Pakistan.
Box 5.2 International bonds.
Box 5.3 Concession in Buenos Aires, Argentina.
ACKNOWLEDGEMENTS
This document has been drafted within the framework of the GPA Strategic Action Plan on Municipal Wastewater which aims at supporting the efforts of States to address the serious public health problems and the degradation of coastal ecosystems that result from the disposal in coastal areas of inadequately treated municipal wastewater. It does so through, amongst others, the development of Recommendations for Decision-making and associated Knowledge Base; and the holding of regional meetings - including partnership meetings - and global consultations. These Recommendations are based upon, among others, materials contained in the draft report, Strategy Options for Sewage Management to Protect the Marine Environment, by:
Netherlands Economic Institute [NEI] (Leo Beumer and Esther Uytewaal);
International Water and Sanitation Centre [IRC] (Dick de Jong and Madeleen Wegelin); and
International Institute for Infrastructural, Hydraulic, and Environmental Engineering [IHE–Delft] (Guy Alaerts, Martin Bijlsma, Maarten Blokland, Richard Franceys, Huib Gijzen and Liliane Saade).
The UNEP/GPA Coordination Office is grateful to the reviewers of the document:
Mahmood Y. Abdulraheem, Habib N. El-Habr, and Melanie Hutchinson (UNEP/Regional Office for West Asia, Bahrain); Ingvar Andersson (United Nations Development Programme/Sustainable Energy and Environment Division, USA); George V. Butcher (Trinidad and Tobago); Richard Carr (World Health Organisation, Switzerland); Francesco Civili (UNEP/Mediterranean Action Plan, Greece); Salif Diop (UNEP, Kenya); Bob Dorr (Water Service Association, Australia); Barbara Evans (World Bank/Water and Sanitation Program, India); Bernhard Griesinger (Organization of American States, USA); Wim van der Hoek (International Water Management Institute, Sri Lanka); Tim Kasten (UNEP/Regional Coordination Unit Wider Caribbean, Jamaica); Hugh Kirkman (UNEP/Regional Coordination Unit East Asian Seas, Thailand); Tapani Kohonen (Finland); Tom Laughlin (United States National Oceanic and Atmospheric Administration, USA); Pascal Magoraou (European Commission/Directorate-General, Environment, Belgium); Tony Milburn (International Water Association, UK); Janusz Niemczynowicz (University of Lund, Sweden); David Osborn (Environment Australia); Jonathan Parkinson (GHK Research and Training, UK); Rolph Payet (UNEP/Regional Coordination Unit Eastern Africa, Seychelles); Ian Pearson (South Africa); and Marc Richir (European Commission/Directorate-General, Environment, Belgium).
Great support and assistance has been provided by James Frankiewicz (United States Agency for International Development); Jack Moss (Suez-Lyonnaise-des-Eaux); Deputy Minister Aca Sugandhy (Indonesia); and Lee Travers (World Bank).
This report has been edited by Susan M. Lee.
The development of these Recommendations was coordinated by Leo de Vrees of the UNEP/GPA Coordination Office.
INTRODUCTION
Domestic wastewater discharge is considered one of the most significant threats to human health and to sustainable coastal developments worldwide. The priority for action to address these threats was identified by:
· The Global Programme of Action (GPA) for the Protection of the Marine Environment from Land-based Activities (Washington, DC, 1995);
· Seven regional workshops of government-designated experts held from 1996 to 1998 under the framework of the United Nations Environment Programme (UNEP) Regional Seas Programme, involving more than 60 mostly developing countries.
Aim
The Recommendations for Decision-making on Municipal Wastewater are aimed to serve as a consensus guide on appropriate and environmentally sound systems for wastewater management and associated investments. The document aims to set the standard for initiating, implementing, and successfully maintaining projects in the field of wastewater management. It contains key principles and annotated checklists of recommended practices and procedures, including those needed for investment decisions and public–private partnerships.
Target groups
The Recommendations are aimed at:
1. Decision-makers at the national and local level, especially in developing countries (such as staff in Ministries of Health and/or Environment and Majors and Directors of Public Works in [coastal] municipalities);
2. Regional organisations, the private sector, development banks, and related organisations that facilitate and participate financially in individual projects;
3. Policy-makers at the national level who are responsible for implementing the GPA. They will be invited to endorse the Recommendations at the 2001 Global GPA Review Meeting.
Although the focus is on developing countries, the issues mentioned in this report are also relevant for developed countries and form a basis for sharing lessons and experiences.
Context
The Recommendations are part of the GPA Strategic Action Plan on Municipal Wastewater, developed in cooperation with the World Health Organisation, the United Nations Centre for Human Settlements (UNCHS–Habitat), and the Water Supply and Sanitation Collaborative Council. The Action Plan includes regional meetings to illustrate the use of these Recommendations. It is envisaged that the regional meetings will stimulate regional and local cooperation, supporting states in their efforts to sustainably address the serious public health problems and the degradation of coastal ecosystems stemming from the disposal of inadequately treated municipal wastewater into river basins and coastal waters.
Agents of change
The GPA Recommendations focus on the following elements, or agents of change:
· Approaches and policies, including demand-driven, opportunity-driven, and integrated management approaches (chapter 2);
· Technical options, including a series of steps for choosing the most appropriate technology, and considering waste as a resource (chapter 3);
· Institutional arrangements, including public participation and new partnerships with the private sector and water users (chapter 4);
· Financing options, including private capital and public–private partnerships (chapter 5).
This document refers to other, more detailed sources of information. In particular, Sanitation Connection, the clearing-house on wastewater (accessible via www.sanicon.net or www.gpa.unep.org), will serve as a tool for disseminating experiences and best practices.
Process
The current version of the guide will form the basis of discussions at the regional level with a wide variety of stakeholders, including national and local experts, representatives from non-governmental organisations (NGOs), the private sector, professional organisations, international financial institutions, and potential donors, and other stakeholders during the first half of 2001. Regional annexes to the Recommendations will be developed as needed to reflect the common views of stakeholders and the mix of approaches and procedures best suited to the realities of the regions. The results of the regional meetings will be presented at the first Intergovernmental Review of the GPA in October/November 2001, where the Recommendations will be submitted for political endorsement.
KEY ISSUES AND RECOMMENDATIONS
Preamble
There are several prerequisites for addressing the management of wastewater in order to safeguard human and ecosystem health, and to avoid the degradation of water quality and other coastal and marine resources. These include:
· Stakeholder involvement, which will foster the political will to assign a high priority to wastewater management among other pressing public investment needs
· Financial affordability.
These recommendations aim to provide guidance how to gain this political will and to increase financial affordability by describing sustainable systems for wastewater management, including less expensive technical options and ways of attracting support.
The key principles for managing wastewater sustainably are to conserve water resources, by eliminating pollution at the source, using water efficiently, and maintaining water quality, and to respond effectively to demands from society.
INTEGRATED APPROACH
Issue 1
A comprehensive and integrated approach to urban wastewater management is needed to maintain the environmental integrity and the economic functions of aquatic ecosystems, including ground water, rivers, lakes, and coastal areas.
Recommendations
1.a Promote studies to quantify the socioeconomic impact of environmental pollution in case of inaction and action, and use such information to determine the priorities for investment and clean-up programs (section 1.4).
1.b Prioritise actions to minimise current and future environmental damage with carefully selected policies, programmes, and investments; invest stage-wise in infrastructure for wastewater management while maintaining a long-term horizon for planning and operations (section 1.2).
1.c Impose appropriate effluent standards that are feasible for local conditions (section 3.3).
1.d Integrate planning for wastewater with the planning for other sectors, such as water supply, solid waste, and land use (section 2.1.2).
1.e Use a mix of technological options and managerial approaches, including community-based development approaches, that are appropriate and optimal for different zones in the city (section 2.2).
1.f Incorporate wastewater management within integrated approaches for the management of river basins and coastal zones (section 2.1.3).
STAKEHOLDER INVOLVEMENT
Issue 2
Successful wastewater management requires a high level of public commitment.
Recommendations
2.a Invest in creating and maintaining awareness among citizens regarding their dual role as polluters and beneficiaries of wastewater management (section 4.4).
2.b Develop commitment to a clean environment and “river basin solidarity,” and demonstrate that “win-win” situations exist when all polluters cooperate in wastewater management (section 4.2).
2.c Devolve decision-making to the lowest appropriate administrative level, and ensure that local communities receive financial power to participate in local or regional initiatives to operate, manage, and maintain their part of the infrastructure (section 4.2).
2.d Ensure that citizens receive an adequate wastewater management service relative to their financial contributions (section 5.1).
Issue 3
Wastewater management is pre-eminently an effort that involves many actors who must be willing to cooperate and contribute to the overall result.
Recommendations
3.a Apply both restrictive and enabling regulations. To make this approach more palatable and effective, add positive incentives, such as load-based licensing fees (section 4.1).
3.b Introduce market-based instruments, such as tradable effluent permits, in conjunction with administrative regulation to give polluters more flexibility to invest and operate in the management of wastewater (sections 4.2 and 5.2).
3.c Develop mechanisms that allow civil society and its representatives (such as consumer associations) to hold polluting entities accountable, whether they are owned and operated privately or publicly (section 4.2).
3.d Ensure that the investment and operational mechanisms and instruments enable the equitable distribution of costs and benefits among all stakeholders (section 4.2).
FINANCING
Issue 4
The financial sustainability of the wastewater management system must be assured.
Recommendations
4.a Strive to apply the principles of “the water user pays” and “the polluter pays” in the wastewater management systems (section 5.3).
4.b Design the financial system to balance the quality of the service, the investment costs, and the tariffs that households are willing and able to pay (demand-driven approach) (section 5.1).
4.c Involve the stakeholders who are to gain from the water quality improvement, including those benefiting from enhanced land values, and ensure that they contribute financially (opportunity-driven approach) (section 2.1.3).
4.d Use charges or pollution fees to establish funds for the cofinancing of wastewater treatment facilities, instead of considering these revenues as taxes that enter the national budget (section 5.2).
4.e Establish systems to ensure that tax revenues are allocated to the appropriate service provider (section 5.2).
4.f Examine the potential to use cross-subsidies (section 5.4).
INSTITUTIONAL ARRANGEMENTS
Issue 5
A country’s central government can play a significant role as a facilitator and initiator of appropriate wastewater management.
Recommendations
5.a Develop systems to ensure good and sustainable governance and protect the performance of investments and operations, whether performed by the public sector or the private (section 4.2).
5.b Recognise the responsibility and authority of the central government to set the institutional environment to encourage local governments, the private sector, regional and river basin agencies, and other partners to initiate and implement programmes. This can include:
· Developing and maintaining national policies and strategies in cooperation with local governments and other stakeholders
· Enacting legal and regulatory instruments
· Encouraging the development of appropriate organisations to complement local government initiatives (section 4.2).
5.c Consider cofinancing schemes and infrastructure that are highly cost-effective and that have a high priority, as appropriate (section 4.2).
5.d Make local governments and environmental agencies accountable to central governments for implementing, operating, and maintaining sustainable wastewater management systems (section 4.2)
5.e Establish criteria for central governments to assess the performance of local governments and environmental agencies in reducing pollution (section 4.2).
Issue 6
In many countries, institutional restructuring and strengthening is required to ensure the good performance of the wastewater management system.
Recommendations
6.a Develop a long-term strategy for institutional reform and capacity building where existing structures, legal and regulatory frameworks, and organisations inside and outside of the government are weak or inadequate (section 4.3).
6.b Recognise that weak capacities pertain to the capacities of individuals (such as wastewater engineers) and to capacities embodied in managerial procedures, regulations, administrative rules, and career and salary incentives (section 4.3).
6.c Make use of or develop dedicated networks of multidisciplinary sector experts in academia, government, industry, and civil society (section 4.3).
6.d Ensure that these networks and information exchange systems, such as web-based clearing-houses, help to identify or articulate the problems to be solved and draw upon experiences from other countries in the region and globally (section 4.3).
Issue 7
Partnerships between the public sector and the private sector are important options and useful tools to assist local governments in financing and operating the infrastructure for wastewater management.
Recommendations
7.a Review the regulatory and legal frameworks that might impede public–private partnership arrangements; appropriate frameworks can facilitate local governments and the private sector to investigate partnership opportunities (section 5.5).
7.b Devise carefully the requirements and options for such regulation, which should be compatible with the country’s economic, social, and political situation and should discourage monopolistic behaviour (section 5.5).
7.c Structure the contract and its implementation to maximise the long-term effectiveness of collaborative partnerships between the contracting authority and the operator by building in systems for dialogue (section 5.4–5.5).
7.d Implement pilot public–private partnership initiatives and learn from the experiences (section 5.5).
7.e Evaluate fairly and objectively the performance of such partnerships against international benchmarks and consumer satisfaction surveys, regardless of whether the utility is managed by a private firm or a public entity (sections 2.2 and 4.2).
TECHNOLOGY
Issue 8
The high cost of wastewater management warrants a very careful search for low-cost and thus more sustainable technologies and approaches.
Recommendations
8.a Introduce appropriate strategies and incentives that target waste prevention and minimisation, water conservation, and the efficient use of water (section 3.1).
8.b Apply more cost effective technologies such as lagoons, natural systems, anaerobic treatment, and reuse schemes (section 3.1).
8.c Adapt land use policies and financial and other regulation to promote the segregation of industrial effluents unsuitable for municipal wastewater treatment by relocating industries, recycling waste streams, and using the best available technologies (section 2.2).
8.d Promote the exchange of experience with the implementation and operation of different technologies (section 3.1).
GLOSSARY OF TERMS
Aerobic treatment
A treatment of sewage that relies on aerobic bacteria.
Anaerobic treatment
A sewage treatment process that relies on anaerobic digestion processes.
Biochemical oxygen demand (BOD)
A measure of the organic pollutant strength of sewage measured in milligrams per litre. This is equal to the mass of oxygen consumed by organic matter during aerobic decomposition under standard conditions during a fixed period (usually five days).
Comminution
A part of the wastewater treatment process. Comminutors can be used as an alternative system to racks or coarse screens to grind up coarse solids without removing them from the wastewater flow.
Domestic wastewater
All discharge from households, including discharge from toilet flushing (black water) and from showers, washbasins, kitchens, and laundries (grey water).
Dry latrine
The term is used to describe both:
a) Crude systems in which faeces are excreted onto a slab or into an improvised container from which they are manually removed; and
b) Latrines from which water and urine are excluded in order to increase the rate at which excreta decomposes.
Excreta
Faeces and urine.
Latrine
An installation used for defecation and urination.
Municipal wastewater
A mixture of domestic wastewater, effluents from commercial and industrial establishments, and urban runoff.
On-site facilities
Sanitation facilities that are located on a householder’s plot. May be an on-plot system or the on-plot components of a more extensive system.
On-site sanitation
A sanitation system that is contained within a householder’s plot occupied by the dwelling and its immediate surroundings.
Pathogens
Micro-organisms such as bacteria, viruses, and protozoa that cause disease.
Pit latrine
Latrine with a pit for the accumulation and decomposition of excreta and from which liquid infiltrates into the surrounding soil.
Pour flush latrine
A latrine that depends on small quantities of water, poured from a container by hand, to flush faeces away from the point of defecation. The term is normally used for a latrine incorporating a water seal.
Sanitation
A system for promoting sanitary (healthy) conditions.
Septic tank
A tank or container, normally with one inlet and one outlet, which retains sewage and reduces its strength by settlement and anaerobic digestion of excreta.
Sewage
Wastewater from a community, including excreta, that is, will be, or has been carried in a sewer.
Sewer
A conduit, usually a pipe, which is used to convey the wastewater from more than one property.
Sewerage
A system of interconnected sewers.
Sludge or bio-solids
Residue after wastewater treatment. It can be, after proper treatment, used for soil amendment or as fertilizer, unless it contains toxic substances, such as heavy metals or persistent organic pollutants (POPs).
Soakaway
A soakpit or drainage trench for the subsoil percolation of liquid waste.
Soakpit
A hole dug in the ground serving as a soakaway.
Solid waste
Litter and other waste in the streets. It can be flushed away with stormwater into the sewer or drainage system and cause blockage in the system.
Stormwater
Runoff caused by rainfall.
Ventilated improved pit (VIP) latrine
A pit latrine with a screened vent pipe and a dark interior to the superstructure.
Water closet
A pan, incorporating a water seal, in which excreta are deposited before being flushed away with water.
Wastewater
Sewage.
Wastewater management
All of the institutional, financial, technical, legislative, participatory, and managerial aspects related to the problem of wastewater.
ACRONYMS
BOD Biochemical oxygen demand
BOO Build–own–operate contract
BOT Build–own–transfer contract
CSD Commission on Sustainable Development
DBO Design–build–operate contract
EBRD
European Bank for Regional Development
EU
European Union
GESAMP
Joint Group of Experts on the Scientific Aspects of Marine Environmental Protection
GESI
Global Environmental Sanitation Initiative
GNP
Gross national product
GPA
Global Programme of Action for the Protection of the Marine Environment from Land-based Activities
ICZM
Integrated coastal zone management
IFI
International financial institution
IHE–Delft
International Institute for Infrastructural, Hydraulic, and Environmental Engineering
MPF
Multiproject financing facility
NGO
Non-governmental organisation
OECD
Organisation for Economic Cooperation and Development
POP
Persistent organic pollutant
ROT
Rehabilitate–operate–transfer contract
UNCHS
United Nations Centre for Human Settlements (Habitat)
UNDP
United Nations Development Programme
UNEP
United Nations Environment Programme
UNICEF
United Nations Children’s Fund
WCC
World Coast Conference
WMO
World Meteorological Organisation
WSSCC
Water Supply and Sanitation Collaborative Council
CHAPTER1: MANAGING MUNICIPAL WASTEWATER: A GROWING CHALLENGE
1.1 Wastewater in our environment
The gradual but irrevocable deterioration of coastal waters around the world calls upon us to take up the challenge of managing water pollution. It is no longer enough to simply evacuate wastewater from our cities; effective wastewater management has become an imperative. It will be a complex and expensive task, but, if we do not begin to manage our sewage properly, in a holistic, environmentally sustainable manner, we stand to lose our habitat and liveable environment in the future.
For a long time, low population densities and the prevailing rural economy kept pollution localised, preventing it from spilling over into the wider environment. With modest consumption levels and no drains to concentrate sewage and take it away, rivers and coastal zones remained comparatively free of human-caused pollution. In addition, the absorption capacity of the natural environment was adequate to deal with these modest pollution loads.
However, urbanisation is changing the face of the earth dramatically. The industrial city with its factories is the engine of economic development. However, it also requires many more resources and builds up the space, forcing waste to be discharged into the “nature” beyond the its borders. Urbanisation and economic development are and will remain powerful engines of pollution. Between 1970 and 2000, in just 30 years, the global population doubled from 3 to 6 billion people. In this same period, the level of urbanisation in developing countries doubled from less than 25 percent of the population to 50 percent, while the value of their combined economies grew tenfold, from US$0.4 trillion to 4 trillion (World Resources 1998; World Bank 1992). Moreover, most of the largest urban centres are located in coastal zones. The pollution load discharged into the environment has increased concomitantly, and in many places, nature can no longer cope with these pressures; the very basis of a number of economic activities is threatened. With strong, sustained growth in population and the economy, we are likely to witness even more critical damage in the next decades.
The impact of wastewater is visible at three distinct levels, as follows. Each level calls for separate conceptual and policy choices, but they are intimately connected.
· The direct living environment. Domestic wastewater is generated in a neighbourhood of houses, shops, small factories, and so forth. If it is not drained away, it poses a serious public health risk to the residents. In most towns in the developing world, the lack of sanitation is a major and persistent concern, particularly in large, peri-urban zones (slums, usually located on the periphery of a city) where low-income families and small- and medium-sized industrial activities are located. To protect the neighbourhood, funds must be dedicated to sanitation to direct its wastewater either into the soil and shallow ground water through household disposal systems, like septic tanks or latrines (the on-site strategy), or to rivers in the vicinity through sewers and treatment facilities (the off-site strategy). The first strategy tends to be less expensive; it is often more socially feasible in poorer regions because it allows the community development and gender aspects to be addressed more effectively.
· Rivers and lakes near the city. Cities, if they can afford it, invest in conveying sewage to rivers and lakes. These are employed to dilute the waste and carry it further away—out of sight and out of the perimeter of the city’s formal responsibility. This degrades the quality of river water and can seriously harm other water users and the ecology downstream. The alternative, low-cost strategy of on-site sanitation provides some protection to the rivers; however, this can contaminate shallow ground water, often used as a drinking water resource, particularly with pathogenic microbes and nitrates.
· The marine environment. The coastal and marine environment is the ultimate recipient of all of the waste generated in coastal watersheds. It was often assumed that seas could easily dilute wastewater. However, only organic, oxygen-consuming substances can benefit to some extent from such dilution. Most other pollutants, such as pathogens, nutrients, and toxic materials remain in local and even global food chains, and can affect human health, disrupt ecosystems, and damage the economy and nature.
Coastal and marine pollution has become a worldwide phenomenon and has triggered international action. In 1995, the Global Programme of Action for the Protection of the Marine Environment from Land-Based Activities was adopted by 108 countries and the European Commission. The GPA recognises that the environmental effects associated with domestic wastewater are generally local, though with transboundary implications in certain geographic areas. The GPA notes that significant sewage-related problems are common in coastal areas throughout the world. Thus, urban wastewater discharges are to be considered one of the most significant threats to sustainable coastal developments worldwide (GPA 1995).
Around the world, most decision-makers, industrialists, and ordinary citizens are now aware of the significance of pollution, and most industrialised countries have made substantial progress in controlling wastewater pollution. However, especially in developing nations, hard choices are still too often postponed. Addressing pollution requires very substantial investments and intensive, long-term cooperation among many stakeholders. Relative to the task ahead, too little is being done at present; governments, the private sector, and households prefer to spend their money on other goods. In developing countries, for example, drinking water typically enjoys a far higher priority than wastewater management. It is no wonder then that even after the International Drinking Water Supply and Sanitation Decade (1981–1990), nearly 3 billion people, mostly in developing countries, still lack access to adequate sanitation—let alone that their wastewater is not treated sustainably (see figure 1.1).
Figure 1.1 Access to safe water and sanitation services in developing countries; percentage of the population served and unserved (united nations 1997)[1].
The slowly growing awareness, the technical complexity, and the high cost of wastewater management are the main reasons that it took several decades for the rich, industrialised nations to take effective action. Developing countries face a heavier burden because they have fewer resources and weaker institutions. Thus, this document aims to support developing countries by providing recommendations on approaches, technologies, institutional arrangements, and financial options for the management of wastewater. These recommendations are based on worldwide experiences and research.
1.2 Main constraints to addressing wastewater
1.2.1 Out of sight, out of mind …?
When sewage is not handled properly in a poor city neighbourhood, the consequences are soon felt locally. The lack of adequate sanitation causes infectious diseases and leads to the contamination of the water supply, flooding, and unsavoury conditions. Local inhabitants suffer. Consequently, they are usually willing to take collaborative action to improve their neighbourhood conditions, provided that they have certainty of tenure and the government facilitates their efforts. In developing countries, cleaning up the local habitat is typically a high priority in congested, urbanised areas.
Unfortunately, in most other water pollution situations, people are not typically aware that cooperation is needed. As soon as the residents of a neighbourhood have a drain or sewer installed, their local waste gets flushed away to a downstream neighbourhood or to the river, thus becoming someone else’s problem. This imposes costs on the downstream water users instead of on the polluters themselves; this imbalance is called an externality. The polluters are usually reluctant to remedy the situation, in part because they do not “see” the problem. To complicate matters further, the polluting industries and cities may be hundreds of kilometres upstream from the location where the damage from pollution occurs, and the effects of pollution may take years or even decades to become obvious. Because the cause–effect relationship is so complex, many polluters are loath to assume responsibility.
Clearly, the nature of water pollution hampers clear insight into the consequences of waste discharge and poses a key constraint to cooperation and “river solidarity” among water users. Thus, reliable data, communication, and education are needed to overcome these constraints. Similarly, appropriate institutional arrangements and knowledge about causes and effects are necessary to create the organisations and procedures to raise the issues, stimulate dialogue among the different stakeholders, resolve conflicts, and achieve agreement on joint actions. Chapter 4 discusses these institutional arrangements, awareness raising, and public participation.
1.2.2 High costs demand clearer priorities
The second key constraint to addressing water pollution is the cost involved. Table 1.1 demonstrates that even in countries in which labour and materials are inexpensive, the cost of addressing water pollution is high and can be prohibitive. The state does not have enough resources while household members, who should bear at least part of the burden, are too poor or unwilling to participate. Although simple on-site options are less expensive than the more advanced alternatives, their application is often limited by local conditions that demand sewerage and off-site treatment.
Wastewater collection and treatment tend to be two to three times more expensive than the costs to extract, treat, and distribute tap water. In addition, the costs to operate and maintain sewage collection and treatment systems are often higher than the annual depreciation of the capital investment in the infrastructure. Treatment plants consume a lot of energy, generate large quantities of excess sludge that must be disposed of or used, and require relatively sophisticated equipment that demands well-trained operators and engineers. In The Netherlands, Germany, and other European countries, the water agencies currently spend more money to treat sewage than on all other water-related activities such as flood protection, pumping, and dredging combined—and most of that expenditure is devoted to the operation and management of the treatment plants. Moreover, only a few countries in the world manage to recover all of their costs directly from their customers through user charges.
Table 1.1 Cost range per capita for on-site and sewered (with conventional treatment) options (kalbermatten et al. 1982; alaerts et al. 1990).
1 For primary plus secondary treatment, including land purchase and simple sludge treatment, for a capacity of 30,000–40,000 persons. Lower values pertain to low-cost options, such as waste stabilisation ponds; higher values pertain to mechanised treatment, such as oxidation ditches and activated sludge plants.
2 For plant capacity of 100,000–250,000 persons.
3 For industrialised countries, this includes tertiary treatment and full sludge treatment; for other countries, this includes basic secondary treatment.
Many countries cannot afford the technologies used in industrialised countries to reach European effluent standards. Table 3.4 in Chapter 3 provides estimates for a number of low- and middle-income countries for the length of time needed to meet these standards, assuming that 1.5 percent of the gross national product can be invested in sewers and treatment facilities. The table shows that this period far exceeds the economic lifetime of the treatment plant (20–30 years) and in many cases even that of sewers (50–60 years).
So, does this mean that no progress can be made in the developing countries? The picture is less dramatic than the average figures suggest, but calls for a candid strategy and prioritisation:
· First, the wealth in urbanised regions is much higher than the average, especially in large cities. Thus, local governments do have the resources available to address pollution.
· Second, mixed strategies that apply low-cost and on-site sanitation, waste minimisation, and some conventional sewerage can significantly reduce costs compared to conventional, high-investment technologies.
· Third, important efficiencies can be attained and costs reduced by integrating wastewater planning more with that of other sectors, by taking a longer-term planning approach, investing step-by-step, and by ensuring stronger support from citizens.
Thus, ample scope exists for targeted and effective wastewater management programmes, spread out over longer periods of one or more decades.
1.3 Origin and type of water pollution
Municipal wastewater consists of a mixture of domestic wastewater, effluents from commercial and industrial establishments, and urban runoff (figure 1.2). Domestic wastewater composition depends on specific levels of water consumption, which can vary from 40 to more than 300 litres per capita per day. This explains the wide range in concentration of the main wastewater constituents in table 1.2. The composition is further influenced by effluent discharges from industry and by seepage or ground water infiltration into the sewer system. Domestic wastewater is produced mainly in areas that have (multiple) in-house tap connections and that are connected to the sewer infrastructure. In areas in which handpumps or public standposts are used for water supply, water consumption is relatively low and sewer infrastructure is mostly unavailable.
Figure 1.2 Components of municipal wastewater.
The composition of industrial wastewater depends largely on the type of industry and whether on-site pollution control measures are taken. Industrial water demand and wastewater production are sector-specific; for example, some industries may require large volumes of water for cooling, processing, cleaning, product transport, and flushing wastes. Both the flow and fluctuations in the pollutant load of industrial wastewater discharged in a municipal sewer system have potentially detrimental effects on the functioning of a wastewater treatment plant.
Table 1. 2 Variation in domestic wastewater composition (veenstra et al. 1997).
Biological oxygen demand (BOD)
Pollution from municipal sewage has many faces. Part of any successful strategy rests in the proper analysis of impact, costs, and benefits of the pollution and of the various mitigation measures. Sound analysis allows priorities to be set with respect to the type of actions required and their implementation schedule over a longer time frame, of, for example, 10 to 20 years.
Table 1.3 summarises the impacts of pollution on the marine environment.
Table 1. 3 Constituents of wastewater and their impacts on the marine environment (Windom 1992).
Type of Constituent
Impact
Solids
High levels of suspended solids may cause excessive turbidity and shading of sea grasses and result in sedimentation, which is potentially damaging to benthic habitats and can cause anaerobic conditions at the sea bottom. Fine particles may be associated with toxic organics, metals, and pathogens that adhere to these solids.
Organic matter
Biological degradation of organic matter requires oxygen and can deplete available dissolved oxygen. The strength of wastewater is commonly expressed in terms of the biochemical oxygen demand (BOD) parameter. High BOD levels in natural waters can cause hypoxia and anoxia, especially in shallow and enclosed aquatic systems, resulting in fish death and anaerobic conditions. Anaerobic conditions subsequently result in the release of bad odours, from the formation of hydrogen sulphide.
Nutrients
Nutrients, like nitrogen and phosphorous, increase primary production rates (of oxygen and algal biomass); adverse levels cause nuisance algal blooms (including toxic algae blooms), dieback of coral and sea grasses, and eutrophication that can lead to hypoxia and anoxia, suffocating living resources (fish). Massive die-off of algal matter will result in additional organic matter.
Pathogens
Pathogens can cause human illness and possible death. Exposure to pathogens via contact with contaminated water or consumption of contaminated shellfish can result in infection and disease.
Toxic organic chemicals (Persistent organic pollutants, or POPs)
Many toxic materials are suspected carcinogens and mutagens. These materials can concentrate in shellfish and fish tissue, putting humans at risk through consumption. Bioaccumulation affects fish and wildlife at higher levels of the food chain.
Metals
Metals in specific forms can be toxic to various marine organisms and humans; shellfish are especially vulnerable in areas with highly contaminated sediment.
Fats, oil, and grease
Fats, oil, and grease float on the surface of seawater, interfere with natural aeration, are possibly toxic to aquatic life, destroy coastal vegetation, reduce recreational use of water and beaches, and threaten waterfowl.
1.4 The cost of inaction
The cost to halt the pollution of water may seem prohibitive, and the constraints to initiate action may be numerous, but allowing pollution to continue causes damage and costs money. The damage may sometimes be difficult to measure, but a growing body of evidence demonstrates that pollution is associated with large, quantifiable direct costs to the existing economy and with even higher (missed) opportunity costs. Early preventive action can often generate substantial benefits by reducing future expenditures to mitigate the effects of pollution. Few people and decision-makers are aware that these damages are indeed more costly than one would intuitively expect.
Possibly the best known case is the 1992 cholera epidemic in Peru. Cholera spread because of poor sanitation and the inadequate disinfection of drinking water. This caused the tumble of Peru’s income from fish exports and tourism, which had accounted for 34 percent of the gross national product before the epidemic. The income lost and additional health costs were estimated at US$1 billion, which equalled 10 times the annual amount spent on water supply and sanitation in the regular national budget. Similarly, Shanghai experienced bouts of endemic hepatitis because of contaminated water and seafood. Moreover, most of the incidence of shigellosis, hepatitis, and other water-related diseases in Northern Europe can be traced to contact by tourists with contaminated bathing and drinking water on the Mediterranean coast.
Damage can generally be expressed in monetary terms, which allows a comparison with the cost to prevent or repair the damage as well as cost-benefit analysis. Several values cannot yet be properly monetised, such as the loss of biodiversity or other environmental assets or the social functions of water. A partial list of the types of damage from sewage pollution includes:
· Direct health damage. This takes the form of increased illness or mortality due to the ingestion of or skin contact with contaminated water, raising health care costs. In particular, this refers to the effect of pathogenic bacteria and viruses and of toxic algae, causing diarrheic shellfish poisoning and paralytic shellfish poisoning. Damage assessments usually include the direct costs, such as expenses for treatment and lost income during sick days. Other indirect or opportunity costs are more difficult to estimate but may be substantial, such as lost days at school for children. A study by the Joint Group of Experts on the Scientific Aspects of Marine Environmental Protection (GESAMP) and the World Health Organisation (GESAMP 1999) estimated that bathing in polluted seas causes some 250 million cases of gastroenteritis and upper respiratory diseases every year. Eating polluted shellfish causes millions of cases of hepatitis and thousands of cases of liver damage and death. The study estimates that these impacts cost society worldwide approximately US$12–24 billion per year.
· Loss of tourism income. International tourism and residential amenities have drastically raised the economic value of freshwater and coastal assets, because polluted water and unsanitary conditions deter tourists. Tourism is now one of the largest industries in the world, representing 27 percent of the total value of exported services in member countries of the Organisation for Economic Cooperation and Development (OECD 1993). Spain’s tourism industry depends on its coasts and employs 10 percent of the country’s entire work force. The Caribbean island Bonaire depends almost entirely on tourism related to its coral reef—the same reef that is being slowly destroyed by the island’s sewage. Similarly, local tourists may incur additional costs when they want to visit other recreational sites instead of the nearby, polluted beach.
· Lost income for those whose income depends on reasonable water quality. This pertains notably to fishermen and aquaculture farmers, but also includes the loss of productive days when the supply of processing and cooling water to industries must be suspended. The fisheries are usually of commercial nature but subsistence fishery should also be counted, as many poor people depend on fishing to supplement their protein intake. Organic pollution can deplete oxygen in the water, triggering fish kills or permanently destroying the aquatic ecosystem on which the fish, shellfish, and/or waterweed depend. Pathogenic micro-organisms, heavy metals, and persistent toxic substances often accumulate in fish as well as in waterfowl and aquatic mammals, rendering them unfit for consumption. Eutrophication results in recurring large-scale blooms of algae or other organisms that damage the local aquatic ecosystems and food webs.
· Loss of amenity value of the property near the polluted water. Houses and real estate lose value when the quality of the surroundings deteriorates. Conversely, investments in cleaning up the environment increase their amenity value.
· Additional costs to produce drinking water and water for industrial processes.
The list of damages above is not exhaustive but rather illustrative, emphasizing the widespread, global ill effects of pollution. The increasing urban pressures on coastal zones will multiply the incidence of pathogen contamination, oxygen stress, and the emergence of red tides and toxic micro-organisms. Moreover, these events may confront us with yet unknown problems. For example, a recent, worrisome development is the feminisation of fish and reptiles caused by endocrine disrupters, substances that mimic female hormones and are present, for example, in municipal wastewater and even in conventionally treated effluents.
Box 1.1 presents the results the cost/ benefit calculations of a proper wastewater management scheme in the Turkish Bay of Izmir. The discounted cost/benefit ratio is estimated to vary between 1:4 and 1:8, depending on whether a conservative or progressive scenario is used.
Box 1.1 Types of economic benefits: A case study on Izmir Bay, Turkey (unep 1993).
A case study assessed the economic damage of the pollution of Turkey’s Izmir Bay and the possible benefits of a clean bay.
Discounted benefits of the restoration of Izmir Bay (1990–2025):
The discounted investment cost of a proper pollution control system for the bay is estimated at US$1,326 billion, meaning that the cost/benefit ratio varies between 1:4 and 1:8. Most benefits result from more tourists, an increased number of nights spent in the area by tourists, and from increased salt production. These figures exclude the existence (non-use) value of the bay and of the ecology of Tuzla bird sanctuary.
1.5 A new priority and new agenda
It is time to take up the challenge of managing the pollution of coastal waters by municipal wastewater. Experiences with non-conventional techniques are becoming increasingly available. It is the time for new partnerships between governments and the private sector to be built, and new financial mechanisms for funding effective strategies to be explored.
In 2000, a World Water Vision was developed for the World Water Council and presented at the Second World Water Forum in The Hague. The Vision emphasised the need for new mechanisms for managing water (Cosgrove and Rijsberman 2000), the most vital of which are:
· The pricing of water services at full cost to provide the right incentive to users
· Service-oriented management to respond to users’ needs
· Empowering communities, woman and men, to stimulate people’s initiative and capacity for self-reliance.
To achieve the World Water Vision, investments in water supply and sanitation will have to rise from US$70–80 billion per year to US$180 billion. Private firms—domestic and international—should be the main source of finance, and local communities will have to contribute considerable amounts in cash and in kind. However, in the end, the households, the consumers, will pay most of these costs. Government resources will become a smaller proportion of direct capital investment and maintenance costs.
A recent report by the United Nations Secretary General (CSD 2000) on the progress made in the 1990s in providing safe water and sanitation for all concludes that full coverage can only be achieved in the next 25 years if governments, the international community, NGOs, and civil society commit to undertakings of a much larger magnitude than they have previously. The report recommends that in national programs, attention should be paid to:
1. Making water supply and sanitation integral parts of poverty alleviation programmes
2. Incorporating water supply and sanitation as integral parts of human settlement programmes
3. Improving service delivery, operation, maintenance, service reliability, and water quality
4. Making massive infusions of financial resources coupled with effective cost recovery policies
5. Decentralizing and devolving responsibilities to the lowest appropriate level of management
6. Integrating water supply and sanitation with hygiene education
7. Focusing on the gender dimension of water supply and environmental sanitation
8. Improving information management
9. Integrating water supply and sanitation within a holistic approach to the development, management, and use of water resources.
There is an important role for all stakeholders, from the household level to the regional and national levels. The private sector has an important role as well, as a partner in building and improving infrastructure and providing services, and as a beneficiary of such measures. Opportunities do exist for the private sector to play both of these roles.
There is no single recipe, approach, or strategy to address the problems associated with municipal wastewater. Socioeconomic, cultural, and physical circumstances determine the choice of the best possible mix of approaches and strategies. This document aims to make available practical experience and scientific knowledge on a number of strategies and approaches from which the practitioner might choose the best mixture, appropriate to his or her local circumstances.
CHAPTER 2: APPROACHES AND POLICY STEPS TO MANAGE MUNICIPAL WASTEWATER
2.1 Finding an appropriate approach
In recent decades, many different approaches have been used to address wastewater and sanitation. In the traditional approach, planners and engineers assess the needs and decide what type of service will be provided—the supply-driven approach. This approach was not always successful, particularly not in developing countries. This led to the development of approaches in which more attention is paid to the users’ preferences, and ability and willingness to pay—the demand-driven approach.
The need for integrated approaches and processes, such as integrated water management, river basin management, and integrated coastal zone management, is now widely recognised. This increased attention provides opportunities to address sanitation and wastewater management as an integral part of these approaches. The use of an integrated approach can be triggered by the need for sanitation, but planned developments of certain economic sectors might also create the opportunity to address sanitation. For example, the extension of tourism infrastructure in a coastal zone without the proper treatment of wastewater in a nearby urban area could prevent the optimal use of this opportunity. This opportunity-driven approach can be considered as an extension of the demand-driven approach.
This document highlights all three of these approaches. The approaches are not mutually exclusive, and each has its advantages and disadvantages. No single solution exists to address wastewater management needs or to overcome constraints. The best mix of strategies is influenced by local physical and political circumstances, differences between and within cities, existing infrastructure and institutions, cultural differences, the applicability of certain technical solutions, and so forth. However, lessons emerge from the application of different approaches; examining successes and failures can clarify the underlying factors that may have shaped different outcomes. In the near future, the GPA Clearing-house (www.gpa.unep.org) will make these lessons available and sharing them as widely as possible.
The approaches can be applied within a policy life cycle, which comprises a comprehensive set of related tasks. Section 2.2 describes these tasks.
2.1.1 Supply-driven approach
The conventional approach to wastewater management is based on the assumption that there is a universal demand for services, for which planners and engineers have the appropriate solutions to meet this demand. In this approach, utility planners develop demand projections based on demographic and economic progress indicators. Sector professionals then translate these projections into calculations of hypothetical demand for new services and convert this hypothetical demand into project designs based on sewerage and treatment technologies commonly used in industrial cities of Europe and the United States. This supply-driven approach has often lead to investments by governments and donor agencies that suffer from several serious flaws (Wright 1997), such as:
· The investments are costly, both in absolute terms and relative to the number of people served
· The main beneficiaries are the wealthier neighbourhoods that can afford the high connection charges, with the help of subsidies
· The environmental and water resources implications are not compared with those of other options
· Investments are not recovered.
2.1.2 Demand-driven approach
Understanding the defects of the supply-driven approach led to the development of a demand-driven approach. This approach encourages the use of technologies that are more appropriate to local conditions, and, most importantly, recognises that technology alone is not sufficient to sustain wastewater management systems.
A demand-driven approach requires:
· Understanding what potential users and stakeholders want
· Learning what resources they have and are willing to use to finance the systems
· Learning what resources and capacities they have to manage the operation and maintenance of installed systems
· Designing systems, financing mechanisms, and institutional support structures that are best suited to their needs.
The objective of demand-driven approach is to make service delivery sustainable by basing future improvements on (Watson and Jagannathan 1995; Peterson et al. 1994):
· Demand for services, identified through appropriate consultation with potential users
· Community participation in the selection, planning, implementation, and operation
· Selection of technology appropriate for local physical and socioeconomic conditions
· Transforming the role of central government agencies from service provider to enabler
· Coordinating the agencies responsible for different subsectors (such as water supply, sanitation, and solid waste) and comprehensive planning (physical/land use planning, integrated water management, planning of industrial developments).
Box 2.1 gives a short description of the Strategic Sanitation Approach, a type of demand-driven approach. Box 2.2 summarises a recent email discussion on this approach.
Box 2.1 Strategic sanitation approach (tayler 1999).
The UNDP–World Bank Water and Sanitation Program developed the Strategic Sanitation Approach. Wright (1997) sets out the key features of the approach. He emphasises two fundamental principles, the need for a demand orientation and attention to appropriate incentives. The former is seen primarily in economic terms and is strongly related to users’ willingness to pay, leading to an emphasis on demand assessment studies. The approach sets out a number of key concepts, which are central to strategic approaches to sanitation provision. These include:
· A commitment to sound finances
· A concern with cities as a whole rather than with discrete projects
· A wide view of sanitation, encompassing stormwater drainage, sludge disposal, the disposal of human wastes, and solid waste management
· The use of different sanitation options in different areas within a city, depending on local conditions
· The division and devolution of responsibilities for the management of sanitation services—in other words, recognizing that one organisation does not have to be responsible for all aspects of sanitation provision
· The use of a small-steps approach, which portrays sanitation provision as a process rather than a series of large projects.
2.1.3 Opportunity-driven approach
Four types of issues can be identified as triggers of a management response related to municipal wastewater in coastal zones (WCC 1993, adapted):
1. Societal demands for sanitation
2. Conflicts between users: For example, between users of water resources for water supply and for discharge of wastewater
3. Effects of non-product outputs on the state of the natural system: Such as the discharge of untreated wastewater into sensitive aquatic systems
4. Opportunities: For example, development and/or planning needs, such as aquaculture development plans, infrastructure for tourism development, or the management of integrated coastal zones.
Box 2.2 Summary of an email conference on the strategic sanitation approach.
At the end of 1999, the Global Environmental Sanitation Initiative (GESI) held an e-conference on the Strategic Sanitation Approach (described above). Participants in this discussion concluded that the demand for improved sanitation is crucial to achieving increased sanitation coverage, and emphasised the importance of informing demand and providing appropriate incentives at all levels. They also identified cost recovery arrangements for financing the operation and maintenance of infrastructure and services as an important factor for sustainability. There was a consensus that a strategic approach to sanitation planning is a fundamental prerequisite for improved coverage of infrastructure and services. Participants also agreed on a number of issues regarding the need for an integrated approach to planning and design and reliable information for decision-making processes (Parkinson 2000).
During the discussion, participants noted that it may be difficult to implement such an approach in practice because of local constraints. For example, effective institutional frameworks, appropriate financial arrangements, and proper forms of technology may not be in place at the onset of activities or present in the short term, or the required capacities may not be available. Thus, it may not be to the benefit of a responsible organisation or municipality to initiate this approach.
The adequate handling of wastewater is a prerequisite for enabling socioeconomic development. Thus, the opportunities to address the problem can be created. For example, the expansion of tourist sector/hotel development, the development of coastal aquaculture, urban expansion through project developers due to potential enhanced property values, and industrial development requiring clean, fresh water such as the food processing industry and breweries all provide opportunities to address the management of wastewater. The stakeholders should be involved in the policy-making, and the (planned) socioeconomic developments should be linked with planning and investments for municipal wastewater management. Stakeholders can also be approached to pay their share of the investment and operational costs. Thus, it is clear that an opportunity-driven approach has a wider dimension than the demand-driven approach. Chapter 5 discusses the costs and benefits assigned to different levels of beneficiaries.
The recent increase in attention to integrated management approaches, such as river basin and integrated coastal zone management (ICZM) provides another opportunity to address municipal wastewater, because it can be an integral part of these comprehensive approaches. The lessons from ICZM can benefit the development of appropriate wastewater policy. Box 2.3 presents some of the characteristics of ICZM.
Box 2.3 Characteristics of integrated coastal zone management (wcc 1994).
Integration in coastal zone management is cooperation between all responsible actors. The actors’ incentive for cooperation is their common need to achieve the shared objectives, related to coastal zones, resulting in “win-win” situations. In this context, integrated coastal zone management involves the integration of the:
· Responsibilities of agencies at different levels of government (vertical integration)
· Responsibilities of different government sectors (horizontal integration)
· Responsibilities between governments and local groups
· Policies across economic sectors
· Economic, technical, and legal approaches.
Integrated coastal zone management is performed in a dynamic context that often features changes in: (i) demographic and socioeconomic conditions, including social preferences and demands; (ii) natural coastal systems; and (iii) long-term conditions.
2.2 Policy steps for wastewater management
The approaches described above can be applied within a policy life cycle, a framework, which comprises a comprehensive set of related tasks, all of which must be performed in order to produce certain desired objectives. This process is cyclic and evolves over time, which suggests that the process can also be applied in situations in which some sort of wastewater management already exists. An evaluation of the discrepancy between the present and required performance of the system might trigger a renewed round of defining or reformulating these tasks.
Each cycle addresses problem identification, planning, implementation, enforcement, and evaluation. Each of the tasks in the cycle can be subdivided in a number of different steps, and the different stakeholders should be involved as early a possible in the process. Since the tasks are executed in a cyclical process, step 1, although seemingly the logical place to begin, is not always the first step taken. Steps to identify opportunities or to evaluate the current situation might come first, followed by the other steps in sequence.
The policy steps are:
1. Problem identification
a. Monitoring
b. Assessment and identification of the need for action
2. Planning
a. Review of information
b. Identification of needs and opportunities
c. Setting of objectives and formulation of the plan
d. Formal adoption
3. Implementation
a. Management instruments
· Regulation
· Economic and financial instruments
b.1 Operational management of on-site sanitation initiatives
b.2. Operational management of infrastructure
c. Institutional arrangements
· Institutions
· Capacity building
· Awareness/public participation
4. Enforcement and evaluation
a. Operational management of water quality (monitoring and enforcing rules and standards)
b. Evaluation
Two recent publications provide detailed guidelines for strategic approaches to the sustainable management of water resources (European Commission 1998) and municipal sanitation (GHK 2000), using the policy life cycle as an entry point. The following section describes a number of important considerations in developing a wastewater management policy.
2.2.1 Problem identification
a. Monitoring
The methodology for monitoring (both performance and environmental monitoring) is well established. In the future, the GPA Clearing-house will be a platform to provide monitoring techniques related to wastewater. An adequate monitoring strategy is focused on:
· The areas where impacts can be expected (Table 1.3 presented a qualitative assessment of impacts in coastal zones.)
· The amount and quality of wastewater from industries and small enterprises that is mixed with domestic wastewater
· The amount and quality of urban runoff and the frequency with which it drains into the wastewater collection system.
b. Assessment and identification of the need for action
The early successes in pollution control in industrialised countries in the 1950s and 1960s pertained primarily to oxygen depleting substances, suspended solids, and some heavy metals, in part because this pollution was recognised first, and in part because the technology to address it was available. However, other pollution, particularly from pathogens and the nutrients, has still not been sufficiently mitigated. Lessons that emerged from these early pollution control efforts include the need to:
· Identify the contaminant that is causing serious harm to the region
· Use scarce money to tackle this pollution using cost-effective means
· Establish criteria to prioritise services to communities, based, for example, on health risks or living conditions.
The assessment of the problem, including a review of the existing situation can be conducted on a citywide basis by local government staff. However, it can also be done at the neighbourhood level with the involvement of stakeholders; the assessment then becomes a powerful tool for raising public awareness. Chapter 4 elaborates further on strategies for advocacy and awareness raising.
2.2.2 Planning
a. Review of information
Relevant existing policies and arrangements must be reviewed to make linkages possible with the wastewater sector. These can include:
· Demographic and socioeconomic projections, such as the rate of urbanization, projections of income per capita and distribution, water supply, and water demand
· The existing legal framework including standards, and regulations
· The current institutional framework
· The financial framework
· Related sector policies (such as water supply, waste management, land use planning and zoning, and urban development)
· National economic planning
· Identification of stakeholders and key agencies.
b. Identification of needs and opportunities
When developing a policy for wastewater management, a number of obstacles may arise to hamper its implementation and performance. Identifying the potential obstacles early in the process can allow them to be addressed within the policy. For example:
· Identifying insufficient institutional capacities suggests that capacity building should be one of the implementation activities
· Recognising the need for financial support for investments should influence the kind of partners that could be involved, such as regional development banks or international water companies.
As emphasised in section 2.1.3, the adequate handling of wastewater can be one of the prerequisites for socioeconomic development. Thus, planning and investments for wastewater management should be linked with (planned) socioeconomic developments and the integrated management of river basins and coastal zones. These developments provide opportunities to initiate action. National economic planning and sector planning may provide relevant information on how and where to link them with wastewater management.
For the successful implementation of the wastewater management plan, it is essential that all stakeholders are involved at an early stage. Chapter 4 discusses this issue further.
c. Setting of objectives and formulation of policy
The setting of aims and objectives is a crucial part of a wastewater management plan. It involves consultation and negotiations with all of the stakeholders, as well as the analysis and assessment of the technical, economic, and social feasibility of different options.
The objectives of the wastewater management strategy should be measurable and verifiable. The objectives can be a subset of the overall objectives of integrated water management. The latter could have quality objectives and standards for designated water use (that is, for the production of drinking water, for fisheries, for navigation, and so on) and long-term quality standards for water resources such as rivers, wetlands, and coastal zones.
As the management of wastewater becomes more comprehensive, the most important components of the strategy include:
· Preventing especially toxic pollution at the source
· Minimising wastewater at its origin
· Applying low-cost and on-site sanitation as much as possible, taking into account environmental impacts
· Considering options for recycling. Municipal wastewater and bio-solids or sludge can be recycled after pretreatment, for example, into agriculture, aquaculture, or for industrial cooling and processing
· Identifying the priority constituents and selecting cost-effective mitigation approaches, taking into account alternative technologies
· Applying the absorption capacities that natural systems offer
· Integrating the policy with other sectors, such as water supply and land use planning
· Addressing the zoning of polluting and beneficiary functions, such as industry or coastal tourism
· Considering temporal and spatial differentiation:
Temporal: Invest stage-wise and keep a long-term horizon of future coverage and extension in mind by taking into account the possible consequences for space, design, and operation. Removing the first 50 percent of the pollutant is moderately expensive, but removing the next 40 percent is more expensive, and removing the last 10 percent is often prohibitively expensive.
Spatial: Differentiate neighbourhoods/suburbs by their physical characteristics (slope, soil type, ground water level, existing infrastructure for water supply and sewerage) and socioeconomic characteristics (population density, income, willingness to pay, skilled labour, price of land, energy costs).
· Strive for an integrated approach to river basin management, raising awareness and solidarity in implementation among the populations living upstream and downstream; river solidarity.
d. Formal adoption
A more comprehensive approach for wastewater management requires mechanisms for coordinating the responsibilities of agencies at different levels of government, including the responsibilities of the different stakeholders (vertical integration) and those of different government sectors (horizontal integration). The formal adoption of the policy entails the following steps, among others:
· Establishing an interagency coordination mechanism between the relevant authorities
· Approving staffing and organisational changes that may be required
· Adopting related policies, goals, and new management arrangements
· Assigning, by legislation, the distribution of responsibilities among the authorities, such as monitoring, revenue collection, operation, and maintenance
· Approving the funding allocation.
As the policy moves from the planning phase to the implementation phase, the degree of horizontal versus vertical integration may change. At the beginning of the process, it is most important that all of the different levels of government and stakeholders interact. When the policy is being implemented, other related sectors may play a more important role.
2.2.3 Implementation
a. Management instruments
Each of the responsible agencies has a set of management instruments, in the form of regulatory and incentive-based instruments at its disposal. These instruments should be supported by legislation and other types of authorisation.
The policy must be translated into regulations that, among other things:
· Creates measures to prevent pollution at source, for example, the specific collection and treatment of toxic liquid waste such as car oils, laboratory and hospital waste, and industrial waste
· Ensures that the quality of wastewater discharge falls within the adopted standards
· Ensures that sludge is handled according to the adopted quality standards
· Enables the use of economic instruments, such as financial and fiscal stimuli, to promote waste minimisation, pollution prevention, and recycling
· Promotes the capacity of authorities to enforce these regulatory and economic instruments.
Box 2.4 presents some examples of regulatory and economic instruments.
Box 2.4 Examples of management instruments.
A. Regulatory instruments (command and control)
Licenses and permits
Prohibitions on improper disposal of waste and effluents, including sludge
Rules to discourage the abuse of monopoly privileges
Standards on water quality of effluent and receiving waters
B. Economic or market-based instruments (incentives and penalties)
Adherence to ISO140001
Charges and tariffs
Covenants between government and industry
and/or municipality
Eco-labeling
Public disclosure of pollution control records
Subsidies and cofinancing
Taxes
Tradable effluent permits
1 International Organisation for Standards 14000 series on voluntary environmental management standards
and guidelines.
b. Operational management of infrastructure
A basic distinction can be made between the management of on-site sanitation and of off-site collection and treatment.
The management of on-site sanitation demands a distinct approach, as it is also related to hygiene behaviour and regulations for building and land use in the city. The strong involvement of households and neighbourhood communities is essential. Furthermore, small entrepreneurs can fulfil an important role in operational management.
Several technical agencies are involved in the financing, design, operation, and maintenance of the infrastructure for the collection and off-site, centralised treatment of domestic sewage. For example, public works departments of a municipality are often responsible for operating and maintaining the sewers, while the more complex, main pumping stations and treatment works are often under the purview of regional technical agencies, in order to benefit from economies of scale and synergies.
The next chapter describes different technical options and steps to consider in selecting the appropriate technology. Chapter 5 discusses the financial implications for investments, operation, and maintenance. The operational management is outside the scope of this report.
c. Institutional arrangements
Institutional arrangements provide the framework within which management tasks are undertaken and the management instruments applied. Chapter 4 focuses on these institutional arrangements, as well as on capacity building, raising awareness, and public participation.
2.2.4 Enforcement and evaluation
a. Enforcement
Enforcing existing rules and regulations is one of the most difficult aspects of governance in developed and developing countries alike. The goal should be to have rules that are generally accepted by society and that can be enforced. Strong and objective enforcement is often required when certain parties clearly benefit economically from breaking the rules (Post and Lundin 1996).
Among other activities, enforcing wastewater policy entails:
· Monitoring the agreed water and effluent quality standards
· Issuing discharge licenses
· Collecting discharge fees or penalties
· The operational management of water quality.
b. Evaluation
The results of the wastewater management plan should be subject to regular monitoring and evaluation as a way of continually improving its performance. Thus, it is especially important that the goals and objectives can be specified as clearly and as quantitatively specific as possible; otherwise, assessments are difficult. Any discrepancies between the required and the actual performance must be communicated to the appropriate authorities, to initiate a new round of policy setting.
CHAPTER 3: TECHNICAL OPTIONS
3.1 Selection of technology
This chapter presents a brief overview of technologies for wastewater pollution control. It does not intend to provide a complete and detailed description of all of the technology options available, as excellent overviews on the design, construction, operation, and maintenance of a wide range of physical measures for on-site and off-site wastewater collection and treatment are readily available (Metcalf and Eddy 1991; Viessman and Hammer 1993; GHK 2000). There is a large variety of conventional and less-conventional sewage treatment technologies, ranging from simple screening and settling operations to sophisticated biological and chemical operations. The materials removed from wastewater end up as bio-solids or sludge and other residual matter, which may require additional treatment before disposal. UNEP has an International Environmental Technology Centre (UNEP/IETC) with an Internet-accessible database for environmentally sound technologies to address urban environmental problems and the management of freshwater basins (www.unep.org.jp).
The selection of technology is an essential step in any strategy for wastewater management. The technology should be environmentally sound, appropriate to local conditions, and affordable to those that must pay for the services. The selection process should be combined with awareness and behaviour changes, regulations, and enforcement, and should be applicable and efficient within the context of the whole river basin. The average performance of a technology, its reliability (under variable wastewater flows and compositions and operational problems), its institutional manageability (planning, designing, construction, operation and maintaining capacity, including the local availability of skilled human resources), and required investment, operation, and maintenance costs are other aspects to be considered.
In rural areas with low rates of water consumption, human excreta can be disposed on-site using dry sanitation. As the water consumption per capita increases, sanitation becomes increasingly water-based. Septic tanks can be introduced as a decentralised, on-site treatment system. In areas with higher water consumption rates and population densities, sewerage is often required and the collected wastewater must be treated off-site in centralised systems; however, there has been a recent return to the study of dry sanitation.
Figure 3.1 presents an example of a decision tree for selecting wastewater technology and illustrates a number of key factors in the process (UNEP 1998). Different options should be compared to establish the best available technology for a given community. For example, the use of a land-based alternative, such as lagoons or wetlands, could be compared to a conventional alternative, such as either secondary treatment or primary treatment and outfall discharge. Only after local costs (of power, land, labour, and capital) have been identified can the questions in the decision tree be answered.
3.2 Technological strategies
As mentioned in chapter 2, an innovative wastewater strategy is based on the demand for services, the application of a mix of technological and managerial intervention options, integration with other sectors, a long-term planning horizon, and the use of socioeconomic opportunities.
The application of a mix of technological and managerial interventions, each optimal for different zones in a city, requires an approach with sequential steps (as proposed in table 3.1). The overall strategy in the step-wise approach is aimed to reduce and contain the pollution as much as possible while treating the remaining, more concentrated waste through resource recovery options. The maximum potential of interventions should be exploited at each step before moving on to the next step. The local conditions will determine which step in the approach is most appropriate and contributes most effectively to the (partial) solution of the wastewater problem. The individual steps of the overall approach are discussed in the following sections (sections 3.2.1 to 3.2.6).
Figure 3.1 Example of a decision tree for the selection of wastewater technology (UNEP 1998).
Although successful examples for each of the individual steps presented in table 3.1 have been described elsewhere, the integrated approach as proposed above has not been applied in previous wastewater interventions. Thus, it is essential to develop this new concept further and to establish its feasibility and advantages through selected demonstration projects. Moreover, not all of the steps indicated in the approach involve established or ‘main stream’ technologies. While all technologies will be subject to major developments in the coming years, the further development of new and cost effective technologies, such as dry technology, anaerobic treatment, lagoons, natural systems, and reuse schemes, requires special attention. The development of new concepts should also be encouraged.
Table 3.1 Steps in a sustainable approach to wastewater management, in declining order of preference (adapted from varis and somlyody 1997).
1. Pollution prevention.
2. On-site treatment and reuse (close to production).
3. Off-site transportation: Sewerage and stormwater drainage.
4a. Natural treatment systems: The use and/or stimulation of the natural self-purification capacity of receiving water bodies.
4b. Reuse options and waste valorisation: Using low technology and ecological engineering for the conversion of wastewater into resources.
5. Conventional off-site wastewater collection and centralised, high technology, end-of-pipe treatment.
3.2.1. Step 1: Pollution prevention
The assessment and implementation of opportunities to prevent pollution should be the first steps taken when deciding on technical options. Other terms used to describe pollution prevention include low waste technology, cleaner production, waste and emission prevention, waste minimisation, and source reduction. Pollution prevention aims to reduce or prevent pollution at its source, minimises the use of resources, thereby reducing the amount of waste discharged into the environment (see box 3.1). It should also involve preventing solid waste, including litter, from washing away with stormwater.
Box 3.1 Reducing wastewater in Korea (veenstra et al. 1997).
Reducing domestic water consumption is a very effective way to reduce sewage volume and makes treatment less expensive. Demand management, using water saving technologies in households, and, for example, reusing grey wastewater for toilet flushing, may yield significant reductions in required wastewater capacity. In South Korea, for example, the expansion of the sewage treatment capacity for Seoul and Pusan was proposed based on the projected growth of tap water consumption from 120 to 250 litres per capita per day. When the costs of such expansion appeared too high, investments were made to promote water savings in households. This eventually allowed the design of sewers and wastewater treatment plants to be scaled back by half.
Industries have implemented a wide variety of pollution prevention measures, and a large number of successes have been documented in recent years (see, for example, the website of the UNEP Cleaner Production Program, www.unepie.org). The adoption of cleaner production technologies in industry can reduce or even eliminate the need for investment in end-of-pipe treatment technology. As a rough guide, 20 to 30 percent reductions in pollution can often be achieved without requiring any capital investment, and additional reductions of 20 percent or more can be achieved with investments that have a payback period of only a few months (World Bank 1997a). Such efforts do, however, require continuous managerial attention.
Currently, water consumption rates are almost directly correlated with a country’s development status. Thus, it may be difficult to suggest to developing countries that only ‘new’ connections to water services should use a different wastewater management approach. It is clear that alternative concepts of non-water borne sanitation or low-water consuming alternatives need to be developed and introduced in both industrialised and developing nations.
3.2.2 Step 2: On-site treatment
After having ensured that pollution is prevented to the largest possible extent, on-site treatment should be considered as the second step. On-site sanitation is effective when little or no piped water is available. It consists of on-site systems for wastewater collection and treatment at the level of a household, a community, or an apartment block. Package plants are used mostly for resorts, hotels, and other public buildings.
On-site systems use either a septic tank or a pit for collection. Characteristics of on-site systems with regard to collection include:
· A septic tank, which is a watertight tank that collects wastewater from toilets, showers, sinks, and other household utilities through a pipe. In this system, the solids settle on the bottom.
· In a pit latrine, the solids settle but the liquid seeps directly into the soil. This can have serious effects on the quality of the nearby (ground) water.
· They are low-cost technologies that allow construction, repair, and operation by local communities or homeowners.
· They effectively reduce public health problems related to wastewater.
Characteristics of on-site systems with regard to treatment include:
· The liquid flows out of the septic tank into a drainage field or overflows into a drainage system. The area needed for effluent disposal depends on the flow rate and local soil infiltration. The effects of these flows on the quality of the ground water must be considered.
· The solids that accumulate in the pit or tank (some 40 litres per person per year) have to be removed periodically. The liquid is usually discharged into nearby sewage treatment plants or into a separate waste stabilisation lagoon
· A septic tank will remove 30 to 50 percent of BOD and 40 to 60 percent of suspended solids. In properly designed septic tanks with soil absorption of the liquid flows, the soil will remove the remaining BOD, suspended solids, bacteria, and viruses from the effluent.
Selection criteria to decide whether on-site treatment is appropriate:
· Population density (number of people per hectare)
· Produced wastewater volume (in cubic meters per hectare per day)
· The presence of shallow water wells susceptible to sewage pollution
· Soil permeability
· Unit cost of sewerage
· Socioeconomic and cultural considerations.
The congested nature of many peri-urban settlements restricts the space available for pit latrines and septic tanks. Furthermore, in densely populated areas, the volume of generated wastewater may exceed the capacity for ground infiltration. The additional risks of ground water pollution and soil destabilisation (affected by factors such as ground porosity, slope, and high water tables) often necessitate sewerage and centralised treatment. Depending on the local physical and socioeconomic conditions where central sewage collection systems are not economically feasible, on-site sanitation may therefore be feasible only for lower density towns, city districts, and rural areas.
3.2.3 Step 3: Off-site transportation: Sewerage and stormwater drainage
Off-site options should be considered when on-site treatment could entail direct risks to health or to ground water, or risk the faecal contamination or eutrophication of coastal waters, as in more densely populated areas. For this, sewerage must be provided. In areas where wastewater production levels exceed 10 cubic meters per hectare per day, off-site transportation is definitely required. For areas with lower wastewater production levels, additional decision criteria regarding the need for sewerage include the presence of shallow ground water wells used for water supply, the soil permeability and capacity to absorb effluents, and the population density.
Centralised treatment systems require sewage collection and transportation through a sewer system. Combined sewerage systems carry sewerage and stormwater in the same conduit. Separate systems transport stormwater and sewage through separate stormwater drains and sanitary sewers respectively.
Comparison between separate and combined systems
Separate system
Combined system
· Requires smaller, more regular, and more concentrated wastewater flows (dry weather flow)
· Treatment process performance is consistent
· The overland flow of stormwater reduces the required capital investment for the separate system
· Is cheaper than the combined system.
· Requires an even rainfall distribution throughout the year
· The treatment plant must accommodate two to five times the peak dry weather flow
· Soil erosion must be controlled (for example, by paving road surfaces)
· Overflows can contain wastewater that is discharged to the surface water
· Requires simultaneous investments for drainage, sewerage, and treatment
· Is most appropriate for more industrialised regions with a phased urban development.
For both systems, the following points are relevant:
· The construction costs are relatively high, depending on slopes, soil, and ground water level.
· The unit costs for sewerage decrease with higher population densities.
· Gravity sewers are preferred because of their lower operation and maintenance costs compared to pumped systems. Veenstra et al. (1997) note that gravity sewerage become economically feasible at population densities of 200 to 300 persons per hectare in developing countries, and at 50 people per hectare in industrialised countries.
Conventional sewerage systems may be difficult and expensive to construct in densely populated, low-income areas. Therefore, intermediate sewerage technologies can be applied in many places. Small PVC pipes connected to septic tank overflows allow easy construction in rocky surfaces and prevent damage due to soil instability, while virtually eliminating infiltration. The operation and maintenance of these small bore systems is labour-intensive and requires community involvement. Veenstra et al. (1997) describe a number of successful examples of small bore sewerage projects in Brazil, Colombia, Egypt, Pakistan, and Australia.
Small bore sewerage can be more cost effective than on-site sanitation where population densities exceed 200 persons per hectare. One possible problem with small bore sewerage arises if septic tanks are not desludged regularly, or if only the liquid is removed; this leaves the solids in the tank until they overflow, possibly causing the blockage of small sewers. This poses additional public health risks if the overflowing septic tanks are illegally connected to public, open drains or sewers.
Decision trees for the choice for on-site sanitation, intermediate small bore sewerage, or conventional sewerage can be found in the literature (see, for example, UNEP 1998 and World Bank 1982).
3.2.4. Step 4a: Natural treatment systems
The use of the cleaning capacity of natural systems should be considered as the next step for the treatment of the collected sewage. In areas with higher population densities, it is feasible to develop a local collection system and use a single facility to treat the community’s waste. Lagoons and stabilisation ponds are inexpensive, common biological treatment options with low operational costs. They are being used, for example, in mid-sized communities in the wider Caribbean region (UNEP 1998). The treatment is stimulated by self-purification of the natural ecosystems and water bodies or by stimulating these natural, biological processes in effective, low-cost, engineered systems. The criteria applicable to the selection of natural treatment systems include:
· The potential to generate useable resources
· The price and availability of land, as they require greater land area than conventional processes
· The possibility of reducing retention time by stimulating natural conversion processes and/or by including an anaerobic pretreatment step.
The capacity for nutrient removal may not be adequate for densely populated areas near eutrophication-sensitive estuaries or near coral reefs. In these cases, more conventional treatment options may be required.
Box 3.2 and 3.3 present examples of the use of natural ecosystems. Such systems are operating in both developing and industrialised countries for the conversion of wastewater into useable resources.
Box 3.2 Ecological engineering: Wastewater–fed aquaculture.
Aquaculture is a widely applied strategy for wastewater treatment and reuse. Fish raised in (pretreated) wastewater-fed ponds represent an important source of high quality animal protein for many millions of people, especially in southeast Asia. In addition, the direct reuse of excreta in aquaculture is traditionally practiced in a number of Asian countries, including China, India, Indonesia, and Vietnam.
The world’s largest example of wastewater-fed aquaculture is the Calcutta wetland system, located immediately east of the city (Edwards and Pullin 1990). The wetlands receive about 550,000 cubic metres of untreated wastewater per day, which flows through about 3,000 hectares of constructed fishponds within the wetlands area. The annual fish production amounts to 13,000 tons (mainly Indian Major Carp and Tilapia), which is supplied to fish markets in central Calcutta and consumed in the wider region.
However, it is clear that these practices will not comply with current World Health Organisation guidelines for microbiological quality in aquaculture (that is, 0 nematodes and less than 10,000 faecal coliforms per 100 ml in the pond so that fish and vegetables are exposed to less than 1,000 coliforms per 100 ml) without low-cost pretreatment in stabilisation ponds at short retention times (Mara et al. 1993).
Marine sewage outfalls are another example of self-purification. Raw and pretreated wastewater can be discharged in coastal waters, deep and dynamic enough to achieve a proper dilution, and with long travelling time of pathogens to sensitive areas. A long outfall pipeline is also required, along with a diffuser at the end, which discharges at a certain depth. However, a sound understanding of the local morphodynamics of the coastal waters is essential for the proper design of the coastal outfall.
3.2.5. Step 4b: Reuse options and waste valorisation
While considering the use of the cleaning capacity of natural systems, the reuse of wastewater and wastewater products should also be considered. A main problem with wastewater treatment is that the result obtained after treatment is not widely recognised as a valuable product. This may explain in particular why many ‘low-cost’ wastewater treatment systems are poorly maintained and eventually become inactive. If the treatment process itself, in addition to the purified effluent, generates valuable products, it would create an important incentive to optimise the operation and maintenance of the treatment plant. There are numerous examples of effective reuse or resource recovery from wastewater achieved in so-called integrated systems.
Characteristics of reuse options
Integrated systems combine processes and practices to optimise the use of resources by recycling waste, to recover and reuse energy, nutrients, and possibly other components. The conversion processes for different sources of waste are arranged so that minimum inputs of external energy and raw materials are required and maximum self-sufficiency is achieved.
Box 3.3 Ecological engineering: Duckweed-based sewage treatment and resource recovery in Bangladesh.
Stabilisation ponds for the treatment of wastewater can be modified by the use of aquatic macrophytes such as Pistia, water hyacinth, or duckweed. Duckweed-based wastewater treatment has been successfully introduced in a number of countries. In Bangladesh, for example, a local NGO, PRISM–Bangladesh, has operated a small-scale, duckweed-based pond to treat domestic sewage for more than 10 years (Gijzen and Ikramullah 1999). The protein-rich duckweed (Lemnaceae) biomass is harvested daily and fed to adjacent fishponds, which yield an annual fish production of 12 to 16 tons per hectare. During the last five years of operation, the system has generated an annual net profit of almost US$2,000 per hectare. By comparison, the maximum annual net profit for rice production in Bangladesh is estimated to be US$1,000 to US$1,400 per hectare. A detailed financial evaluation of the wastewater treatment and aquaculture facility suggests that this is probably the first system that is able to generate a net profit from the treatment of domestic sewage. This is possible because the low-cost treatment is combined with revenue generating aquaculture.
In rural Asia, integrated systems are an old concept that has been applied for hundreds or probably even thousands of years. In China, for example, there are huge farms that are almost completely self-sufficient in terms of energy and nutrients because of the effective recycling of their waste streams. Box 3.2 and 3.3 present some examples of effective reuse and waste valorisation, and low-cost and land intensive systems that could be attractive, especially in low- and middle-income countries. The application of integrated concepts provides a good balance between resource use and reuse and environmental protection.
To prevent toxic components from polluting the bio-solids or sludge, the components should be retained at the source as much as possible. The then–clean bio-solids can be used in agriculture to improve of the structure of the soil and as fertilizer.
3.2.6 Step 5: Conventional treatment
After all of the options described above have been considered and rejected, the use of conventional systems should be considered. The development of the ‘Western’ conventional wastewater management concept originated in the 19th century with the prime objective of preventing waterborne diseases. This has been achieved by selecting clean water resources and by developing effective systems for water treatment and the distribution of potable water. Consequently, large volumes of clean drinking water are used to transport human waste out of the city. Since the large-scale introduction of centralised water supply and sewerage infrastructure, cities in countries with a high gross national product have been essentially free of waterborne diseases.
Conventional wastewater collection and disposal systems:
· Aim to control the transmission of waterborne diseases and to prevent degradation of the environment
· Require large volumes of diluted wastewater, collected by an extensive sewer system and treated in modern, centralised treatment works
· Require large investments, highly skilled labour, and stable socioeconomic conditions
· May increase the risk of waterborne diseases if collection of wastewater is not combined with effective end-of-pipe treatment.
The national plans of all developing nations address the importance of increasing the coverage of safe water supply to the population, and donor agencies and development banks promote this objective and provide support. After safe, centralised drinking water services have been provided in low-income countries, it is unlikely that sufficient financial resources will be available for the proper collection and treatment of the sewage before it is discharged into nearby bodies of water. Consequently, the sanitary waste (excreta) that was previously contained and treated using on-site technology (such as pits or composting toilets) will probably appear as sewage pollution in nearby water resources. Depending on the carrying capacity of those water resources, this can seriously threaten the environment and the health of the users and communities downstream.
Table 3.2 provides an overview of conventional treatment options. See Metcalf and Eddy (1991) and Viessman and Hammer (1993) for detailed descriptions of these technologies.
Table 3.2 Classification of common and advanced wastewater treatment processes.
Economies of scale can play a role in designing conventional wastewater management and infrastructure. This is because of the physical and technical characteristics of treatment technology and water pollution. The consequent incentive to centralise the capacity of treatment plants is balanced by the increasing cost of transporting sewage over longer distances. Planning wastewater treatment based on the administrative boundaries of small municipalities rarely makes sense. On the other hand, regional cooperation among municipalities or other local government creates major financial gains and offers stronger “win-win” options than it does in any other sector. Large plants serving more than 300,000 people are also able to invest in technologies that substantially lower the operational costs for maintenance, energy, and sludge disposal. For example, only large plants can invest in sludge digestion reactors with methane gas recovery and gas-powered generators. Enough electrical power can then be generated to supply all of the power required by the plant, which is often the largest recurrent operational expenditure. Similarly, it usually makes technical and, thus, financial sense to combine domestic and most industrial (pre-treated, not heavily polluted) wastewater streams.
Removing pollutants from wastewater results in the production of sludge, which is subjected to another series of treatments before its disposal. Anaerobic digestion is the most commonly used process for sludge treatment. Digested sludge requires dewatering before its final disposal. If concentrations of the heavy metal and toxic organics are below the admissible standards, the dewatered sludge can be applied as soil amendment; if concentrations exceed these standards, the sludge is placed in landfills or is incinerated. The assessment of the sludge quality requires an adequate monitoring system. Industrial wastewater frequently contains non-biodegradable pollutants and requires physicochemical treatment (chemical coagulation and flocculation). The sludge that is produced is often heavily contaminated and not fit for reuse.
3.3 Evaluation
The efficiency of a certain technological solution depends on the design, the physical circumstances, the state of operation and maintenance, and so on. Table 3.3 gives the ranges of the removal capabilities for certain substances in wastewater for the technical options mentioned in this chapter. In the future, the GPA Clearing-house will serve as an entry point and reference point for more information on technologies.
The cost of conventional wastewater infrastructure is prohibitive in the majority of, if not all, developing countries. Grau (1994) and Gijzen (1997) estimated the time needed to meet European effluent standards (20 mg/l BOD, 20 mg/l total suspended solids, and 1 mg/l total phosphorous for surface water) by a number of low- and middle-income countries, assuming that 1.5 percent of the gross national product can be invested in sewers and treatment facilities. Table 3.4 summarises their results.
Table 3.3 Typical removal capabilities of various treatment processes, effluent concentration or removal efficiency (adapted from national research council 1993; unep 1998).
Table 3.4 shows that this period far exceeds the economic lifetime of the treatment plant (20–30 years) and in many cases even that of sewers (50–60 years). Thus, it is unrealistic to implement conventional wastewater collection and treatment in developing countries to reach European Union standards. However, conventional wastewater collection and treatment may be feasible in densely populated urban centres where the average income is much higher.
Table 3.4 Estimated time needed to meet European Union (EU) effluent standards at an investment level of 1.5 percent of gross national product (GNP) (Grau 1994; Gijzen 1997).
The issues mentioned above suggest that the wide application of the current ‘Western’ conventional approach to water supply and wastewater should be reconsidered or re-evaluated before applying. Changes in the industrialised world will be slow due to the huge investments that have already been made in the existing infrastructure for water supply, collection, and treatment in these countries, together with the considerable commercial interests of established companies on the technology supply side. Nevertheless, it might prove rewarding to develop long-term strategic approaches leading to sustainable urban water services within two to four generations. Most low- and middle-income countries have not yet invested heavily in the physical infrastructure for urban water supply and wastewater; thus, they may benefit in the short-term from considering such new approaches.
The challenge for the coming decades will be to develop integrated concepts and processes for the minimisation, recovery, and reuse of waste materials for energy, nutrients, and other valuable components in both rural and urban environments in both high- and low-income countries. This approach will provide a more sustainable solution than the widely applied, costly end-of-pipe treatment. If effective programmes and action plans could be defined by relevant organisations, such as the United Nations, the World Bank, national governments, universities, and research centres, this challenge could be met within a reasonable period with the help of modern science and technology.
CHAPTER 4: INSTITUTIONAL ARRANGEMENTS
4.1 Type of partners and institutional arrangements
Section 2.2 described the tasks in relation to policy setting for wastewater management, each complementary and each requiring distinct expertise and appropriate institutional arrangements. These tasks are performed by and with the involvement of:
· National, regional, and local governments
· Regional organisations, such as river basin authorities or water boards
· Households
· Non-governmental organisations, such as consumer associations, environmental groups, and civic action groups
· Professional service providers
· Water service operators (public and private)
· Private sector companies as water polluters
· Private sector companies as benefiting entities.
Box 4.1 Institutional changes in England and Wales.
England and Wales recently went through four phases with distinct institutional arrangements and organisational structure with respect to water management and pollution control:
Before 1972 Local government departments owned and operated the wastewater infrastructure, and were responsible for water supply. This led to severe inefficiencies, because each municipality had its own small, inefficient treatment plant but lacked critical mass for technical expertise and financing. Regulation and water quality management rested with Inspectorates and the River Authorities (one for each of the nine major river basins).
1972–1982 To increase the scale of the organisations, all water resource and service management was brought into one organisation per river basin. Nine Water Authorities were created, to be supervised by local governments. All assets were transferred to the Water Authorities except for city sewerage, and many activities were merged, including drainage, river management, and water supply. In addition, the regulatory function was brought under the same roof. However, the organisations proved too large and unfocused, struggled with internal conflicts of interest, and were unable to generate a sufficient volume of investment to meet increasing environmental quality standards.
1982–1989 The Authorities were made more business-oriented in order to increase their efficiency and effectiveness. They came under the supervision of the national Environment Ministry. Preparations were also made for privatisation.
After 1989 The government sold the water supply and wastewater assets of the Authorities to public and private investors. These regional, private utilities retained their monopoly in their river basins. The regulatory and water quality management functions were taken over by the National Rivers Authority, which is also responsible for river management, and by the Environmental Authority. The new Office of Water was created as the financial regulator to ensure that the companies meet government policy and do not abuse their monopoly. The separation of operator and regulator functions was considered essential.
Existing arrangements among these actors depend on a country’s cultural, social, economic, and political conditions. However, these conditions change, and thus, the arrangements will also change. For example, England and Wales went through a fundamental shift in their water management organisations in the 1980s because the existing river basin–based Water Authorities could not cope with the large financing requirements to address water pollution. This led to the privatisation of the water utilities in 1989 (box 4.1).
This case study illustrates that sustainable wastewater management will require carefully devised institutional arrangements. In particular, the important institutional arrangements include the following (Alaerts 1997):
· The overall institutional structure. Links should be made with other relevant sectors, such as urban development, water management, solid waste, and industrial policy but also to the sectors in which its impacts are felt, such as health, environment, and agriculture. At the national level, it is particularly important that all sectoral functions are adequately addressed through technical organisations and other institutional arrangements; this requires proper role descriptions, responsibility, authority, and other means to carry out the tasks and avoid overlap in competence, loopholes, or “blind spots.” Formalised and informal links among all of the stakeholders mentioned above, the vertical integration, is required to optimise communication and cooperation.
· Implementing agencies. These comprise typical, “formal” agencies such as national ministerial departments, state or municipal technical departments (for example, departments of environmental management, public works, or public health engineering), water utilities, and river basin agencies. At very local levels, they can include community-based organisations for sanitation in slum areas.
The performance of implementing agencies depends on their mandate and means, the right balance between decision-making and financial autonomy and accountability, the quality of their leadership, and the professional skills mix of their staff.
· Legislation is required to determine the division of responsibilities and authority, performance standards, systems for regulation and incentives, financial flows, and so on. The legislative obligation can also come from international law. For example, conventions (binding arrangements between governments) are in place in a number of regions of UNEP’s Regional Seas Programme. In one region, the Wider Caribbean, a protocol was adopted in 1999 focusing specifically on municipal wastewater, obligating member countries to address the problem in a phased manner and on an agreed schedule.
· Regulatory tools and incentives systems. These institutional arrangements consist of agreed procedures. Typically, a mix of regulatory and incentive systems (“sticks and carrots”) is most effective. The incentive systems are especially relevant because they often have the largest influence on the behaviour of people or an industry. Positive incentives include subsidies, cofinancing arrangements, and tax reductions to promote the construction of wastewater facilities. Negative financial incentives include tariffs, charges, and penalties to discourage the production of potentially polluting substances, reduce water use, or generally making polluting alternatives more expensive than clean alternatives Regulation in the United States first tried an administrative approach, but it is now supplemented with more flexible approaches (box 4.2).
· Financial flows. The appropriate structure of financial flows is particularly critical in attaining pollution control goals. The overall effectiveness of a wastewater management plan depends on the successful completion of complementary activities by separate agencies, such as for wastewater collection, its treatment, and discharge regulation. For each activity, financing arrangements must be sustainable and the costs commensurate with willingness to pay. Thus, each main activity depends on different contributors, including households, industries, municipal governments, and national funds. Consequently, money flows originate in different sectors, are often managed by more than one agency, and must be directed to different cost sites that are frequently located in different sectors.
Box 4.2 Regulation and treatment in the United States of America (usa) (adapted from mariño and bohland 1999).
The 1971 federal Clean Water Act governs current wastewater policy in the USA. It is characterised by strict national standards and “command and control” procedures, backed up by strong law enforcement. It employs both technology-based effluent standards and ambient water quality standards to issue renewable discharge permits. However, no charges or taxes are associated with discharge.
In principle, all polluters have to comply with the same rules. For example, all plants are currently required to have secondary biological treatment regardless of their location. Increasingly, however, full compliance with national, technology-based standards is proving financially unfeasible in many locations.
The wastewater collection and treatment infrastructure is owned and operated by local governments (municipal or county), or, frequently, by regional associations of local governments. No infrastructure is owned privately, but private contractors operate some schemes under lease or concession agreements. Cost recovery is usually adequate, but in the first decade of the drive to treat all wastewater (until 1985), state and federal governments made large grants available, to cover up to 75 percent of construction costs.
Weaknesses of the policy include rigidity, excess costs arising from uniform standards that do not reflect local conditions, a lack of incentives for waste minimisation, pollution prevention, or technological innovation. Recent modifications under consideration are various forms of river basin approaches, localised approaches, increasing local participation and control, and providing more flexible ways for polluters to achieve compliance.
4.2 Design of institutional arrangements
Before modifying institutional arrangements, existing institutional frameworks must be identified and their strengths and weaknesses assessed. The assessment should examine the following: The agencies already in place, their organisational structure, roles, responsibilities, gaps, and/or overlapping authority. Most countries have extensive central government agencies, but regional, and especially local levels, will have minimal experience and capabilities. Thus, institutional strengthening must begin with the existing structure and recognise that any structure requires continuous effort before it is functional. The national institutional framework must be integrated to ensure that central, regional, and local agencies are aware that coordination and cooperation is essential when addressing wastewater sector issues.
A number of design criteria can be devised for institutional arrangement in wastewater management:
· “River basin solidarity.” This requires creating appropriate organisations and other institutions dedicated to:
(i) Strengthening the sense of solidarity and cooperation among people within the river basins
(ii) Ensuring that all stakeholders in water use, including the in-river ecological interests, are recognised and have a voice
(iii) Setting long-term goals and priorities
(iv) Collecting feasible financial contributions from all inhabitants (water users and polluters) that can then be allocated to a step-wise investment program.
· Flexible regulation. Regulations, if enforced adequately, can serve a number of purposes, but often come with hidden opportunity costs if they do not take local circumstances and opportunities for synergy into account. Many regulations for pollution control could be better formulated so that local regulators and polluters can devise cost-effective solutions. In this way, the government positions itself as the facilitator, and as guarantor that the goals will be achieved, rather than the implementer of the policy. More flexible regulations typically include:
· Market-based and financial instruments
· Self-regulation: Covenants, negotiated between the governments and polluters (such as industries and municipalities), which set mid- and long-term goals but leave the detailed implementation to the polluters themselves
· Informal regulation: Public interest in environmental quality raises the pressure on polluters to comply with regulations.
· Longer-term and broader strategy. The high costs involved in achieving comprehensive wastewater management (chapter 1) necessitate that successive priorities are identified and that stage-wise investments and gradual capacity building take place. Such strategies should stretch over several decades and should seek sustainability and economies of scale through negotiated cooperative arrangements. For example, with rapidly expanding cities, it is worthwhile to plan ahead, before an area becomes a busy city quarter with many commercial interests but lacks proper wastewater treatment. Box 4.3 gives an example of long-term planning and integration with land use planning.
Box 4.3 Integration with land use planning.
In a World Bank–financed programme in China for the collection and treatment of wastewater in cities along the Yangtze river, the original proposal to collect and fully treat municipal wastewater had to be altered substantially because of concerns about the technical and financial feasibility. The wastewater contained far too many components, originating from industries that would seriously hamper the normal operation of a treatment plant. The agreed-upon, less expensive proposal entailed:
(1) relocating the main factories to new industrial estates; (2) providing clean technologies where possible, as well as the specialised treatment of industrial wastewater to remove all noxious components; and (3) collecting primarily household and non-toxic wastewater in the sewers, and, after simple mechanical treatment, releasing it into the river. Full treatment of domestic wastewater was considered a second priority because of the large dilution capacity of the Yangtze.
· Task distinctions between “operator,” “regulator,” and “owner.” It is advisable to strictly separate the functions of regulation and monitoring of wastewater discharges (typically a role for an environmental agency), and the function of attaining the standards (typically the role of the municipality, a related technical agency, or a utility). Similarly, a distinction must be made between “owner” and “operator.” Although municipalities may be vested with the responsibility and authority to collect and treat wastewater, and thus “own” the wastewater, they may choose to delegate parts of the operational tasks to private firms or other public agencies (see chapter 5).
· Synergies. The optimal arrangement of institutions entrusted with the different pollution control functions is partly determined by the existence of synergies with existing or new institutions, which in turn depends on a country’s hydrological and other characteristics. In the United States, for example, the greatest synergy was found by combining all regulatory and several management functions into one environmental agency, the Environmental Protection Agency, while the operations remain at the municipal level. In France, synergy between the management of water quantity and water quality is found in river basin agencies, while the wastewater operations remain in municipal hands. In the Netherlands, synergy is achieved by assigning the task of wastewater treatment to water boards (See table 4.1). In some situations, the management of wastewater infrastructure is merged with other services, such as water supply, power, or public transport, into a city enterprise (like, for example, in Germany and Colombia).
· Enforcement, accountability, and transparency. The design of tasks like monitoring water quality, issuing discharge licenses, collecting discharge fees or penalties, and the operational management of water quality should take the potential for enforcement into consideration. It is important to maintain public scrutiny on organisations that serve such public purposes as wastewater management to keep them efficient and effective. Accountability to (the different interests in the) public and other stakeholders can be institutionalised in organisations by adjusting their working procedures to this purpose or requiring them by law to submit to public audits or divulge critical information. Transparency regarding the organisational objectives, targets, performance as measured against benchmarks, and finance is essential to allow the public to assess the effectiveness of the organisations and, if necessary, to call for remedial action. Transparency and access to information are essential to accountability; the effectiveness of this transparency depends upon agreement on detailed internal procedures.
· Competition. Networked systems for wastewater management present very strong natural monopoly characteristics, much stronger even than in water distribution. There is virtually no scope for introducing direct competition within such systems. Experience shows that direct government providers of wastewater services typically lack either the competitive or regulatory pressure needed to stimulate efficient performance. Whether a government bureau or a public enterprise, government providers work under civil service employment, government procurement arrangements, and government budgeting that provide little incentive for highly efficient operation. The introduction of the beneficial effects of competition can be achieved through the adoption or threat of public–private partnership contracts. This will not lead to “perfect” competition, but can promote many of the beneficial effects of competition. Competition is increasingly seen between private sector operators, and between the public and the private sectors.
· Long-term economic equilibrium. The investment, maintenance, and operating costs of virtually all wastewater management systems are very high. Moreover, because much of the infrastructure is invisible, there is a strong tendency toward neglect. When neglected, these systems deteriorate very rapidly and cease to perform their functions correctly. Consequently, it is particularly important to ensure that the long-term economic equilibrium of the system is designed into the institutional arrangements. This applies in both public operation and public–private partnership contracts. It is particularly important in public–private partnership contracts in which the private sector has been asked to make very substantial capital injections and incur short-term operating losses at the beginning of the contract to correct a backlog situation. These investments and operating losses must be compensated prior to the expiration of the contract.
· Devolution and subsidiarity. The experience with water management calls for “decentralising water management to the lowest appropriate administrative level” (WMO 1992). As a rule, national governments should not implement tasks that can be done more efficiently or effectively at lower government levels, although they should ensure that these tasks are executed (subsidiarity principle). Similarly, governments should not implement tasks that can be done more efficiently by private firms or by local communities. National governments are to keep control by facilitating agreement on broad national priorities and strategies, and by issuing and enforcing general regulations. Local government has clear responsibilities in meeting sanitary goals, but must seek cost-efficient ways for implementing these duties.
Table 4.1 Organisational arrangements for the different functions in water pollution control in five countries.
1 In about half of the cases operated by specialised private firms under concession or lease contracts with the local government, which retains ownership of the infrastructure and ultimate regulatory authority. In the other cases, both ownership and operation are within technical departments of local governments.
2 AQUAFIN is registered as a private investment and construction firm; 51 percent of its shares are held by different government levels and the remainder by the private sector, including about one-third by the English utility, Severn-Trent. AQUAFIN’s costs are recovered through payments from the Flemish Environmental Agency (tariff) and regional government subsidies.
3 United States Environmental Protection Agency.
4.3 Building institutional capacity
Weaknesses in institutions or institutional arrangements, in their broad meaning, are a major cause of underperformance in the wastewater management sector. The 1996 United Nations Development Programme (UNDP) Symposium on Capacity Building in the Water Sector (Alaerts et al. 1999) concluded that it is insufficient to train staff and students better, when the aim is to remedy these weaknesses. Rather, it is necessary to work simultaneously on three basic elements:
· The creation of an enabling environment with targeted policy and legal frameworks
· Institutional development, including community participation
· Human resources development and strengthening of managerial systems.
In a number of cases, it may suffice to strengthen the existing situation, for example, by introducing new or additional procedures and skills, such as technological expertise, accounting, communication with local communities, or cost recovery mechanisms. In other cases, however, it is necessary to reform the existing arrangements, which can entail wide-reaching interventions in the administrative, organisational, legal, and regulatory frameworks.
Tools that can be used for capacity building include (Alaerts 1999):
· Training, problem-solving workshops, and hands-on application of new principles
· Skills and attitude development
· Joint and participatory review of administrative, regulatory, and legal frameworks, involving the stakeholders, teachers, and consultants, and enactment of proposed changes
· Twinning arrangements among peer organisations from different regions
· Dedicated networks for the dissemination of generic as well as local knowledge, this can take place on a global or regional scale, as envisaged in the GPA Clearing-house system
· Developing databases and management information channels
· Education, and distance and modular education programs
· Technical assistance on management.
Of course, capacity-building programs must be carefully tailored and prioritised to suit local problems and financial capabilities.
4.4 Advocacy and public awareness
The success of wastewater management programmes depends on effective advocacy and public awareness through information, education, and communication.
Public awareness is only one element of a communication process that includes (McKee 1992):
· Advocacy: Creating awareness and getting the commitment of decision-makers for a social cause
· Social mobilization: The process of bringing together all feasible and practical intersectoral social allies to raise people’s awareness of and demand for a particular development programme
· Programme communication: The process of identifying, segmenting, and targeting specific groups or audiences with particular strategies, messages, or training programmes.
Below is an example of how the government of Bangladesh used McKee’s communication planning model for the Sanitation for All programme, which it implemented from 1993 to 1998 with support from the United Nations Children’s Fund (UNICEF), Denmark, and Switzerland. Political will, linked with an investment of more than US$4 million and the use of appropriate and effective allies, contributed to an increase in the use of sanitary latrines from 10 percent to nearly 40 percent of the population.
Figure 4.1 Communication planning model (mckee 1992).
Communication for behavioural change is a complicated process of human action, reaction, and interaction. It involves looking at situations from the viewpoint of other people, and understanding what they are seeking. It requires understanding the potential obstacles to change, presenting relevant and practical options, and telling people about the results of the choices they make. Communication can help to get policy-makers, the private sector, and people/communities committed to programmes and can help to prevent expensive mistakes.
People tend to change when they understand the nature of change and view it as beneficial, so that they make an informed and conscious choice to make it a priority. Unless their circumstances are taken into account, and their needs are met, no effort to promote change will be successful. People must be informed and convinced, or they do not feel part of the effort and may not be motivated to change their behaviours.
In addition to the important role of leaders, who initiate, promote, and coordinate activities, are another critical component for success are “champions,” such as a neighbourhood or group of families, who take over the initiative and who are committed to bring the initiative to a success. The activities of advocacy, social mobilisation, and programme communication do not necessarily happen consecutively. Box 4.4 illustrates that particular events may be used to generate further awareness and change in behaviour.
4.4.1 Understanding attitudes and behaviour change
Box 4.4 Diarrhoea epidemic as catalyst to improve wastewater management (foley et al. 1999).
In Indonesia, a localised diarrhoea epidemic in part of Tlogomas in Malang, a city in East Java, led to the death of five children from poor families. This was the catalyst for women in the community to start agitating for improvements in drainage and sanitation. Until that time, small children still defecated in the open drains that bordered the lanes, making living conditions both unpleasant and unhygienic. Many families still used the river as their toilet. The women’s openly expressed concern led a group of six families to initiate community action to overcome the problem. The head of the neighbourhood association searched for information on sanitation systems and the solution chosen was to build a community sewerage system. The group of families began by pooling their own limited funds and then organising with neighbours to collect more funds, acquire materials, and begin construction of the system.
It is most important to recognise that public understanding and attitudes regarding wastewater management systems differ significantly from every other form of infrastructure service. The very question is often subject to an effective taboo, since people do not want to recognise their individual contributions to waste generation. In addition, the system is one of collection; there is no tangible “product” with which “value” can be associated. The infrastructure is almost entirely invisible and therefore suffers from a problem of “out of sight, out of mind.” People quickly forget the problems and discomforts they suffered before an adequate system was established. Moreover, it is very difficult to sanction non-payment or non-compliant use of the system. All of these factors combine to present a formidable challenge to political decision-makers, planners, and operators. This challenge has to be met at both the inception of the system and throughout the life of the service.
4.4.2 Strategies, approaches, and steps
A systematic strategy for advocacy and awareness raising is needed to mobilise different segments of society to support the sustainable management of wastewater. This consists of the following seven steps, detailed below.
1. Identify the issues that must be addressed in the strategy.
Advocacy requires agreement on the specific issues to be addressed by the strategy. These may change in the course of implementing the strategy and can be adapted as needed. In the case of wastewater management, one example is the call for a clean river or a clean lake.
2. Assess the current situation.
This assessment can focus on the different systems in place for the collection and disposal of human waste and the disposal and treatment of wastewater. It can be done on a citywide basis by local government staff, but it can also be done at the neighbourhood level, covering only a part of the city. It can involve the main stakeholders, such as the private sector, community level authorities, and communities. The assessment in itself can be a powerful tool for raising public awareness, as it confronts local authorities and communities/people with the reality of the current situation and shows them the environmental impact of the absence of a sewerage system (box 4.5).
Box 4.5 The preparation of an environmental profile as a public awareness tool (unchs and unep 1999).
The preparation of an environmental profile is one of the key activities in the first phase of the UNCHS Sustainable Cities Programme (Habitat). Its objectives are to identify and clarify environmental issues, to involve relevant stakeholders, and to prioritise the issues to be addressed through the project. It first provides a systematic overview of city development activities and how they interact with the city’s environmental resources. Second, the environmental profile supports the process of identifying and mobilising stakeholders, both as a source of relevant information and through the process of its preparation.
3. Assess current knowledge, attitudes, and practices.
It is also necessary to assess what the present knowledge, attitudes, practices, and traditional culture are regarding the management of wastewater. As the next component demonstrates, the audience to be addressed must be segmented so that target-oriented messages can be developed and delivered. However, these messages must be based on the present knowledge, attitudes, and practices in order to be relevant and to determine what is possible in the future. Like with the environmental profile, involving the different stakeholders in this assessment may help it to become an awareness raising activity in itself.
4. Conduct audience research and segmentation.
The segmentation of audiences and their communication needs is essential for effective communication. Without understanding the differences among various segments of the target audience, it is difficult to design effective messages promoting change. While the general themes remain the same, the fine-tuning of message content, the choice of media mix, and the design and packaging of the messages will vary depending on the characteristics of the audience segments identified. In the end, the communication strategy should encompass all stakeholders and all sections of society. In the short-term, priority targets should be those who make and influence decisions, such as policy-makers, sector professionals, local government staff, and communities/users. Usually the local government has to take responsibility for action and play a leading role.
5. Find the right incentives.
It is unrealistic to expect stakeholders at different levels to become interested in improving wastewater management if they do not perceive that they will benefit. Finding the right incentives can go a long way toward mobilising people to become vested in the management of wastewater. Obviously, the incentives will be different for stakeholders at different levels. However, it is necessary to find the right incentive for each target group.
At the national level, these incentives may include:
· Socioeconomic benefits of a (more ) healthy population
· Socioeconomic benefits of a healthy environment (“win-win” situation)
· Rising to a good “level” in international statistics on health or environment
· Exposure as a good example at international fora and in international media and literature.
At the municipal level, these incentives may include:
· Elections for the sanitation town of the year
· Access to (regional) training for the municipal engineers or industries that win the election
· Matching funds for cost recovery.
At the community level, these incentives may include:
· Reduction of health risks
· Improved environment for living (and recreation)
· Tenure
· Access to other services (electricity or increased water supply)
· Financial benefits (because they may work in a sector that depends on a water resource, or benefit from recycling of waste) (see box 4.6).
Box 4.6 Willingness to pay for a clean Lake Ohrid, Macedonia.
In Macedonia, Lake Ohrid is considered one of the most beautiful spots in the country. It is also the most popular tourist destination for the Macedonian people and used to be an international resort as well. Under the rallying cry, “Keep lake Ohrid clean,” people were made aware of the need to keep the lake clean. In addition, they were mobilised to pay for the construction of a collector to prevent stormwater from draining directly into the lake and for the construction of a sewerage system. Since the direct benefit to all users was clear—to ensure that the lake remains a tourist attraction and a source of income for the majority of the residents—people were willing to pay. Presently, they pay the highest water and sewerage charges in the country. However, when asked if they would be willing to pay more to ensure longer-term sustainability of the water service, they were not. At the moment, they perceive the service to be sufficient, and thus have no incentive to make further improvements.
6. Set verifiable goals.
Advocacy requires agreements on specific operational goals that are realistic and achievable in a specified period. For example, a goal like increasing wastewater treatment in the developing world from the current level of less than 10 percent to 75 percent by 2010 is clearly not achievable, since this would require financing that is simply not available, and political commitment to this cause does not exist. It is best to involve the main stakeholders in setting goals and in developing and agreeing upon verifiable indicators. Box 4.7 describes an example from Colombia.
7. Build alliances.
Once these goals are in place, the next step is to identify and mobilise potential partners. If there are antagonists, the reasons for their antagonism have to be identified, along with the conditions that may turn their antagonism into support. Every stakeholder connected with waste management must be approached, including legislative bodies, NGOs, industries, religious leaders, the media, and community and professional groups. All of these groups are important for political and financial support.
Box 4.7 Colombia’s water pollution charge initiative (world bank 1999).
According to a study by the World Bank’s New Ideas in Pollution Regulation programme, Colombia has achieved significant results in reducing pollution. After the traditional “command and control” approach had failed, stakeholders were involved in negotiating the targets for pollution reduction.
The industrialised country system of enforcing national emission standards by active monitoring and criminal penalties for non-compliance proved too burdensome and expensive to implement in Colombia. Instead, the Environment Ministry introduced initial charges on biological oxygen demand (BOD) and total suspended solids (TSS) by getting key stakeholders (industries, municipalities, and communities) to negotiate targets for reducing water pollution over a five-year period. The base rate for the charge would increase incrementally until the polluter met the required targets during this period, and 33 regional environmental agencies in Colombia would implement the charges. The Ministry decided to launch the program in the ecologically-sensitive Rio Negro watershed area near Medellin because the regional agency, CONARE, was effective in managing environmental policy and had good working relationships with key stakeholders. In the first semester after implementing the charges, CONARE recorded a drop of 28 percent in BOD pollution from industrial sources in the Rio Negro basin. This was more than half-way to the 50 percent targeted reduction level agreed in the negotiations.
CHAPTER 5: FINANCING OPTIONS
5.1 Introduction
Conventional sewerage and wastewater investments are capital intensive. The costs for operating and maintaining these systems are often higher than the annual depreciation of the investment, and only a few (developed) countries in the world manage to recover all costs directly from their customers through user charges. The key problem in financing wastewater programmes is that low- and middle-income countries cannot afford conventional, engineered solutions.
Quality
Investment Cost recovery
At the heart of any sustainable wastewater management system is the challenge to balance three critical and interrelated aspects, quality, investment, and cost recovery. The objective standards for water quality and the target levels for wastewater management should first be defined. These standards should then determine the investment that is required. Finally, the investment level, with its operational and maintenance costs, determines the costs that need to be recovered. These costs can be recovered through tariffs or through taxes, or by a combination of these mechanisms. The cost recovery again determines the service level that can be provided and the associated water quality objectives. This interrelated system can evolve over a long period, so that with increasing cost recovery, the service provided also improves.
Recognizing the different needs of the different users and selecting the technical and institutional solution for which those users are willing and able to pay are prerequisites for optimising revenue. The cost of wastewater management can be influenced by the technology chosen. Techniques such as on-site treatment, the use of natural systems, reuse, and other technical aspects such as condominial systems, as described in chapter 3, can minimise the funds required for investment and operation.
There are new ways of financing the required investments, at both the household level and at the city and (river-) basin levels under the prevailing circumstances. International financial markets can be involved in financing various combinations of debt and equity financing. A promising trend in the developing world consists of transferring part of the responsibilities for infrastructure management to private partners to bring in capital as well as to gain from typical private sector virtues like managerial capacity, operational efficiency, and access to capital markets. Section 5.5 describes a number of those methods.
5.2 Cost recovery mechanisms
Various cost recovery mechanisms or economic instruments can be applied to cover (at least) the operational costs of urban sanitation and the treatment of wastewater. These include charges to direct users, effluent charges, and indirect local taxes. High user charges may encourage industries to treat their wastewater flows to ensure that they are suitable for discharge to surface waters. However, high tariffs may induce (illegal) discharges outside of the wastewater system. In some countries, the costs of overall water management (among which is wastewater treatment) in a river basin are shared among the users and polluters. Enforcing these mechanisms requires an efficient revenue collection system; raising awareness that people pay for a service delivered to them and not a penalty for disposing waste may assist in the efficient collection of revenue.
5.2.1 Consumption-based user charges
User charges are levied upon the discharge of wastewater into the sewerage based on volume and/or characteristics of the effluent. The volume of discharged wastewater is directly related to the consumption of potable water. Consequently, the tariff is usually collected as a surcharge on the water consumption bill.
5.2.2 Effluent charges
Effluent charges are levied on the discharge of wastewater, imposed on polluters to generate revenue for wastewater collection and treatment facilities and to stimulate reduction of discharges. The charge can be based on either the actual quality and quantity of wastewater, on a fixed amount per household, or, with regard to an industry, on a proxy based on verifiable information from an organisation (such as production or the number of employees).
Effluent charges are among the most commonly applied instruments for cost recovery on investments in wastewater collection and treatment in Western Europe (for example, in France, Germany, and the Netherlands). The system is also applied in some developing countries, such as Indonesia and Mexico, and in a few Eastern European countries. This scheme is rather complex in design and implementation; it requires monitoring of effluents, the ability of authorities to assess appropriate tariffs, the capacity to implement appropriate billing systems, and the ability of polluters to change behaviour.
5.2.3 Indirect local taxes
Local governments may impose indirect taxes to generate revenue directly for the financing of wastewater systems. For example, authorities may recover sewerage investments through surcharges on property taxes. In general, these are levied only on properties with access to the sewer system, in which case the surcharge is actually a variant of the user charge. The limitation of this surcharge is that it depends on the performance of the property tax system, which is usually not (well) developed in low-income countries. In many countries, the money collected from wastewater discharge is not always earmarked for water infrastructure. It normally goes in to the national treasury, and then may be used for other services.
5.2.4 Discharge permits
Discharge permits may also be a tool for controlling pollution and raising revenue. In this approach, a responsible authority sets maximum limits on the total allowable emissions of a pollutant to a sewer or to the surface water. In the discharge permit, the charges or levies can be incorporated for cost recovery purposes.
5.3 Willingness to pay and cost sharing
Users’ willingness to pay should be tested before considering how they can be subsidised from revenues, collected from other user groups, or from external funds. User contributions are usually in cash but can also be in kind, for example, by carrying out certain operational tasks.
Any sustainable wastewater management programme must address the key issues of financing and cost recovery on the one hand and ensuring equity on the other. This concerns local community-based sanitation initiatives as well as large-scale programmes funded by international donor organisations. In most developing countries, a conflict will arise if sound financing is to mean full cost recovery and equity. In such cases, targeted subsidies are necessary from the rich for the poor, who cannot afford the service costs. In Burkina Faso, for example, the financing formula for urban sanitation is based upon the resources of the communities, involving cross-subsidy systems from taxes on water supplies.
Many well-known case studies, such as those on PROSANEAR[2] in Brazil, the Orangi Pilot Project in Pakistan, and Kumasi sanitation project in Ghana, have shown that people’s willingness to pay for sanitation improvements is much higher than expected if they can select the sanitation system that they want. The key features to success in this willingness to pay are that:
1. Community members make informed choices, based on:
· Their participation in the project
· Technology and service level options, recognizing that more expensive systems cost more per member
· When and how the services are delivered to them
· How funds are managed and accounted for
· How their services are operated and maintained.
2. An adequate flow of information is provided to the community and procedures are adopted to facilitate collective decisions within the community and between the community and other actors.
3. Governments play a facilitative role, set clear national policies and strategies, encourage broad stakeholder consultation, and facilitate capacity building and learning.
4. An enabling environment is created for the participation of a wide range of providers of goods, services, and technical assistance to communities, including the private sector and NGOs.
Households may be willing to pay for in-house sanitation facilities and for facilities that remove the wastewater flow from their property. However, individual households often do not directly perceive the more aggregate level benefits from wastewater services. Nevertheless, at the level of the block, neighbourhood, or city, households may collectively place high value on services that remove excreta from their area as a whole. The waste discharged from one city may pollute the water supply of a neighbouring city. Accordingly, groups of cities in a river basin, as well as farmers and industry, perceive a collective benefit from environmental improvement.
Costs assigned to each level in this hierarchy should be in accordance with the benefits accruing at each level (Wright 1997):
· Households should pay for most of the costs for on-site facilities, such as bathrooms, on-site sewer connections, and septic tanks.
· Residents of a block or neighbourhood collectively pay the costs of transferring collected waste to the boundaries of this block or neighbourhood (or in treating the neighbourhood’s waste).
· Residents of a city collectively pay the additional costs of collecting waste from neighbourhoods and transporting these to the boundary of the city (or treating the cities’ wastewater).
In addition, negotiations could lead to opportunities whereby the stakeholders in a river basin—cities, farmers, industries, and so on—collectively assess the value of different levels of water quality for which they wish to pay and agree on financial responsibility for the costs of treatment and water quality management. In coastal areas, stakeholders may include hotels and fisheries for which water quality has a high (commercial) priority.
The participation of beneficiaries in the planning and decision-making process is essential. This method increases the sense of responsibility among the beneficiaries to pay the wastewater bills once the service is operating. In addition, the chosen solutions tend to be lower cost technologies (see box 5.1).
Box 5.1 Cost sharing in the Orangi Pilot Project in Karachi, Pakistan (serageldin 1994).
In the 1980s, the 600,000 residents of the Orangi slum area had no access to the city’s sewer system. A renowned community organiser began with a small amount of core external funding to explore alternatives. The residents were asked about their needs and wishes and some community members participated in the construction of facilities, which included in-house sanitary latrines and house sewers on each plot and underground sewers in the lanes and streets. Simple techniques and free labor reduced infrastructural costs to less than US$100 per household. Elected lane and neighborhood managers manage the sewers and households pay for the costs, partly in kind.
The “polluter pays” principle is a fair and straightforward concept, but in practice, it has been extremely difficult to implement. There are categories of users unable or unwilling to pay for their contribution to pollution loads. For example, agriculture may well be the primary polluter in any large river basin, yet typically, the government will not attempt to charge or restrict agricultural operations. Furthermore, pollution from urban storm sewers (in either separate or combined systems) is usually ignored, and industries claim that they are unable to pay. These practices tend to distort the polluter pays concept. Unfortunately, the problem of major polluters not paying their share is typical worldwide. Thus, in light of the increasing degradation of water quality and the coastal environment that threatens human health, concrete action with true partnership with the private sector should be encouraged, and changes in “business as usual” practices should be promoted. Furthermore, regulatory instruments should be developed to enforce the polluter pays principle and foster a willingness to pay among all polluters, including industry.
5.4 Investment options for infrastructure
As indicated above, the investment requirements for wastewater management are enormous. Very significant investments are needed to establish new collection systems, transportation, and treatment installations. It is also frequently necessary to invest in extensive rehabilitation or reconstruction of systems that have fallen into disrepair. Traditionally, these investments have been met solely from public finance mechanisms, foreign aid, or multilateral lending. However, these funding sources are not sufficient to meet the current challenges.
Subsidies have often been used as a mechanism for financing this kind of infrastructure. Subsidies can help in certain areas, but they must be implemented with great care; subsidies often introduce undesirable side effects, such as creating dependencies and reaching the wrong target group, which may even be worse than the problem they were intended to solve.
Unlocking additional funding sources is now an important area of initiative if progress is to be made in managing wastewater sustainably. In this regard, the use of public–private partnerships offers new solutions. Appropriate partnership contracts between the public and private sectors can help in two ways. First, they can improve the self-sustainability of the system, and second, they can open up routes to alternative and additional forms of financing. The following section discusses some of these options.
5.4.1 Grant finance
Internationally, most of the existing wastewater infrastructure has been financed through allocations from national or local government budgets; bilateral and multilateral aid programs have also provided grant financing in a number of countries. Although the bulk of these grants have supported municipal collection and treatment systems, some programs provide support directly to households or communities for investments in improved latrines, condominial sewers, and the like.
Grants can help to overcome the lack of household or community willingness to pay for pollution abatement that only benefits downstream communities. Grants permit systems to fully cover costs at lower tariff rates than would otherwise be feasible. However, those lower tariffs reduce the incentive for households or industries to abate pollution. In addition, grant programs reduce the pressure on municipalities to identify the most efficient solution to their problems, since they typically support only facility construction.
5.4.2 Loan finance through government or multilateral institutions
National governments, domestic development banks, bilateral and multilateral aid programs, and international financial institutions offer loan financing for wastewater infrastructure. Like grants, these loans focus on financing the capital costs of wastewater collection and treatment facilities. Like grants, loans may be offered to households and community organisations, for example, through microcredit systems for investments in improved latrines and communal sewers. Such loans differ from commercial loans in that they typically contain a subsidy component. The subsidy may be in the form of below-market interest rates or by using credit risk guarantees not normally offered to private borrowers. The risk guarantees allow loan terms with much longer grace and repayment periods than those available from commercial sources.
In addition to the cost savings from any interest subsidy, long-term loans have the advantage of matching the expected facility life to the loan period. Both pipe networks and treatment plants have an economic life of 25 years or more, and long-term financing allows the repayment burden to be shared over all of the generations that will benefit from the facilities.
These loans create fewer incentive risks than grants, since they must be repaid. However, the ultimate incentive effects depend on the structure of the chosen tariff system. Loans provided by International Financial Institutions (IFI) often include loan conditions, including tariff structures and financial performance measures, designed to maximise the incentive for efficient service.
The subsidised finance can be provided by:
Local special financial intermediaries
In many countries, special purpose, government-owned development banks or financial intermediaries have been established to meet the need for medium- to long-term project financing. Governments may also manage environmental funds that provide loans and grants to municipalities for environmental investments. The funds could come from revolving funds or from multilateral and bilateral funding.
International Financial Institutions
IFIs may provide low-cost financing for sanitation projects. As a highly creditworthy institution, their key function is to channel financing from the international capital market to recipient developing countries. They provide this financing on mostly favourable terms (for example, with low interest margins or long repayment periods) and in many cases, accept the country credit risks (Lauren et al. 1995). Constraints to using IFI loans are that in many cases, they require a sovereign guarantee. In addition, the loans are denominated in a foreign currency, exposing the projects to a foreign exchange risk that may be difficult to manage on the project level.
5.4.3 Market financing
The perceived lack of creditworthiness and limited confidence in the capacity of local governments to repay debts limit their access to long-term (international) capital markets and equity financing.
Commercial banks are usually not very interested in long-term lending for sanitation and wastewater treatment projects. They typically require a public sector guarantee, which may not be available. This makes international commercial lending even more difficult. However, several mechanisms for securing bank loans do exist, including contracts and documentation to assure lenders that their funds will be used to support the project in the way intended, a mortgage on available land and fixed assets, and so forth.
Municipal bonds are guaranteed for full repayment in the case of default through the levying of additional taxes, and thus they are only available to governments. Revenue bonds are secured by the revenues of the project and, given the higher risk involved, typically offer slightly higher interest rates than general bonds. In recent years, a few attempts have been made to replicate the model of the US municipal bond market and access to cheap, long-term finance. Traditionally, in the US, these bonds have a tax-exempt status that makes them attractive to creditors (and are, in fact, a form of subsidised finance).
Box 5.2 International bonds (Allred 1998).
Argentina and Brazil have been leaders in accessing international capital markets by issuing municipal and provincial bonds for infrastructure. Argentine and Brazilian municipalities can gain access to the international bond market after addressing some important barriers, such as political risks, currency risks (macroeconomic stability), and transparency in fiscal management. Most importantly, both countries have shown the ability to provide adequate guarantees for the bonds.
The most creditworthy countries might issue an international bond, backed by a sovereign guarantee, as illustrated in box 5.2. The critical requisites for developing a countries’ access to this international bond market are a good name with respect to governance, a sound municipal fiscal policy, and adequate collateral or securitisation of risk (for example, royalties from state assets, tax revenues, or loan guarantees) to cover the foreign exchange risk and other risks involved (Allred 1998).
5.4.4 Attracting private capital
As stated in Chapter 2, certain socioeconomic developments may benefit from adequate wastewater management. Involving the private sector companies associated with these developments in the planning and implementing of wastewater management may create opportunities to attract private financial sources for investment.
A project pool structure is an innovative instrument to attract financing sources, particularly long-term, private financing. In this instrument, the risks to lenders and investors are spread over a number of projects; the primary source of repayment is not a the cash flow from a single project, but rather, the performance of a number of projects. Examples of such pooling structures include revolving funds, equity funds, the European Bank for Regional Development’s (EBRD) multi-project facility, and multi-utilities (Haarmeyer and Mody 1998).
Revolving funds
A fund financed from various sources can be created to finance project costs. Subsequent repayments from the projects are then used to replenish the fund, permitting the funding of other investments. The large, diversified pool of borrowers is attractive to lenders because it spreads out the risks of debt payment. In the sanitation sector, revolving funds are usually created with extensive government or donor involvement. Households, communities, and property investors may also apply revolving funds to finance on-site and local sewerage systems.
Equity funds
During the past few years, infrastructure equity funds have provided a means for developers to raise financing for infrastructure projects in emerging markets. Such funds allow developers to leverage their contributions with those of investors and thus to spread their capital. For investors, equity funds mitigate project and country risk by creating a portfolio of projects under one company (Haarmeyer and Mody 1998). An example of the use of equity funds for the development of sanitation and wastewater infrastructure is the introduction of a US$300 million water fund in Asia in 1995 by a French water and sanitation company.
EBRD’s private multiproject financing facility
The EBRD has developed a multiproject financing facility (MPF) to mobilise private investment in the sanitation and wastewater treatment sector in Eastern Europe. The facility provides a framework for financing a series of projects that may be too small to be considered individually. The facility is available to a private company for investing in private water and sanitation projects. In July 1995, EBRD established its first MPF, a US$90 million equity and loan facility with Lyonnaise des Eaux. Recently, the company was awarded a wastewater treatment project in Maribor, Slovenia (Haarmeyer and Mody 1998).
5.5 Public–private partnerships
Since 1990, the participation of private sector companies in water and sewerage projects in developing countries has accelerated. By cooperating with private companies, water and sanitation projects may benefit from the following advantages:
· Private companies are usually technically better qualified to manage the facilities efficiently, resulting in lower operating costs and more secure revenues
· Private companies have access to cheap, long-term financing.
In total, 97 investments valued at US$24,950 million have been initiated from 1990 to 1997. However, public–private partnerships in the water supply sector are more common than in wastewater management. Only about 14 percent of total private investment in water and sewerage is directed exclusively to the wastewater sector. About half of the total private funds have been allocated to investments in combined water and wastewater projects; however, in these projects, water supply usually has priority (Silva et al. 1998; World Bank 1997b). There are strong economic, environmental, and health reasons for combining municipal wastewater and water system within a single contract.
Table 5.1 shows the different types of cooperation between public and private partners and summarises the organisation of responsibilities in those partnerships. These options are discussed in detail below.
Service contracts
Under a service contract, the public sector remains the primary provider of the wastewater service and contracts out only parts of its operation to the private contractor to reduce operating costs. The government pays a predetermined fee to the private business, and is responsible for funding any capital investments needed to expand or improve the system. Examples of service contracts include operation of a treatment plant, billing, and collection operations (Bennett 1998) and can be found in Madras, India and Santiago, Chile, among many other locations.
It is important to recognise the role that small-scale, independent sanitation providers may already play in the existing sanitary system. It is wise to protect their interests when introducing large-scale, citywide service contracts.
Management contracts
In a management contract, the public authority transfers responsibility for the entire operation and maintenance of the system to a private company. The contractor acts at all times on behalf of the public authority and has no direct legal relationship with the customer. Payments to a management contractor can be a fixed fee but are usually related to the achievement of performance targets, such as improved efficiency, the volume of wastewater treated, or (improved) collection rates. This payment system creates an incentive for increasing productivity (Idelovitch and Ringskog 1995).
One difficulty of management contracts concerns the setting of targets, their monitoring, and evaluation. Furthermore, the achievement of targets may be related to capital investments, which are not the responsibility of the private contractor.
Lease contracts
In a lease contract, a private operator rents the assets from the public authority for a certain period and is responsible for operating, maintaining, and managing the system, including revenue collection. The private company assumes the commercial risk. The authority remains the sole owner of the assets and is responsible for expansion and upgrading investments, debt service, and tariff setting and cost recovery policies. Lease contracts are particularly beneficial if no substantial capital investments are required; thus, they are not popular in the wastewater management sector.
Concessions
In 1993, the government of Argentina delegated water and sewage services of the city of Buenos Aires and its suburbs as part of a larger privatisation programme supported by the World Bank. The private participation option chosen was a 30-year full concession that allowed the assets to remain under public ownership with operation, maintenance, and wastewater treatment transferred to a private concessionaire. Aguas Argentinas, a consortium of foreign and local firms led by Lyonnaise des Eaux, won the bid.
The consortium mobilised funds for the US$5.5 billion investment requirement during the contract, of which it invested US$300 million in the first two years. Aguas Argentinas has invested US$1.4 billion during the first 6 years of the concession. This was more than 10 times the annual investment made by the utility in the previous decade. The performance targets of the contract included, among others, 90 percent coverage in the sanitation sector by year 30, a reduction of unaccounted-for water from 45 percent to 25 percent, and an increase in sewage treatment to 93 percent.
Argentine Federal Government has defined the Comprehensive Sanitation Plan that is carried out by Aguas Argentinas. Its objective is to reach gradual improvement in the environment and the quality of the water surrounding the City of Buenos Aires and the suburbs, and at the same time offer a reliable and flexible sewerage service with existing facilities. The Plan includes the recovery of the Matanza-Riachuelo and Reconquista-Rio de la Plata rivers; interception and further processing of rain and sewerage liquids and projects two more treatment plants.
To regulate and control the concession, the government established a regulatory agency that is managed and administrated by a Board of Directors formed by six members representing the Federal Executive Power, the province of Buenos Aires, and the Government of Buenos Aires City. Its budget (US$8 million) is recovered through a user surcharge of 2.67 percent of the water and sewage bill collected by the concessionaire.
During the first 6 years of operation, a new sewage treatment plant in Buenos Aires suburb of San Fernado was built and the existing Southwestern sewage treatment plant was extended and automated, allowing a 40% increase in treatment capacity of effluent and serving now 200,000 inhabitants more. The sewerage treatment services has increased with 23 %, going from 4,664,000 inhabitants served in 1993 to 5,744,134 in 1999. The number of people served with drinking water increased by 33 % from 5,760,000 in 1993 to 7,669,042 in 1999.
The investments are for 40 percent financed with equity funds and 60 percent with loans (debt), including medium-term multilateral loans from the International Finance Corporation, partly through commercial banks, with recourse to the central government in the event of the project’s early termination.
Under a concession, the government awards a private contractor, the concessionaire, full responsibility for the delivery of infrastructure services in a specified area through a bidding process. These responsibilities include technical tasks (operation, maintenance, and expansion of the system), and managerial and financial tasks (collection of revenues and fundraising for investments). The public sector entrusts the physical infrastructure to the concessionaire for duration of the contract, usually awarded for periods of more than 25 years, but the assets remain government property. The public sector is responsible for establishing performance targets, such as the quality and coverage of the service, and their enforcement (Bennett 1998).
The concessionaire has strong incentives to make efficient investment decisions and to develop innovative technological solutions, since any efficiency gains will directly increase its profits. Therefore, full utility concessions are attractive where large investments are needed to expand coverage of the service or to improve quality. A critical factor is the quality of regulation, as it concerns a long-term monopolistic position of the concessionaire.
Experience from the concession contracts in Malaysia and Buenos Aires, Argentina (box 5.3) shows that the involvement of governments in financing of wastewater projects is considerable. In the Buenos Aires case, generally considered one of the most successful concessions in wastewater management, the central government guarantees repayment of the International Finance loans. The Malaysian concession is fully financed with loans subsidised by the national government.
Build–Own–Transfer (BOT) contracts
Build–Own–Transfer contracts are designed to attract private capital into the construction phase of a project. The private sector finances, builds, and operates a new infrastructure facility according to the performance standards set by the government, but the government retains ownership of the facility. In the construction period, the private sector provides the investment capital required. In return, the government guarantees the purchase of a specified output. The operation period should be long enough for the contractor to recover its construction costs and to realise a profit.
BOTs may be an effective way to bring private sector money into the wastewater sector. They work well if the main problem in the sector is bulk supply or treatment, but are not useful if the primary concern is poor water distribution or collection. The agreements mitigate commercial risks for the private sector, because the government is its only customer. Thus, BOTs are financed with a relatively high debt component. The main weakness of this model is that the contracts do not apply to the whole system, including existing infrastructure, and are therefore unable to tackle the deficiencies and turn financially weak utilities into strong ones. Another weakness concerns the length and complexity of the agreements, for example, because they are based on future demand estimates, which reduces the efficiency of the operation. Although private companies have to compete in the bidding phase, most BOTs have to be renegotiated once they are underway. Moreover, the size and time frames of the contracts often require sophisticated and complicated financing packages (Bennett 1998; Haarmeyer and Mody 1997).
In Mexico, BOT contracts with the private sector for the construction of 49 wastewater treatment plants have had poor results; only 10 (22 percent) are currently operating. The fundamental reasons for this inefficiency include the high financial burden imposed by the projects through delays, macroeconomic instability, expensive technologies, and high tariff increases, which gave rise to public opposition. Similar to the concession contracts in Malaysia and Buenos Aires, the Mexican public sector retained a major role in fundraising for most of the contracts.
Variations on the BOT model include:
· BOO (Build–Own–Operate) contracts, in which the assets are not transferred to the local government
· ROT (Rehabilitate–Operate–Transfer) contracts, in which the investment concerns the rehabilitation of major assets
· Reversed BOOT contracts, in which the government takes care of asset construction and the private company is responsible for operation
· DBO (Design–Build–Operate) contracts, in which the private company also carries out investment design.
Divestiture
Divestiture, either partial or entire, of water and sanitation assets can take place through the sale of shares. In the case of partial divestiture, a joint venture is created in which the government and private companies assume co-ownership and co-responsibility for the delivery of wastewater services. Both parties provide capital for investments and share in the risks as well as in the returns. Optimally, the jointly owned company should be financially independent.
Full privatisation concerns the sale of a city’s or country’s entire water supply and wastewater management systems to one or more private companies. With full privatisation, the regulation function is completely separated from the ownership and operation functions. Experience with full privatisation of the wastewater management sector has been limited. The most obvious example is in England and Wales, where the entire water sector is presently owned by private companies (Bennett 1998). Full privatisation in these countries has led to improvements in performance of the wastewater system. However, sewerage tariffs have been raised significantly and further efforts to improve service performance are still required. In this industrialised country, private capital played the main role in funding the investments.
Advantages of partial or full divestiture include improved incentives for efficient investment decisions and the development of innovative technologies (see concessions). Furthermore, low transaction costs are involved compared to the costs of tendering and contract negotiations associated with the models discussed above.
A weakness of joint ownership is a possible conflict of interest within the public sector, since it is at the same time responsible for regulation (that is, the safeguarding public interests) and a shareholder of the company, responsible for maximising returns. This can lead to political interference and counteract the advantages to be gained from private sector management. Additionally, the absence of competition, because no tendering procedure is involved, can raise concerns about transparency and corruption.
5.6 Evaluation
Table 5.2 shows five prerequisites for successful private participation as formulated by the World Bank and published in its Toolkits for Private Sector Participation in Water and Sanitation (1997). Stakeholder support and commitment, cost-recovering tariffs, information about the system (the utility’s assets), and a developed regulatory framework become more important as the role of the private company increases. In addition, political and economic stability are necessary for creating access to inexpensive, long-term (private) financing.
Experience in the water sector shows that private involvement in the provision of wastewater services has the potential to attract other (private) sources of capital. However, public–private partnerships in the wastewater sector in developing countries have not always been successful.
Service and management contracts and simple lease structures have proved to be rather successful tools in improving operational efficiency. However, they do not provide a means for service expansion or upgrading, for which substantial amounts of capital are required. Concessions, BOTs, and (partial) divestitures are means to raise funding for such investments. However, governments and international donors remain the main financiers of these projects in developing countries; the high commercial risks (low revenues and high investment costs) and typical political and economic risks in low-income countries deter private lenders and investors from such projects. England and Wales provide one of the few examples in which government funding plays a minimal role in financing investments in the management of wastewater.
A recent report by the OECD describes the multiple tasks required for municipalities, national governments, and international donors to increase the private investment options for urban water and wastewater services (Gentry and Abuyuan 2000). Setting the water tariffs and performance standards, providing strong regulatory oversight, using market access controls, increasing public awareness, and addressing transitions are but a few of the important steps involved; thus, such partnerships require extensive preparation and should involve long-term cooperation.
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[1] Note that because of population growth, the number of people remaining unserved with adequate sanitation facilities has actually increased since 1990.
[2] World Bank Water and Sanitation Project for Low Income Communities, Brazil.