S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance,...

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 1/20

Securing the Future Today 

The Manila Water-MWSS PPPEnabling a Successful Wastewater Management

Program

VIRGILIO C. RIVERA, JR.Group Director, Regulation and Corporate Development

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 2/20

2

The Philippine government, through the MWSS, established a

successful PPP framework in 1997, which has provided the mostprogressive and dynamic water regulatory system in the

country.

Manila Water’s wastewater management program has requireda multipronged approach in Metro Manila’s East Zone.

The success of Manila Water’s wastewater program in the East

Zone is made possible through a concession which ensures theintegration of the whole water supply chain and full cost

recovery.

Key Messages

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 3/20

3

3

Conditions before Privatization

Illegal Connections

Low water pressure to

no water

Leaks

Low Water Pressure No Water

POOR

SERVICE

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 4/20

4

Conditions before Privatization

WATER SUPPLY AVAILABILITY:

3.1M Customers

Only 26%had access to

24/7Water Supply

1000 mldin System

Losses

Only 3%Sanitation

Coverage

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 5/20

5

1997 Regulatory Reform “PPP"

Metro Manila,

Philippines

WEST ZONEEAST ZONE

Metropolitan Waterworks andSewerage System (MWSS)

NATIONAL WATER CRISIS ACT

CONCESSION

AGREEMENT

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 6/20

6

Population

(Million)

Water

Availability

(hrs/day)

Water

Coverage

(% of Pop)

Non-

Revenue

Water

(% of Prod)

Staff/1000

Connections

Manila East Zone: Before and After

1996 3.1 16 58 63 9.8

2010 Dec 6.1 24 99 11 1.4

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 7/207

The Philippine government, through the MWSS, established a

successful PPP framework in 1997, which has provided the mostprogressive and dynamic water regulatory system in the

country.

Manila Water’s wastewater management program has requireda multipronged approach in Metro Manila’s East Zone.

The success of Manila Water’s wastewater program in the East

Zone is made possible through a concession which ensures theintegration of the whole water supply chain and full cost

recovery.

Key Messages

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 8/2088

Wastewater Challenges

The uncontrolled urbanization

of Metro Manila underlies poverty,

congestion, and environmental

pollution

In 1997, only 3% of Metro Manila had access

to sewerage system

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 9/2099

Wastewater Challenges

35 percent reside in informal

"slum" settlements withimproper sanitation facilities

Wastewater continues to

discharge to rivers, morethan half of which come

from households

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 10/201010

Current Scenario

SEPTIC TANK SEPTIC TANKSEPTIC TANK

DRAINAGEOne of thecauses of flooding

Note:Septic tank requiresregular desludgingevery 5- 7 years

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 11/2011Securing the Future Today 

MWC Wastewater Management Program:

A Multipronged Approach

SeptageManagement

Separate SewerNetwork

Combined Sewer

Network

1

2

3

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 12/2012

Wastewater in the East Zone:

Before and After Manila Water

40 mldWastewater

Capacity

135 mldWastewater

Capacity

3%Wastewater

Coverage

2STPs

1997

23%Wastewater

Coverage

38STPs

2010

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 13/20

13

San Juan River

Catchment

Marikina River

Catchment

Pasig River Catchment

1997

2022

2008 2010

2037

16% 23%3%

100%

3-River system100%

East Zone

San Juan River

Catchment

Marikina River

Catchment

Pasig RiverCatchment

Expansion of Wastewater Services

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 14/20

14

The Philippine government, through the MWSS, established a

successful PPP framework in 1997, which has provided the mostprogressive and dynamic water regulatory system in the

country.

Manila Water’s wastewater management program has requireda multipronged approach in Metro Manila’s East Zone.

The success of Manila Water’s wastewater program in the East

Zone is made possible through a concession which ensures theintegration of the whole water supply chain and full cost

recovery.

Key Messages

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 15/20

15

2007 2008 2009 2010 2011 2012

Environmental Charge (allcustomers)

10% 12% 12% 16% 18% 20%

SEPARATE Sewer Network

Residential Sewer Charge 50% 40% 40% 20% 10% 0%

Commercial SewerCharge

50% 45% 45% 35% 30% 30%

COMBINED Sewer System

Residential Sewer Charge 0%

Commercial SewerCharge

0%

Wastewater Charges are Embedded in Tariffs

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 16/20

16

Rate Rebasing

Inflation Adjustment

Foreign Currency

Differentials Adjustment

Extraordinary

Price Adjustments

Allows FULL RECOVERY of prudent costs andgenerate reasonable return on investments

5 years

Annual

Quarterly

As needed

Tariff Setting Mechanism

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 17/20

17

Invested nearly a billion dollars into the system

1997 2010

DEC

1997 2010

TARIFF/m3 CAPEX (Cumulative)PhP 33.54

Php 4.02

PhP 42B

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 18/20

18

Solid Financial Performance

-3000

0

3000

6000

9000

12000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006* 2007* 2008* 2009*

Revenues

EBITDA

NET INCOM E

REVENUE:

US$250M

EBITDA:

US$170M

NET INCOME:

US$90M

1997 2010

1 USD = 44 PHP 

18

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 19/20

19

A balanced PPP framework and dynamic concession

agreement lead to investments and fulfillment of serviceobligations.

Manila Water’s multipronged, customized approach

explains the early successes in its wastewater

management program.

Water supply chain integration and full-cost recovery

ensure the sustainability of Manila Water’s wastewater

program over the life of the concession.

Summary

8/6/2019 S5A Investments in City-wide Wastewater Management Systems: Customizing Collection, Conveyance, Treatment, Disposal and Reuse Systems by Virgilio Rivera

http://slidepdf.com/reader/full/s5a-investments-in-city-wide-wastewater-management-systems-customizing-collection 20/20

20

THANK YOU!