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Budget To Standardise Pipes,Fittings, Plumbers’ Qualifications

  • B.O.T. Projects For Water Sector Due To Govt.’s Capital Constraints

Budget 2014 will introduce proposals to minimize the waste of treated water, while the Government will encourage “b.o.t.” projects with the private sector due to capital constraints, an NWSDB officer said.

The proposals include regularizing pipes and fittings and also setting standards for plumbers, said state owned National Water Supply & Drainage Board’s (NWSDB’s) Project Director Greater Kandy Water Supply Project P.H.  Sarath Gamini.

Gamini whose presentation titled “Investment Cost and Cost-Water Sector Sri Lanka” which was delivered at the IESL on Monday (October 21) said that only 30% of the treated water costs that flows in as pipe borne water is recovered by NWSDB.

He further said that because of heavy capital costs involved, just 40% of the island’s population has access to pipe borne water, whereas electricity coverage in the island was more than double that at 90%.

A paper presented by Gamini at this occasion also said that 59.4% of the population is dependent on wells, tube wells, streams and rivers for their water requirements, while 1.5 million families have access to pipe borne water.

Gamini said that the Government plans to increase pipe borne water coverage to 60% by 2020.

B.O.T.

Due to budgetary constraints, those will take place as “build, operate and transfer” projects with the participation of the private sector.

He further said that 30-40% of the water produced by NWSDB is classified as non revenue water due to leakages.

Gamini said that price revisions which take place once in four years were too long.

“Bank interest, cost of treatment and the cost of treatment plants, low population density in certain areas as a result of which as little as 20 people are being serviced by one kilometre of pipeline leading to costly infrastructure and operational and maintenance (O&M) works, all contributed to the losses made in the pipe borne water sector,” he said. Seventy per cent of Sri Lanka’s population lives in villages.

Gamini said that at a 12% bank interest charge, to generate one cubic metre (1m3) of treated water would cost the NWSDB Rs. 160. That cost is inclusive of O&M and capital costs.

Whereas what they charge the consumer for that treated water is a mere Rs. 47, he said.

When this reporter asked Gamini whether corruption and wastage such as overstaffing and unnecessary overtime billing were also factored in, in calculating the cost of generating treated water? He said that though corruption had not been factored in, wastage however was negligible.

Gamini added that staff costs were less than 5% of total O&M costs and therefore their impact on total production costs were infinitesimal.

He further said that tariffs were last increased in 2012. Prior to that, tariffs were increased in 2008. Tariff increases due to these two adjustments amounted to 25% on each of these two occasions.

Gamini said that 88% of consumers, comprising 1.4 million households run monthly water bills not exceeding Rs. 400.  The paper presented by the speaker also showed that 60.6% of consumers’ monthly water consumption didn’t exceed 15 m3 a month and their total bill value was equivalent to 19.4% of overall billing charges.

From a bill value perspective, 11.4% of all consumers contribute to 52.2% of total bill value. Their monthly water consumption was a minimum 26 m3 and upwards, statistics presented on this paper further showed.

Gamini said that water has to be detailed not only as pipe borne water, but also for power generation and irrigation.

His paper in summary said that capital investments (CI) on water supply schemes ranged from between Rs. 250,000 to Rs. 490,000/m3/day. Additionally, average O&M costs amounted to between Rs. 36-40/m3. Average cost of providing water supply facilities including CI recovery: Rs. 158/m3. Present recovery by NWSDB: Rs. 47/m3.

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