Promoting a Wastewater Management Revolution in Asia-Pacific

1. Promoting a Wastewater Management Revolution in Asia-Pacific Dr. Anand ChiplunkarPrincipal Water Supply and Sanitation Specialist Asian Development Bank

2. Sanitation Coverage: Mixed Results Source: World Bank. Global Data Monitoring Information System

3. Sanitation Coverage: Not Enough While the progress in meeting quantitative targets is significant and laudable, there are continuing concerns over the quality of the services. It is estimated that 85% South Asia’s wastewater is discharged untreated – polluting groundwater, rivers and coasts Source: UNEP/GPA. 2004.

4. Sewerage coverage • Additional target: “To halve by 2015 the proportion of the urban population without household connections to a sewerage system”

5. Facts and Figures • Economic impacts of lack of sanitation cost them from 1% to 7% of their GDP each year (Cambodia, Indonesia, Lao PDR, Philippines, Viet Nam) — Cambodia: 7.2.% of GDP — Indonesia: $ 6.3. billion p.a. or 2.4% of GDP — India: $53.8 billion p.a. or 6.4% of GDP (Water and Sanitation Program. Economics of Sanitation Initiative.) • WHO study revealed • ─ $1 invested in water and sanitation would provide an economic return between $3 and $ 34 • (WHO. 2004. Evaluation of Costs and Benefits of Water and Sanitation Improvements at the Global Level.)

6. Wastewater management revolution • Knowledge drive: compilation of successful and sustainable environmental sanitation case studies • Technology drive: specific technology datasheets and its applications for different treated output standards required for various end-uses • Financing and incentives drive: business briefs and pre-feasibility studies with financing mechanisms to fast-track wastewater investment projects, and encourage extraction of resources from wastewater • Awareness and advocacy drive: knowledge products, capacity development workshops , networking with stakeholders in round tables for taking up identified business opportunities

7. Wastewater Management Revolution in Asia PROGRESS AND INITIATIVES

8. Knowledge Drive • Compile sustainable models/case studies • Choices in the sanitation ladder

9. Technology Drive • Many choices for different end uses Conventional: Sihanoukville DEWATS: Viet Nam Constructed Wetlands: China

10. Can address water scarcity and food security: Source of water for irrigation: VietNam, China Source of water for industrial use: India Biosolids/Organic fertilizers: Philippines Feeds for aquaculture: Bangladesh, India Source of energy Biogas for electricity, lighting and cooking: India, China, Cambodia, Indonesia, Nepal Potential for carbon credits CDM: Kinoya Wastewater Treatment Project in Fiji Technology Drive PROMOTE REUSE OF TREATED WASTE Fertilizer: Philippines Biogas: Cambodia

11. Wuhan UrbanEnvironmental Improvement Project, PRC • Wastewater management • Wetland parks as part of treatment • Membrane Bioreactorfor advanced wastewater treatment • Sludge treatment and disposal • Lake/channels rehabilitation • Real time water quality model

12. Financing Drive • Develop Business briefs and Pre-feasibility studies • Models of Affordable and innovative financing • Gram Vikas (India):Socialized community fund raisingfor toilets and bathing facilities • Kerala (India) and Viet Nam: Revolving fundsfor toilets and biogas plants • Philippines: Environmental User Fee; microfinancing • Public – Private Partnerships • Philippines and India: private concessionairesresponsible for investments, operation and management • Other mechanisms • Nepal: Output-based aid • Shanghai (PRC) and Fiji: Clean development mechanism

13. Financing Drive • Project Development Fund (PDF) • Can be recovered with returns in successful projects • Viability Gap Fund (VGF) • Enhancing viability to make it financially attractive • Usually upfront grant • Operational/Transition Support Fund • Support cash flow based on business plan and reforms • Grants or Debt to project in O&M • Other measures • Credit Enhancement • Risk Guarantee Mechanisms In ADB: • Loan – single or multi-tranche facility • Grant • Non-sovereign public sector facility • Local currency loan • Debt management products • Private Sector – equity investments, loans, guarantees, and B loan (complementary financing scheme)

14. Kyrgyz Republic:Issyk-Kul Sustainable Development Project • Gov’t to link viability gap funding and output-based aid to achievements • Financial Improvement Action Plan by city and utility • City concludes performance-based service contracts with service utility ADB Loan & Grant Repayment Grant Ministry of Finance City Government Viability Gap Fund Output Based Subsidies VGF Performance-based service contracts with targets, incentives, and penalties CAPEX Service Utility Supply Service Pay Tariff Customers

15. Examples: Philippines: Manila Water Company, Inc. India: Municipality of Alandur sewerage project Factors to ensure financial viability and social acceptability: conduct public consultations determine level of service needed select a suitable technology access affordable financing mechanism set appropriate wastewater tariffs to cover: costs, return on investment, future expansion requirements Show shared benefits from reuse Financially Viable Sewerage Systems

16. Bali, Indonesia: Reuse of treated wastewater from the “Eco-Lagoon,” which is also a tourist attraction India: Reuse of treated wastewater for industrial use, in Surat, Gujarat State through PPP is augmenting water supply, set to earn US$6 million per year Incentives Drive POTENTIAL REVENUES • Xiamen, PR China: The Shiweitou Sewage Treatment Plant supplies 24,000 cu.m/day of treated wastewater for watering plants in more than 500 ha., earning RMB 2 million per year Treated wastewater: China • Bangladesh: duckweed-based wastewater treatment pond - net profit of almost US$ 2000/ha/y from operation and using duckweed as feeds in aquaculture farms. Eco-lagoon, Nusa Dua

17. Hygiene and environmental education in schools India: Total Sanitation Campaign Philippines: Fit-for-School Program Triggering demand: community-led total sanitation Bangladesh, Cambodia Stakeholder participation: SANIMAS in Indonesia Social marketing of sanitation India Stimulate demand and willingness to pay Awareness and Advocacy Drive INCREASE AWARENESS AND INVOLVE THE STAKEHOLDERS

18. Partnership with the private sector Need bankable projects and cost recovery mechanism Business briefs and pre-feasibility studies with willing partners Conduct Round Tables Govt/municipal administration, private sector, consumers, financiers etc. Address affordability issues: lower interest rates, longer repayment period Awareness and Advocacy Drive • This is a key component of the Asia Sanitation Revolution • Go beyond advocacy • Develop sustainable business opportunities • Have stakeholder buy-in

19. Allocate budget for sanitation Central government support to local governments Support small-scale providers and entrepreneurs Increase public awareness and involve stakeholders to stimulate demand and willingness to pay Awareness and Advocacy Drive It is estimated that the annual costs of meeting the 2015 sanitation target are about $7 billionfor sanitation facilities, and $53 billion for wastewater treatment. (UNICEF 2004)

20. Examples: Philippines: Low-Cost Decentralized Wastewater Treatment in Liloan, Cebu Viet Nam: Sanitation Options for Peri-Urban Areas Cambodia: Microfinancing system for sanitation in rural areas ADB: Pilot and Demonstration Activity Advisory technical assistance Testing of innovative technologies and methodologies for effectiveness and possible replication Targeted water sector organization capacity improvement Catalyse reforms Knowledge products

21. ADB: Expanding the Knowledge Base

22. Lessons and Opportunities • Financing is not a constraint. • Learning and capacity building • Knowledge sharing on good practices, technology and financing options • Demonstrate innovative projects • Replicate and scale up successful projects • Co-benefits of sanitation and sustainable agriculture as we address food security and water scarcity • Climate change adds another dimension to the sanitation challenge but provides opportunities: • Less energy intensive wastewater treatment systems • Methane capture and waste-to-energy projects

23. THANK YOU.For More Information: achiplunkar@adb.org Web site: www.adb.org/water