Diagnostic City Water Assessments

Transcription

1 Model Terms of Reference Diagnostic City Water Assessments May 2006

2 TABLE OF CONTENTS Abstract A. Background B. Objectives C. Scope D. Methodology of Surveys E. The Questionnaires F. Analysis of Results G. Stakeholder Consultation H. Implementation Schedule I. Human Resource Inputs J. Financial Resources K. Reports Appendixes 1. Questionnaire for Water Utility (International Consultant) 2. Questionnaire for Small Private Piped Water Operators (Domestic Consultants) 3. Questionnaire for Water Vendors (Students) 4. Questionnaire for Bottled Water Supplier (Students) 5. Questionnaire for Consumer Survey (Students) 6. Optional Questionnaire on Sanitation for Utility/Local Govt. 7. Optional Questionnaire on Sanitation for Consumers 8. Example of Analysis of Water Assessment Results 9. Example of Analysis of People Assessment Results 10. Example of Analysis of Money Assessment Results 11. Water Production and NRW (Breakdown)

3 Model Terms of Reference Diagnostic City Water Assessments Abstract ADB project officers now have a powerful tool for revealing the facts about water consumers and water and money flows in project cities and towns. ADB has produced a model Terms of Reference (TOR) for investigating and responding to both the "formal" and "informal" segments of a city's water market. Why Conduct A Diagnostic City Water Assessment City water supply projects mostly concentrate on the city water utility. But in developing countries many urban residents obtain water from an "informal" market. There might actually be more money turning over in informal markets than through the water utility. And formal and informal markets are linked. The informal water vendors, tanker operators, water re-sellers, small piped network operators, and bottlers might be buying or stealing their water from the utility--and some water utility staff and officials might even be complicitly aware of this. Which might explain intractable high unaccounted for water (UFW) in some utilities. So it could be risky investing in the water utility without also understanding the informal water market. An incisive audit of water and money flows might reveal a governance and leadership problem that needs to be fixed before committing to the project. Even more important, the project might completely miss those who need support most--underserved and disadvantaged poor. What The Model TOR Offers The TOR for undertaking investigative city water assessments provides an approach and methodology for surveying all classes of water consumers and all types of water providers analyzing the survey results undertaking stakeholder consultations based on the survey findings formulating responsive city government policy and ordinances organizing civil society (consumer groups) to monitor policy implementation The TOR even contains the survey forms. With this knowledge and an improved policy setting underway, a successful project can be prepared with influential and well-meaning city and utility leaders. Contact Ellen Pascua Deputy Water Fund Manager Tel.: (632) local epascua@adb.org

4 A. Background 1. Urban water supply and sanitation (WSS) projects are typically prepared using only limited socioeconomic surveys of the target market. There may just be some basic data on water utility customers; and with insufficient analysis to inform local water supply policy development. The survey, the results and the analysis may be inadequate to give a true picture of what is happening and what needs changing. There are strong reasons for finding out more about the water supply situation in a project town or city. First, even though water is scarce and is expensive to transport and treat, the utility may be tolerating high non-revenue water (NRW). Second, even with a piped water network in place, the majority of residents may not be connected and these will invariably include poor families. Third, in urban areas informal water supply is big business, but not much is known about it. 2. When preparing a water supply project, it is necessary to have as complete information as possible about how all people get water now; what source, what quality, what cost, what consumption and what reliability. Project planners need to know about all the water providers and about the consumers using at least a 5% representative sample including the non-domestic consumers. This information then needs to be analyzed under different categories, and presented to and discussed among stakeholders with a view to formulation of new city government policy and investment plans. 3. A diagnostic water assessment will provide the following: Verification of the true coverage with piped water and 24 hour supply Justification for the registration and licensing of small private piped water operators and water vendors Information on the sale of utility NRW Verification of consumer information versus utility records Tariffs from various suppliers What suppliers generate what revenues Who consumes the water Who pays what for water 4. It is diagnostic because it will reveal the truth about informal as well as formal flows of water and importantly, flows of money. This may be critical to identifying well-meaning development partners and preparing a successful project. B. Objectives 5. The objectives of the diagnostic city water assessment are to provide facts for (i) formulation of policy and/or ordinances (ii) encouragement of civil society involvement, (iii) determining priorities for a new project, (iv) improving the efficiency and financial performance of the water utility, and (v) highlighting the needs of the urban poor. C. Scope 6. There are three steps to the water assessment leading to two consequent actions: i. Undertake surveys of consumers, the water utility, small private piped water operators, water vendors and bottled water suppliers. (See attached Water Assessment Questionnaires, Appendixes 1-5. For Sanitation, see Questionnaires Appendixes 6 and 7). ii. Analyze the results of the surveys, especially comparing information from the consumers with information from the suppliers (the differences may throw a light on NRW). Publish the results in the local newspaper and on the Internet. (See attached Appendixes 8-11). iii. Discuss the findings of the surveys in a stakeholder consultation that includes people not served with piped water, people served by the utility, industries that use water, representatives of the utility, small private piped water operators, water vendors and bottled water suppliers, representatives of central, regional and local government, NGOs, journalists, academics and consultants. Publish the stakeholder consultation discussion and findings. iv. Leading to Formulate at the stakeholder consultation and publish for public comment new draft city government policy and/or ordinances. After incorporating relevant public comments, the policy statement would be formally endorsed by city council.1 1

5 v. A civil society task force convened at the stakeholder consultation, actively monitors the implementation of the new government policy, publishing its findings on a monthly basis. D. Methodology of Surveys 7. Three types of human resources will be required. One international consultant will have overall responsibility and will be responsible for conducting the interview of the water utility, analyzing all results and drafting water policy. Five domestic consultants will be responsible for logistics and supervising the students undertaking the surveys in five separate geographic areas making up the whole city. These consultants will also be responsible for interviewing all small private piped water operators in their designated areas. One hundred university students will undertake 5% sample consumer surveys in each of 100 representative zones of roughly equal population. They will also be responsible for interviewing water vendors and bottled water suppliers operating in each of their zones. Formal permission to survey will be obtained from the local government by the concerned domestic consultant and a copy provided to each student, who will also as a matter of courtesy introduce themselves to the leader of each community in which they are operating. 8. Each of the five domestic consultants will work directly with twenty university students. Details to be explained by them to the students will include (i) location, (ii) how to sample for interview, (iii) who to interview, (iv) length of interview, (v) number of interviews per day, (vi) transport, (vii) total time to complete interviews, (viii) payment for work, (ix) clarifications, (x) testing of survey, (xi) permit to survey and (xii) the questionnaire. Students should also seek and document any anecdotal information given to them about the water industry, which may not correspond to any question asked. 9. Quality control on the surveys will be maintained by random field checks undertaken by both the domestic and the international consultants. The name of the person being interviewed, their address and the name of the person undertaking the interview and the date of the interview must be recorded on each questionnaire completed. In the event a student is found to be manufacturing results they will not be paid and all the work already undertaken by them will be repeated by a new student interviewing different people. E. The Questionnaires 10. The questionnaires will be translated from English into the local language by the domestic consultants. 1. Questionnaire Water Utility (Appendix 1) 11. Apart from details of individual customers this will identify the recipients of bulk sales including small private piped water operators, subdivisions, homeowner associations and water vendors. Its focus will be on identifying the water source and for each type of customer (nondomestic, house service connection, standpipe etc) the total number of connections, the volume sold per month and the revenue gained per month. It will provide information on production volume versus consumption volume to determine NRW. It will note the extent of 24-hour piped water coverage. 2. Questionnaire Small Private Piped Water Operators (Appendix 2) 12. The domestic consultant will carry out interviews with every small private piped operators in each survey zone. The questionnaire will seek essentially the same information as for the utility except the quality of the service to the customer such as direct connection or hose and drums will be determined. The method and frequency of payment is an important dimension to be ascertained from this interview. 3. Questionnaire Water Vendor (Appendix 3) 13. If water vendors operate at all in a given survey zone, then at least three different vendors of each type (water tanker, motorized tricycle, pedaled tricycle, rickshaw, ushcart etc) should be interviewed by the student. She/he will also estimate the total number of vendors of each type operating in that zone. Pertinent information being sought includes their source of water (and please check), means of transport of water, number and 2

6 type of customers, average distance transported, volume sold and revenue gained. It is important to establish how much the vendor pays at source for the water and to whom it is paid. 4. Questionnaire Bottled Water Supplier (Appendix 4) 14. The student will interview at least five different bottled water suppliers in his/her survey zone and make an estimate of the total number of bottled water suppliers and type (example mixed goods shop, sole purpose bottled water shop, treatment and sale on site, deliveries of bottled water etc.) in that zone. The focus of the interview is on obtaining information about the source of water, the type of treatment provided, the volume of water sold per month price paid and the total revenue. 5. Questionnaire Water Consumer (Appendix 5) 15. The student must obtain a 5% representative sample of all water users in his/her zone. This means identifying those served by the utility, by small private piped water operators and by water vendors and surveying them in the numbers proportional to their prevalence. The focus of information sought will be on water source (and it may well be that consumers get water from more than one source), access to water, water quality, reliability of supply, availability of supply, volume consumed per month and cost per month. It is important to record the number of persons in each household. This survey must include a representative number of non-domestic consumers, especially industrial users. 6. Optional Sanitation Questionnaire Utility/Local Government (Appendix 6) 16. This questionnaire would only be used if undertaking an assessment to prepare a sanitation project. It focuses on sewerage/sewage treatment facilities and services, on-site sanitation and septage collection and treatment. 7. Optional Sanitation Questionnaire Consumers (Appendix 7) 17. Again this questionnaire would normally be used if undertaking an assessment to prepare a sanitation project. It deals with the ways and means people address their sanitation and the people s perspectives. F. Analysis of Results 18. Clarifications will be required from the domestic consultants and the students. The domestic consultants will collate and summarize the answers to all the questions. The international consultant will then consider the following points of interest: deriving basic data from the summary of results. Coverage % with 24 hour supply to individual house connection by utility Coverage % with individual o house connection by the utility Coverage % including all utility domestic connections and standpipes. Coverage % with piped water in home (all water providers). Average household consumption per month by different sources of supply Average household cost per month by different sources of supply. Total monies paid by small private piped water operators at source per month. Total monies paid by vendors at source per month. Average price of utility water. Average price of small private piped water. Average price of vendor water. Average price of bottled water. Revenue turnover (a) utility, (b) small piped operators, (c) vendors, (d) bottled water suppliers Volume of sales (a) utility, (b) small piped operators, (c) vendors, (d) bottled water suppliers Official NRW figure from utility. Comparison of consumption and cost - consumer record versus utility record. Estimate of utility NRW sold to small piped operators and vendors Comparison of cost and consumption - piped water versus non-piped water Proportion of utility water volume sold to non-domestic Proportion of utility water revenue derived from non-domestic Comparison of average tariff for utility water domestic versus non-domestic 3

7 Proportion of all piped water where utility maintains the reticulation Rating of customer satisfaction with utility. 19. The main purpose of the assessment is to focus on those not served with piped water and to compare their plight with those served with piped water. The comparison of consumption and cost for these two groups is critical. The idea will then be to propose policy for consideration at the stakeholder consultation. This will be policy that corrects inequities in services, guides new development, enhances cost recovery and institutional development to promote sustainability of services, encourages water resource conservation, including reduction of NRW, and ensures that due attention is given to connecting the urban poor to piped water. G. Stakeholder Consultation 20. About two weeks after the results of the survey and the analysis have been published a twoday stakeholders consultation should be convened for between 50 and 100 stakeholders as identified above. The first day would be devoted to presentation of results and analysis of the surveys and discussion of the analysis. The second day would be devoted to formulation of draft water supply policy for that city or town and formulation of a civil society task force (5 to 10 members and at least half women) to monitor the implementation of that policy. The stakeholder consultation would be facilitated by a domestic consultant skilled in such work, or by a well respected and capable local person. H. Implementation Schedule Surveys of consumers and water providers Clarifications and preparation of summary of results Analyze results and prepare draft water supply policy Stakeholder consultation and report of findings Total Implementation Period one month one month one month one month four (4) months I. Human Resource Inputs University students Domestic water supply consultants International consultant Stakeholder consultation facilitator J. Financial Resources 100 person months 10 person months 1 person month 2 person days Students, consultants, facilitator $ Local transport $ Stakeholder consultation $ Reports / communications $ Total $ K. Reports: 1. Water Assessment Report for City of As of (Date) Part A. Summary of Results of Surveys (Domestic Consultants) Part B. Analysis of Results (International Consultant) This two- part report will be due for completion not later than three months after start of assignment. 2. Report of Stakeholder Consultation on Water Supply in City of Date International Consultant This report will be due not later than one month after completion of the stakeholder consultation. Appendixes 1. Questionnaire for Water Utility (International Consultant) 2. Questionnaire for Small Private Piped Water Operators (Domestic Consultants) 3. Questionnaire for Water Vendors (Students) 4. Questionnaire for Bottled Water Supplier (Students) 5. Questionnaire for Consumer Survey (Students) 6. Optional Questionnaire on Sanitation for Utility/Local Govt. 7. Optional Questionnaire on Sanitation for Consumers 4

8 8. Example of Analysis of Water Assessment Results 9. Example of Analysis of People Assessment Results 10. Example of Analysis of Money Assessment Results 11. Water Production and NRW (Breakdown) 5

9 Appendix 1 6 Questionnaire for Water Utility Name of Water Utility Date Name of Person who answered this questionnaire Position 1. Name of City 2. Population in City 3. Population in Utility Service Area 4. Population Served by Utility (Direct) 5. Population Served by Utility (Bulk Supply / Indirect) 6. Population Served by House Connection 7. Population Served by Shared Connection 8. Population Served by Standpipe or Community Tank 9. Population Served by Utility Tanker 10. Number of House Connection s a. Metered b. Meter Not Working c. Not Metered 11. Number of Shared Connections a. Metered b. Meter Not Working c. Not Metered 12. Number of Standpipes a. Metered b. Meter Not Working c. Not Metered 13. Number of Utility Tankers a. Capacity of tankers 14. Number of Community Tanks a. Metered b. Meter Not Working c. Not Metered 15. Number of Bulk Connection s a. Metered b. Meter Not Working c. Not Meter ed 16. Number of Connections to Industry/ Other a. Metered b. Meter Not Working c. Not Metered 17. Number of House Connections with 24 Hour Service 18. Percentage of Service Area with 24 Hour Supply 19. Number of Sources of Treated Water for Piped Supply 20. Production sources metered and working

10 8 21. NRW for Utility % a. Leakage % b. Mis-Metering % c. Illegal Connection % d. Illegal Sale of Water % 22. Number of Meters replaced in last 12 months 23. Total Consumption by House Connection Per Month m Total Consumption by Shared Connections Per Month m Total Consumption by Standpipe or Community Tank per Month m Total Consumption by Utility Tanker Per Month m Total Consumption by Bulk Supply to Small Private Piped Water Operators/Vendors Per Month m Total Consumption for Municipal Use Per Month m Total Consumption by Industry/ Other Per Month m Total Money Billed Per Month for House Connections * 31. Total Money Billed Per Month for Shared Connections * 32. Total Money Billed Per Month for Standpipes or Community Tanks * 33. Total Money Billed Per Month for Utility Tanker Services * 34. Total Money Billed Per Month for Bulk Supply to Small Private Piped Water Operators/Vendors * 35. Total Money Billed Per Month for Industry/Other * 36. Number of new connections installed in last 12 months (domestic) 37. Number of new connections installed in last 12 months (nondomestic) 38. New connection fee and terms of payment (domestic)* 39. Accounts receivable in equivalent months of billing 40. Number of people employed by utility. *Please indicate in local currency. NRW = Non-revenue Water = Production - Consumption % Production Consultant to independently and randomly check domestic meters (40), industrial meters (10), and accounts on computer (100). Name of Consultant Interviewer

11 Name of Company/Organization if any Appendix 2 8 Questionnaire for Small Private Piped Water Providers Date Name of Person who answered this questionnaire Position 1. Location of Piped System 2. Total Population Served by the System 3. Population Served by House Connections 4. Population Served by Shared Connections 5. Population Served by Standpipe or Community Tank 6. Source of Water 7. Cost of Water at Source $/m 3 8. Volume of Water Received at Source m 3 9. NRW % 10. Number of House Connections 11. Number of Shared Connections 12. Number of Standpipes and Community Tanks 13. Population Receiving 24 Hour Supply by House Connection 14. Consumption Per Month from House Connections m Consumption Per Month from Shared Connections m Consumption Per Month from Standpipes or Community Tanks m Money Received Per Month from House Connections * 18. Money Received Per Month from Shared Connections* 19. Money Received Per Month from Standpipes or Community Tanks * 20. Water Treatment Provided by the System 21. How Long in Business 22. License or Agreement with Local Authority Yes No * Please indicate in local currency. NRW = Non-revenue Water = Production - Consumption % Production Name of Consultant Interviewer

12 9 Appendix 3 Questionnaire for Water Vendor Name of Company/Organization if any Date Name of Person who answered this questionnaire Position 1. Location of vendor 2. Population served by vendor 3. Population served by tanker 4. Population served by pushcart/tricycle 5. Businesses served by vendor 6. Source of water 7. Cost of water at source* 8. Average distance for delivery of water (km) 9. Volume of water delivered per day by tanker m Volume of water delivered per day by pushcart / tricycle m Revenue received per day for water delivered by tanker * 12. Revenue received per day for water delivered by pushcart/tricycle * 13. Number of tankers in your business 14. Number of pushcarts / tricycles in your business 15. Fuel cost per day for power cycles * 16. Fuel cost per day for tankers * 17. Approval of local government 18. License fee to pay * Yes No 19. How long in business 20. Average capacity of tanker m Average capacity of full load in pushcart or tricycle (liters) * Please indicate in local currency. Name of Enumerator

13 Appendix 4 10 Questionnaire for Bottled Water Supplier Name of Company/Organization if any Date Name of Person who answered this questionnaire Position 1. Location 2. Source of Water 3. Cost of Water at Source 4. Treatment Provided On-Site 5. Volume of water sold per day 6.. Revenue in one day* 7. Proportion sold to business 8. Average household volume purchased per day 9. Average household cost per day 10. License fees to Local Government 11. How long in business 12. Smallest volume sold /cost 13. Largest volume sold / cost 14. Business growing or static 15. Delivery services / distance 16. Approx cost loading % for delivery* 17. Costs per month in power, chemicals, rent, staff etc* * Please indicate in local currency. Name of Enumerator

14 11 Name of Person who answered this questionnaire Appendix 5 Questionnaire for Water Consumer Date 1. Location 2. Who supplies you with water Water Utility Small Private Piped Water 3. What is the source of water 4. Is the water treated Water Vendor Own Well 5. How much water do you use per month /per day m 3 (last two bills)* 6. How much does this cost you per month / per day (last two bills)* 7. How many people in your household 8. How much bottled water do you use per day (liters) 9. How much does the bottled water cost you per day * 10. How far do you go to access water Home < 100m > 100m 11. How is the water quality 12. How is the service from the utility Good Fair Poor Good Fair Poor 13. For how many hours per day is water available 14. Is the supply reliable 15. How is the service of the Small Private Piped Water Operator 16. How is the service of the water vendor Good Fair Poor Good Fair Poor 17. If you get water from the utility is the supply metered and working 18. If you don t have piped water then when do you expect it 19. What is your monthly power bill 20. Are there pipe leaks in your street 21. Are there water leaks in your home * Please indicate in local currency. Name of Enumerator

15 Appendix 6 (Sanitation) 12 Questionnaire for Utility/Local Government Name of Company/Organization if any Date Name of Person who answered this questionnaire Position 1. Coverage of population with sewerage (%) 2. Number of sewer connections 3. Sewer connection fee* 4. Sewer tariff 5. Capacity of sewage treatment plants (m 3 /d) 6. Type of sewage treatment (a) wastewater stabilization pond (b) activated sludge 7. Length of sewers installed (km) 8. Number of sewage pumping stations 9. Capacity of septage treatment plants (m 3 /d) 10. Number of trucks collecting septage a. Private b. Government 11. Coverage of population with onsite sanitation a. septic tanks (%) b. latrines (%) 12. Any eco-san facilities in city? a. Public b. Private 13. Name five biggest polluting industries in city. a. Does industry pre-treat their wastewater? Yes No Yes No Yes No Yes No 15. Is there any recycling of wastewater? What %? Yes No * Please indicate in local currency. Name of Consultant Interviewer

16 13 Name of Company/Organization if any Appendix 7 (Sanitation) Questionnaire for Consumer (2) Date Name of Person who answered this questionnaire Position 1. Are you connected to sewerage? Yes No 2. What is your monthly charge for sewerage? * 3. What is your on-site facility? 4. Is the latrine 5. What happens to your washing/bathing/cleaning water? none latrine septic tank inside house outside house straight to sewer straight to drain to septic tank then drain 6. Are there community toilet facilities? Yes No 7. Are there public toilet facilities? Yes No 8. Are you happy with your sanitation? Yes No 9. What are the main problems? smell health 10. Are you concerned about the environment downstream in river/ sea? Yes dignity privacy convenience No 11. Do you want a sewerage connection? Yes No 12. What could be done to improve your sanitation? 13. When was your latrine / septic tank last emptied? other 14. Does your septic tank overflow to a drain? 15. Does your family wash hands after going to toilet? Yes Yes No No * Please indicate in local currency. Name of Enumerator

17 14 Appendix 8 WATER FLOW DIAGNOSTIC RESULTS (Sample) Source Qlty Volume m 3 per month Vol % Revenue ($ per month) Ave. Tariff $/m 3 Rev % Customer Accounts m 3 per HH Pop. 000 Utility ND A 600, , ,000 NA NA Utility HSC A 3,000, ,110, , Utility SP B 300, , , SSWP C 500, , , Vendor B 600, ,950, , Own B 480,000 9 NA NA NA 40, Wells Bottled Water A+ 30, ,080, NA NA NA TOTAL 5,510, ,948, ,000 1,995 ND = Non-Domestic HSC= House Service Connection SP = Standpipe PP= Persons HH= Households One purpose of the above analysis is to contrast where most of the water comes from (the utility) and where most of the revenue goes to (the vendors). The analysis is able to clearly show real coverage with piped water by the utility and the contrast in consumption and cost for those with and without utility piped water. This is a powerful tool to redefine policy and put more emphasis on connecting the poor to piped water.

18 16 Appendix 9 CONSUMER DIAGNOSTIC RESULTS (Sample) Source Qlty Consump m 3 per Month Cost per Month BW Cost per Month Customer Accounts PP per HH Pop. 000 Cost per Month $ % Utility ND A 200 $120 $2 4,000 NA NA 488,000 9 Utility HSC A 40 $16 $2 100, ,800, Utility SP B 6 $1 $5 50, ,000 5 SSWP C 20 $20 $5 25, , Vendor B 6 $18 $6 100, ,400, Own Wells B 12 NA $2 40, ,000 1 TOTAL 359,000 1,995 5,693, ND - Non-Domestic HSC - House Service Connection SP - Standpipe PP - Persons HH - Households BW - Bottled Water This analysis shows the contribution of non-domestic consumption as compared with domestic both from the utility and other sources. Cross-subsidy policy can be better grounded after comparing consumption and cost. For people the variation in cost and consumption levels from different sources is important. It shows revenues to vendors can total more than revenues to the utility. The overall importance of connecting to utility piped water in terms of improvements in both cost and volume consumed can be highlighted.

19 16 Appendix 10 MONEY FLOW DIAGNOSTIC RESULTS (Sample) Water Provider Declared Revenue of Water Provider ($ Million) Consumer Expenditure ($ Million) Difference ($ Million) Utility Non-Domestic Utility Domestic Small Private Piped Water Operator Water Vendor Bottled Water Supplier Own Wells NA TOTAL NOTE: It is possible that much of the $17.6 million difference between provider declared revenue and consumer expenditure comes from the sale of utility NRW. But this activity is on a utility-wide basis whereby the benefit is going either to the utility or the local government or both. There is also the matter of illegal connections and mis-metering whereby the benefit goes to an individual consumer and to the utility staff who collaborates. It is feasible that in this example another $15 million could be lost in revenue from the combined effects of illegal connections and mis-metering. See Appendix 11. Now if we consider a 10% profit on $60 million the official revenue of the utility this is only about $6 million. But someone is making an unofficial profit of close to $30 million from NRW. Perhaps this is why high NRW is maintained and there is not much incentive to connect the urban poor to piped water. The purpose of the above analysis is two quantify two sources of NRW, both of which have potential to produce large amounts of revenue illegally. One is of course the NRW being sold by the utility to water vendors. The other is the under-reporting of sales by the utility.

20 18 Appendix 11 WATER PRODUCTION and NRW Annual Utility Water Production 100,000,000 m3 Annual Consumption 46,800,000 m3 Non- Revenue Water 53,200,000 m3 (53.2%) Leakage Illegal Connection Illegal Sale Mis-Metering 50% 10% 27% 13% Illegal Sale is the Difference between Consumer Consumption Records and the Utility Sale Records plus NRW sold to water vendors, and in this case is 14,400,000m3. Mis-Metering can be estimated from the consumer survey. Illegal Connections can be spotted from a door to door survey and comparing actual consumption with average for community. Where this chart differs from past analysis of NRW is that it identifies and quantifies a large element of illegal sales. These come from direct sale of NRW by the utility to water vendors and from under reporting of sales to registered customers by the utility.

21 19 DIAGNOSTIC CITY WATER ASSESSMENTS NOTES FOR ADB STAFF PREPARING WATER SUPPLY PROJECTS A. Introduction 1. When ADB prepares an urban water supply project, it is usual to undertake socioeconomic surveys. The information from these surveys is mostly used to validate affordability and willingness to pay with respect to the tariffs proposed to make the project viable. It is also used to justify poverty reduction as a project goal. 2. The proposed city water assessments are not designed to replace the socio-economic surveys, but to provide in depth information directly related to service provision of water. This is new and different because it examines existing service delivery from the perspective of all water service providers and again from the perspective of all consumers and looks particularly at consumption and cost in both cases. It is diagnostic because it will review the truth about water flows, and importantly, money flows both formal and informal. B. Concept, Rationale and Objective 3. Water is a basic human need. Yet there are those with good piped service and many unserved urban poor. Water is a precious resource. Yet in most developing country cities nonrevenue water (NRW) is around 50% of production. Water, especially in the informal sector is also big business. But how much do we know about that? Well, we know quite a lot about the utility, mostly from information supplied by it. But how much do we know about the utility service from their customers? More important, how much do we know about those not served by the utility; those who get their water from small-scale water providers and vendors? The Millenium Development Goals assume certain figures for coverage with water supply. What are the actual figures? 4. At one end of the scale we may know that a household with an individual piped service connection from the utility may consume 30 m3 per month and pay about $8 per month. But do we know that at the other end of the scale, a poor household getting water from vendors may consume 6 m3 per month and pay about $24 per month? Even worse, do we know what proportion of the total population are in the first category and what proportion in the second? Do we understand the incentives that keep NRW high? Do we understand the linkages between high NRW and large unserved urban poor? Especially, do we know how much NRW is illegally sold to the urban poor? Do we know that what the utility records as consumption and revenue is what the consumer experiences as consumption and expenditure? 5. The immediate objective of the water assessment (which for sensitivity reasons may also be called a water service assessment ) is to provide a comprehensive understanding of the existing situation including the true coverage of the city with piped water.

22 20 6. The broader objectives of the water assessment are: (i) (ii) (iii) (iv) (v) formulation of policy encouraging the engagement of civil society determining priorities for a new project improving the efficiency of the water utility and highlighting the needs of the urban poor. C. Scope of the Assessments 7. The first step in undertaking the assessment are field surveys: (i) (ii) (iii) (iv) (v) a survey of the water utility a survey of the small private piped operators a survey of water vendors a survey of bottled water suppliers and a survey of all water consumers on a 5% sample basis: 8. The second step in undertaking the assessment is preparing a summary of results. 9. The third step is analysis of the results and identification of major findings. 10. The fourth step is convening a stakeholder consultation to discuss the findings. It is during this consultation that draft water supply policy is developed and a civil society task force to monitor policy is convened. The priorities for a new water supply project may also be determined. 11. The first consequential action resulting from the assessment is formulating a government endorsed water supply policy for the project city. 12. The second consequential action resulting from the assessment is monitoring of the water supply policy by civil society. Terms of Reference for Consulting Services to Undertake a Diagnostic City Water Assessment including the proposed questionnaires and sample analyses are available for use in the PPTA.