Stealing water

From opposite sides of the world come stories this week about stealing water.  There are multiple ways of doing this – getting water at a discounted price, by-passing the meter, or simply tapping the supply illegally are three of the most common.

In Mumbai commercial establishments have been found illegally tapping water meant for residential pockets in the city.  An audit on supply and distribution of water in the city has brought to light cases where commercial establishments are illegally consuming water meant for residential consumption.  The report, tabled before the standing committee of the Brihanmumbai Municipal Corporation (BMC) recently, cites 407 cases. It was compiled by the office of the chief accountant (water supply and sewerage department) of the BMC. Instead of applying for a commercial connection, these establishments have been tapping water from domestic lines.

The BMC has differential charges for domestic and commercial connections. It charges between Rs25 and Rs38 per kilolitre of water for a commercial connection. In contrast, the rates for domestic users range from Rs2.25 to Rs3.50. The report says commercial establishments have been masking their identity to avail of domestic water connections.  Of the 407 cases, 221 are in the western suburbs, 95 in the island city, and 91 are in the eastern suburbs. The illegal connections have brought to nought the BMC's efforts to combat water shortage by restricting new commercial connections. The corporation is denying connection for projects where the daily water demand is over two lakh litres.  Interestingly, instead of taking action and discontinuing water supply to the violators, the BMC has regularised their connections after penalising them. Many of these connections receive 24 hours water supply while several residential colonies go without water. The audit report has also identified 100-odd cases where water bills were not being regularly sent.

In Monterey County, California, American Water says it is keeping a sharp lookout for thieves making off with one of the Peninsula's most precious commodities — water.   Cal Am announced Friday that it is making a concerted effort to deter the theft of water from its system — most typically by tapping fire hydrants without required permits and meters.  "We have asked all our employees to be on the lookout in the past couple of months," said Cal Am spokeswoman Catherine Bowie. The utility, which serves most of the Peninsula, is under standing state orders to reduce pumping from the Carmel River, conserve water and to reduce losses from its system.

Bowie said losses to the water supply have run as high as 13percent, but the utility has reduced that to about 10percent in recent months. The primary causes are leaks in the system, malfunctioning meters and theft, she said.  The utility can't estimate what share of the losses is attributable to thefts, but given the tight restrictions on Peninsula water use, Bowie said, "Even if it's 1percent — that's too much."  Most thefts are probably committed by builders who tap into fire hydrants to provide water on construction sites, Bowie said. The utility has found about 10 instances of theft in recent months, including a couple of places where someone hooked into Cal Am's system by "reverse plumbing."

The bills won’t go up

An austere regulatory settlement could have forced Thames Water, the UK's largest water utility, to tap shareholders for up to £1bn.  The company might have had to raise the money by suspending its dividend for the full five years of the Ofwat's price review, industry sources said.  However Ofwat’s decision was not as bad as had been feared, so shareholders are safe.  Consumers have not benefitted so much.  Water bills will not be as “good” as they might have been under the draft decision.  Thames Water is owned by Australia's Macquarie Bank and a group of pension funds.

Energy efficiency

A recent series of articles in Business Week about the smart grid has been collected together in the week of October 10 and published in one place - http://www.businessweek.com/technology/ceo_guide/newsletter/index.html. How this link will move as it becomes less current will be monitored, but in the meantimne this is a fascinating set of articles.

Delaying price rises in Manila

Metro Manila’s two water distributors have agreed to forego customer disconnections and shelve rate increases to help customers reeling from the effects of storm Ondoy. Water consumers will continue to enjoy uninterrupted service this October should they fail to settle their bills for the period, Diosdado Allado, administrator of the Metropolitan Waterworks and Sewerage System (MWSS) said on Friday.

Manila Water Co. Inc. (MWCI) and Maynilad Water Services Inc. (MWSI) “have agreed to the initiative of the MWSS to implement a disconnection moratorium for [customers’] October water bill," Allado said in a text message. Manila Water has even given its customers “the option to pay for their October billing for a maximum term of 12 months," he added. The option “is to be applied to 79 barangays representing the areas hardest hit by storm Ondoy," he said.

In a separate announcement made during the same day, the Ayala-led utility said it has temporarily shelved a proposal to hike rates. The company distributes water to locations that remain flooded by the record amounts of rainfall brought by Ondoy. Instead of starting on October 2, the rate hike will be moved to November 1 this year

Indebtedness

The borrowing spree of the last few years is catching up with the public sector just like everyone else. In Mississippi Gulfport administration estimates the city needs to increase water and sewer rates a minimum of 15 percent for the upcoming fiscal year to cover debt payments. Finance Director Mike Necaise said all localities in Harrison County, not just Gulfport, will soon have to grapple with how to meet the costs of utility payments coming due.

When Katrina hit, the Harrison County utility authority, composed of the county and its five cities, decided to defer debt payments for two years. Necaise said the authority had about $100 million in debt at the time. The debt, he said, was refinanced at 7.5 percent, compared to the previous rate of 5 percent.

The deferred payments plus the higher interest rate mean Gulfport can no longer meet its debt payments with current revenue. Taking the money out of the city’s general fund is not viewed as an option. Incoming Mayor George Schloegel said he supports the rate increase over a property tax increase. He believes utility customers should pay for the service rather than all Gulfport property owners. “It’s consumption driven,” said Schloegel, who on Monday takes office along with a new City Council. “It’s got to be user-based. That’s the only equitable way.”

Unpaid bills amnesty

In Arizona, delinquent utility users in Surprise's Original Town Site owed the city about $262,000 in unpaid sewer and trash bills - some a decade old - but the city forgave 81 percent of the debt, according to public records. The City Council in March established the amnesty program, allowing people in 101 households to set up a payment plan with the city to bring their accounts current.

As of last week, about 20 percent of the accounts have been paid in full, but 14 people who set up payment plans have defaulted on them, resulting in a planned water shutoff either late this month or in July. The remaining debt is $40,102. However, the city will not see about $9,576 of that amount because 21 accounts are closed. City officials said that the customer moved out of the property or the land is now vacant. In one case, the customer died. The utility billing software contains a facility to write bills off.

The costs of water

Water has not only to be collected, stored and distributed; it must also be pumped. Running pumps use electricity. Electricity is not a cost of water that comes immediately to mind; nevertheless as electricity costs rise, so do some of the inputs to water costs. The water billing software prices charged o customers should reflect all of the inputs.

Everybody wants to cut their electric bill including the Lewisburg Water and Wastewater Department (TN) and last week the utility's board decided to investigate a way to do it. The utility might save $1,000 a month, thereby lowering a $15,000 part of its monthly $20,000 bill by almost 7 percent at a cost of $36,000, but that means the system pays for itself in three years, officials said.

Utilities consolidation

Government utilities working together will ensure Saudi Arabia's power and water demands are met, Middle East Business Intelligence reports. Responsibility for the power and water sectors in Saudi Arabia is shared between four separate government owned utilities - the Water & Electricity Company, Saudi Electricity Company, the Saline Water Conversion Corporation (SWCC) and the Power & Water Utility for Jubail & Yanbu (Marafiq).

Despite the companies all being tasked with ensuring the kingdom's growing demand for power and water is met, they have so far pursued this objective completely independently of each other. Now, spurred by the global economic slowdown, they have seen the error of their ways and recognised the need for a co-ordinated response to the demand picture. As a result, Marafiq and SWCC are now planning to merge what were to be two separate projects located at Yanbu.

SWCC and Saudi Arabian Mining Company (Maaden) also intend to combine their power and water schemes at Ras al-Zour. In both cases, the government has abandoned plans to develop the projects as private schemes and is opting instead for the more conventional engineering, procurement and construction approach. Greater co-operation between the various stakeholders in the power and water industries will ensure that the right amount of new capacity is built where it is needed and in the most efficient way possible. Marafiq, SWCC and Maaden have been forced into this position by the economic downturn.

Subsidising solar

In Nevada, solar energy generation is being subsidized (encouraged?) through extended property tax abatements for renewable energy production plants, which were to expire in this year, and expanded them from 50 percent for 10 years to 55 percent for 20 years. The Las Vegas Sun newspaper reports that solar energy developers had been worried about a fierce stance by Assemblywoman Kirkpatrick, who began the year saying she would not support the industry’s request for a 75 percent property tax abatement and would impose a new tax on renewable energy. The revenue would go to offset higher energy costs for ratepayers.

Kirkpatrick was concerned that solar plants would not bring many permanent jobs to Nevada, and that solar plant construction jobs have gone to out-of-state workers in the past. But the possibility of a new tax “brought development to a halt,” said renewable energy lobbyist Tom Clark. “It sent a red flag to every developer.”

Paying for recycling

It is reported that Oshkosh residents will pay for carts that will be used as part of the city’s switch to automated recycling this fall. Going against a vote from last fall, the Oshkosh Common Council voted 7-0 Tuesday to go ahead with assessing a one-time special fee on property taxes to pay for recycling carts, charging homeowners $46.51 for a 95-gallon cart and $40.18 for a 64-gallon cart. Initially, the council voted 6-1 in November to finance the carts over 10 years. During a discussion on the matter in March, the majority of the councilors expressed desire to switch to the special fee so the city decided to take another vote on the matter.

In discussion of how to pay for the carts, councilors said charging property owners encourages them to take responsibility for their carts. "There’s an ownership associated with it," said councilor Harold Buchholz. Now the city plans to go ahead with its education process over the summer, teaching residents how the switch will affect them. City Manager Mark Rohloff said information will be mailed out to Oshkosh residents regarding the switch and a Web site on single-stream recycling created.

In information mailed out, Public Works Director David Patek said the city would give residents the option of obtaining a 95-gallon or 64-gallon cart. If the residents do not specifically request a 64-gallon cart, they will be provided with the larger cart. As part of the switch to single-stream, residents will put all recyclables – paper, plastic, cardboard, glass – in the one bin for pick up every two weeks.

"I think people will be surprised once they get cardboard and other recyclables in there that they will be able to use that (95-gallon) bin pretty readily," Rohloff said.

Recycling. What recycling?

Cities that manage their own trash collections and get their citizens to pay via their property taxes or utility bills apparently may not be doing so well these days, according to CNN. When Lynn Heinisch and her neighbors in Atlanta's Lake Claire neighborhood take their recycling to the curb for pickup each Thursday, they cross their fingers and hope for the best. Accusing city collectors of unreliable pickups, Heinisch and the others have resorted to stockpiling recyclable materials in their garages.

"It's frustrating," Heinisch said. "People are trying to recycle, and it's not easy. I wish it was easy to do what we all feel strongly about." When she has to, Heinisch drives her recycling 4 miles to a dropoff center in the town of Decatur.

The recession has trashed the nation's booming recycling industry in just a few months, and cities are straining to keep their programs alive. Demand for commodities such as cardboard, paper and glass has taken a nose dive, and prices for those materials have gone south since last fall. In August, a recycler in Georgia could expect to receive about $160 a ton for curbside recyclables. Now the average is about $37 a ton.

Market dominance

Electricity and to a lesser extent gas billing for consumers large and small has been deregulated in many economies. However the retail energy providers still have to buy their energy from the electricity generating companies. Where fewer of those exist - in say a small country like New Zealand - they can use their market dominance to distort prices. A recent New Zealand Commerce Commission report says that power generators overcharged customers $4.3 billion over six years by using market dominance.

The study has found find that the country's main electricity generators, state-owned Meridian Energy, Genesis and Mighty River Power and privately owned Contact Energy, effectively used their market power to maximise profits, including withholding power at peak times. But the power companies have been cleared of the most serious allegations levelled against them - that they breached the Commerce Act by abusing market dominance and that they colluded to make extra profits.