Think Water Conservation

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THE continuous rainfall may lead one into believing that the supply of water is abundant. Current international debate on climate change and the environment is focused on the food, energy and water nexus.
With 70% of the projected nine billion people expected to live in cities by 2050, rapid urbanisation will put an additional strain on Earth’s limited water resources.

Half the total revenue in the water industry flows down the drain due to high non-revenue water (NRW).

Instead of pointing fingers at the regulator, we as consumers should ask ourselves whether we have done enough to improve the situation and conserve water in our daily lives.
For instance, a pipe is leaking outside the premises and the owner chooses to ignore it as it is not going through the meter and, therefore, he/she is not billed for the lost water.

A study conducted by Fomca from 2007 to 2010 revealed that 70% of those surveyed say they are not likely or very not likely to reduce their water usage at home for the next three years. It shows that awareness of the people on water issues is still very low.

There is an immediate demand for governments around the world to formulate approaches, undertake changes in governance and behavioural patterns and deploy technological innovations to address the issue of water security.
Water security in Malaysia is a national issue. The Malaysian water services industry faces issues which need to be tackled immediately for it to be viable and sustainable.

Among them are the decentralised water services sector, ineffective governance structure, unsustainable tariffs, huge investments required to develop the water supply and sewerage infrastructure, inefficient operation by the operators and high non-revenue water (NRW) losses.

Prior to the transformation of the water supply services industry which was implemented by the Federal Government in 2008, the management of water services in Malaysia was decentralised to the 14 states with different water tariff rates and tariff structures with the gap between the lowest and the highest tariff reaching almost 200%.

For most states, the revenues collected by the water operators are not even enough to cover their operating costs.

The water operators in Malaysia exist in various forms such as privatised companies, corporate bodies and government agencies.

To some extent, they operate without being properly supervised by the respective regulatory bodies in the states.

Under the reform exercise to strengthen the governance structure, the Federal Constitution had been amended for the water services sector to be placed under the Concurrent List.

With this amendment, the Federal Government is now responsible for setting the direction of the water services sector for the country, while state governments will be responsible on water resources aspects.

The second initiative is to shape the industry’s efficiency and effectiveness.
The transformation of this industry starts with the corporatisation of all state water supply agencies which will then be monitored and regulated by the National Water Services Commission (SPAN) .

To enforce the regulatory regime and ad­­dress the inefficiencies and ineffectiveness of the current setup, the Water Services Industry Act was enacted and enforced on Jan 1, 2008.

Under this regulatory framework, operators are licensed and required to achieve certain standards and Key Performance Indicators set by SPAN under the licence conditions.

All water and sewerage operators are required to submit three-year and 30-year business plans for the approval by SPAN before they can be executed by the operators.

The requirement to put up business plans will gradually shift the water services operators from a project-based management to a demand-side management.

To address the issue of huge capital requirements, Pengurusan Aset Air Berhad (PAAB), was established to build new water assets and finance the water operators’ capital expenditure. In return, the water operators will pay lease rental to PAAB at low interest rates to ensure their sustainability and affordable water tariffs to the consumers.

Currently, five out of 12 states in the Peninsula – Johor, Malacca, Negri Sembilan, Penang and Perlis – have restructured their water services industry.
After three years, the reform has led to improved performance especially for the states that have restructured their water services industry. For example, the rate of NRW for Malacca was reduced to 26% in 2010 compared to 30.1% in 2008.

In addition, Syarikat Air Negri Sembilan Sdn Bhd has recorded an increase in its average monthly revenue from RM10.3mil in 2009 to RM12.9mil in 2010.
Finally, advocating the water cycle chain concept is the ultimate aim of the water reform initiative. It involves the integration of both water and sewerage services so that the whole water cycle management will be under single operators.

The issue of decreasing quality and quantity of water resources is a global phenomenon as water resources are currently under the threat of depletion, pollution and climate change.

We must look at our resources and integrate water resources to optimise its usage to benefit all consumers.

With the cost of treating raw water and waste water escalating, consumers must be prepared to pay more for the provision of water services in the future.

With the incessant rainfall lately, we may take for granted that water is everywhere but are we sure that water will still be there tomorrow?
Let us join hands in conserving this precious gift of life we call water through excellence and innovation in water management.

(An adaptation of an article written by DATUK LOO TOOK GEE)