Water Crisis Deserves Government´s Priority

If only for giving potable drinking water the place it deserves in the nation´s radar screen, Presidential aspirant Sen. Francis "Chiz" Escudero deserves the people´s thanks and gratitude for putting forward his advocacy for a state-run bulk water distribution system as the answer to the country´s water woes, however unfeasible such a scheme might be.

Although he prefers the state to stay out of businesses which can be run more efficiently by the private sector, Escudero said he believes basic utilities like water and power require sustained effort from government to guarantee competitive prices and sufficient supply. He added that if government can spend for power generation and distribution, it should also do the same for water.

Taking off from the power distribution system that enables electricity generated in Pangasinan to be transmitted to Manila, the good senator dreams one day of replicating the system of Transco wherein power from Mindanao can be distributed to any point in the country. He said a similar water distribution system for water would benefit areas like the National Capital Region, Central Luzon, Southern Tagalog and Central Visayas where access to clean and adequate water is fast approaching crisis proportions.

In the senator´s ideal world, government would be responsible for water production while water districts would be distributors just like utilities in the power sector. He added that government should make drastic efforts to ensure water rates are affordable and strengthen the water sector before the price of water becomes as expensive as gasoline and energy.

There´s no arguing with the latter proposition to make the price of water affordable for all. But his other proposals are worth a second look especially by other well-meaning legislators and other powers-that-be who may be mulling similar projects.

Let´s see now: First, to compare water distribution to the distribution of electricity is like, well (to refer to the fatigued cliché), comparing ´apples to oranges´. Water is liquid, heavy and requires an inordinate amount of energy to move from one point to another, precluding the good senator´s well-meant "perfect world." You just can´t wheel it from one point to another the way you do electricity.

Second, government, as already proven by the country´s sad experience with many of its water districts, is hardly the ideal institution to undertake water abstraction and distribution. No need to go far, your local water district has a top-heavy (read: costly) bureaucracy which has been unable for many years now to properly address its growing problem of non-revenue water (NRW), or water which is produced but not paid for.

In contrast, the two privatized concessionaires of the Metropolitan Water & Sewerage System (MWSS) have significantly brought down NRW during the comparatively short time they´ve been managing their respective areas.

It´s just like electricity: politics and business are a poor mix for success, and the reason that electric cooperatives just can´t seem to thrive in certain provinces of the country is not because of inherent weaknesses in the cooperative system per se, but because of constant intervention, better described as harassment, from local government executives who regularly pressure coop officers into continue providing non-paying customers with electricity. We can´t expect the situation for a government run water distribution system to end up differently.

However, the good senator is nearer the mark when he envisions government taking up water production while distribution would be the purview of local water districts just like the Transco-Genco-local utilities set up of the power sector.

In fact, water in two areas of the country, Metro Manila and Cagayan de Oro, is already being abstracted/produced in bulk and distributed/retailed to private distribution companies. This system isolates water distributors like the various water districts, from the additional burden of producing water and enable them to focus on improving their often flawed distribution systems.

But it is competition on a level playing field between private bulk supplies, rather than a government monopoly, which can bring out the lowest prices for end users at the highest quality, as proven by the competitive bidding for the MWSS franchises in Metro Manila eventually won by Manila Water and Maynilad.

In fact, in Cebu, the Metro Cebu Water District (MCWD) was all but ready to award the bulk water supply project to a proponent at P25.55 per cubic meter (m3) for 40,000 m3 a day.

But when the usolicited proposal was subjected to the Swiss challenge (where other suppliers were given a chance to bid for the water project using the Luyang-Cantumog River in Carmen town as source) Cebu Bulk Water Consortium offered to sell water to MCWD at less than P20 per cubic meter. That comes to a P222,000 daily savings outright or approximately P5.7 million a month, certainly no amount to sneeze at.

Nearer home,treated surface water is being bought by the COWD in bulk from Rio Verde Water Consortium at P10.50 per cubic meter (m3) and sold by the water district to residential households at P23.50-26.50/m3, from P47-53/m3 for commercial/industrial firms and from P70.50-79.50/m3 for bulk water.(see http://www.cowd.gov.ph/existingWaterRates.htm).