WATER POLICY IN THE AMERICAS ROUNDTABLE

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WATER POLICY IN THE AMERICAS ROUNDTABLE
Energy Efficiency for Water Utilities presentat
ion by Amarquaye Armar Principal Energy
Specialist Infrastructure Group World
Bank October 19, 2000 Padilha Vidal Conference
Room Organization of American States
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STRATEGIC FRAMEWORK FOR ENERGY EFFICIENCY IN
WATER UTILITIES

• ENERGY EFFICIENCY IMPROVEMENTS ARE INTEGRAL
  TO WORLD BANKS THEMATIC PRIORITY OF WATER
  UTILITY MODERNIZATION IN LATIN AMERICA
• Unsustainable dependence on increasingly scarce
  public finances to cover operational expenditures
  (including energy and chemicals)
• Consensus on private participation in provision
  of water supply and sanitation services
• Need to devise more effective regulatory tools to
  enhance economic efficiency in the provision of
  water supply and sanitation services
• Key focus is on assessing, sharing and
  disseminating lessons of experience in
  harnessing low cost technologies to improve
  energy efficiency.

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CRITICAL SUCCESS FACTORS FOR SUSTAINABLE ENERGY
EFFICIENCY

• FINDINGS OF ESMAP SURVEY OF 1995/96
• Awareness - realizing that energy costs can be
  controlled
• Start-Up - reinforce commitment through low cost
  measures that achieve significant cost savings in
  short-term
• Sustained Approach - institutionalizing measures
  to establish baseline for pre-investment
  activities and also to ensure that short -term
  savings are not eroded in medium to long term
• Selective Investment - identifying and providing
  justification for major new investments in energy
  efficient technology
• MONITORING AND TARGETING (MT) WAS IDENTIFIED
  AS
• MOST PROMISING LOW COST TECHNOLOGY FOR
  DISSEMINATION

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• ESMAP INITIATIVE
• Initiated by ESMAP in 1995, following Critical
  Success Factors Study on Energy Efficiency
• Executed in parallel with support to energy
  efficiency pre-investment activities of
  ELECTROBRAS (PROCEL) and of FINEP/CNI for
  industries.
• Impetus provided by Energy Conservation Manager
  of CEDAE (Rio de Janeiro Water Utility), based on
  internal awareness campaign of CEDAEs Energy
  Conservation Committee (CICE).
• Interest reinforced by energy efficiency
  presentation at 1996 Annual Convention of
  Brazilian Association of Water and Sanitation
  Engineers (ABES).

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• PRELIMINARY ESMAP ASSESSMENTS OF BRAZILIAN
  WATER UTILITIES
• Collaborating Water Utilities were
• CEDAE of the State of Rio de Janeiro
• CESAN of the State of Espirito Santo
• EMBASA of the State of Bahia
• NOVACON, private concessionaire of small
  municipal systems in the States of Sao Paulo and
  Mato Grosso
• Associated agencies were
• Brazilian Association of Water and Sanitation
  Engineers (ABES)
• Caixa Economica Federal (CEF), the Brazilian Bank
  for Infrastructure Development

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• ESMAP INITIAL FINDINGS
• Water utilities had considered energy (primarily
  electricity for pumping) as fixed overhead cost
  of water treatment and pumping operations.
• Typically, losses of treated water was 40-50 of
  total production of water treatment facilities
• Expenditure on electricity was 10-15 of
  operating costs, usually concentrated in water
  treatment facilities.
• Major impediment was corporate viewpoint about
  extent to which electricity use could be managed
  as variable cost rather than a fixed overhead
  cost.
• CEDAE and ABES highlighted need to mobilize CICEs
  to create awareness about potential to reduce
  operating costs through energy efficiency
  measures.

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• OVERVIEW OF PILOT MT APPLICATION AT CEDAE
• ESMAP support consultant services through Manager
  of CEDAEs Energy Conservation Committee (CICE)
• CICE secured approval of CEDAE Senior Management
  for pilot demonstration of MT as Start-Up Tool
  for achieving sustainable energy efficiency
  improvements at the GUANDU Water Treatment
  Station
• GUANDU Water Treatment Station
• Water treatment and supply capacity of 1500
  million cubic meters/annum.
• Expenditure on electricity is equivalent to US40
  million/annum or approx. 25 of total operating
  costs.
• Expenditure on chemicals is equivalent to US 15
  million/annum.
• Pilot MT system by CICE at GUANDU (with portable
  meters only) resulted in US1 million savings in
  annual electricity expenditure

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• OVERVIEW OF FEASIBILITY STUDY AT EMBASA
• ESMAP supported consultant services for
  system-wide assessment of energy savings
  potential of MT systems and introduction of
  Variable Speed Drives (VSDs)
• EMBASA System Characteristics
• Water treatment and supply capacity of 560
  million cubic meters/annum.
• Expenditure on electricity is equivalent to US20
  million/annum or approx. 11 of total operating
  costs.
• Expenditure on chemicals is equivalent to US 5
  million/annum.
• Two-stage program to initially apply MT systems
  followed by VSD retrofits of motors would require
  an investment of US 8 million but payback period
  would be less than 2 years, based solely on the
  projected value of electricity savings.

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• OVERVIEW OF FEASIBILITY STUDY AT CESAN
• ESMAP supported consultant services for
  system-wide pre-investment study of energy
  savings potential of MT systems in the SANTA
  MARIA system.
• SANTA MARIA System Characteristics
• Water treatment and supply capacity of 76 million
  cubic meters/annum.
• Expenditure on electricity is equivalent to
  US1.8 million/annum or approx. 12 of total
  operating costs.
• Expenditure on chemicals is equivalent to US 0.2
  million/annum.
• MT approach (installation of sub-metering units
  for water and electricity, computer software,
  training transfer activities) would require an
  investment of US 0.7 million and payback would
  be less than 3 years, based solely on the
  projected value of electricity savings.

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ESPIRITO SANTO (PRODESPOL)PILOT PROJECT ON
ENERGY MANAGEMENT IN WATER TREATMENT AND
SEWERAGE FACILITIES
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ESPIRITO SANTO (PRODESOL)PILOT PROJECT ON ENERGY
MANAGEMENT IN WATER TREATMENT AND SEWERAGE
FACILITIES
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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• OVERVIEW OF ASSESSMENT AT NOVACON
• ESMAP consultant assessed energy savings
  potential of MT systems in the small municipal
  water utility concessions held by NOVACON.
• Municipalities are
• Pereiras, Tuiuti, Tanabi, Santa Isabel, Serrana,
  Pirangi, S. Jose Rio Pardo, Tambau, Uchoa,
  Severinia (State of Sao Paulo).
• Caceres, Barra do Garcas (State of Mato Grosso)
• Combined water treatment and supply capacity of
  60 million cubic meters/annum.
• Expenditure on electricity is equivalent to US2
  million/annum or approx. 22 of total operating
  costs.
• MT approach (installation of sub-metering units
  for water and electricity, computer software,
  training transfer activities) would require an
  investment of US 0.5 million and save US 0.2
  million/annum.

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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL
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ENERGY EFFICIENCY FOR WATER UTILITIES - CASE
STUDY ON BRAZIL

• POSSIBLE NEXT STEPS
• FINANCING OF PILOT AND SCALE-UP PROJECTS
• WORLD BANK PROJECT PIPELINE WITH CEF FOR BRAZIL
  WATER PRIVATIZATION/SECTOR REFORM (e.g., PROPAR)?
• CEDAE, CESAN, EMBASA
• FUNDING OF DETAILED PRE-INVESTMENT WORK
• PUBLIC PRIVATE INFRASTRUCTURE ADVISORY FACILITY
  (PPIAF)?
• NOVACON
• ENERGY SECTOR MANAGEMENT ASSISTANCE PROGRAM
  (ESMAP)?
• CEDAE, CESAN, EMBASA, NOVACON, etc.