ECA SECTORS / WATER & WASTEWATER
ECA works extensively in the water sector, assisting in institutional development and regulatory framework development for water and wastewater service provision.
Our services in the water sector include pricing, resource management and allocation, investment planning and institutional design. We have advised river authorities, governments and water regulators in Europe, Africa and Asia.
We also provide capacity building and training courses to strengthen our client’s capabilities across all economic and regulatory issues in the sector.
In addition to these services our water experts are experienced in the links to sanitation and hygiene advising on suitable business models, regulatory frameworks and tariff setting in the sanitation and wastewater sectors.
SELECTED PROJECTS INCLUDE >
SELECTED PROJECTS INCLUDE >
ECA was contracted to advise the Consumer Council for Water on the appropriate cost of capital for the water companies in the 5-year regulatory period of Ofwat’s PR14 price review. ECA’s analysis focused on the weighted average cost of capital (WACC) and the recent financial performance of the companies.
ECA and PWC undertook a major study to propose a new regulatory framework and new tariffs for water/sewerage services to the Electricity and Cogeneration Regulatory Authority. ECA’s inputs included preparing a new incentive-based regulatory framework, modelling costs and flows across multiple sector entities and value chains, calculating a revenue requirement for the next four years, recommending changes to the design of tariffs, preparing new tariff schedules for stakeholder feedback, and conducting impact and affordability analysis.
Building on past studies for the basin organisation OKACOM, this study sought to determine a pathway to meet the national development needs and poverty reduction objectives of the member states (Angola, Namibia and Botswana), without compromising the ecosystem services of the basin and diminishing the global value of the Okavango Delta. The study involved developing integrated economic, hydrological and environmental modelling and working with stakeholders to strengthen regional cooperation in the basin.
Following the successful completion of ECA’s previous work in Indonesia, resulting in the implementation of National Urban Water Supply (NUWAS) framework, we were asked to assist the World Bank Team Jakarta to design a regional water supply and PPP framework. The regional water supply frameworks developed under this assignment aim to provide a streamlined and consistent approach and associated tools for the development of Indonesia’s regional water supply scheme.
ECA supported the UK water regulator, Ofwat, in their assessment of company performance against quality based incentive mechanisms.
ECA supported Aguaconsult and WSUP of the UK in a review of the pricing for sanitation services provided by municipalities in Mozambique. Following a review of the existing model, ECA developed a new model that was more fit for purpose, and provided support to the handover and training of personnel from CRA, the water and sanitation regulator in Mozambique.
This project objective was to establish an autonomous urban water regulator for Uganda, to ensure that water supply is both financially sustainable and affordable for consumers through setting appropriate tariff structures and other regulatory mechanisms. ECA reviewed the current water sector regulatory framework, comparable frameworks from other countries, prepared a business plan and financing strategy, and drafted the required legal frameworks for establishing the regulator.
ECA, in collaboration with JG Afrika, led a comprehensive cost of service and tariff study for the provision of water and wastewater services of the water utility WASCO. The study was to advise on the preparation of the annual tariff proposal to better reflect WASCO revenue requirements, improve the fairness in the allocation of its cost-of-service among customer classes, and account for future investment needs.
ECA conducted a global study to find out what policies, institutions and regulatory (PIR) incentives have been used in practice and how these can be combined to further improve water supply and sanitation (WSS) services. The study involved a literature review of existing theories on IPR incentives, development of case studies to illustrate findings, and development of a framework that can be used to design appropriate IPR incentives to improve WSS services. The result of this study has been published and can be seen on this link: STUDY
ECA, together with Trémolet Consulting, worked with NWASCO to develop a strategy for regulating sanitation services in Zambia.
ECA has worked with the World Bank Jakarta office since 2012 to help develop a national framework that will assist the Government of Indonesia in improving urban water service provisions, through efficient allocation of available sources of finance for the sector to appropriate investment, or service improvement project. Our team designed the incentive-based framework, a system water companies (PDAMs) can access funding only when they continuously improve performance. The national framework was approved by the Government in 2017 and its implementation started in 2018.
The Sanitation Corporation (LWSC) wanted to develop a business plan for onsite sanitation services and faecal sludge management (FSM). ECA led the political economy assessment, conducted financial analysis and developed a financial model for different types of FSM business models, plus contributed to the market design and recommendation of FSM business model and to the development of the FSM business plan for LWSC.