Water system sustainability and the need for change.
The Sustainability Problem
There are thousands of hand pumps installed throughout the world yet, unfortunately, non-functionality rates range from 15% to 50%. This variability in functionality raises the question: how do you make sure manually-operated pumps keep working after installation, especially in difficult contexts like the Central African Republic, which is one of the most remote, rural countries on earth?
Market density refers to the number of potential customers of a product or a service per unit area generally per square km or per square mile. The market density multiplied by the total area gives the total number of potential customers in that particular area.1
Capital Asset – In our situation, we are referring to the pump that was installed on the borehole to provide water to the community.
Capital Maintenance Expenditures (CapManEx) – The cost of renewing, replacing, rehabilitating, refurbishing or restoring assets to ensure that services continue at the same level of performance that was first delivered.2
Simple Solution?
The sustainability of a water project depends on the management structure of the community pump and whether the responsible party(ies) have the resources needed to provide the ongoing Capital Maintenance Expenditures (CapManEx) that are required to keep that pump operational.
Basically, communities need access to funds, someone who knows how to service that pump, and the necessary parts. In order to reliably get the parts and services, there needs to be a local supply chain for both the replacement parts and expertise, available at a price that communities can afford.
Ok…so what conditions allow for a local parts store and service technicians to exist at the local level?
There needs to be a market for parts and services, and the opportunity to make a profit.
A parts store has fixed costs (their staff, assets, etc), and they have variable costs (costs directly related to their good or service). Typically, their variable costs will be covered by each transaction, and their fixed costs will be spread over the sum of their transactions over a given point of time.
When the market or customer base is more dense, the fixed costs are then spread over more water points, which can be serviced at a lower unit cost, providing the customers with a more affordable price point. The lower the price, the more likely it is to be paid in full by communities managing these water points.
Building Markets for Rural Water Services in CAR
Creating Economies of Scale
Part of Water for Good’s strategy for 2020 is to provide 100% of the people in one region in CAR with access to water. See the map below of our “Focus Region,” where we aim to dramatically increase the water point density and ensure Basic water access for 100% of the population.
We believe that increasing water point density in this region will make services more efficient from an operational standpoint, creating the opportunity for cross-subsidy and economies of scale, and increasing the likelihood of private sector businesses participating in the CapManEx associated with keeping these projects functioning well into the future.
In summary, we see a link between increasing water point density, improving the quality of services, reducing the unit cost of services, and increasing the capacity of the private sector to participate in the market for rural water services (both the supply chain of parts and service delivery). We’re testing that theory in our focus region between now and 2020!
We’ve charted the Logic of our Focus Region below.
Linking Increased Water Point Density and Sustainability of Services
- Increased access
- Less wear on pumps
- More pumps per regional repairman
- Less fuel-intensive transport options
- Lower frequency of part replacement
- Lower costs
- Faster response times
- Less pump downtime
- Local on-demand services
- Long-term engagement of private sector in provision of maintenance services
But what about the government’s role?
While our logic focuses on increasing operational efficiency and creating the potential for private sector services, we know the same efficiencies would benefit the public sector capacity to monitor, improve, and subsidize these services as well.
One thing we are clear on is that a strong public-private partnership can provide the solutions needed for ongoing reliable access to water, even in the most rural and remote contexts.
Over the past 7 years, we have collected a lot of data. We understand the gaps to show where improvements and efficiencies can be made. We are using that information to develop the private sector and provide support to the communities as their economies and governments stabilize.
So, what do YOU think?
Are professionalized services a key to sustainability? How can the public and private sector do better to collaborate on the delivery of professionalized services?
Please join the conversation! Comment below or connect via email: info@waterforgood.org.
The series culminates during the World Water Week conference in Stockholm, Sweden at the end of August, where we would love to meet up with other attendees! We will also have representatives at the 41st WEDC conference in Nakuru, Kenya in July, 2018. Contact info@waterforgood.org of you’d like to connect!
1https://www.mbaskool.com/business-concepts/marketing-and-strategy-terms/11194-market-density.html
2https://akvopedia.org/wiki/Capital_Maintenance_Expenditure_(CapManEx)
