Business analysis of fecal sludge management

Emptying truck Phnom Penh, Cambodia. Photo from publication.

This study was initiated and funded by the Bill & Melinda Gates Foundation to map the urban sanitation situation and assesses business and operating models for fecal sludge management in 30 cities across 10 countries in Africa and Asia, specifically focussing on the extraction and transportation market segments. The study was carried out in Burkina Faso, Ethiopia, Kenya, Nigeria and Senegal in Africa and Bangladesh, Cambodia, India, Malaysia and Viet Nam in South/Southeast Asia.

Using a common analytical framework, teams of local consultants in each of the ten countries gathered users’ perspectives through 13,000 household surveys and the collected data on the financial and business models of 150 emptying service providers. This report presents the comparative analysis based on these data from those surveys.

A majority of households (5.6 million households) in the 30 cities use on-site sanitation facilities. Households spend only a small percentage of their income, on average less 4%, on emptying services. About one third of surveyed households (2 million households) rely on manual emptying for sludge management.

The total available market for emptying services across the 10 cities is an estimated US$ 134 million.

Some regional trends were seen in the business operations between Africa and Asia:

• average truck capacity in Asia is just over 3 cubic metres and in Africa around 10 cubic metres – tracking the differing average pit volumes (2 cubic metres in Asia vs. 7 cubic metres in Africa)
• age of emptying trucks in Africa is 15 to over 30 years and in Asia between 5 to 10 years
• local assembly of trucks in done in Asia, while businesses in Africa import second hand trucks
• the cost of the trucks is three times higher in Africa than in Asia
• in Asia the operating expenses per truck are about US$ 11,000 and three times that much in Africa
• African businesses spend 76% of their expenses on variable charges such as fuel and maintenance, while their Asian counterparts spend most of their expenses (62%) on fixed costs – mainly staff salaries
• the single largest component of operating costs in Africa is fuel, making up 40% of expenses.
• the annual profit per truck in Africa is US$ 12,000 and is twice that seen in Asia, due to the higher empting fee charged (US$ 60 vs. US$ 28 in Asia) and the larger number of trips per day per truck in Africa.

A general finding was that the size of the fleet was the only factor that had a clear and strong correlation to profitability of the business – two or more trucks were needed to become profitable. There was also a lack of support systems necessary to create sustainable and profitable businesses.

The report presents several recommendations to realise the potential of the US$ 134 million market for emptying services, including:

• supporting the scaling of the single truck operators to become mid to large sized operations;
• better access to finance
• introducing transfer stations to save fuel costs and increasing truck efficiency
• regulating scheduled desludging
• local manufacture or assembly of trucks, especially in Africa
• a more effective supply chain for spare parts
• constructing safe dumping sites for sludge and sludge treatment plants
• enabling sludge reuse

Chowdhry, S. and Kone, D., 2012. Business analysis of fecal sludge management : emptying and transportation services in Africa and Asia. Seattle, WA, USA: Bill and Melinda Gates Foundation. 116 p.; 47 fig.; 22 tab. With bibliography  p. 115-116
Available at: <http://www.washdoc.info/docsearch/title/179741>

Financing sanitation in Sub-Saharan Africa

This guide provides highly practical decision-making tools for identifying the type of financing mechanisms to be implemented for on-site sanitation and small-piped sewerage systems.

The authors caution that the costs provided in the publication are for illustrative purposes only and do not reflect the wide variety of situations and practices encountered in the different countries
in sub-Saharan Africa.

The guide is organized into five chapters:

• The chapter ‘Categories of sanitation costs and expenditure’ provides a detailed list of the different components that need to be financed for each segment of the sanitation chain. Indicative cost estimates are also given here;

• The chapter ‘Financing transversal activities’ presents the various possible means of financing the activities and tools necessary for managing and supervising the entire sanitation sector (notably the intervention strategy and the monitoring and evaluation mechanism);

• The chapter ‘Financing access to sanitation’ details the different strategies available  for financing the access segment of the sanitation chain;

• The chapter ‘Financing the evacuation of wastewater and excreta’ presents the various means of financing the second segment in the chain, drawing a distinction between on-site sanitation and small piped sewerage systems;

• The chapter ‘Financing the disposal and/or treatment of wastewater, excreta and sludge products’ details the strategies available for financing the disposal and treatment segment of the sanitation chain.

Lastly, the ‘Financing Sanitation Overview’ contains a summarized and simplified version of all of the financing mechanisms presented in the guide. [author abstract]

Désille, D., Le Jallé , C., Toubkiss, J. and Valfrey, B., 2011. Financing sanitation in Sub-Saharan Africa . (Concerted Municipal Strategies [CMS] methodological guides on water and sanitation : six methodological guides; 6). [online] Paris, France: pS-Eau, Programme Solidarite Eau. 77 p.; ill.; 14 tab.; 5 fig.; 10 boxes
Available at: <http://washurl.net/dz4psq>

SWASH+ website

SWASH+ is an action-research and advocacy project focused on increasing the scale, impact and sustainability of school water, sanitation and hygiene (WASH) interventions in Kenya. Since September 2006, SWASH+ has collaborated with teachers and students in 185 primary schools in four districts in Nyanza Province, Kenya to identify challenges and analyze innovative solutions for sustaining school WASH. The project’s randomized controlled trials and numerous sub-studies have resulted in a compendium of research publications, one-page research summaries, stories from the field, photo essays and short films. They have been made available on this dedicated project website.

The partners that form the SWASH+ consortium are CARE, Emory University, the Great Lakes University of Kisumu, the government of Kenya, andWater.org. SWASH+ is funded by the Bill & Melinda Gates Foundation and the Global Water Challenge. The SWASH+ website is created and hosted by the IRC International Water and Sanitation Centre.

Website: www.washinschools.info/home/swash

Policy review of the Dutch contribution to drinking water and sanitation – 1990-2011

Tesselaar, R. et al., 2012. From infrastructure to sustainable impact : policy review of the Dutch contribution to drinking water and sanitation (1990-2011). (IOB evaluation ; no. 366). The Hague, The Netherlands, Ministry of Foreign Affairs of the Netherlands. 132 p. : 9 fig., 12 tab. 54 ref.
Available at: <http://washurl.net/d6qgwq> [PDF 4.6 MB]

This policy review examines Dutch aid during 1990 to 2011 to improve drinking water and sanitation services in developing countries. The main focus is on the period from 2004 when aid was directed at supporting the Millennium Development Goal of halving the world’s population without sustainable access to safe drinking water and basic sanitation by 2015.

The review is primarily based on:

• a study of Dutch policy and its execution;
• impact evaluation studies of drinking water and sanitation programmes in Benin, Egypt, Yemen, Mozambique and Tanzania.

Following an introduction, chapter 2 covers the problem analysis and international context. Chapter 3 describes the Dutch policy that lies at the basis of the targets for drinking water and sanitation, the responsibilities, instruments and policy execution, the budgets, monitoring and evaluation and the available information about the realisation of the contribution to the MDG target for drinking water and sanitation. Chapter 4 analyses the impact of the Netherlands-supported programmes and sustainability of results. The final chapter discusses findings that concern policy efficiency.

The main findings were:

• Dutch aid helped millions of people gain access to improved drinking water supply and sanitation
• the substantial increase in the use of improved water sources did not a guarantee the safety of the drinking water or the necessary water consumption
• effects of training and education on the building of toilets and their use and on hygiene was often limited and sanitary facilities were often too expensive for the poor
• improved access to drinking water supply significantly reduced women’s burden and increased their participation in programmes, and gave girls more time for school, but had a limited impact on income
• positive health impacts were generally modest or non-existent
• water supplies benefitted many poor communities but to a lesser extent the poorest segment while sanitation increased mainly in better off villages and households
• capacity of local communities, governments and NGOs for the maintenance of the facilities remained insufficient, there was limited involvement of the private sector, and partial subsidies remain necessary
• costs of communal water supplies and of privately owned toilets made with local materials were low, but benefits were often limited
• internal policy processes still fell short

Access to improved water source and satisfaction with services : evidence from rural Ethiopia

Abebaw, D., Tadesse, F. and Mogues, T., 2011. Access to improved water source and satisfaction with services : evidence from rural Ethiopia. (ESSP II working paper ; 32). Washington, DC, Ethiopia Strategy Support Program II (ESSP II), International Food Policy Research Institute. v, 14 p. : 9 tab. 20 ref.

Available at: <http://www.ifpri.org/sites/default/files/publications/esspwp32.pdf> [Accessed 16 January 2011]

In recent years access to safe and reliable water supplies has received increased government attention in Ethiopia. As a result, the national coverage rate for this service has gradually improved. Yet millions of people in rural areas still do not get drinking water from an improved water source. While expanding improved water source schemes is generally essential, it is equally important to ensure that the schemes have increased users’ satisfaction with water quality and availability for everyday use. Using household survey data and employing univariate and bivariate probit models, this paper attempts to investigate the effect of access to an improved water source on users’ satisfaction with both quality and availability of water. The study findings suggest that access to an improved water source significantly raised household satisfaction with both quality and availability of water. However, the effect of the improved water source on users’ satisfaction was slightly lower for water availability than for water quality. (author abstract)

Arrangements and cost of providing support to rural water service providers

Smits, S. … [et al.] (2011). Arrangements and cost of providing support to rural water service providers. (WASHCost working paper ;  no. 5). The Hague, The Netherlands, IRC International Water and Sanitation Centre.  42 p. :  1 fig., 16 tab.  37 ref.
Download full paper

This joint WASHCost and Triple-S paper is about the costs of providing direct and indirect support to rural water service provision. It provides an overview of the features such support entails, how those features can be organised, what they cost and how they can be financed. It also provides recommendations to countries for strengthening support. The paper is based on a desk review of existing literature from seven countries and an analysis of primary cost data collected by the WASHCost project in Andhra Pradesh (India), Mozambique and Ghana in 2010 and 2011.

Ladders for assessing and costing water service delivery – 2nd edition

Moriarty, P. … [et al.] (2011). Ladders for assessing and costing water service delivery. (WASHCost working paper; no. 2). 2nd ed. The Hague, The Netherlands, IRC International Water and Sanitation Centre. iv, 19 p. : 5 fig., 5 tab. 14 ref.
Download full paper

This working paper introduces the concept of service levels, grouped as sequential rungs on a ladder, as a way of differentiating between broad and recognisable types (levels) of service. By developing this metaphor, a structure is provided to analyse the data being collected in different countries and settings, not just in terms of the technologies being used, but in terms of the domestic water services being received. The paper introduces water service levels and explains how these can be used as integral components of an analytical tool for applied research or benchmarking. It is best read together with Working Paper 3: Assessing sanitation service levels. Both papers are aimed at providing a framework for data analysis of life-cycle costs. This second edition reflects the experiences of applying this methodology in Burkina Faso, Ghana, Mozambique and India (Andhra Pradesh).

Assessing sanitation service levels – 2nd edition

Potter, A.; Klutse, A.; Snehalatha, M.; Batchelor, C.; Uandela, A.; Naafs, A.; Fonseca, C.; Moriarty, P. (2011). Assessing sanitation service levels. (WASHCost working paper; no. 3). 2nd ed. The Hague, The Netherlands, IRC International Water and Sanitation Centre. 27 p. : 16 fig. 12 ref.
Download full paper

Conventional sanitation ladders rank sanitation in increasing complexity of technological options. However, sanitation improvement is not as straightforward as the concept of “a ladder” with incremental improvements, might suggest. For example, from the user perspective, a VIP toilet may in some circumstances be a better option than a septic tank system. There is a wide gap between technologies and service provision, especially when O&M considerations are taken into account. This working paper from IRC’s WASHCost project sets out a common framework to analyse and compare sanitation cost data being collected across different country contexts (Burkina Faso, Ghana, Mozambique, India) with different service delivery norms and standards. It represents a fundamental shift away from the focus on capital investment costs, to the costs of sustainable sanitation services.

Managing water locally : an essential dimension of community water development

Bunclark, L., Carter, R., Casey, V., Day, St J., and Guthrie, D. (2011). Managing water locally : an essential dimension of community water development. London, UK, Institution of Civil Engineers; Oxford, UK, Oxfam GB and London, UK, WaterAid. 95 p. : boxes, fig., tab. Includes glossary. 48 ref.
Oxfam Online ISBN 978-1-78077-011-6
Download full publication [2 MB]

Based on experiences from three continents, this publication provides practical guidelines for water sector practitioners, policy-makers and donors on Community-Based Water Resource Management (CBWRM).

New web resource on rural water supply – www.waterservicesthatlast.org

One out of three rural water supply systems in developing countries doesn’t function at all or performs far below its promised level. IRC’s Triple-S (Sustainable Services at Scale) initiative has put together a web resource to help those involved in financing, planning or implementing rural water supply projects or providing services. The website brings together the latest thinking on creating water services that last, including results from Triple-S work in Ghana and Uganda. It covers key elements such as monitoring, financial planning, institutional models, and capacity building for service providers and local government. Here you’ll find tools, concepts, case studies, videos, cartoons, and more.

Web site: www.waterservicesthatlast.org