Public water supply


 * "Waterworks" redirects here. For other uses, see Waterworks (disambiguation).

Public water supply is the process of providing drinking water to residential, public, commercial and industrial users as well as for fire fighting, usually through piped systems. Water supply is closely related to sanitation, which - in the context of water supply - is the process of collecting and treating wastewater.

Global access to water supply
In 2004 about 3.5 billion people worldwide (54% of the global population) had access to piped water supply through house connections. Another 1.3 billion (29%) had access to safe water through other means than house conncetions, including standpipes, "water kiosks", protected springs and protected wells. Finally, more than 1 billion people (10%) did not have access to safe water, meaning that they have to revert to unprotected wells or springs, canals, lakes or rivers to fetch water. An example of the challenges posed by inadequate access to water supply can be found in the entry on water and sanitation in Latin America.

Water and public health
Both an adequate amount of water and adequate water quality are essential for public health and hygiene. Waterborne diseases are among the leading causes of morbidity and mortality in low- and middle-income countries, frequently called developing countries. For example, an estimated 900 million people suffer (and approximately 2 million die) from water-related diarrhoeal illnesses each year. At least 17 percent of the total burden of human diseases in many developing countries can be attributed to diarrhea and infestations by intestinal worms. The most common waterborne or waterwashed diseases are diarrhea, typhoid and cholera. Another example is trachoma, an infectious disease of the eye, which results in many cases of blindness in developing countries, which is associated with poor water supply, poor sanitation and failure to adequately process human excrement.

Sometimes, due to actual or suspected contamination by pathogens a boil water advisory, known as as a Boiling water order in the UK, may be invoked.

The World Health Organization has defined around 20 liter per capita per day as basic access, which implies high health concerns, and 100 liter per capita per day as optimal access, associated with low health concerns.

Technical overview of public water supply
Water supply systems get water from a variety of locations, including groundwater ( aquifers), surface water ( lakes and rivers), and the sea through the desalinated. The water is then, in most cases, purified, disinfected through chlorination and sometimes fluoridated. Treated water then either flows by gravity or is pumped to reservoirs, which can be elevated such as water towers or on the ground (for indicators related to the efficiency of drinking water distribution see non-revenue water). Once water is used, wastewater is typically discharged in a sewer system and treated in a wastewater treatment plant before being discharged into a river, lake or the sea or reused for landscaping, irrigation or industrial use (see also sanitation).

Service quality
Many of the 3.5 billion people having access to piped water receive a poor or very poor quality of service, especially in developing countries where about 80% of the world population lives. Water supply service quality has many dimensions: continuity; water quality; pressure; and the degree of responsiveness of service providers to customer complaints.

Continuity of supply
Continuity of water supply is taken for granted in most developed countries, but is a severe problem in many developing countries, where sometimes water is only provided for a few hours every day or a few days a week. It is estimated that about half of the population of developing countries receives water on an intermittent basis.

Water quality
Drinking water quality has a micro-biological and a physico-chemical dimension. There are thousands of parameters of water quality. In public water supply systems water should, at a minimum, be disinfected - usually through chlorination - or it may need to undergo treatment, especially in the case of surface water. For more details please see the separate entries on water quality, water treatment and drinking water.

Water pressure
Water pressures vary in different locations of a distribution system. Water mains below the street may operate at higher pressures, with a pressure reducer located at each point where the water enters a building or a house. In poorly managed systems, water pressure can be so low as to result only in a trickle of water or so high that it leads to damage to plumbing fixtures and waste of water. Pressure in an urban water system is typically maintained either by a pressurized water tank serving an urban area, by pumping the water up into a tower and relying on gravity to maintain a constant pressure in the system or solely by pumps at the water treatment plant and repeater pumping stations.

Comparing the performance of water and sanitation service providers
Comparing the performance of water and sanitation service providers (utilities) is needed, because the sector offers limited scope for direct competition (natural monopoly). Firms operating in competitive markets are under constant pressure to out perform each other. Water utilities are often sheltered from this pressure, and it frequently shows: some utilities are on a sustained improvement track, but many others keep falling further behind best practice. Benchmarking the performance of utilities allows to simulate competition, establish realistic targets for improvement and create pressure to catch up with better utilities. Information on benchmarks for water and sanitation utilities is provided by the International Benchmarking Network for Water and Sanitation Utilities.

Institutional responsibility and governance
A great variety of institutions have responsibilities in water supply. A basic distinction is between institutions responsible for policy and regulation on the one hand; and institutions in charge of providing services on the other hand.

Policy and regulation
Water supply policies and regulation are usually defined by one or several Ministries, in consultation with the legislative branch. In the United States the EPA, whose administrator reports directly to the President, is responsible for water and sanitation policy and standard setting within the executive branch. In other countries responsibility for sector policy is entrusted to a Ministry of Environment (such as in Mexico and Colombia), to a Ministry of Health (such as in Panama, Honduras and Uruguay), a Ministry of Public Works (such as in Ecuador and Haiti), a Ministry of Economy (such as in German states) or a Ministry of Energy (such as in Iran). A few countries, such as Jordan and Bolivia, even have a Ministry of Water. Often several Ministries share responsibilities for water supply. In the European Union, important policy functions have been entrusted to the supranational level. Policy and regulatory functions include the setting of tariff rules and the approval of tariff increases; setting, monitoring and enforcing norms for quality of service and environmental protection; benchmarking the performance of service providers; and reforms in the structure of institutions responsible for service provision. The distinction between policy functions and regulatory functions is not always clear-cut. In some countries they are both entrusted to Ministries, but in others regulatory functions are entrusted to agencies that are separate from Ministries.

Regulatory agencies
Dozens of countries around the world have established regulatory agencies for infrastructure services, including often water supply and sanitation, in order to better protect consumers and to improve efficiency. Regulatory agencies can be entrusted with a variety of responsibilities, including in particular the approval of tariff increases and the management of sector information systems, including benchmarking systems. Sometimes they also have a mandate to settle complaints by consumers that have not been dealt with satisfactorily by service providers. These specialized entities are expected to be more competent and objective in regulating service providers than departments of government Ministries. Regulatory agencies are supposed to be autonomous from the executive branch of government, but in many countries have often not been able to exercise a great degree of autonomy. In the United States regulatory agencies for utilities have existed for almost a century at the level of states, and in Canada at the level of provinces. In both countries they cover several infrastructure sectors. In many US states they are called Public Utility Commissions. For England and Wales, a regulatory agency for water (OFWAT) was created as part of the privatization of the water industry in 1989. In many developing countries, water regulatory agencies were created during the 1990s in parallel with efforts at increasing private sector participation. (for more details on regulatory agencies in Latin America, for example, please see Water and sanitation in Latin America and the regional association of water regulatory agencies ADERASA [http:/www.aderasa.org])

Many countries do not have regulatory agencies for water. In these countries service providers are regulated directly by local government, or the national government. This is, for example, the case in the countries of continental Europe, in China and India.

For more information on utility regulation in the water sector see the body of knowledge on utility regulation and the World Bank's knowledge base on the same topic at

Service provision
Public water supply service providers, which are often utilities, differ from each other in terms of their geographical coverage relative to administrative boundaries; their sectoral coverage; their ownership structure; and their governance arrangements.

Geographical coverage
Many water utilities provide services in a single city, town or municipality. However, in many countries municipalities have associated in regional or inter-municipal or multi-jurisdictional utilities to benefit from economies of scale. In the United States these can take the form of special-purpose districts which may have independent taxing authority. An example of a multi-jurisdictional water utility in the United States is WASA, a utility serving Washington, DC and various localities in the state of Maryland. Multi-jurisdictional utilities are also common in Germany, where they are known as "Zweckverbaende", in France and in Italy. In some federal countries there are water service providers covering most or all cities and towns in an entire state, such as in all states of Brazil and some states in Mexico (see Water supply and sanitation in Mexico). In England and Wales water supply and sewerage is supplied almost entirely through ten regional companies. Some smaller countries, especially developed countries, have established service providers that cover the entire country or at least most of its cities and major towns. Such national service providers are especially prevalent in West Africa and Central America, but also exist, for example, in Tunisia, Jordan and Uruguay (see also water supply and sanitation in Uruguay). In rural areas, where about half the world population lives, water services are often not provided by utilities, but by community-based organizations which usually cover one or sometimes several villages.

Sector coverage
Some water utilities provide only water supply services, while sewerage is under the responsibility of a different entity. This is for example the case in Tunisia. However, in most cases water utilities also provide sewer and wastewater treatment services. In some cities or countries utilities also distribute electricity. In a few cases such multi-utilities also collect solid waste and provide local telephone services. An example of such an integrated utility can be found in the Colombian city of Medellín. Utilities that provide water, sanitation and electricity can be found in Frankfurt, Germany (Mainova), in Casablanca, Morocco and in Gabon in West Africa. Multi-utilities provide certain benefits such as common billing and the option to cross-subsidize water services with revenues from electricity sales, if permitted by law.

Ownership and governance arrangements
Water supply providers can be either public, private, mixed or cooperative. Most urban water supply services around the world are provided by public entities.

Private sector participation
An estimated 10 percent of urban water supply is provided by private or mixed public-private companies, usually under concessions, leases or management contracts. Under these arrangements the public entity that is legally responsible for service provision delegates certain or all aspects of service provision to the private service provider for a period typically ranging from 4 to 30 years. The public entity continues to own the assets. These arrangements are common in France and in Spain. Only in few parts of the world water supply systems have been completely sold to the private sector (privatization), such as in England and Wales as well as in Chile. The largest private water companies in the world are SUEZ and Veolia Environnement from France; Aguas de Barcelona from Spain; and Thames Water from the UK, all of which are engaged internationally (see links to website of these companies below).

Governance arrangements
Governance arrangements for both public and private utilities can take many forms. Governance arrangements define the relationship between the service provider, its owners, its customers and regulatory entities. They determine the financial autonomy of the service provider and thus its ability to maintain its assets, expand services, attract and retain qualified staff, and ulitmately to provide high-quality services. Key aspects of governance arrangements are the extent to which the entity in charge of providing services is insulated from arbitrary political intervention; and whether there is an explicit mandate and political will to allow the service provider to recover all or at least most of its costs through tariffs and retain these revenues. If water supply is the responsibility of a department that is integrated in the administration of a city, town or municipality, there is a risk that tariff revenues are diverted for other purposes. In some cases, there is also a risk that staff are appointed mainly on political grounds rather than based on their professional credentials. These risks are particularly high in developing countries. Municipal or inter-municipal utilities with a separate legal personality and budget as well as a certain extent of managerial autonomy can mitigate these risks.

Tariffs
Almost all service providers in the world charge tariffs to recover part of their costs. According to estimates by the World Bank the average (mean) global water tariff is US$ 0.53 per cubic meter. In developed countries the average tariff is US$ 1.04, while it is only U$ 0.11 in the poorest developing countries. The lowest tariffs in developing countries are found in South Asia (mean of US$ 0.09/m3), while the highest are found in Latin America (US$ 0.41/m3). Few utilities do recover all their costs. According to the same World Bank study only 30% of utilities globally, and only 50% of utilities in developed countries, generate sufficient revenue to cover operation, maintenance and partial capital costs.

According to another study undertaken in 2006 by NUS Consulting, the average water and sewerage tariff in 14 mainly OECD countries excluding VAT varied between US$ 0.66 per cubic meter in the United States and the equivalent of US$ 2.25 per cubic meter in Denmark. However, it should be noted that water consumption in the US is much higher than in Europe. Therefore, residential water bills may be very similar, even if the tariff per unit of consumption tends to be higher in Europe than in the US.

A typical family on the US East Coast paid between US$30 and US$70 per month for water and sewer services in 2005.

In developing countries tariffs are usually much further from covering costs. Residential water bills for a typical consumption of 15 cubic meters per month vary between less than US$ 1 and US$ 12 per month.

Water and sanitation tariffs, which are almost always billed together, can take many different forms. Where meters are installed, tariffs are typically volumetric (per usage), sometimes combined with a small monthly fixed charge. In the absence of meters, flat or fixed rates - which are independent of actual consumption - are being charged. In developed countries, tariffs are usually the same for different categories of users and for different levels of consumption.

In developing countries, are often characterized by cross-subsidies with the intent to make water more affordable for residential low-volume users that are assumed to be poor. For example, industrial and commercial users are often charged higher tariffs than public or residential users. Also, metered users are often charged higher tariffs for higher levels of consumption (increasing-block tariffs). However, cross-subsidies between residential users do not always reach their objective. Given the overall low level of water tariffs in developing countries even at higher levels of consumption, most consumption subsidies benefit the wealthier segments of society. Also, high industrial and commercial tariffs can provide an incentive for these users to supply water from other sources than the utility (own wells, water tankers) and thus actually erode the utility's revenue base.

Metering
Metering of water supply is usually motivated by one or several of four objectives: First, it provides an incentive to conserve water which protects water resources (environmental objective). Second, it can postpone costly system expansion and saves energy and chemical costs (economic objective). Third, it allows a utility to better locate distribution losses (technical objective). Fourth, it allows to charge for water based on use, which is perceived by many as the fairest way to allocate the costs of water supply to users. Metering is considered good practice in water supply and is widespread in developed countries, except for the United Kingdom. In developed countries it is estimated that half of all urban water supply systems are metered and the tendency is increasing.

Most cities are increasingly installing Automatic Meter Reading (AMR) systems to prevent fraud, to lower ever-increasing labor and liability costs and to improve customer service and satisfaction.

Costs and Financing
The cost of supplying water consists to a very large extent of fixed costs (capital costs and personnel costs) and only to a small extent of variable costs that depend on the amount of water consumed (mainly energy and chemicals). The full cost of supplying water in urban areas in developed countries is about US$1-2 per cubic meter depending on local costs and local water consumption levels. The cost of sanitation (sewerage and wastewater treatment) is another US$1-2 per cubic meter. These costs are somewhat lower in developing countries. Throughout the world, only part of these costs is usually billed to consumers, the remainder being financed through direct or indirect subsidies from local, regional or national governments (see section on tariffs).

Besides subsidies water supply investments are financed through internally generated revenues as well as through debt. Debt financing can take the form of credits from commercial Banks, credits from international financial institutions such as the World Bank and regional development banks (in the case of developing countries), and bonds (in the case of some developed countries and some upper middle-income countries).