Five towns to get privatised sewer lines in World Bank planTuesday January 31 2023
Kenyan homes not connected to sewer lines will pay about Sh827 every month under a proposed Public Private Partnership (PPP) programme aimed at privatising the sanitation chain in urban areas.
The Sh3.4 billion market-based World Bank programme will initially target five towns with private investors building toilets for 140,000 households, even as others participate in emptying, transporting, treatment, disposal or reuse of the sludge at a fee.
Should the proposal be adopted by the new administration, these households will pay nearly three times what a typical household connected to the public sewer lines pays for similar services as the government taps the private sector to provide critical services.
However, at the beginning county governments will be required to give temporary performance-based subsidies for market creation in the building of toilets as well as transporting the faecal sludge for safe disposal or re-use.
The payout will include a one-off payment of Sh68,200 for the construction of toilets for 140,000 households by both households and counties, and an annual service fee of between $30 and $40 for emptying and transporting the sludge, with the counties, through their respective water service providers, matching the payment.
This means that sanitation service providers, including those emptying and transporting for treatment and safe disposal, will be receiving a total of Sh827 from both households and water service providers in the respective counties, with this fee being borne by the households as the counties exit.
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Water service providers charge homes and businesses an average of Sh93 per cubic metre or 1,000 litres for piped water and sewerage, with a lot of them paying an average of Sh300 a month.
This means that households in this programme will pay more than twice as much as those connected to the sewer lines.
The World Bank’s PPP Options Report, which was published last year, was informed by an earlier unpublished market intelligence research conducted in Kisumu, Malindi, Nairobi's Eastlands, Naivasha, and Wajir.
The multilateral financier was commissioned to do the report on the market viability of Non-sewered sanitation (NSS) by the Water ministry in President Uhuru Kenyatta's government, given that a lot of Kenyans are not connected to the sewer line.
In 2021, the Ministry of Water, Sanitation, and Irrigation and the county governments adopted the National Water and Sanitation Investment Program (NAWASIP) framework, which maintains the universal coverage target by 2030 but revises the sewerage coverage target from 80 percent to 40 percent.
"Given the difficulty of meeting sanitation targets through sewer systems, both public and private players recognize the potential for non-sewered options to supply sanitation services on a large scale,” said the World Bank.
The lender reckons that the remaining 60 percent of the sanitation access coverage would have to be covered by safely managed NSS facilities.
Initially, the County governments will be expected to give temporary performance-based subsidies to facilitate market creation, by attracting private investors while reducing the payment burden to households.
"The top-up payment will be fixed in the bidding documents (in Ksh, per standard unit). The intended target group is owner-occupied housing units and rental units."
Residents in these cities will each pay approximately $550 (Sh68,200) for the building of a new toilet facility or $200 (Sh24,800) for the repair of an existing one in a deal that will include a predefined fixed payment by the households and a top-up payment by the Water Service Provider (WSP) to ensure financial viability.
On emptying and transporting, the programme proposes a PPP model that will see the different municipalities zoned into several areas with a limited number of three- to five-year concessions in each area to be tendered among formal pit emptying service, including both labour-intensive and vacuum tanker services.
Operator payment will consist of a fixed household payment--increasing over the contract period—initially around 50 percent of the cost of service, reflecting a willingness to pay between Sh3,720 and Sh4,960.
WSPs or counties will initially match this payment with a performance-based subsidy—which will decline over the contract period—aimed at incentivizing efficiency improvements by the private operator.
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The intelligence research by the World Bank found that 80 percent to 100 percent of the population in the five selected cities use Non-sewered sanitation (NSS), with most faecal sludge not safely emptied and almost none being safely disposed of.
Twice as many Kenyans have access to electricity compared to basic sanitation, with some Kenyans resorting to open defecation or 'flying toilets' due to a lack of proper sanitation facilities.
The World Bank notes that safe sanitation is critical for health and well-being, especially for girls who are more likely to drop out of school or are vulnerable to assaults while seeking privacy without adequate sanitation facilities.
"Lack of safe sanitation is also damaging to economic growth due to premature deaths, healthcare, and pollution, as well as leading to lost time and productivity seeking treatment and finding access to sanitation facilities," said the World Bank.
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