24x7 Water supply project for
nagpur city
NAGPUR MUNICIPAL CORPORATION
Nagpur
• History : 300 Years old.
• Location : Geographical Centre of
India.
• Population: 2.50 million
• Area : 217 Sq. Km
• Political : Winter Capital of
Maharashtra.
• Known for : Oranges
• Facilities : Education, Health Services.
• Tourist Place : 4 Major Tiger Projects.
• Weather : Temp 80c to 480c(Summer).
Rainfall- 1200 mm.
• Growth in Population: Reach 5.0
million in next 25 years.
HISTORY OF NAGPUR WATER
SUPPLY
Year
Populati
on
Water
Supply
in mld
lpcd
Rate
Sources
1921
145000
16.50
114
Ambazari + Gorewada
1941
302000
45.00
149
1961
644000
80.00
124
Ambazari + Gorewada +
Kanhan
Ambasari + Gorewada +
1st Aug. Kanhan
1981
1217000
125.00
103
Ambazari (discarded ),
Gorewada + 3 Times Aug.
to Kanhan
2001
2150000
370.00
172
Gorewada + Kanhan +
Pench -I + Pench -II
2004
2350000
470.00
200
Gorewada + Kanhan +
Pench -I + Pench -II +
Pench -III
RAW WATER SOURCES
:
(AS PER IRRIGATION DEMAND AGAINST NMC)
Kanhan
PENCH
DAMP
Pench – RBC
at Mahadula
Gorewada
TOTAL
120
mld
370
-440
mld
16
mld
536
mld
KanhanP
Gorewada
RAW WATER UFW
>20%
+ MAJOR LOSSES THROUGH CANAL
(Irrigation Account)
WATER SUPPLY SOURCE LOCATION
Rahari
New water sources are far away will need high capital and energy cost.
Salient Features of Nagpur Water Supply Infrastructure
RAW WATER PUMPING STATIONS
At Mahadula (370 - 440 Mld)
At Kanhan (125 Mld) and
Old Gorewada (17 Mld) by gravity
WATER TREATMENT PLANT/ PURE WATER PUMPING
Description
Rated Capacity of
Treated Water
(mld)
1) Kanhan
108
Actual Operating
Capacity
In mld
120
2) Gorewada
(Old)
3) Pench-I
16
16
113
4) Pench-II
133
136
Upgraded
140
5) Pench-III
100
Total
470
120
Design
532
MASTER BALANCING
RESERVOIRS
At Seminary Hills
Capacity – 24.97 Ml
G.L. – 349.700 M
At Governor House
Capacity – 22.74 Ml
G.L. – 344.000 M
AT Sitabuldi Fort
Capacity – 22.7 Ml
G. L. - 334.300 M
PURE WATER DISTRIBUTION TRUNK MAINS
1200 MM TO 300 MM appx. 100 km
STORAGE RESERVOIRS
43 RESERVOIRS AT 31 LOCATIONS
TOTAL CAPACITY – 151.79 ml
DISTRIBUTION
NETWORK
Appx.2100 K.M. of length
in 10 Water Distribution
Zones of Nagpur City
WATER SOURCES FOR NAGPUR WATER
SUPPLY
Gorewada
3%
Kanhan
20%
Pench
77%
77% OF RAW WATER IS FROM PENCH RIGHT BANK CANAL AT 48.5 KM CHAINAGE AT MAHADULA .
IT IS ALSO A MAJOR SOURCE OF WATER LOSS.
COMAND AREA FOR Kanhan SOURCE
POPULATION : APPX. 0.8 MILLION
WATER DEMAND & SUPPLY
Demand Within
NMC limits
supply
Exhibit- I
Water Demand & Supply
(Constant Rate of supply from WTP)
1000
Water Quantity
(mld)
800
600
400
200
0
2004
2011
2021
2031
Demand Within
NMC limits
488.5
531.62
709.18
933.74
supply
470.00
470.00
470.00
470.00
Year
WATER SUPPLY MASTER PLAN
Year
Demand
Supply
(As on
2004)
Future Planning
Surplus /
Deficit Over
Existing
Supply (+/-)
Mld
Net Surplus /
Deficit Over
Existing + Future
Planned Supply
2011
532
470
113 (Pench-IV
additional thru
Water saving)
(-) 62
+51
2021
709
470
113 (Pench-IV)
+ 175(Rahari-I)
(-) 239
+49
2031
934
470
113(Pench-IV)
+ 175(Rahari-I)
+ 175(Rahari-II)
(-) 464
+1
NEED FOR REFORMS IN WATER SECTOR
Annual expenditure of Municipal Corporation on water supply : Rs 106 crores
Total demand from consumers against water bills: Rs 70.7 crores (deficit of Rs 36.5 crores)
Total recovery against water bill
: Rs 50 crores (arrears of Rs 20.70 crores)
STATEMENT OF WATER BILLING DEMAND TO CONSUMER AND IT’S RECOVERY
YEAR
DEMAND
RECEIPT
% RECOVERY
(IN Rs. CRORES)
(IN Rs. CRORES)
WATER SUPPLY
2001-2002
70
44
63
370 MLD
2002-2003
73.50
45
63
370 MLD
2003-2004
71.50
50
69
490 MLD
Municipal Corporation Makes Payment to Irrigation Department for : 540 ml/Day (annual avg.)
Municipal Corporation Supplies Treated Water to City
: 530 ml/Day
Municipal Corporation Billing to all consumers against water supply: 245 ml/Day (annual avg.)
Total Water Losses /UFW/ NRW are 291 ml/Day i.e. 54 % of supply.
OPEX is Rs 3.30/ 1000 ltrs. @ WTP
ANNUAL ENERGY BILL OF Rs. 28 CRORE /YEAR
NMC Water Supply: Income
Expenditure (in Rs.Lakhs)
2003-04 2004-05 2005-06 2006-07
Actual
Actual
Actual
Actual
2007-08
Establishment Expenses
501.96
705.00
Energy
2186.32 2110.02 2040.02 2770.00
3265.00
Raw water
1173.25 939.35
1356.12 852.29
1200.00
Other expenses
195.90
274.85
191.74
346.00
439.00
M&R
480.20
397.46
679.53
582.71
794.00
Total Operating
Expenses
4537.63 4296.51 4891.27 5181.50
6397.00
Water Charges recovery
4891.20 5146.01 4840.70 5011.00
5500.00
Old Loan Repayment
3208.47 2111.31
3711.40
4451.48
1879.51
Capital Expenses
1852.88 527.91
720.87
937.24
1561.00
JNNURM
(Pench-3)
574.85
623.86
640.00
JNNURM
(BUDGET)
NAGPUR WATER SUPPLY:
Status before JNNURM
Measurement
Losses 125 mld
Raw water
Losses
Purchase
In canal
625 mld
Losses
20 mld
235 mld
Commercial losses/
theft/metering error
TREATMENTDistribution
500 mld
480 mld
Recovery
200 mld
Physical Collection
140 mld
losses
Losses
SYSTEM EFFICIENCY : 32%
45mld
Annual Loss (W/O Dep): Rs 56 crore
With Depreciation
: Rs 75 crore (appx)
Water sector Challenges: NMC
•
•
•
•
•
•
•
•
Water Losses and UFW
Equitable distribution (Alternate day / 20 hrs/day)
Accountability
Water to Slums (inefficient system)
Water network coverage and inadequacy of network
Water supply management during summer peak demand
Old and inefficient assets
Delay in capacity augmentation for future demand from
Limited water sources.
• Capital availability
• Low water tariff and Poor billing mechanism.
• Lack of professional approach.
NMC Strategy
 Inadequate
maintenance of
existing assets
 Lack of operational
expertise
 High UFW
 Strain on Water
Resources
 Tariffs not rational

Unsatisfied demand
AUGMENTATION

Poor cost recovery
•
Strain on water
resources
•
Additional capital
expenditure
STRATEGY
• REFORMS IN WATER
SECTOR
• INVESTMENT SUPPORT
FROM JNNURM
• IMPLEMENTATION
THROUGH PPP MODE
MISMATCH BETWEEN
INCREASING NEEDS &
DECREASING RESOURCES
BWSSB-NOV '96
FUNDING BURDEN ON
NMC/STATE
FUNDING
CONSTRAINTS
THROUGH
COMMERCIAL
SOURCES
NMC Strategy for Reforms in Water
Sector
•
•
•
•
•
•
•
•
•
•
•
•
Fixing of Benchmarking and Performance indicators through Water audit,
Energy audit & Financial reforms.
UFW/NRW reduction program with investment plan
Assets Up gradation plan for better serviceability and efficiency
Cost reduction program (Energy, Water & O & M Cost)
Improvement in services to consumer special emphasis to urban poor
Implementation of augmentation plans with inbuilt efficiencies.
Low cost Funds / Grant from Jn-NURM/ Tax free bonds/ PPP
Performance based contract with 5 to 25 years of O & M with private
participation
Quality & Cost based selection criteria for contractors, consultants and
Operators.
Rationalization of Water Tariff and Billing with Meterisation.
Capacity building of NMC employees by exposure and training.
Review of water supply master plan with inclusion of water reuse option
……………….. Moving towards Continuous Water Supply in Nagpur
STEPS TAKEN BY NMC
FOR BETTER EFFICIENYIN WATER SUPPLY
1. Water & Energy efficiency Project worth Rs. 96 crore
has been approved and funds received from JNNURM
i. Reduction in Raw water UFW by 100 mld (Annual
savings of Rs. 2.0 Crore on investment of Rs. 35
lakhs)
ii. Water Audit & Leak Detection Phase-I of Rs. 28.0
Crore. (Step towards bringing down the UFW to less
than 25%)
iii. Energy Efficiency Program of Rs 25.00 Crore is
under implementation. (Reduction in energy
consumption by 20%)
iv. Up gradation & Expansion of Distribution Network of
Rs 43 Crore (To increase the coverage of piped
water network to 100% and equitable distribution of
water)
2.
3.
4.
5.
6.
7.
STEPS TAKEN BY NMC
FOR BETTER EFFICIENYIN WATER SUPPLY
Pench-4 : Aug. water to supply project through reduced
water losses in canal. : Rs 422 crore has been
sanctioned under JNNURM (project cost increase to
550 crore)
New Water Supply Policy for Slums. To reduce UFW
and service to urban poor.
Rationalisation of Water Tariff. (To recover O & M Cost
+ Telescopic tariff for water conservation)
Up gradation of Kanhan water supply systems (Project
cost Rs. 83 crore sanctioned under JNNURM )
(Optimum Utilisation of water resources)
Water Reuse Projects under WENEXA-II: To make the
region water surplus : Project cost Rs.131 crore
sanctioned under JNNURM
Resolution by General Body for PPP mode to
implement 24x7 project
JNNURM
PHASE-1
Projects
Cost
In Rs
crore
Completion Outcome
Leak
Detection
3.30
Dec’2008
•Flow Meters from source to ESR
•Reduction in BW –UFW to 2% from 23%
Water
Audit
25.00
June’2010
•24x7 for 15000 connection by Sep’09
• Replacement of 20000 consumer meter
•Reduction in UFW < 25%
Energy
Audit
28.00
Dec’2008
•Replacement of All Pumps installed prior to
Year 2000 with minimum efficiency of 70%
•Reduction in system head by 12m for Pench-1
•Centralized monitoring system
•Infrastructure for equitable dist.
Expansion 43.21
of Network
July’2009
•Connectivity to 572 layouts
•Population over 2.0 lakhs will be covered in
piped water network
JNNURM
Phase-1
Cost
In Rs
crore
Completion Outcome
Kanhan Up
gradation
87.65
Dec’2010
•New Plant of 240 mld and discarding the
old plant of 120 mld with Pumps
Pench-4
Part-1
210.00 Feb’2011
•Replacement of Canal by 2300 mm pipe
•Additional Raw water of 115 mld from
reduction in water losses in canal
Pench-4
Part-2
70.80
Feb’2011
• New WTP of 115 mld at Godhani
•Trunk main up to MBR
Pench-4
Part-3
87.68
Feb’2011
•Service Reservoirs 25 nos
•Feeder Mains 35 Km
Pench-4
Part-4
174.00 Feb’2011
•Distribution system of 225 Km
Total
JNNURM
Phase-1
729.64 Feb-2011
•Total Production Capacity 765 mld
•Rehabilitation of old Pumps and WTP
•10% of Area will be converted in to
24x7
Water Tariff for Conservation and Sustainability
•
•
•
•
Water Tariff for full cost recovery for sustainable water business.
Subsidized Tariff to Urban poor and low domestic consumption 55 lpcd
Tariff at cost for domestic consumption up to 135 lpcd
Premium Tariff for domestic consumption beyond 135 lpcd and non
domestic usage
• Indexation with raw water and energy charges. It enable to pass
additional cost (70% of operating expenses) directly to consumer as
surcharge.
• Tariffs are sufficient to meet Operating expenses and repay the loan for
Jnnurm Projects
• Earning will be better with operational efficiency and reduction in Non
Revenue Water.
Catagory
Old Tariff
/1000 Ltrs
New Tariff
Remark
Residential
Rs 3 to 4
Rs. 8 to 15 for > 8
units per month as
per telescopic
consumption
•Minimum charges
Replaced by
Monthly access
charges (Rs 56 for
15mm)
Semi Residential NA
Rs 8 to 18 >8 units
Min access charges
are Rs 100
Institutional
Rs 12
Rs. 15 to 20
Commercial-1
Rs 20
Rs. 25 to 100
Commercial-2
NA
Rs 60 to 540
Mineral water +
Cold drink
Slum
Rs 25 PM
Rs. 30 to 80 PM
Kaccha, Concrete,
Multifloor
Indexation
NA
Energy + Raw water
Directly passing to
consumer as
surcharge
Annual Revision NA
5% to MC and 10%
to 25% to GB
No need to approval
from GOM
Tariff Revision
Action Plan Summary of Water Efficiency
Projects & Tariff Revision
Cash Flow
Sr.
No.
Description
Rs. (Crore
1
Total Investment including
Augmentation
730
2
Annual Savings /
Additional Revenue
71
3
NMC Share (30%+)in Loan 300
4
Annual Burden
54.00
(10 years repayment)
5
Cash Surplus
17.00
NAGPUR WATER SUPPLY: Status After
Implementation of JNNURM Projects
Losses
5 mld
Raw water
Transmission
by Pipe
285 mld
Commercial losses/
theft/metering error
TREATMENT Distribution
535 mld
530 mld
Physical
losses
Recovery
200 mld
Collection
Losses 45mld
Benefits after partial Implementation
•System Efficiency : 37% from 32%
•Reduced financial losses by tariff revision
•Increased water supply to distribution by 40 mld
Review of NMC Maintenance Record
Disconnected
HSC
5%
Valve
Repair
8%
Low Pressure
3%
No
Water
7%
Polluted Water
4%
Pipe Repair &
Fitting
24%
Leakage water
41%
Borewell
8%
Customer Complaints
Review of NMC Maintenance Record
400 450 500 600 700
350 1% 0% 0% 1%
2%
300
0%
1% 250
1%
200
3%
15
28%
150
10%
20
3%
100
25%
Pipe Size & Repairs
25
2%
80
11%
50
7%
40
4%
Review of NMC Billing Record
PWR, 15220,
7%
No Bill, 6956,
3%
Disconnect,
3945, 2%
No Meter,
30746, 15%
Average,
66380, 32%
Slum, 980, 1%
Reading,
36504, 18%
Minimum,
45594, 22%
Consumer Billing Break up : 206356 nos
Analysis of DMA results for leak
Detection
Consumers Test Zone
Total No. of
Conn.
(Studied)
Legal
Conn.
No Bill
Conn.
ILLegal
Conn.
4141
2866
536
708
100%
69%
13%
17%
Analysis of DMA results for leak
Detection
Total Suply
(m3/day) Bulk
Meter
Recorded NMC
Billing m3/Day
3794
1753
100%
46%
Analysis of DMA results for
leak Detection
Losses in Network Upto
Commerci Consumer End (Physical
al Losses
Losses +un identified
Illegal Conn.)
Total Losses
Unit (m3)
Unit (m3)
Unit (m3)
1373
674
2053
36%
18%
54%
Analysis of DMA results for leak
Detection
Summary of Metering Error For All Test Zones
Sr. No.
Zones
No. of Meters
Actual Study
Recorded
Working Flow NMC Billing
3
3
Meters m /Day
m /Day
Difference
Percenta
ge (%)
1
Dharampeth
191
151.01
92.58
58.43
38.69%
2
Laxminagar
431
345.66
276.11
69.54
20.12%
3
Dhantoli
103
90.20
81.06
9.14
10.13%
4
Hanuman Nagar
184
84.59
93.58
-8.99
-10.63%
5
Nehru Nagar
238
110.86
119.50
-8.64
-7.79%
6
Lakkadganj Zone
179
89.53
69.08
20.44
22.83%
7
Ashi Nagar
7
4.38
1.99
2.39
54.61%
8
Satranjipura (100% on avarage)
0
0.00
0.00
0.00
0.00%
1333.00
876.22
733.90
142.32
18.28%
Total
Source of Losses (Physical +
Commercial)
• House service connection : 63% of reported
leak complaint
• Old conservancy lane / G I Pipes
• Old Lead Joints / Valve leaks
• 70% of non working meters
• Illegal connections
• Poor quality of meters
• Absence of water accounting
Strategy For Water Loss Control
Water Audit
Leak Detection in Bulk water system (Supported by JNNURM)
Identification of the Water Losses (Technical & Commercial )
• Installation of Flow Meters (Supported by JNNURM)
• Reduction in Raw water transmission losses (Supported by JNNURM)
Pilot & DMA for Leak Detection
Pilot of 24x7 water supply project to reduce UFW in Distribution
System (Supported by JNNURM)
DMA for leak detection plan to identify the causes (Supported by
JNNURM)
Full City Rehabilitation Plan
Rehabilitation Plan Based on Water Audit and Pilot /DMA studies (Submission of this report to JNNURM)
O & M Strategy for Sustainability
Rationalization of Tariff for cost recovery (Revised by General
Body)
PPP for Technical & Commercial Efficiency through 25 years O
& M lease contract ( EOI received from 10 prospective bidders)
Pilot 24x7 Pilot Project
• Feature
– 15000 Connection including slum
– 10 slum areas
– Population 1.5 – 1.75 lakhs
• Contract
– Study, Rehabilitate, Operate contract with
Private operator.
– Penalty /bonus for targets in UFW, Quality,
Customer services and Continuity of supply
Pilot 24x7 Project :Baseline for Private
Operator
KPI
Baseline KPI
Target KPI
UFW level
The NRW is assessed at 50%
UFW below 30%
proportionate bonus
for
Increase of volume Volume billed for FY 2006-07 = 21,7 Higher than baselines by
10% for bonus
billed compared to MLD on average.
FY 2007-08
This value shall be used for the costbenefit analysis of the rehabilitation
plan.
The baseline KPI for the assessment of
bonus/penalties during O&M will be
based on FY 2007-08 data.
Continuity
supply
Water Quality
of 2 to 24 hours depending on the area of 24/7 throughout the zone
supply
with
minimum
2m
pressure at customer tap
63% of samples tested had a residual Residual chlorine higher
chlorine level higher than 0,2 ppm
than 0,2 ppm
Time for handling Not applicable
customer
complaints
Within 3 days
Rehabilitation Plan for Pilot 24x7
• Replacement of 100% House service
connection & Meters
• Replacement of old conservancy GI pipe
• Rehabilitation of Tertiary network
• Hydraulic modeling as per Master plan
• Installation of new billing system
• Customer Facility centre
24x7 WATER SUPPLY : OBJECTIVES
“Water for all and 24 x 7 supplies
with focus on safety, equity, and reliability”.
• Continuous water supply at desired
pressure.
• No Contamination of water
• Reduction in water losses
• Better Accountability
• Better Service to Consumer
• Sustainability of system
Investment for Rehabilitation
JNNURM Phase-2
• Replacement of House connection
• Replacement of consumer meters
• Replacement of deteriorated pipes and
fittings
• Rehabilitation of ESR/GSR.
• Rehabilitation of Pench-II WTP
• Rehabilitation of Misc component
• Implementation of Slum Policy
Public Private Partnership in JNNURM
Projects
• Project Finalized Under JnNurm
– Pench-I WTP Improvement & Up gradation (Rs 6.42 Crore)
• 70% grant in aid, 30% by private operator
• 5 Years O & M by operator
– Water reuse For Power Plant (Rs 130 Crore)
• 70% grant in aid, 30% by Mahagenco
• 30% O & M by Mahagenco & pay to NMC the raw sewage charges
@ Rs3.0 – 3.50 per 1000 Ltr for 110 MLD. Annual revenue to NMC
Rs 15 crore from sewage
– 24/7 Water Supply (Rs 20 Crore)
• 5 years O & M with performance based targets to reduce UFW and
improvement in service level to customers in a pilot zone of 1.25
lakhs population.
– Improvement to Kanhan Water Supply (Rs 65 Crore)
• 70% grant in aid, 30% by private operator
• 15 Years O & M by operator
– Water Distribution Monitoring System
Implementation Options
• OPTION-1 : INVEST JNNURM MONEY KEEPING EXISTING
MANAGEMENT PRACTICES AS IT IS WITH ASSUMPTION
THAT ALL PROBLEMS ARE WITH PUMP AND PIPES.
• OPTION-2 : INVEST JNNURM FUND IN THE WATER SUPPLY
SYSTEM AND IMPROVE THE MANAGEMENT &
ACCOUNTABILITY.
PPP Definition and Basic
Principal
• Public Private Partnership
• Partnership
– Ownership : NMC
– Operation: Private
– Investment: Both
•
•
•
•
NMC to decide Tariff
NMC to decide Development Plan for City
Private Partner to Operate the system.
Private Operator to earn profit through
efficiency in Implementation and operations
Private Participation in Water Sector
:Exist in NMC
• All new assets created since 1999 is managed though service
contract.
• Existing assets also managed thru service contract for
Pumping station/ WTP O&M / Valve operations/ Billing
distribution/ Annual maintenance contract for Zonal level
• Disadvantages
– It is only a labor contract replacing retired employees.
– No link with performance
– No accountability towards consumer
– Short term Contracts break up in small parts with no
feasibility for private investment
– Contractor motivated for providing short term solution
Private Participation in Water Sector
:Exist in NMC
• Advantage :
– Reduced number of NMC employees as of now 80% of
assets managed by private contractors
– Short term annual contract can be replaced by better
contract
– Non performing contactor can be replaced by better one
– Reduced O & M cost
– Over the period of time capacity building of local
contactors in O & M
– Prepared the ground for larger involvement of Private
participation without affecting the NMC employees.
Hence, less resistance for PPP.
Proposed NMC approach for Private Participation for
entire city
• Rationalization of Tariff for full cost recovery and subsidy
to urban poor.
• Political willingness
• Performance based contract for 25 years.
• Participation in capital investment from Operator
• Better service to consumer and emphasis on urban poor
• Asset ownership with NMC
• JNNURM funding for better viability of project and reduced
cost of capital.
• All operational risk with Operator
• Inbuilt incentive for performance
Regulatory Framework:
Accountability and Mission of the
Regulator
Regulator to
Commitment to meet
Full City 24x7 WS since
2012 without tariff
increase
RFOM Contract
including
NMC
Service Performance
+ Works Contract
Operator
Consumer Service
Agreement
Protect short term and
long term interests of the
Consumers
Provide certainty for
public and private
investment
Regulatory
Office
Consumers
&
other
stakehoders
Ensure consumers receive
expected level of service at
reasonable cost
Enhance accountability
and transparency
Control the financial
performance
The Regulatory Office set-up
• Regulatory Office set as an SPV created by the NMC. The
participation of other stakeholders in the constitution of the SPV may
be envisaged.
• Initial set up and annual operating budgets approved by the
Parties chargeable to the Operating Cash Flow.
• Regulator appointed for 5-year contract extensible.
• Regulator personally accountable for prejudice to the Parties.
• Key Staff selected on the basis of merit references.
• Public access to all resolutions and statements of the Regulator on
the RO Web Site.
NMC Expected Revenue from Tariff
Operator’s Rate
EXISTING
PPP Lease/Concession
Arrangements
Proposed Transaction Structure (1/5)
Type of Contract
RFOM Concession Contract
NMC grants for special purposes the exclusive right of use of all
NMC’s Water Supply Facilities and undertakes the expansion works.
The Operator is appointed as Contactor for the realization of certain
works of rehabilitation and replacement of NMC assets and as agent
of the NMC to operate and maintain the Facilities and to perform
Water Supply services to consumers.
Contracting Authority
NMC represented by the Commissioner. Under the provisions of the
CNC Act and per Decision of the General Body,
Scope of Contract
The Operator to implement and co-finance first 5-year 350 crores
Rs investment programme while JNNURM provides for 70%
funding with grants (Up to Rs #245 crores).
The Operator, at its own risks and peril, to operate, maintain, repair,
and to replace warned-out granted Facilities and to provide piped
drinking water to consumers according to service levels target, to bill
and collect water charges on behalf of the NMC according to
Municipal By-Laws and Tariff Codes.
Duration and possible
extension
25 years.
Extension subject to approval from General Body.
Proposed Transaction Structure (2/5)
Service Area/
Service Perimeter

The NMC grants exclusive rights to deliver water supply
in the Jurisdiction of the NMC.
The operator shall ensure access of any applicant located
less than 200m from an existing pipe to water services
conform to required service level and subject to compliance
with the By-Laws.
 The NMC can request bulk water services to be provided
to communities located outside NMC jurisdiction.
Exclusivity
The NMC to provide with the water ressources input to the
water systems operated by the Operator
The Operator is granted the exclusive right
1. to use the municipal Facilities as required in order
to provide the Granted Services and
2. to provide and to bill water supply Services, and to
collect water charges as per By-Laws in the
Service Area
Proposed Transaction Structure (3/5)
Service
Performance
The Operator is required to improve the financial and
operational performance of the water utilities and to
achieve specific service performance targets related to
service levels and to operational efficiency.
Set up of a
Regulator

Role & power of
the Regulator
To
NMC to create a Regulatory Office RO in the form of
an SPV which shall be granted regulatory functions.
protect short term and long term interests of the
Consumers, ensuring that the Consumers receive the
expected levels of service at a reasonable Cost in
compliance with the Contract.
To control the Operational and financial performance
of the Parties, and to provide certainty for public and
private investment
 To enhance accountability and transparency in the
sector.
Proposed Transaction Structure (4/5)
Tariff
Adjustments

Tariff Codes determined by NMC based on proper By-Laws
include adjustment routines to be implemented by
Commissioner of Standing Committee as the case would be.
 Tariff revision to be decided by General Body on request of
NMC based on required investment program and the
assessment by independent auditor of actual tariff efficiency.
Operator’s
Remuneration
Single
Rates Adjustment
Standard adjustment based on formula referring to WSPIs
(Industrial Equipment, Salaries +Quarterly for Electricity & Raw
water Surcharges).
Extraordinary Adjustments by the RO relating to agreed
Business Plan, to be approved by Commissioner or by Standing
Committee as the case would be.
Operator’s Rate applicable to volume of water supply
billed to and paid by the Consumers according to category of
service (standard, bulk).
 In-built incentive to improving technical and commercial
efficiency as well as collection efficiency.
Split of Operating Income through Escrow Account.
Proposed Transaction Structure (5/5)
Governing law
The operator must comply with all Indian laws, regulations,
orders and directives that may affect the lease contract.
Mechanism of
enforcement
Independent
Resolving
disputes

Regulatory Office to adjust rates, and to monitor
contract performance.
Penalties to be applied to the operator in the event of breach of
its obligations under the Contract.
 Performance bond in favor of NMC
Power of attorney to be given to the operator to act against
illegal connections and disconnect bad payers.
Procedures & time table shall be strictly regulated under
applicable Indian Law by the lease agreement.

Mechanisms of arbitration by an Arbitrations Panel.
Court
of Law (Mumbai)
PPP implementation process
•
•
•
•
•
•
•
•
•
•
•
EOI for RFQ
Pre RFQ meeting
RFQ
Pre Qualification
Issue of RFP
Pre bid Meeting
Technical Proposal
Evaluation of TP and RFB
Financial Bids
Closing
DPR to JNNURM
August-08
9thSept-08
20th Sept-08
10thOct-08
15thOct-08
10th Nov-08
15thDec-08
15thJan-08
20thJan-09
Jan/Mar-09
15th Oct-08
INTERESTED OPERATORS
(submitted EOI)
•
•
•
•
•
•
•
•
•
•
Veolia Water + VIL
Jusco + Ranhill
IRVCL + Aqualia of spain
Bywater + Nagarjuna
Punack + Lanco
Manila water + Mahindra
Salcon + Maytas
KBL
ILFS with Seventrent
East water with Hydrocom
THANK YOU