BACKGROUND
Two decades ago the water services of the Butuan City Water District (BCWD) was better compared today. The water quality and supply were far better than what the Butuanon consumers experience today. However, massive illegal mining, logging and road construction within Taguibo Watershed was observed in the early part of 2000 which went on for several years. This prompted BCWD to lead in the campaign to stop these illegal activities in the area. In the years that past, the effect of this destruction was gradually felt. According to a paper by wrote by BCWD, “when the rain dissolves the loosen soil, mudflows are running down into the river basin. Accordingly, as more dissolved solids are suspended, the water in the river becomes turbid; this intensifies as rain continues to pour down the river with increasing level of turbidity. Subsequently, when turbidity level becomes intolerable, valves are needed to be closed to prevent turbid water from entering into the distribution pipelines.” Once this happens, “deep well pump stations are utilized to supply into the system but not sufficient enough; hence, several areas are not served.” Despite the good intention of BCWD to come up with an immediate rehabilitation plan to address the turbidity problem of the surface water sourced from Taguibo River as well as improve and expand its service reach even to the outskirts, their outstanding LWUA loans constricts them financially from implementing relevant projects. The said loan was used in laying the 900mm pipelines from Anticala to Butuan City and the additional micro filters.
THE PRIVATE-PRIVATE PARTNERSHIP (PPP)
The Private-Private Partnership (PPP) has been aggressively pushed by the national government to pursue capital-intensive development projects. This prompted the government to come up with special rules known as the “2008 Joint Venture (JV) Guidelines” which was collaboratively crafted by the National Economic Development Authority (NEDA), the Department of Budget of and Management (DBM), and the Office of the Government Corporate Counsel (OGCC) under the mandate of the Office of the President through Executive Order (EO) No. 423 DATED April 20, 2005. This was seen by the BCWD to be an alternative solution address the water supply problem especially during the rainy days.
On December 12, 2011, our company submitted to BCWD an Unsolicited Proposal for Taguibo Water Supply Development Project through Public-Private Partnership (PPP) scheme. The goal is to provide reliable and uninterrupted water supply to BCWD and the people even in times of drought and high level of turbidity.
The Engineering Solution:
In order to come up with consistent water supply, TASC has proposed an engineering solution that will address the water supply during the rainy and drought seasons.
The first solution will be the construction of a Sabo Dam, which is considered to be the first line of defense to protect from the rolling debris and boulders. This will not hold water but freely flows to the catchment area called the Impounding Weir which will hold an estimated volume of water that can sustain a supply for three months. Since the water is not stopping, the river continues to flow; thus, a continuous supply of water. The water may go down on certain level during summer but this will not affect the supply since the water is already impounded to last for three months in anticipation of a worse-case scenario of drought. Furthermore, the hydrology will be calculated that even during extended summer situation supply o potable is secured.
In the Impounding Weir, course particles in the water settle down but find sands still abound in water that is directed to pass through a Desander that takes off the fine sand particles. Then, from the Desander, the water flows to the Gravity Gravel Filter that finally takes off the remaining particles that the Desander is not able to catch up. The project also employs the Conveyance Channel directing water flow toward the Sedimentation Plant that can be bypassed when turbidity level is manageable or at a minimal. However, on the contrary, it is indispensable when water turbidity level is high. With the sedimentation pond, TASC calculated it very carefully to ensure that water flows at 300 litters per minute in a descending fashion, effectively controlling turbidity level before water reaches the BCWD water treatment facility.
The project also includes a state-of-the-art Water Treatment Plant that is both cost-effective and efficient as it can filter the flood water from 1,000 Nephelometric Turbidity Units (NTU) to the standard even below the 5 NTU as required by the Philippine National Standard for Drinking Water (PNSDW). The proponent included in the package an advanced water treatment technology namely the coagulation and flocculation reactors.
The Economic Benefit:
The project is basically a “buy and sell” arrangement. The project proponent, will design, construct and maintain the project without any capital cost from BCWD. The estimated 500 Million cost of the project is actually being borne by TASC – BCWD will NOT shed a single centavo in constructing the said project. The TASC and BCWD guaranteed through a joint statement issued last March 19, 2014 that unlike the loan generated project of BCWD or any of the water district, it is a practice and one of the first requirement is to increase the water rates in order to assure the lender that they are getting paid. On the contrary, this project doesn’t need additional water rate increase because it will be imbedded into the existing water rates. Meaning we can proceed with the project implementation without requiring the people to pay additional burden even during full operation of this water supply project. Any increase of water rates will not be attributed to the project but to other reasons such as new BCWD loans for pipe line extension and salary increases among others. The original price per volume of bulk water was pegged at P14.5/m3, BCWD asked the project proponent to lower down the price, which the proponent agreed, to P11/m3 for the first three years, P14.5/m3 for the next two years, after which succeeding adjustments shall be based on the prevailing Consumer Price Index (CPI). With these changes, TASC made a new financial model in order to accommodate the request of BCWD. TASC revised the work schedule as well as the infusion of capital in order to come to a win-win solution. TASC submitted a new schedule according to the revised capital outlay:
- Year 0-1to infuse only 60% of the supposed capital
- Year 3 to infuse another 20% of the supposed capital
- Year 4 to spend another 20% to complete 100% capital expenditures
Additionally, with this capital infusion adjustment, BCWD agreed to the revised provision which resulted to limited implementation. BCWD would not insist on the perfect contract implementation until such time the entire capital expenditures are used up for the project. The escalation provision is also suspended.
- Year 1 to 3: 27.5 – 40MLD from partial implementation up to full implementation = P11.00/m3
- Year 4: 50 MLD = P14.00/m3
- Year 5: 60 MLD = 14.50 the escalation provision shall takes effect on the 6th year and onward.
Comparatively speaking, TASC offers bulk water in a much competitive price than other existing bulk water providers. While prevailing market rate for bulk water in major cities, for instance Cebu, would play around P21-23/m3, TASC offers it for as low as P11/m3. This would lead to a comparative difference of at least P9/m3. Water connections are expected to swell in numbers, reaching as far as outskirts of Butuan City as BCWD can now expand easily with least add-on in capital expenditure.
Water Quality and Service:
Turbidity spoils the water quality, which redound to poor water district services. TASC will employ a state-of-the-art treatment plant, as part of the package, to ensure best water quality. Accordingly, with the consistent water supply, concessionaires will enjoy an all year round supply while making expansions possible to serve un-served areas with BCWD’s coverage area.
As the long-term solution, the Taguibo Watershed area needs to be protected from illegal activities. A massive reforestation should be undertaken to keep the source of water in a healthy state. With this, TASC is committed to contributing in the rehabilitation and protection of the watershed. In partnership with BCWD and other concerned agencies, TASC will undertake programs and projects, even if it is outside the confines of the JV agreement that will support the rehabilitation effort of the watershed.
Taguibo Aquatic Solutions Corporation 