"Our goal is to provide 70% sewerage service access by 2014"

Friday, September 9, 2011

While Brazil has decent potable water coverage, wastewater collection and treatment remains low in many areas, and Espírito Santo state is no exception to the rule.

State water company Cesan plans to invest 250mn reais (US$153mn) annually from 2011-2014, with upcoming works including a slew of wastewater management initiatives.

BNamericas spoke with company president Neivaldo Bragato about plans to reach 70% sewerage service access by 2014, an upcoming 700mn-real public-private partnership (PPP) and various sewerage works.

BNamericas: Cesan plans to invest 1bn reais in sanitation from 2011-2014. How is your investment plan coming along?

Bragato: Of the 1bn reais, 123mn reais has been invested so far. On average, we intend to invest 250mn reais each year. 

BNamericas: How is the plan being financed?

Bragato: Some 340mn reais should come from Cesan itself, deriving from revenue acquired through tariffs and additional state government funding.

So far, some 310mn reais in financing has been approved from federal savings bank Caixa Econômica Federal (CEF) and national development bank BNDES. The resources have been secured and our plan now is to hire contractors and kick off works.

BNamericas: Some companies have criticized CEF for delays in releasing funds. Is this something you've experienced?

Bragato: Unlike many other parts of the country, the release of funds from the bank isn't slow for us. Generally, once we've submitted the loan documents, the release of funding takes up to 20 days. Cesan has a very good relationship with the CEF team.

BNamericas: What is Cesan's service coverage for water and sanitation?

Bragato: Cesan serves 52 of the 78 municipalities in Espírito Santo. All of the urban population in our coverage area has potable water service and 46% have access to wastewater collection and treatment.

BNamericas: Sewerage coverage in the state is still slightly under the national average. How much do you expect this to improve by 2014?

Bragato: At Cesan we're focused on achieving universal service for both water supply and sewerage.

Our goal is to provide 70% sewerage service access by 2014. Once this is available, we then need to convince the population to implement new connections in their homes.

BNamericas: What types of treatment processes do you use?

Bragato: The main types of sewage treatment processes we use are stabilization ponds, activated sludge, and UASB reactors.

For water treatment, we use processes such as direct filtration, dissolved air floatation, and conventional methods using flocculation, clarifiers and filters.

BNamericas: Can you tell us about some of the company's sewerage system projects?

Bragato: In terms of sewerage construction and expansion works, I'd like to highlight two initiatives in the city of Serra. One, budgeted at 48.9mn reais, entails expanding the Manguinhos sewerage system. The other is for a system in the neighborhood of Jardim Limoeiro and surrounding areas. It is priced at 23.5mn reais.

Two sewerage initiatives are also planned for the city of Guarapari, being a 28mn-real construction project in the downtown area and a 23.9mn-real expansion project.

Another 26.2mn reais has been destined to deploy the Ponta da Fruta sewerage system in the city of Vila Velha.

Finally, we have a 20.7mn-real project which includes phase I implementation of a sewerage system and phase II implementation of a wastewater treatment plant in the town of Nova Venécia.

Cesan is also investing heavily in expanding water supply systems in metropolitan Vitória as well as rural areas.

BNamericas: Cesan previously said it was planning a 1.5bn-real PPP for services in the metropolitan region of Vitória. Is that still going ahead?

Bragato: The plan has been reduced from the Vitória region to the neighboring city of Serra. Studies are still underway and the whole process is being discussed with parties involved in the process.

A tender estimated at some 700mn reais should be called in 2012. The project will result in more than 90% of the population being covered by wastewater collection and treatment services.

BNamericas: Why do you think Brazil as a whole invests so little in sanitation?

Bragato: Besides the billions in investments that are needed, the complexity of the projects and the inconvenience for the population during civil works, these initiatives produce results that are underground and aren't visible to the general public.

Since the 1970s, Brazil has mainly invested in water supply projects through its national sanitation plan Planasa and with resources from former national housing bank BNH.

However, priorities have changed in the last few years and more investments in sanitation are taking place now.

BNamericas:  Rural communities are often neglected when it comes to basic sanitation services. What is Cesan doing to improve coverage in these areas?

Bragato: We established a state government sanitation program called Pró-rural in 1996. It is aimed at improving water supply and sewerage services for groups of 50-1,500 people in municipalities throughout our coverage area.

Work is carried out in a partnership between Cesan, the municipality and the local community. Cesan first carries out work to implement the system such as designing the project, launching tenders and supervising work. Once it is installed, the utility also provides operational training and environmental education. The local community sets usage fees and operates and maintains the system.

Most of the work is funded by grants from the federal government through national health foundation Funasa or the state government through regional development fund FRD. Additional funding comes from the city halls as well as Cesan.

BNamericas: How many areas does the program cover?

Bragato: Throughout the state, the program operates in 254 locations in 48 municipalities. It contemplates 195 water supply systems and 39 sewerage systems. In addition, 40 wells from an old program known as Pró-Hidro are included.