Transcript Trends in the Performance Indicators of the WSS Utilities in the Russian Federation Dmitriy Khomchenko The Institute for Urban Economics Helsinki, Finland, 24-25 May 2007

Trends in the Performance
Indicators of the WSS Utilities
in the Russian Federation
Dmitriy Khomchenko
The Institute for Urban Economics
Helsinki, Finland, 24-25 May 2007
Objectives of Work Carried Out:
• Collection and processing of technical and
financial data on performance of the WSS
utilities in the RF in 2000-2005
• Capacity building in the collection of
technical and financial data by transferring
the World Bank methodology (IBNET)
Information Sources:
• Sample of 48 WSS utilities in Perm and
Krasnodar Krays of the RF
• Official statistics (forms 1-water supply, 1sanitation and 22-housing and community
amenities (consolidated))
Analysis of WSS Utilities’ Operational and
Technical Indicators (1)
• Out of total water sales, more than 60 percent is
supplied by municipal utilities; about 25 percent, by
state-owned utilities; and the rest, by private utilities
and those with mixed ownership
• Average water production and consumption in
Russia reduced by almost one third to 402 l/day
and 328 lcd, respectively, in 2000-2005
• In 2005, useful life of 35 percent of the water
networks and 29 percent of the sanitation networks
was over and they had to be replaced; in the capital
cities of the Russian regions, 41 percent of the
water networks had to be replaced.
70%
80%
81%
80%
79%
74%
93%
91%
91%
91%
73%
76%
78%
78%
78%
80%
78%
72%
90%
[sample]
75%
100%
84%
Water Service Coverage
2001
60%
2002
50%
2003
40%
2004
30%
2005
20%
10%
0%
Krasnodar Kray
97%
94%
94%
93%
93%
83%
99%
99%
99%
99%
98%
100%
100%
Russia
120%
Perm Kray
1995
2000
80%
2001
2002
20%
0%
Urban villages
Rural localities
38%
29%
29%
29%
22%
40%
28%
60%
Cities
2000
2003
2005
[statements]
Non-Revenue Water: Share in Total Water
Supply to the Network [Sample]
40%
37%
35%
30%
29% 28% 29% 29%
31%
30% 31%
33% 32%
27%
25%
2001
25% 24%
23% 23%
2002
2003
20%
2004
15%
2005
10%
5%
0%
Entire sample
Krasnodar Kray
Perm Kray
50%
45%
28.3%
5%
0%
Russia
Krasnodar Kray
Perm Kray
19.7%
19.8%
18.1%
13.6%
27.5%
26.5%
10%
7.3%
18.5%
18.4%
2002
7.6%
15%
17.7%
20%
16.7%
25%
16.1%
30%
23.0%
2001
22.2%
35%
20.5%
2000
15.3%
Non-Revenue
Water
[Statistical
Statements]
40%
2003
2004
2005
Analysis of WSS Utilities’ Operational and
Technical Indicators (2)
• Water losses in the water supply networks went
up from 15.3 percent to 18.5 percent of the total
water supply to the network in 2000-2005
• High accident rate
• Prevalence of water meters increased (61
percent of connections)
Share of Networks in Need of Replacement in Total Length
of Water Lines and Street Water Supply Networks
[Statements]
40%
38%
34%
34%
35%
33%
35%
33%
35%
34%
31%
2001
2002
28%
30%
29%
40%
32%
47%
50%
2003
2004
20%
2005
10%
0%
Russia
Krasnodar Kray
Perm Kray
Analysis of Financial Indicators (1)
• While in 2000 average household tariff in
Russia accounted for more than 50 percent of
the economically sound tariff (EST), in 2005
the household tariff went up to 87 percent of
the EST
• Commercial-user-tariff-to-household-tariff-ratio
went down from 3.9 to 1.7
• WSS utilities’ costs increased 3-fold from
$0.16 to $0.44 per cub. m of water sold and
from $0.11 to $0.32 per cub. m of water
produced in 2000-2005
Average Water Tariff in Russia [Statements]
0.45
0.40
0.35
0.30
0.25
0.20
0.15
0.10
0.05
0.00
0.41
0.31
0.23
0.18
0.19
0.15
0.07
0.05
2001
Household tariff
0.10
2002
Economically justified tariff
0.38
0.29
0.24
0.26
0.19
0.11
0.09
2000
0.34
0.14
2003
2004
Tariff for other consumers
2005
Analysis of Financial Indicators (2)
• Length of collection of payments for provided
services in Russia as a whole went down from
151 days in 2000 to 89 days in 2005
• Collection rate in the Perm and Krasnodar
Krays has steadily accounted for 97-98 percent
of the bills issued over the past three years.
Conclusions
During the analyzed period both
negative and positive developments
were identified in the WSS in Russia,
including:
• Degradation of fixed assets, network
deterioration, chronic lack of
investment
• Stabilization of utilities’ financial
position, improved payment discipline