20 March 2015
Asit K. Biswas
Over the past several decades, Hong Kong’s water supply and wastewater management practices have been on an unsustainable path. Poor planning, absence of sustained interest from its top policymakers, an uninformed public, lack of regular media scrutiny and a series of poor policy interventions have ensured that, today, it lags behind nearly all cities of similar levels of economic development in its management of water.
Hong Kong is a net water importer. Currently, 70-80 per cent is imported from Guangdong’s Dongjiang through multiple agreements. The Audit Commission reported in 1999 that the planners had so badly overestimated city water requirements in the 1989 agreement that some 716 million cubic metres of water literally went down the drain, which cost taxpayers, between 1994 and 1998, HK$1.7 billion.
Even after this sad performance, the next agreement was even worse. The requirement was again another overestimate. Consequently, between 2006 and 2012, the city had to pay for seven years of water imports but in reality used only about six years of water. This over-estimation cost the taxpayers another HK$2.8 billion.
As an adviser to 19 governments, I am not aware of a single city anywhere in the world which has consistently overestimated water requirements so badly for over two decades.
Not only has overestimation been a serious problem, but also no serious policy measures were taken to manage domestic and industrial water demands. At present, average water use in Hong Kong is about 220 litres per capita per day, a figure that is higher than in 2003. This is bad management since in nearly all similar cities of the world, the usage trends are generally declining because of better management practices and increasing awareness of the people that water is a scarce resource.
Accordingly, inhabitants of cities like Hamburg and Barcelona use about half that of an average Hongkonger. In Singapore, per capita water use has steadily come down in recent decades. It is now 152 litres per capita per day, which is still on the high side. An average Hongkonger uses 45 per cent more.
One of the reasons for this very high usage is because water and wastewater provisioning has been subsidised at higher levels with each passing year. The water tariff has remained the same since 1995, but costs of services have gone up steadily. This has resulted in some ridiculous situations, like the city providing private bottled water companies with highly subsidised water, which at the retail level is being sold at over 1,000 times the cost of city water.
The present pricing structure means that a round 14 per cent of Hong Kong residents do not pay for water and sewerage services. Each household now receives completely free 12 cubic metres of water every four months irrespective of their ability to pay. This is in contrast to Singapore, where its national water agency, PUB, not only completely recovers its costs but also makes a profit.
Furthermore, in Hong Kong, there have been no consistent attempts to educate the citizens on the importance of water as a strategic resource. This is again in sharp contrast to Singapore, where the population is regularly made aware of the value of water. The interactive permanent exhibitions of wastewater treatment and water management at its NEWater Visitor Centre and Marina Barrage have become major tourist destinations.
When compared to other Asian cities of similar levels of per capita gross domestic product, like Singapore, Tokyo or Osaka, urban water management in Hong Kong comes out very poorly. But even when compared to some cities in developing countries, like Cambodia’s Phnom Penh, Hong Kong does not fare well.
For the past 15 years, the Phnom Penh Water Supply Authority has outclassed Hong Kong. Like in Hong Kong, Phnom Penh residents receive clean water which can be drunk straight from the tap. Both the poor and the rich pay for water at affordable prices, and no one receives free water, as in Hong Kong.
Phnom Penh’s water authority, a public-sector autonomous corporation, has been consistently profitable for over a decade and receives no subsidy. All its performance indicators have been consistently better than Hong Kong’s, with many of them better than in London or Los Angeles. Its planning and execution have also surpassed Hong Kong’s. For example, Phnom Penh’s bill collection ratio is almost 100 per cent, and unaccounted-for losses from the water system are about 6.5 per cent, compared to about 17 per cent in Hong Kong.
The question the Hong Kong public and policymakers need to ask and answer is: how did a third world city like Phnom Penh, which has limited technical and administrative capacities, no private sector to speak of, inadequate educational and management facilities and poor governance practices, manage to leapfrog a world-class city like Hong Kong so thoroughly in little over a decade?
Urban water management is not rocket science. There is no reason why any city of more than 200,000 people cannot have a good water system. It is high time for Hong Kong to do some serious soul-searching and find solutions which can radically improve its present urban water system.
Asit K. Biswas is the Distinguished Visiting Professor at Lee Kuan Yew School of Public Policy, National University of Singapore. An adviser to 19 countries, he received the Stockholm Water Prize, equivalent to a Nobel Prize in the area of water, in 2006.
13 December, 2014
Environment officials had another victory yesterday, securing funding for an extension to the Ta Kwu Ling landfill and a study into expanding the Tuen Mun tip.
The Legislative Council’s Finance Committee approved the controversial HK$7.5 billion plan to expand the New Territories landfill, which officials had said would reach capacity by 2017.
Lawmakers will vote on a proposal to build a HK$19.2 billion incinerator on an artificial island near Shek Kwu Chau on Friday.
Officials can now proceed with the expansion plan for Ta Kwu Ling, which will add 70 hectares to the landfill and capacity for another 19 million cubic metres of waste. The building work is expected to be tendered out by the end of the year, and the extension should open by 2018.
Last week, lawmakers approved funding for the HK$2.1 billion expansion of the Tseung Kwan O tip, triggering outrage from residents who said they were considering legal action.
Both of the landfill projects had been delayed for over six weeks by filibustering.
Support from the pro-establishment camp was crucial for the Ta Kwu Ling project, which was passed by 34 votes in favour to 19 against. Pan-democrats continued their non-cooperation campaign by tabling amendments, at least 40 of which were put forward for debate – most of them from People Power’s Albert Chan Wai-yip. All were rejected.
Some HK$38 million in funding for a feasibility study into the Tuen Mun landfill expansion was also passed yesterday, with 27 lawmakers for it and 16 against.
Officials had tried to quell opposition to the plan by shrinking the proposed expansion by 20 hectares to 180 hectares.
Lawmaker Leung Kwok-hung tabled a motion that independent health checks be carried out on Tuen Mun residents before work began. But it was rejected, along with dozens more.
Environmental Resources Management (ERM Group), the consultancy selected by TransCanada to conduct the environmental review for Keystone XL‘s northern leg on behalf of the U.S. State Department, is no stranger to scandal.
Accepting the bribe landed Yan Shunjun, former deputy head of the Shanghai Municipal Environmental Protection Bureau, an 11-year prison sentence.
Yan “allegedly took bribes of 864,000 yuan (126,501 U.S. dollars), 20,000 U.S. dollars and 4,000 euros from seven contractors,” explained Xiuhuanet. “Yan was also accused of illegally setting up a channel to speed up environmental impact assessment processes, which are essential for companies wanting to build factories.”
BP, one of the companies standing to gain if Keystone XL North receives a presidential permit from the Obama administration as a major Alberta tar sands producer, was also mired in the Chinese ERM Group scandal.
“Two firms on ERM’s bluechip client list, BP and Sinopec, are big investors in a petrochemical complex on the site, but the Chinese authorities apparently saw no conflict of interest in awarding the environmental evaluation to ERM,” explained London’s Sunday Times.
In a sense, history has repeated itself.
Hopenhagen to Paris
Back in 2009 when news arose of ERM’s bribery and corruption, Chinese environmental campaigners worried the incident could portend a lack of commitment to tackling climate change in the months leading up to the United Nations climate summit in Copenhagen, Denmark.
But Keystone XL will soon be front and center once again in early 2015 in the halls of Congress and the White House.
Environmentalists fear that opening another route between Alberta and the U.S. Gulf Coast for tar sands crude would ensure the deal struck between the two carbon-emitting giants becomes a moot point, or worse.
Bribery as “Investment”
A commenter on People’s Daily, the state-owned newspaper in China, wrote that bribery was merely the cost of doing business and an “investment” of sorts.
“Foreign firms have quickly learnt the philosophy of guangxi [connections],” wrote the commenter. “Their rule has become, ‘When in Rome, do as the Romans do.’”
ERM, in turn, denied any wrongdoing on its end, even though it had doled out the payments landing Yan in jail to begin with.
“ERM Group had no advance warning of any of the alleged payments to the former deputy director of the Shanghai Environmental Protection Bureau,” ERM declared to the Sunday Times.
“To suggest otherwise is damagingly inaccurate. We are committed to: conducting our business with integrity, applying ethical principles to our relationships with clients.”
KXL, ERM: Institutionalized Corruption
In the U.S. context as it pertains to Keystone XL, ERM’s conduct has been far less ham-handed than it was in China.
By procedure and by law, the company applying for the permit gets to pick and pay for the contractor conducting the environmental review on behalf of the State Department. In this case, it meant TransCanada selected ERM Group to give it a rubber stamp of approval for KXL.
In other words, the State Department has legalized a de facto form of “institutionalized corruption” for handling environmental reviews for cross-border pipelines like Keystone XL’s northern leg. Sierra Club attorney Doug Hayes described it as a “built-in conflict of interest” in a 2013 Bloomberg Businessweek article.
ERM Group, with a track-record of rubber-stamping ecologically hazardous projects in places ranging from central Asia to Peru to Alaska to Delaware and China, has proven itself once again a key tentacle of the “carbon web” for Keystone XL.
The question remains, though: will the sordid episode in the city near Shanghai serve as a teachable moment as applied to the tar sands pipeline described as a “fuse to the biggest carbon bomb on the planet”?
We’ll find out, and likely soon.