The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

THE WATER and Sewerage Corporation’s (WSC) fuel costs now account for 41 percent of its operating expenses, a Cabinet minister said yesterday, branding the $66m in taxpayer subsidies for the utility’s capital projects as unsustainable.

Alfred Sears KC, minister of public works and utilities, told the Caribbean Water and Wastewater Association (CWWA) annual conference that inadequate infrastructure dating from the colonial era - when coupled with climate change - is threatening The Bahamas’ existence and the Government must now focus on innovation.

He added that the doubling of Bahamas Power & Light’s (BPL) diesel fuel costs, which have increased by 100 percent over the past year, has negatively impacted the Water & Sewerage’s expenses as the latter is dependent on the provision of electricity to power the 27 desalination reverse osmosis plants that provide Bahamians with potable water.

“BPL is dependent on fossil fuel and, as you can know, in the fuel market, the price of diesel has increased over this past year by over 100 percent,” Mr Sears said. “So a significant portion of the Water & Sewerage Corporation expense, which was 26 percent of its [total] operating expense, is now up to 41 percent. So we see within this very short period this exponential increase in operating expense.”

As a result, he added that the Water & Sewerage Corporation is this month moving aggressively to commission two solar facilities to power some of its desalination plants. “With respect to the Water & Sewerage Corporation, we have intensified the work and partnership with the IDB (Inter-American Development Bank),” Mr Sears said. “Ten years ago we secured a loan of $81m to deal with non-revenue water.

“That has been a very successful project and we are nearing the conclusion of that project. The other area is that of waste management with a very low aquifer. We’re focusing now on waste management systems, and we are now developing waste management facilities.”

Two waste water treatment plants are located at Malcolm Park and Gladstone Road, but to develop more The Bahamas will have to seek out public-private partnerships (PPPs) with private investors and capital. “In this area of waste management systems, we recognise the need for funding these capital projects,” Mr Sears said.

“The Government has provided up to $66m to the Water & Sewerage Corporation. Clearly, that is not sustainable. In addition to the multilateral bodies, we must also look at the private sector to help fund these capital projects.”

The Water & Sewerage Corporation is also constructing infrastructure that can withstand the 200 mile per hour winds that Hurricane Dorian brought. “We’re also developing a greener mix of energy, renewable energy that is. Currently, 40 percent of the expenses relate to fuel and fossil fuel, diesel,” Mr Sears said.