It’s drought, not floods, S’pore should fear

TODAY, 18 Mar 2013

Both are leading names in the world of water and resource management and have advised governments all over the planet.

Both are also firm admirers of the Singapore model — so much so, that they have spent the last few years researching and putting together the book, The Singapore Water Story, to be launched this Friday.

It analyses how and why a tiny island-nation, with hardly any resources, has pulled off something of a miracle in ensuring clean, abundant water for its residents, industries and landscape.

But as Singapore forges ahead with the aim of becoming self-sufficient in water by the time the remaining water agreements with Johor expire in 2061, Professor Asit Biswas and Dr Cecilia Tortajada are concerned about the challenges that lie ahead.

In conversation with TODAY, they talk about the key step Singapore needs to take now: Start talking about raising water tariffs.

TECH ISN’T EVERYTHING

“Assuming that there are 6.9 million people in Singapore come 2030, we will need significantly more water not just for drinking and washing, but also economic activities. The question, then, is where does it come from?

At present, more than 50 per cent of the water supply comes from Johor. By 2061, the Government has said, the country can be self-reliant on water if need be. It has been expanding the water catchment area but there is a limit — hence the emphasis has been on reusing water (NEWater) and desalination. The problem is that both processes are extremely energy intensive, and so, future energy costs will be a major consideration for the water sector.

What is important is that we do not know what will happen with science and technology in the next 20 to 30 years. The old paradigm was that universities used to do the research and development work, and we knew what they were working on. But now, most R&D is in the private sector, which is spending billions of dollars, and companies do not tell you what they are working on.

We know there is research going on into desalination technology that requires very little energy; if it is a success, things could look much brighter for Singapore. (This will, however, take a very long time to become commercially available.)

If it is not successful, and desalination remains as energy intensive as it is now, then in order to be more self-sufficient in water, Singapore would have to be more reliant on importing energy. It is a trade-off. If, in the long term, you buy water security at the cost of energy security, then you could find yourself in trouble.

THE 10-YEAR DROUGHT

One other thing Singapore has to be very careful about is what will happen if both Johor and Singapore get hit by a long-term drought.

One or two years is not much of a problem, but when suddenly you have 10 years of low rainfall, what would be the water strategy for Singapore to survive that?

It is a fact of life that rainfall patterns fluctuate over a century, and no one can predict how climate change will affect Singapore. Take the example of Australia (which suffered the worst drought on record in the Murray-Darling basin, lasting 12 years).

In the past two years, the headlines in Singapore have been more about floods than droughts. In any other country, if there is a flash flood in a 5-sq-km area lasting less than 30 minutes, nobody takes it seriously — you get traffic jams and your socks wet. It is an inconvenience but not a serious issue.

But if a drought comes, it affects life in Singapore for several years. And how will investors react if they realise their industries cannot rely on the water supply here?

We do not have much flexibility in the system here. We have only our “four taps”: Catchment area, which is limited; imported water; NEWater and desalination. If a drought hits the region, you may have only 2.5 or 2 taps left. Even if NEWater is able to meet 50 per cent of needs by then, do not forget, you first need the primary quantum of freshwater before you have used water to recycle.

In our view, it is only a matter of time. Water was rationed here in 1961-3, 1971 and 1976 — in 1990, the PUB said it might have to start water-rationing but then the rains came. At the time, people protested, “we are not a developing country”, but that kind of mentality has to disappear — there are certain problems that exist even if you have the water management systems and technology in place.

It is important also that back then, there were fewer industries requiring less water; today, the needs are greater.

RAISE TARIFFS TO LOWER CONSUMPTION

The last time the price of water was adjusted was in 2000. Since then, average household income has risen by 61 per cent. In other words, water tariffs (even with the water conservation tax) make very little dent on household income.

Domestic consumption of water among Singaporeans is high — 152 litres per capita per day. Compare that to the fact that by 2015, cities like Hamburg, Germany and Barcelona, Spain hope to break through to sub-100 litres by 2015.

Singapore’s goal to reduce consumption to 147 litres per person per day by 2020, and 140 litres by 2030, is not ambitious enough. To proceed further down the road to self-sufficiency by 2061, Singapore needs to reduce consumption through proper pricing.

PUB has done a lot with education but that is a very, very slow process. There is also the problem of a big transient population — maids, construction workers, tourists, executives and their families — who are either not aware of your water needs or do not care.

It was announced last week that water tariffs would not be increased this year. The problem is that the longer you put it off, politically it will be more difficult to increase prices, having allowed it to go down in real terms for 13 years.

In most parts of the world, as long as the water price is at 2 to 3 per cent of household income, there should be no problem; people do not mind paying for clean water. Singaporeans, we estimate, spend less than 1 per cent of household income on water.

How much can you increase tariffs by? Politically, it cannot be too much. But you would have to increase by at least 30 per cent.

Currently, households pay one rate, S$1.17 per cubic metre (before GST), for the first block of 40 cubic metres; and S$1.40 beyond that. Why not break this down into the first 10 or 20 cubic metres instead — which is enough for many households to survive on — and if you want to use more, you have to pay more.

HOW TO SELL THIS MESSAGE, WHEN LIVING COSTS ARE RISING?

The problem is that dialogue on this issue is missing. So far, Singapore has justified water tariff increases (12 since 1965) only on the basis of cost recovery.

The discussion of tariffs as an instrument of water conservation has not been used at all.

My suggestion is, I would go to the people and say, look, we might increase prices but you can still end up reducing your water bill. Water use is high; if you cut your consumption by 25 per cent, you pay less and you ensure Singapore’s water sustainability.

There has to be discussion, a give and take, to sensitise people.

The other thing is that some European cities are pricing water higher and making a profit out of water services, which they use to subsidise municipal services. At the same time, your poor households can get targeted subsidies on their water bills.

The city-owned Hamburg water company, for instance, has been increasing tariffs steadily since the early 2000s and brought down water consumption from 135 litres per capita per day, to nearly 100 litres.

Spain has an innovative pricing structure — if this year your water consumption is, say 10 per cent less than what you consumed last year, you get a 10-per-cent rebate on last year’s bill.

There are many innovative ways in which cities are starting to reduce consumption, and Singapore needs to look at new models.”

Professor Asit Biswas is the founder of the Third World Centre for Water Management in Mexico, and Distinguished Visiting Professor at the Lee Kuan Yew School for Public Policy (LKYSPP). He has been a senior adviser to international organisations and 19 governments. He received the Stockholm Water Prize in 2006.

Cecilia Tortajada is President of the Third World Centre for Water Management and a former Visiting Professor at LKYSPP. She has advised major international institutions and governments.