Water supply and sanitation in Chile

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Water supply and sanitation in Chile is characterized by high levels of access and good service quality. Compared to most other countries, Chile's water and sanitation sector distinguishes itself by the fact that all urban water companies are privately owned. The sector also prides itself of having a modern and effective regulatory framework, including an innovative subsidy mechanism to protect the poor. One weakness of the sector are the relatively high water losses.

This article is part of a series of articles comparing the institutional and financial characteristics of water supply and sanitation around the world.

Contents

[edit] Access and service quality

A leaking tap.
A leaking tap.

In Chile’s urban areas access to water supply stood at 99.8% and access to sanitation at 95.1% in 2005 [1], which is one of the highest levels in Latin America.

Service quality is generally good. Water supply is continuous, both in urban areas and in concentrated rural areas. [2] Drinking water quality complies with bacteriological norms in 99.4% of the simples, according to the regulator SISS. [3]. The sector currently undergoes a major wastewater treatment investment program with the goal of treating more than 98.8% of all collected municipal wastewater in 2010, from 73.4% in 2005. [4]

[edit] Responsibility for water supply and sanitation

Map of Chile
Map of Chile

[edit] Service provision

Water supply and sanitation services in Chile are provided primarily by 19 major companies, which are all privately owned.[5] In rural areas cooperatives and rural drinking water committees are in charge of operating water supply systems.

[edit] Policy and regulation

Responsibility for sector policy in Chile is vested primarily in the Ministry of Public Works, which grants concessions and promotes rural water supply and sanitation through its Department of Sanitation Programs. The responsibility for regulation is shared between the economic regulator, the Superintendencia de Servicios Sanitarios SISS, and the Ministry of Health which sets and monitors drinking water quality standards. [6]

The water and sanitation regulatory system in Chile is considered by the WHO to be a model not only for Latin America, but also for Europe.[7] One of its innovative features is the use of a hypothetical efficient model enterprise to assist in determining if tariff increases requested by service providers are justified.

[edit] Recent developments

Santiago de Chile
Santiago de Chile

Historically urban water and sanitation services in Chile were provided by the national public company SENDOS, which was a holding company for 11 regional branches and two autonomous enterprises. At the end of the 1980s the Ley General de Servicios Sanitarios allowed the granting of 13 regional concessions to public, private or mixed shareholding companies in each of Chile’s regions. At the same time the regulatory agency SISS was created through a separate law. Initially the regional companies remained public. During that period they achieved financial self-sufficiency, were granted tariff increases, improved their efficiency and increased coverage [8]. Investments increased from US$ 65m annually in the early 1990s to US$ 260m in 1998. However, regional utilities still did not have sufficient resources to expand wastewater treatment. In 1998 the law was amended to further promote private sector participation. Subsequently all regional companies were privatized.

[edit] Efficiency (water losses)

Non-revenue water ("water losses") in Chilean water companies was on average 32.9% in 2005, an unusually high level for a sector that is so modern in so many other aspects. The level of non-revenue water is thus still higher than in Germany, France or the United Kingdom. (see e.g. Public water supply and sanitation in Germany#water losses)Indeed, non-revenue water in Chile increased from 29% in 1999 to the current 33%. [9] The regulator considers a level of 15% as efficient.

[edit] Tariffs, Investment and Financing

Tariffs in urban areas varied between US$ 0.61 per cubic meter and US$ 1.66 per cubic meter in 1999.[10] In rural areas, tariffs only cover operation and maintenance costs [11]

On average, the water and sanitation bill accounted for 1.14% of household income according to a 1998 survey by the National Statistical Institute. They varied between 0.77% for the lowest quintile and 2.35% for the highest quintile. [12]

Urban water and sanitation systems do not receive direct subsidies and are financed through the capital market, and ultimately through user fees. However, there is an innovative system of means-tested subsidies that allows qualifying poor households to receive a subsidy administered by the municipalities to pay parts of their water and sanitation bills. Rural water systems receive a partial investment subsidy that is defined in the Ley del Subsidio al Agua Potable y Saneamiento. [13]

Total investment in 2005 was US$ 288m [14]

[edit] Notes

  1. ^ SISS 2005, p.7
  2. ^ OMS 2001, Situación de la prestación de los servicios and SISS 2005, p. 18
  3. ^ ibid
  4. ^ SISS 2005, p. 7
  5. ^ SISS, p. 14
  6. ^ OMS 2001
  7. ^ OMS 2001, Fortalezas
  8. ^ OMS 2001, Antecedentes
  9. ^ SISS 2005, p. 66
  10. ^ OMS 2001, Situación de la prestación de los servicios
  11. ^ OMS 2001, Antecedentes
  12. ^ OMS 2001, Situación de la prestación de los servicios
  13. ^ OMS 2001, Fortalezas
  14. ^ SISS 2005, p.7

[edit] Sources

Organización Mundial de Salud (OMS): Evaluación de los Servicios de Agua Potable y Saneamiento 2000 en las Américas CHILE

[edit] See also

[edit] External links

The water and sanitation economic regulator SISS

[edit] Comments

Please feel free to post comments on this article on its discussion page (by clicking on "discussion" above to the left of the "article" tab) or send them to Manuel Schiffler at mschiffler@verizon.net.

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