BINHDUONGWATERSUPPLY SEWERAGE ENVIRONMENTCO.

,LTD

FINALREPORT
TWINNINGPROGRAM between BinDuongWaterSupplySewerageEnvironment Co.,Ltd(BIWASE) and PhnomPenhWaterSupplyAuthority(PPWSA)

06October,2009

Final Report of the Twining Program between PPWSA and BIWASE

1. INTRODUCTION
With supports of the South East Asian Water Utilities Network (SEAWUN) and the Asian Development Bank (ADB), the Twinning Program between Phnom Penh Water Supply Authority (PPWSA) and Binh Duong Water Supply Sewerage Environment Co., Ltd (BIWASE) signed on 31 July, 2007 and up to now it has been carried out for 02 years. Through visits, meetings and discussions between both parties (PPWSA & BIWASE) were carried out to find out lessons and experiences in NRW works, in order to enhance and improve business works of both countries. Further to the first mission carried out by Phnom Penh Water Supply Authority (PPWSA) at Binh Duong Water Supply Sewerage Environment Co., Ltd (BIWASE) from October 15th to 20th, 2007 to assess the actual state and solutions to improve machinery and management system of NRW works, a mission of 24 people was launched to PPWSA to study, exchange experience from February 24th to March 01st 2008 about zoning and zone management. Our second mission of 05 people was continuously launched to PPWSA for the same duties from November 2nd to 07 November, 2008. Through the meetings, discussions between BIWASE work team and the PPWSA staffs on situation and managing experience as well, so both parties can have a closed cooperation to achieved better results on activities of management and development of water supply and drainage system.

2. EXCHANGEDCONTENTSANDLESSIONLEARNTATPPWSA 2.1 OVERVIEWOFPPWSA

PPWSA has been a self-finance authority since 1997 and it is the one supplying water for all Phnom Penh of Cambodia. PPWSA is leaded by the board of directors (BOD). Members of BOD were assigned from Ministries, such as Ministry of Finance, Ministry of Natural Resources, Ministry of Energy and Industry. . . .There are 2 leading men assigned by the Government to be General Director and Director of finance as chief accountant. PPWSA has 3 water supply plants with the total capacity of 235,000m3/day and all of them use water from rivers surrounding Phnom Penh capital. The current amount staff of PPWSA is 569 and they are working at 5 departments and 3 water treatment plants. The transmission mains are HDPE, DI and GI pipe. PPWSA now do not use PVC pipe in the main pipe.

2.2

ORGANIZATIONCHART

PPWSA has 5 departments (Pls. find the Annex 2-Organization Chart) and 3 water supply plants with capacity as follows: + Phum Prek Water Treatment Plant: 150,000m3/day;

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Final Report of the Twining Program between PPWSA and BIWASE + Chrouy Chanmar Water Treatment Plant: design capacity is 65,000m3/day, but the plant is now running with capacity of 75,000m3/day; + Chamca Morn Water Treatment Plant: 20,000m3/day.

Business fields of PPWSA are to supply cleaned water serving domestic, production, and service in Phnom Penh.To ensure its business, PPWSA has some subsidiary plants in charge of daily activities and 5 departments to manage water production and distribution: 3 water supply plants providing water to Phnom Penh and 5 Departments: Planning & Technical Production & Distribution Commercial Administration & Human Resource Accounting & Finance

The Accounting & Finance Department plays an important role in production and business activities of PPWSA, so it is divided into 7 offices (Pls. find the Annex 3- Organization chart of Accounting & Finance Department). The Board of Directors includes: 1 General Director and 3 Deputy Directors. Statutes of some typical departments of PPWSA as follows: Marketing department Business department: 02 divisions: Division of managing water invoices: After working and considering, BIWASE working team recognized that PPWSA has a strict management at any collecting money place and even at the company. The collecting scale is almost 100%, this is the most concerned problem of every water company, steps from sending water invoice to deadline of payment as well as implementing customers duty of payment is good and managed through the information network of the company. Division of managing water meter: Management of reading and recording indicator is also professional. PPWSA used conditional working policy and strictly testing and observing between departments as well as strictly fined and awarded policy so works of reading and recording indicator are very effective. Moreover, methods of customer management on regulation of periodical time to read and record indicator or inform to customer for reading their meters indicator by required telephone number of the company. Department of customer service Business department: 02 Divisions: Division of service management of developing customer: including 02 groups: Group which deals with management of developing customer, will carry out all design documents of water meter 15 40mm. Group which deals with management of developing customer, will carry out all design documents of water meter > 40mm. Although dividing into 02 groups as well as many people participating in the document, the completion time is rather fast around 3 15 days. This method helps avoiding negative situations in management of developing customer.

Division of receiving and solving customers information: All are very professional both human resource, working facilities, approach and effective answer to meet the highest demands of customers.

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Final Report of the Twining Program between PPWSA and BIWASE NRW Department Planning and Technical department: This is the most important department of PPWSA during water business works. NRW Department where controls suitable designs, reading and recording indicator team customer service and other activities relating to water turnover, etc. Especially, NRW work is very professional and NRW is controlled to be reduced. BIWASE working team is impressive on PPWSA management network and your positive supports not only documents but also at the site to view executing locations, locations of water meter, etc. So we can understand preparing steps and sufficient legality once ending water supply service for customers. Training Department Department of Administration and Human Resource This is one of the important department of PPWSA in training human resources to meet the work demand of PPWSA, with your large scale and training experiences BIWASE hopes to be cooperated in the future. -

2.3

WATERSUPPLYFACILITIES

PPWSA is managing 3 water treatment plants with the total capacity of 235,000m3/day. The water supply plants use river water to provide cleaned water to Phnom Penh residents. The biggest water treatment plant is Phum Prek having capacity of 150,000m3/day. This plant is located on North of Combodia Railway Station and built in 1966 with original capacity of 100,000m3/day. In 2003, PPWSA Phum Prek was expended with 50.000m3/day, increasing the capacity up to 150,000m3/day. The Water Supply Authority is going to expend the capacity of plants with 75,000m3/day in the future to meet water demand of customers.

2.4

SERVICECONNECTIONANDCUSTOMERSERVICE

PPWSA has 165,000 connections with 63 water readers who are also in charge of billing issue. In average, 1 staff is in charge of 2,600 water meters. Each customer pays averagely about USD 100/1 connection. This charge includes material, deposit and VAT. The difference between BIWASE and PPWSA in new connection is that customers have to submit their family books attached to the application form asking for water supply to PPWSA. PPWSA issue a policy to be free of charge for poor household when they want to be connected. After receiving application form from a poor family, PPWSA will appoint their staff to check their living conditions, their income, etc. . . to confirm if the family really poor or not . In case that family is really poor, a connection will be made for them without charge. Beside that, if a household is too poor to pay for their water bill, PPWSA will mobilize their staff to share in paying the bill. PPWAS have a propaganda program to improve customers awareness in using treated water. By this way, they have good relationship with their customers.

2.5

TARIFFRATE

PPWSA is applying block tariff rate, which is presented as bellows:

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Final Report of the Twining Program between PPWSA and BIWASE Categories Domestic Block Consumption (m3) 0-7 8-15 16-50 >50 No volume bracket 0-100 101-200 201-500 >500 Tariff rate (R/m3) 550 770 1,010 1,270 1,030 950 1,150 1,350 1,450

ADM, Whole sale Commercial & Industrial

Note: 1 R 4 VND 0,00025 USD

2.6

WATERMETERMANAGEMENT

PPWSA use water meter with Class C to install for their customers. Each area is installed a bulk meter to enable in controlling water loss. After being metered, customers check and sign in a document prepared by PPWSAs staff to confirm that the meter is in good conditions and they also have responsibility to keep their water meter.

PPWSA take care of accuracy of water meters by spot check new procured water meters and replacement program every 8 years. The meters removed from the service connections will be tested for the accuracy. The good one will be stored for later reuse. All collectors have duty to report on abnormal case of water meter to PPWSA.

2.7

NONREVENUEWATER

NRW of PPWSA is now rather low compared with other water supply companies in the South-East Asia. According to the PPWSAs General Director, the NRW rate of PPWSA is 6.15% at the end of 2007. This is a result getting from good management policies and effort of all PPWSA staff in trying to reduce NRW rate, increasing revenue in order to get sustainable finance. All Phnom Penh water supply network is divided into 3 areas which are managed by respective water treatment plants and each area is divided into small zone installed a bulk meter. Division and separation are carried out as pipes are installed. This enables PPWSA in management and setting good solutions in time to reduce water lost in each zone. Beside methods to reduce lost water, PPWSAs board of directors is determined in dealing with cases causing water lost (non-physical lost). By this way, the NRW of PPWSA is now rather low. This makes the water supply authority increasing revenue and profit. Unaccounted for water from 2001 to 2007 in the below table: Year
NRW (%) rate

2001 22,89

2002 21,84

2003 16,78

2004 15

2005 11

2006 8

2007 6,15

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Final Report of the Twining Program between PPWSA and BIWASE

2.8

BILLINGANDCOLLECTION

The billing issue is prepared by the Computer center and issue water bills every 2 months. Each reader has a Meter Reading Book with some necessary information as: name, address, previous date and index, new reading. Meter reading is carried out in each zone and in turn. After reading, readers give meter reading books to staff in the computer center to enter the new reading. The staff in the computer center is responsible for exact entering data recorded by readers. There is a clear assignment of responsibility between reading and entering staff by the way that the entering staff has to sign in the reading book after entering data. Then the reader will issue water bills to customers. There is a deadline for payment in each bill. Water bill excludes VAT but includes meter maintenance fee which is charged by 50 R/1mm meters diameter. All staffs who read and issue bills have no duty to collect money from customers. Customers pay money at cashier. There are 5 cashiers: 1 at the office of PPWSA and 4 other cashiers located in Phnom Penh. Customers can choose the nearest one to come and pay the bills. PPWSA manage their customers by bar code reader printed in the water bills. Water bills have 2 parts. The part with bar code is kept by the cashier when customers pay money. In case of late payment, customers will be charged 1%/day/amount of the bill. By this way, water collection rate of PPWSA is 99.9%.

2.9

FINANCIALMANAGEMENT

Financial management is carried out by computers and according to International accounting Standards and PPWSA are applying the straight line depreciation. Income statement from 2001 to 2006: Unit: million Riel
No. Description 2001 26,451.562 173,634 4,297.056 30,922.252 2002 30,997.161 990,485 4,545.604 36,533.250 2003 38,508.508 969,414 5,383.010 44,860.932 2004 47,193.427 1,699.675 4,228.727 53,121.242 2005 55,362.777 2,287.759 5,403.706 63,054.242 2006 64,934.130 1,655.412 8,690.977 74,980.519

1 2 3 4

Water Sale Connection fee Other revenue Total Revenue

All type of expense must be approved by Board of Director. Any expenses above $700 must be approved by the General Director. Any payment above $120 must be from bank (check processing). All type of expenditure (operational capital) must be under yearly budget approval, if the expenses are not under the approved budget, they must get approval only from General Director on consider any amount of money. Any expenses above $1,000 to $4,800 must have at least 3 quotations. Any expenses above $4,800 must arrange a tender according to the Government procurement regulations.

2.10 HUMANRESOURCEMANAGEMENTANDDEVELOPMENT
The organization structure is presented as in Annex 2. Total amount of staff is 569 and the water supply authority were already established a training center to train and improve staffs level. Based on the testing result, the General Director signs a decision to increase salary for staff passing the test. All staff must take the test, except the General Director.

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Final Report of the Twining Program between PPWSA and BIWASE PPWSA have already prepared manuals about management, operation and maintenance of all fields to be sure that their staff have to follow the procedures in the manuals. These manuals are given to all PPWSAs staff to carry out. By this way, they save much time and labor force in management, operation and maintenance equipments, work effectiveness is assured and improved more and more.

3 EXPERIENCESACHIEVED
BIWASE highly appreciate PPWSA in controlling water loss and reading meter, issuing water bill. Beside that, staff management of PPWSA is also a valuable experience that BIWASE will study to apply into our company. Good experiences BIWASE achieved from PPWSA through these two study tours as follows: + Management of water supply network is really efficient from designing, zoning, transmitting information to central station, dealing with problems, etcNRW therefore is highly reduced; + Mobilizing human and financial resources to invest in NRW works, so water loss scale is reducing day by day; + There are clear regulations and manuals to enable their staff in improving skill and awareness of duty in working. PPWSAs staff have moral job, they are faithful for the authoritys benefit; + Management of customers services are especially good from supplying water, reading indicator, issuing invoices, arranging the collecting places, etcmeet the highest demand of customers. + Due to a training center, so training works to enhance skills and responsibility of staffs are always interested to meet developing demands, it is considered as an important resource of PPWSA. After these lesson learnt, BIWASE has studied and applied on our managing works, some departments have specific duties, customer services have sufficient trend, especially NRW work has been highly interested, etcHowever, BIWASE has some petitions and opinions as follows: + PPWSA should reduce procedures in asking for connecting meter. + Meter connecting pipelines should be PPWSAs work. When they are broken, PPWSA should cover the repaired cost, it shouldnt be covered by customers. + With unwilling risks of customers, PPWSA should support them. For example, the pipelines behind the meter were leaked but the customers couldnt found it and when the leakages were found, the quantity of water lost are too high, the customer can not pay for these unused quantities.

* General View of Binh Duong Water Supply Sewerage Environment Co., Ltd (BIWASE) : a/ FrameWork of Organization: BIWASE which has been established based on Binh Duong Water Supply Company is a State enterprise and to be changed into one member limited company according to Enterprises Law which passed through by National Assembly of the Socialist Republic of Viet Nam at the Course X of Meeting No.5 on 12 June, 1999. Framework of Organization includes: + Companys chairman holds as Director + 04 Vice Directors

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Final Report of the Twining Program between PPWSA and BIWASE

+ 13 units directly under company + 8 departments directly under company (attached diagram of organization) Nowadays, BIWASEs employees are nearly 700 people, in which careers and fields are divided as follows: + Water Supply: 310 employees, capacity: 140,000m3/day. 170 employees, capacity: 1,000m3/day (domestic waste 700tons/day). 40 employees, capacity: 15,000ha 60 employees 50 employees, 5 Depts + Waste (domestic & industrial): + Irrigation, drainage: + Project Management Unit: + Office Professional Dept: b. Our current activities: b.1 Business fields: - Investment in exploitation, treatment, supply cleaned water for domestic, production, investment in drainage system, irrigation work, collecting and treating domestic and industrial hazard waste. Producing compost fertilizer, houses for lease, pure water bottles, pure ice, eating and drinking services. - Executing and constructing drainage system, irrigation work, transformer station 35KV, public lightening system, transport routes of level III, repair of irrigation works.
- Procuring materials, recycle and reproduce waste, sell products from waste, equipment, facilities. Carrying out urban service such as: cleaning canal, cesspool, cleaning route, selling and buying ornamental trees. - Surveying, designing, cost estimate and investing project. Evaluating invested projects, evaluating technical design cost estimate. Consultant shall make invitation documents, make report on environmental evaluation. - Supervision of construction and installation: Constructing civil works and industrial works, water supply, drainage, irrigation work, infrastructure. Designing water supply and drainage works of urban areas, countryside. Designing civil works and industrial works, transport, engineering works, urban infrastructures. Designing small and average irrigation works. Constructing waste treatment and environment works. - Transport of goods by specialized cars. Car for lease service.

+ Construction services, Consultant 70 employees

b.2 Business situation: Currently, BIWASE has 09 factories, water supply factories which supply clean water for 07 towns and districts of Binh Duong province with design capacity 141,300 m3, in particular as follows: No. Factories system Design Capacity Output Capacity

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Final Report of the Twining Program between PPWSA and BIWASE

m3/day&night 1 Di an Water Supply Plant 90,000

m3/day&night 70,000 (is operating 30,000m3/day&night)

2 3 4 5 6 7 8 9

Thu Dau Mot Water Supply Plant My Phuoc Water Supply Plant Uyen Hung - at Cuoc Water Supply Plant Complex Area Water Supply Plant South Tan Uyen Water Supply Plant Bau Bang IP Water Supply Plant Dau Tieng Water Supply Plant Phuoc Vinh Water Supply Plant Total

21,000 11,000 5,000 5,000 3,000 3,000 1,000 1,000 140,000

20,000 13,000 5,000 3,000 2,000 1,000 1,000 1,000 116,000

Besides water supply field, BIWASE also invests in environment field, now the company has already built a solid waste treatment plant with the capacity around 420 tons/day and is investing in a domestic waste treatment plant in Thu Dau Mot town with the capacity around 17,500 m3/day and park cemetery with area 190 hectare at Chanh Phu Hoa ward, Ben Cat dist, Binh Duong province. Business criteria of 2008 as follows: + Quantity of clean water used: 30 millions m3. + Turnover: 180 billion VND, in which water supply: 130 billion VND. b.3 Applied water price: Progressive price was applied from March, 2009, including 100% free installation of customer branch in 10 m scope, price of clean water was applied as follows: Type of user 1. Household - Using first 20m3 - Using from 21m3 -30m3 - Using from 31m3 - 40m3 - Using over 41m3 2. State enterprises/companies, Military, armed forces: Selling Price (including VAT) 4.000 VND/m3 5.000 VND/m3 6.500 VND/m3 8.000 VND/m3 6.500 VND/m3

3. Physical producing enterprises/companies: - Wholesale (at bulk meter): 6.000 VND/m3 - Retailed sale 6.500 VND/m3

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Final Report of the Twining Program between PPWSA and BIWASE

4. Business, services:

8.000 VND/m3

4 APPLICATIONOFTHEPROGRAM
After these lessons learnt, selected experiences through visits at PPWSA, Director of (BIWASE) organized a meeting to disseminate the key reasons of success of PPWSA, lesson learnt through these two visits to (PPWSA) and other related issues to obtain real benefits for BIWASE. In order to achieve the high and efficient results, Director has conducted a plan to rearrange the framework, especially there are three new departments as follows: + NRW Department; + Department of Customer service; + Training Center Besides, BIWASE adjusted roles and responsibilities of Water Supply Enterprises on Network management and NRW works. a) NRW Works Improving the NRW department, recruiting and training skilled and professional staffs, enthusiasm in works (22 staffs), and 20 staffs to carry out NRW works for enterprises, buying equipment and facilities for NRW works such as leakage sound bar and other rapid methods to face with broken pipelines. Applying fined and awarded regulations to stimulate better working efficiency.

Setting NRW target, better network management for the next years, continuous renewing better internal management for NRW works as follows: + Enhance management of human resource training of network management; + Improve customer service to meet more and more customer demands, creating more admired customers of the company; + Equip more facilities and equipment for NRW works. - Installing 19 NRW testing zones in Thu Dau Mot town and 12 in Di An Enterprise and ongoing to install more new testing zones. Other enterprise is improving organization and special skill to find leakages, zoning and other problems at testing zones for timely repair to avoid water loss; - Assigning specific works and staff who reads and records customer water meter are frequently checked to limit errors and mistakes; - Better management of closing and opening valve works in network, updating new pipelines in testing zones and the general water supply map; - Increasing more staffs of zone management, assigning their specific function and responsibility; - Serious management and strict observation for regulations of checking the executing quality of network to ensure that it is safe while they are operated and maximum limitation of water loss. - Strictly checking detail design of the testing zones. - Especially at the end of 2008, NRW of the whole company was down to 13% and up to now (June, 2009) NRW is 11, 7% and setting target for next years with the lowest NRW. b) Customer service Installing the Department of Customer service included 05 people, in which a department leader who receives all information of customers and looks for sensible way to solve problems, Page 10

Final Report of the Twining Program between PPWSA and BIWASE etc, in order to get the better service for customers and should have continuous training and supplement skilled human resource to meet the customer demands for next years; Investing more working equipment, computers, and enhancing information exchanges by easily remember numbers on hotlines, offering a suggestion and service information are printed at the backside of the water invoice for easy contact. Conducting customer service program and disseminate to enterprises directly under the company as well as having periodic and unscheduled check on the working results of any enterprise, plants directly under the company, mutual coordination to solve any complain of customers and making final report to the General Director as required.

c) Training Program Installing vocational training and enhancing Biass human resources, in order to train for employee to improve their professional skill, work responsibility, working for the benefits of company, customer and then oneself; A training class was opened for 40 people to learn how to read and record customer; Training how to design water supply network, selecting qualified equipment and materials to reduce NRW (30 people were trained); Training more human resources who have better skill and knowledge in NRW works (40 people were trained); 03 managing processes which were carried out and approved by the Director, as a base for utilities to follow in order to meet the highest demands of customers, particularly as follows: * Process: Time of execution and completion of one customer branch pipeline; * Process: Practicing staff to read and record customer indicator; * Process: Flat rate for staff to collect customer invoices. Draft and improve handbook document for installing customer branch pipelines.

5 RESULT
At the end of 2006 NRW was 20,14 %, 2007 was 14,57%, and at the end of 2008 NRW of the whole company was 12,90%, and up to June, 2009 was 11.70%, and are trying to keep at the lowest rate for next years; Improving human resource quality, especially NRW department, network management by training professional skill, awareness for customer serve and for the companys benefit; Increasing expenses for investment in NRW works and training work; Increasing the capability of NRW employees and training center.

6 CONCLUSIONANDPETITION
Conclusion: Twining Program between Phnom Penh Water Supply Authority (PPWSA) and Bin Duong Water Supply Sewerage Environment Co., Ltd (BIWASE) was very successful and BIWASE successfully and efficiently applied Pisas experiences in improving machinery administration, business especially NRW works have more concerned and interested, in which human resources training center has an important role.

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Final Report of the Twining Program between PPWSA and BIWASE Petition: Although Twining Program has almost closed, information exchange between both twining operators (PPWSA & BIWASE) should be maintained to share new experiences, new findings, new advance, etc in order to improve the efficiency of management and customer services. From this result, Water supply enterprises which can base on their own capability to be twining enterprises, improve NRW works. BIWASE is willing to share our experiences which were achieved during the Twining Program with any operator in all over the world.

LIST OF ANNEX
Annex 1 Some working pictures of trips. Annex 2 Some organizing diagrams of the company. Annex 3 NRW report of year 2006-2007-2008 and June, 2009. Signing Ceremony of Memorandum of Understanding Twining Program between BIWASE and PPWSA

Evaluating the result of trips and scheduled plan for next trip between BIWASE and PPWSA

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Final Report of the Twining Program between PPWSA and BIWASE

a) Working with Leaders of Business Dept

b) Working with Leaders of Customer Service Dept

c) Working with Leaders of NRW Dept

d) Working with Leaders of Training Dept

DIRECTOR

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Final Report of the Twining Program between PPWSA and BIWASE Chairman Director

Vice Director Chief Accountant Units directly Under company

Di An Water Supply Enterprise

Mass Organization

Departments under company

Department of Organization &Administration Department of Finance & Accounting Department of Planning & Material

TDM Water Supply Enterprise

My Phuoc Water Supply Enterprise

Complex Area Water Supply Enterprise Water Supply Sewerage Consulting Firm Civil Constructing Enterprise

Department of Laboratory

Department of Customer Service24H Advanced Human Source & Training Centre Project Management Unit

Irrigation Work Enterprise

Waste Treatment Enterprise

Department of Non Revenue Water

Urban Work Enterprise

Leakage testing team Data and GIS network storage team Testing experts of reading and recording indicator

South Tan Uyen Water Supply Enterprise Dau Tieng Water Supply Enterprise
Supervision Team of execution

NRW Enterprises and Plants

Phuoc Vinh Water Supply Enterprise

Area management team (Hamlet Leader (Trng ap)

Technical Team of Zoning, Separating network, Designing

Uyen Hung Water Supply Enterprise

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Zoning Team, NRW team

Leakage testing Team

NRW DEPARTMENT

Supervision Team of execution

Leakage testing team, finding old equipment

NRW Enterprises and Plants

Data and GIS network storage team

Testing experts of reading and recording indicator

Technical Team of Zoning, Separating network, Designing ,

Zoning Team, NRW team

Area management team (Hamlet Leader)

Leakage testing Team

Final Report of the Twining Program between PPWSA and BIWASE

MANAGEMENT DIAGRAM OF WATER SUPPLY ENTERPRISES BOAD OF MANAGER OF ENTERPRISES

Plant

Administratio n dept

Department of Finance & Accounting

Marketing Dept

NRW Dept

Team of Collecting and recording

Team of installing customer branch pipelines

Team of customer Care

Area management team (hamlet leader

Repairing Team

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