Mohammed Al Mowkley, CEO, National Water Company: Interview

Interview: Mohammed Al Mowkley

How are public-private partnerships (PPPs) improving efficiency in the water supply chain?

MOHAMMED AL MOWKLEY: The PPPs currently in the procurement stage for sewage treatment plants are similar to the contracts that have been used for desalination plants. This means that the market will be familiar with the risk allocation, contract terms, offtake agreement and government guarantees provided through the Ministry of Finance. Participation in the two contracts tendered to date suggests that market sentiment is strong. Furthermore, there is potential in the short to medium term for the privatisation of existing brownfield assets, such as groundwater production facilities and sewage treatment plants.

Although the sector is not currently ready for the privatisation of water and sewage networks – due to the higher risks involved – this will be addressed during the first phase of PPPs for the distribution sector. With the appropriate risk allocation and commercial model, private sector participation incentivises both service quality and efficiency. This is more straightforward for a greenfield site, where the private sector is in full control of the factors affecting quality and performance. However, for the distribution services sector, customer expectations and behaviour come into play, and uncertainties regarding the condition and performance of underground assets also have to be factored in. This requires a careful consideration of risk allocation and a more collaborative approach between public and private sector partners.

What measures are being taken at brownfield and greenfield sites to reduce operational costs?

AL MOWKLEY: The effective utilisation of current assets in conjunction with the repurposing of brownfield water infrastructure projects is not enough. A growing urban population is increasing the demand for water. Therefore, it is equally important to earmark and prioritise greenfield projects to balance the available supply with the forecast demand. The privatisation of brownfield and greenfield assets under PPP procurement models incentivises innovation and cost optimisation. Furthermore, to improve energy efficiency through pump scheduling, technology is being introduced to measure consumption rates and enable the real-time monitoring of pressure and flow in the network. The emphasis is on asset utilisation, productivity and service standards. Water pricing is focused on encouraging customers to conserve water to reduce demand and costs.

What upgrades are required to reduce leakages?

AL MOWKLEY: There is an overall focus on investing in water distribution and sewerage networks. Supervisory control and data acquisition (SCADA), along with geographic information systems, are also being used to identify and address leaks. Operational planning and the tracking of key performance indicators with regard to the availability and distribution of water is another area we are working on. Water leakages can be detected and reduced by using pressure management systems in conjunction with SCADA, then using network replacement programmes based on asset conditions and performance data.

How is water conservation and waste reduction being prioritised in new infrastructure projects?

AL MOWKLEY: Water conservation is being achieved through addressing leakages, encouraging customers to reduce consumption, enforcing the use of grey water by updating the Saudi Building Code, and promoting the adoption of treated sewage in lieu of potable water for the commercial and industrial sectors. New PPP projects will also provide higher-quality, lower-cost treated sewage products, which should encourage greater uptake of this resource, thereby reducing overall consumption.