Rio de Janeiro, Brazil, May 2017

Three days in Rio for the ‘Expert Consultation on service regulation and the human rights to drinking water and sanitation’, organized by the UN Special Rapporteur on the human rights to safe drinking water and sanitation, Léo Heller.

At the wonderful Oswlado Cruz Foundation building

The document resulting: course.https://www.ohchr.org/Documents/Issues/Water/ServiceRegulation/A_HRC_36_45_EN.docx

A fascinating discussion with fascinating group of experts – part of my response being to promote the ‘dynamic regulatory processes’ aspect of Service Regulation rather than unachievable (at present) ‘regulations’. It is the task of regulating to balance the needs with the capacities and resources then available, always nudging service providers to better and more efficient service delivery whilst allowing them the resources to undertake the usually forgotten capital maintenance which ensures the services are sustainable. London having ‘low prices’ whilst ‘one third of its pipes were older than 150 years, half older than 100 years’ was not sustainable - prices have to have increased in order to fund that capital maintenance whilst still demanding efficiency savings.

My version, shared with the Expert Group and in Euros here, of the operating efficiencies that Ofwat has driven into the England and Wales system. See elsewhere in these posts for a discussion on how slow they were in delivering a similar benefit to customers through a reduction in the cost of capital.

So, how to capture that increase in prices for sustainability with a decrease in prices due anticipated efficiencies in a single price adjustment? That is the challenge of economic regulation – within the context of customer misunderstanding and political point scoring of course.

I took the opportunity to do a ‘Favela Walking Tour’ to Rocinha to understand a little more of the watsan challenges in low-income urban Brazil (Brazil’s present GDP pc $9,821 https://data.worldbank.org/indicator/NY.GDP.PCAP.CD)

Roof top water tanks and ‘aerial spaghetti connections’

Effective drainage to remove the grey water, along with providing a route for water supply.

Impressive system of sewers wandering along walls and under the steep footpaths … though some suggesting not much in the way of treatment before discharge to the sea.

And a final view of low-income housing in Rio with one of the amazing 'back-drops' of a fascinating city ....