More Urban Poor in Managua Have Reliable Water Supply and Sanitation Services

Challenge

Access to basic services for the urban poor living in extreme poverty in Nicaragua has been limited. Only 26.5 percent had access to piped water and 1.2 percent to in-house toilets. Most of this population used latrines (72.5 percent), but 26.3 percent did not have access to any sanitation services. Raw sewage running down the streets of informal housing developments was not uncommon. Those with access to piped water, received service sporadically—sometimes for no more than two hours a day. ENACAL, as the agency responsible for the provision of water supply and sanitation services to most urban areas and the primary provider in the greater Managua region, was struggling to extend reliable service to the expanding urban population, given the lack of financing and an effective approach to carryout works in marginalized communities. ENACAL’s coverage challenges were amplified by operational inefficiencies and a low capacity to collect tariffs from clients.

Solution

The Greater Managua Water and Sanitation Project (PRASMA) addressed these challenges with combined infrastructure investments, which provided the platform for quality service and efficiency and institutional strengthening activities. The project promoted practical community engagement and capacity building for WSS (water and sanitation services) aspects throughout the project cycle to engage the marginalized, low-income beneficiaries. The project also piloted low-cost sewerage networks, which had not been previously used in Nicaragua. Given their lower cost, these networks permitted ENACAL to extend coverage more broadly. The project also supported the development and implementation of ENACAL’s operational and commercial efficiency strategies, which included water optimization activities (such as non-revenue water¹) as well as a tariff collection strategy that transformed the way ENACAL approached clients with delinquent payments. All of these approaches were innovative for ENACAL at the time of implementation.

Results

The project’s infrastructure and efficiency activities extended reliable water service to 161,896 residents of the greater Managua region.  In addition, the increase in reliability reflected the project’s investments in non-revenue water activities, such as the promotion of micro and macro metering and the establishment of four macro-sectors, which covered 145 neighborhoods. The sanitation projects improved sanitation services, introduced the condominial sewerage method in country norms, and rehabilitated the Ciudad Sandino Treatment Plant.  Finally, the project’s tariff collection strategy increased ENACAL’s total collections by 42 percent.

Bank Group Contribution

The Bank provided Nicaragua with a US$20 million IDA credit and a US$20 million IDA grant to carry out the project. Just under half the financing was used for coverage extension and improvements in low-income neighborhoods. The remaining financing was primarily utilized for technical efficiency improvements and institutional strengthening activities.

Partners

The Ministry of Finance and Public Credit (MHCP) asked the Bank to lead donor involvement in the water and sanitation sector. The Bank engaged high-level international experts to work closely with ENACAL to develop these new areas. The Bank reestablished a roundtable on water and sanitation services to leverage support from other donors and coordinate the investments. Donors included the Inter-American Development Bank (IADB), the Japanese International Cooperation Agency, the Nordic Fund, the Spanish Fund for Development Assistance, and the German Development Bank, already involved in the sector. During missions, the Bank team regularly met with the donors to ensure a harmonized approach. The Bank team also had access to several Bank-executed trust funds, such as the Energy Sector Management Assistance Program (ESMAP) and the Spanish Fund for Latin America (SFLAC) to support complementary institutional development activities and international exchanges.

Moving Forward

The Bank is supporting ENACAL as it develops a Master Plan for Operational Efficiency in Managua through a technical assistance grant financed by ESMAP. The plan focuses on non-revenue water reduction and energy efficiency maximization. In addition, the Program for Human Water and Sanitation, which is financed by a pool of international donors and has over US$ 300 million in funds for investments over the next 15 years, incorporates good practices developed through the project’s activities. It will finance condominial sewerage systems, extend non-revenue water activities and incorporate social and environmental accompaniment throughout the project cycle.

Beneficiaries

ENACAL benefitted because it improved the financial sustainability and the long-term reliability of its services. The water access investments resulted in 15,798 new or rehabilitated connections. This improved the percentage of households who have access to water 16 or more hours a day from 54 percent in 2010 to 71 percent in 2015. The improved sanitation services benefitted 62,295 residents. One beneficiary commented:

“Before we woke up at one in the morning to perhaps collect a bottle of water; there was very little water, sometimes it came out good, sometimes bad.”

“We had roads we called ‘black rivers’- we didn’t know where to dispose of the wastewater so we released it on the streets. The smell was horrible and permanent, day and night.”

“Thank God we have water 24 hours a day.”

Footnote:

^1: Non revenue water (NRW) is water that has been produced and is “lost” before it reaches the customer. Losses can be real losses (through leaks, sometimes also referred to as physical losses) or apparent losses (for example through theft or metering inaccuracies).