The changing Latin American landscape in provision and regulation of the water and sanitation services

Since the Great Depression of the 1930s, it was common knowledge in the Latin American water and sanitation sector the idea of take advantage of scale economies, typical of these natural monopolies, in a context favorable to state involvement in the activity. In parallel, the development of sanitary engineering and the necessity of improve and extend coverage due to health and merit goods considerations. Until the 1980s centralized state-owned monopolies ruled the sector in urban areas, while in rural places the role was performed by decentralized or municipal services. Between the 1930s and the 1960, important investments in sanitary infrastructure were made in the region. Since the 1970s, growing fiscal stress started to affect the expansion and the maintenance of the inherited infrastructure. In the 1980s the sectors decayed because of public spending cuts in the context of the Debt Crisis, and joint with a different vision, a consensus grown in direction to reforms of the sector (regionalization) and to private sector participation. Nowadays, centralized services are the exception and are generally found in small extension countries and or low population places. More spread is the national regulation. Federal countries as Argentina, Brazil and Mexico do not have a national regulator. Multisectoral regulators are found in a few countries, of small territory and population.water; sanitation; Latin America

Economías de escala en agua y saneamiento: examen de la literatura

Este estudio se ocupa de relevar la literatura internacional sobre economías de escala en el sector de agua y saneamiento, reseñarla y extraer hilos conductores. En todo el mundo está en discusión cómo lograr un acceso más equitativo y una prestación más eficiente. Un tema vinculado con la eficiencia es la posibilidad de aprovechar economías de escala al dimensionar la prestación de agua potable y alcantarillado. La discusión teórica y los resultados empíricos sobre economías de escala en agua y saneamiento sirven para detectar si hay o no un quid-pro-quo entre concentrar y desconcentrar servicios como medida de política. Los estudios relevados en un conjunto grande de países, arrojan economías de escala (en diversos países con diferentes situaciones) en poblaciones cubiertas por entre 100 mil, hasta cerca de 1 millón de habitantes (en algunos casos se extiende a varios millones), o con densidades poblacionales de hasta 250 habitantes por kilómetro de red, o con volúmenes entregados a la red de 70 millones de m3 al año. Con poblaciones, volúmenes o densidades mayores, empiezan primero los rendimientos constantes a escala y posteriormente las deseconomías de escala; con valores menores, hay ahorros de costos por aglomerar.water; sanitation; scale economies

Economies of scale in the water sector: A survey of the empirical literature

The issue of the most favorable size and optimal industry structure in the water sector is a relevant topic in many countries, due to fragmentation of the water sector and the key role played by municipalities. Important debates are taking place worldwide about how to provide universal access to the water supply and offer an efficient service. Regarding efficiency, the possibility of exploiting economies of scale would imply better resource allocation, the potential for lower water charges, and greater geographical coverage. By surveying the empirical research from different parts of the world, we aim to shed some light on the topic of economies of scale, and to provide a synthesis of the literature. We also aim to determine whether there is a tradeoff between centralization and decentralization. Our survey shows that, for several countries, variations in efficiency of water provision due to economies of scale do exist. Increases in efficiency related to economies of scale are found for populations in the range of 100,000 to 1 million people served. For larger populations, volume-or density-constant returns to scale are observed, followed by decreasing returns to scale; the reverse occurs for smaller values, suggesting that cost savings are derived from consolidation of providers. Returns to scale refer to changes in output resulting where all inputs increase by a constant factor. If output increases by that same proportional change, then there are constant returns to scale. If output increases by less than that proportional change, there are decreasing returns to scale. If output increases by more than that proportional change, there are increasing returns to scale. Returns to scale is a technological phenomenon, due to the relationship between inputs and outputs in the production function. Economies of scale refer to reductions in unit cost as the scale of production increases. Diseconomies of scale are the opposite: increasing in unit costs as the scale of production increases. Scale changes mean a proportional increase in all factors of production. Economies of scale are a economical phenomenon, due to the relationship between unit costs and the level of production.Fil: Ferro, Gustavo Adolfo. Universidad Argentina de la Empresa; Argentina. Consejo Nacional de Investigaciones Científicas y Técnicas; ArgentinaFil: Lentini, Emilio J.. Universidad de Buenos Aires; ArgentinaFil: Mercadier, Augusto C.. Universidad Nacional de La Plata; Argentin

El cambiante panorama latinoamericano en cuanto a prestación y regulación de los servicios de agua potable y saneamiento

Since the Great Depression of the 1930s, it was common knowledge in the Latin American water and sanitation sector the idea of take advantage of scale economies, typical of these natural monopolies, in a context favorable to state involvement in the activity. In parallel, the development of sanitary engineering and the necessity of improve and extend coverage due to health and merit goods considerations. Until the 1980s centralized state-owned monopolies ruled the sector in urban areas, while in rural places the role was performed by decentralized or municipal services. Between the 1930s and the 1960, important investments in sanitary infrastructure were made in the region. Since the 1970s, growing fiscal stress started to affect the expansion and the maintenance of the inherited infrastructure. In the 1980s the sectors decayed because of public spending cuts in the context of the Debt Crisis, and joint with a different vision, a consensus grown in direction to reforms of the sector (regionalization) and to private sector participation. Nowadays, centralized services are the exception and are generally found in small extension countries and or low population places. More spread is the national regulation. Federal countries as Argentina, Brazil and Mexico do not have a national regulator. Multisectoral regulators are found in a few countries, of small territory and population

Los servicios urbanos de agua potable y saneamiento en Argentina: Estado actual y desafíos.

Capítulo de libroEste artículo tiene por objeto describir el estado actual de los servicios urbanos de agua y cloaca por red en la Argentina y plantear cuáles son los desafíos futuros. Para lo cual también se analiza la situación actual y desafíos de los países de la región para el cumplimiento del Objetivo de Desarrollo Sostenible 6, “Garantizar la disponibilidad y la gestión sostenible del agua y el saneamiento para todos”. En América Latina y el Caribe, la población urbana representa el 81,1%, y para el 2030 esa proporción alcanzaría el 84,1%. Este crecimiento demográfico, combinado con la concentración poblacional en áreas urbanas, requiere que la infraestructura urbana crezca a una tasa superior para atender esta demanda creciente e incorporar a quienes a la fecha no cuentan con los servicios de agua y cloacas. Al analizar la situación actual del sector en la Argentina sobresalen los déficits de cobertura: 13% de la población no tiene acceso a agua por red pública y el 42% a cloacas. Por otro lado, respecto a la organización sectorial, se destacan la pluralidad de prestadores, la falta de información sistematizada y la disparidad respecto de los niveles de desempeño alcanzados por los distintos operadores. En este contexto, se analiza el Plan Nacional de Agua Potable y Saneamiento formulado por el Gobierno nacional en 2016, que marca los lineamientos futuros y establece como objetivo principal alcanzar la cobertura de agua al 100% y lograr un 75% de cobertura de cloaca en las áreas urbanas del país.Fil: Lentini, Emilio J. Centro de Estudios Transdisciplinarios del Agua (Instituto UBA)/Gestión Ambiental Metropolitana (FADU/UBA), Argentina. Email: [email protected]: Brenner, Federica. Centro de Estudios Transdisciplinarios del Agua (CETA-UBA), Argentina. Email: [email protected]: Mercadier, Augusto. Universidad Nacional de La Plata/Ente Regulador de Agua y Saneamiento (ERAS), Argentina. Email: [email protected]

Returns to scale in water and sanitation: estimates for Latin America

Most countries around the world are strongly debating ways to yield more equitable access and a more efficient provision. One issue linked to efficiency is the achievement of scale economies in the industry and the optimal dimension of water and sanitation providers. Changes in the industrial structure of the sector, through mergers in highly atomized services, the breakup of very concentrated services, or the property discussion (private versus public) are major issues. These decisions have often become politicized because of the social complexity of the sector. Empirical findings of the different models reveal the existence of increasing returns to scale in Latin American water provision based on an ADERASA database (a 2005 cross section of 90 providers in 14 countries). The study of returns to scale incorporates a technical argument into the discussion because–as our study suggests–the prescription could be to agglomerate small providers.Fil: Ferro, Gustavo Adolfo. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; Argentina. Consejo Nacional de Investigaciones Científicas y Técnicas; ArgentinaFil: Lentini, Emilio J.. Universidad de Buenos Aires. Facultad de Ciencias Veterinarias. Centro de Estudios Transdisciplinarios del Agua; ArgentinaFil: Mercadier, Augusto C.. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; ArgentinaFil: Romero, Carlos A.. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; Argentin

Returns to scale in water and sanitation: estimates for Latin America

Most countries around the world are strongly debating ways to yield more equitable access and a more efficient provision. One issue linked to efficiency is the achievement of scale economies in the industry and the optimal dimension of water and sanitation providers. Changes in the industrial structure of the sector, through mergers in highly atomized services, the breakup of very concentrated services, or the property discussion (private versus public) are major issues. These decisions have often become politicized because of the social complexity of the sector. Empirical findings of the different models reveal the existence of increasing returns to scale in Latin American water provision based on an ADERASA database (a 2005 cross section of 90 providers in 14 countries). The study of returns to scale incorporates a technical argument into the discussion because–as our study suggests–the prescription could be to agglomerate small providers.Fil: Ferro, Gustavo Adolfo. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; Argentina. Consejo Nacional de Investigaciones Científicas y Técnicas; ArgentinaFil: Lentini, Emilio J.. Universidad de Buenos Aires. Facultad de Ciencias Veterinarias. Centro de Estudios Transdisciplinarios del Agua; ArgentinaFil: Mercadier, Augusto C.. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; ArgentinaFil: Romero, Carlos A.. Universidad Argentina de la Empresa. Facultad de Ciencias Económicas. Instituto de Economía; Argentin

Eficiencia energética en el sector de agua y saneamiento: estimaciones utilizando una función de requerimientos de insumo

We analyze by means of frontier methods (input requirement function) the relative energy efficiency of urban water and sanitation providers in Brazil. We estimate energy savings through measures the sector could implement on variables which control. We find a 63 percent efficiency average, with respect to best practices in the sample (the frontier). We estimate that a 10 percent reduction in unaccounted-for water can reduce 4.2 percent the electricity consumption for the whole sample; also, a reduction in 10 percent of the breach of coverage between sanitation and water can achieve reductions of 1.45 percent in the input under study

Eficiencia energética en el sector de agua y saneamiento: estimaciones utilizando una función de requerimientos de insumo

We analyze by means of frontier methods (input requirement function) the relative energy efficiency of urban water and sanitation providers in Brazil. We estimate energy savings through measures the sector could implement on variables which control. We find a 63 percent efficiency average, with respect to best practices in the sample (the frontier). We estimate that a 10 percent reduction in unaccounted-for water can reduce 4.2 percent the electricity consumption for the whole sample; also, a reduction in 10 percent of the breach of coverage between sanitation and water can achieve reductions of 1.45 percent in the input under study