Operation And Maintenance

Partnership
Contracts for the management and operation of an existing water supply/wastewater disposal system function within a partnership set up for the long-term. BWI AG has the required management expertise and excellent experience in operational management, which it uses to bring sustainable improvement to the services and performance parameters of the plants entrusted to it – improvement that is not limited to quality and cost efficiency.

Role Allocation, Implementation
When BWI is charged with the operational management of a water supply or wastewater disposal system, it establishes an operating company to conduct the operating activities. The operations management model assists the city or municipality to fulfil its official functions. The public sector’s possibilities for influencing and supervising the systems remain intact.

Term
Contracts of this type are usually concluded for a term of five to fifteen years.  Under this model, though, the public partner remains the primary provider of services to the population and responsible for rate collection.

Compensation
The public partner pays a pre-determined fee to the operating company, comprising both fixed and variable (i.e. quantity-dependent) portions. This fee is usually subject to an escalation clause which takes annual cost increases into account.

Advantages
Under this model, the private operating company is responsible for the efficient and economic operation of the plant or system and for the compliance with specific technical operating parameters. The risk to the public sector is limited to the regular adjustment of the fee paid to the operating company.

Limitations
The operating company is responsible for ensuring proper plant operations and organizational processes, as well as for personnel. It takes over operational equipment and is responsible for maintenance and repair of the plants and equipment entrusted to it. The client retains responsibility for financing investments in expansions, improvements or modernization of the system or plant.

Synopsis

• Establishment of a project-specific operating company
• Duration: 5 – 15 years
• Public partner remains responsible for the services to the population
• Pre-determined fee is paid to the operating company by the public partner (usually subject to a price escalation clause)
• Public partner is responsible for financing and investment (for the expansion, improvement or rehabilitation of the plant). Refinancing by regional development banks or the World Bank is an option.
• High degree of performance improvement
• Increased efficiency
• Technology transfer
• Transfer of technological and commercial management skills