PROJECT INFORMATION DOCUMENT (PID)
CONCEPT STAGE
Report No.: AB3380
Project Name / Mexico Environmental Recovery of the Apatlaco River BasinRegion / LATIN AMERICA AND CARIBBEAN
Sector / Sanitation (45%);Sewerage (45%);Solid waste management (10%)
Project ID / P107134
Borrower(s) / UNITED MEXICAN STATE
Implementing Agency / BANOBRAS
Environment Category / [X] A [ ] B [ ] C [ ] FI [ ] TBD (to be determined)
Date PID Prepared / October 17, 2007
Estimated Date of Appraisal Authorization / April 21, 2008
Estimated Date of Board Approval / July 15, 2008
1. Key development issues and rationale for Bank involvement
The Apatlaco River Basin, comprising 13% of the state of Morelos’ land, is heavily polluted by domestic, industrial and agricultural discharges. This has resulted in deteriorated quality of life for the Basin’s 750,000 inhabitants (about 50% of the state’s population), poses serious risks for sanitary health, and hampers economic activity in the region including that associated with agriculture and especially tourism, the state’s primary sources of revenue.
Pollution in the Basin is largely due to poor sewage and wastewater collection and treatment, deficient solid waste collection and disposal, and weak institutional capacity for implementing the existing related laws and regulations. While the current situation affects all residents, basin pollution affects the poor disproportionately as they are more likely to live in degraded areas adjacent to the river, and are more likely to depend upon agriculture.
The institutional framework for environmental and water resource management in Morelos, as in all of Mexico, is complex and does not optimize the roles of local, state and national entities in securing long-term, sustainable management. For example, limited capacity and unaligned policies do not facilitate basin-level strategic planning, provide perverse incentives regarding prioritization of investments, and do not adequately encourage the development of sustainable mechanisms for the operation of environment-related investments, such as water utilities.
As the Mexico Infrastructure Public Expenditure Review (World Bank, 2005) points out, there are several important weaknesses in the sector’s performance:
· Poor service quality, as measured by a high incidence of intermittent supply affecting 55% of connected households;[1]
· Low operating efficiency, as measured by high levels of non-revenue water averaging 44% compared to less than 23% for well-run utilities and for the best utilities in Mexico.
· Low collection efficiency estimated at 69%, meaning that on average 31% of the amounts billed are never paid, compared to 98% for well-run utilities in Mexico and abroad.
Clearly, the weakness of the municipal water service providers puts at risk the sustainability of new investments in wastewater management. These issues have to-date impeded the development of a solution for the Rio Apatlaco Basin.
Given this, the Comisión Estatal de Agua y Medio Ambiente (CEAMA) has requested Bank support to develop and implement the Environmental Recovery of the Apatlaco River Basin Project. The proposed project would enable the recovery of ambient environmental conditions in the Basin, and promote their long-term sustainability. Specifically, the proposed project would support the State of Morelos in improving their strategy for Apatlaco Basin management, financing priority investments to achieve environmental quality improvement, enhancing institutional arrangements and strengthening related capacity to enable the long-term sustainability of such investments.
The proposed project is fully consistent with the current Country Partnership Strategy (2004-2008). For example, the project’s efforts to improve access to sewerage and wastewater treatment support the CPS aims to reduce poverty and inequality through improving access to basic infrastructure. Likewise, activities to improve ambient environmental quality will benefit excluded groups (including rural poor) among others. Similarly, the project’s efforts to improve water quality for agricultural uses will result in enhanced competitiveness, through improving agricultural production quality. The project’s strong emphasis on strengthening institutions responsible for environmental quality in Morelos include activities such as participatory strategic planning (including a Strategic Environmental Assessment, or SEA) which promotes the role of civil society in governance, and is expected to improve the environmental governance framework within the state. Lastly the project supports the CPS’ efforts to improve environmental sustainability through better environmental governance, enhanced decentralization of environmental management responsibilities, stronger institutions, mainstreaming environmental considerations into sectoral strategies and promoting longer-term strategic planning.
Likewise, the project is closely aligned with Mexico’s National Development Strategy (Plan Nacional de Desarrollo 2007-2012), which focuses on five pillars, notably including promoting economic competitiveness, environmental sustainability (including water, solid waste, enhanced capacity for environmental management, and public participation) and effective and responsive democracy. Moreover, the project is included within the National Infrastructure Program (Programa Nacional de Infraestructura 2007-2012).
2. Proposed objective(s)
The Project Development Objective (PDO) for this project is to improve the ambient environmental quality of the Apatlaco River Basin, and the quality of life for Basin residents through the rehabilitation and extension of sanitary infrastructure and the strengthening of the institutions operating and maintaining it.
The development objective outcome will be measured by: (i) reduction in pollution levels of the Apatlaco River; (ii) increase in share of waste disposed of in sanitary landfills; (iii) perceived improvements in quality of life by the population as depicted in annual surveys.
3. Preliminary description
In order to achieve the project development objective, the project will tackle the main sources of contamination through investments in sanitary infrastructure (wastewater treatment plants, sewer systems, sanitary landfills), while in parallel creating the basis for the sustainable operation and maintenance of this infrastructure through targeted institutional strengthening of the sector’s institutions. For that purpose, the following components are proposed.
Component 1: Wastewater Treatment Investments
Clearly the most important source of pollution in the Apatlaco River Basin is untreated wastewater from domestic and industrial sources. This component will support the rehabilitation and construction of wastewater treatment plants. The first year of investment will target the most urgent needs, such as through constructing priority treatment plants to address large untreated discharges. In parallel, Component 4 will support the preparation of a Strategic Environmental Assessment to help CEAMA set priorities for subsequent investments – both in terms of types of activities, geographical scope and level of treatment needed.
This component will not be limited to classical wastewater treatment plants, but may also include incentives for cleaner production technologies or other similar measures aimed at decreasing the volume and polluting charge of effluents being discharged into the Rio Apatlaco without treatment. In addition, this project will include the sewer mains connecting the new WWTP to the existing systems.
Under this component, all works and studies will be conducted by CEAMA and may then be transferred to municipalities if they demonstrate their capacity (technical and financial) to operate and maintain the infrastructure. Initial operation of the new infrastructure may be left with the Contractors for a limited period of time to allow municipal operators to build their capacity in maintaining and operating it.
Component 2: Solid Waste Management
Poor solid waste collection and uncontrolled dumping has been recognized by the State administration as a major issue in the Apatlaco River Basin. The area includes a number of open dumps, some of them within the flowpath of the river’s tributaries. In addition, regular dumping of household wastes into urban waterways (Cuernavaca in particular) significantly impacts the landscape. While solid waste collection is a municipal competency, there is a strong technical rationale for seeking a final disposal solution that is inter-municipal, as only Cuernavaca generates sufficient waste to warrant an independent sanitary landfill. As such, this component will support initiatives to encourage smaller municipalities to join forces to solve their solid waste problem, through the creation of one or more “regional” sanitary landfills, as well as possibly through the construction of up to four solid waste transfer facilities. This component will also include a strong communication campaign to raise collective awareness to the problems created by uncontrolled dumping of solid waste.
This component would be executed by CEAMA.
Component 3: Municipal Utilities Strengthening
In Mexico, provision of water, sewerage and waste collection services is the legal responsibility of the municipalities. This component will therefore focus on strengthening the municipal service providers so that they can financially and technically operate and maintain the investments supported through other project components. This component will also improve the capacity of those service providers to collect waste and wastewater through selected investments in the rehabilitation and / or the extension in sewer networks and solid waste collection equipment and infrastructure. Toward this aim, the component will fund efficiency improvement programs in water utilities to strengthen and bring them to reasonable levels of management, operational efficiency and financial viability, as well as selected infrastructure. Table 1 below shows typical activities to be financed under this component.
Table 1 – Key Actions to be financed under Component 3
Technical Efficiency / Commercial Efficiency / Institutional Development / Rehabilitation and ExtensionEfficiencies:
- Hydraulic
- Physical
- Electromechanical
- Water Quality / Efficiencies:
- Cadastre and customer databases
- Micro-metering
- Consumption estimates
- Billing
- Collection
- Tariff studies
- Control of supplies and stock management
- Transport
- Social communication and customer service / Efficiencies:
- Business organization
- Human Resources development
- Leadership
- Staff Training and capacity building
- Financial management
- Customer service and relations
- External and internal communication
- Accounting systems / In participating municipalities
- Rehabilitation of existing water and wastewater networks
- New water and wastewater connections
- New primary and secondary water and wastewater network
This component would be executed by the municipal operators with financial support from CEAMA.
Component 4: Strategic Basin Management
The previous three components target mostly urgent problems and provide technical solutions to well-identified needs. However the long-term, sustainable recovery of the Apatlaco River Basin will require actions that tackle deeper institutional, economic and environmental challenges. This component will support a series of specific activities and pilots aimed at exploring longer-term solutions. Among others, this component will:
· Support the development of a clear long-term vision for river basin quality, through Strategic Environmental Assessment, technical modeling, economic and financial evaluations and public consultations. This long-term process will build on on-going efforts by the National Water Institute of Technology (IMTA – Instituto Mexicano de Tecnologias del Agua), based in Morelos, and become an iterative instrument to set priorities, evaluate trade-offs, and enable decisions on public environmental spending in the Basin.
· Establish a system to compensate for differences in economic costs and benefits that municipalities are receiving through the project, either through a compensation fund or through a basin-level operator for the infrastructure, financed under the project;
· Develop pilot programs to address issues threatening water quality such as deforestation through illegal logging in protected areas of the upper river basin or erosion stemming from poor agricultural practices in the lower basin.
· Strengthen CEAMA in its capacity to monitor environmental quality at the Basin level, among others through support for a certification to ISO 14000 standards of CEAMA’s operation.
4. Safeguard policies that might apply
The project preliminarily triggers the following Safeguard policies:
Environmental Assessment (OP 4.01)
The project is proposed as a Category A project, given the scope of activities (especially those related to waste water treatment and solid waste). The team is supporting CEAMA in preparing a Category A-level Regional EA, which will include an Environmental and Social Management Framework outlining the specific procedures to manage potential expected impacts. The EA will also include an evaluation of the applicability of other safeguard policies to the project.
The project is also expected to include a Strategic Environmental Assessment (SEA) as a key activity during project implementation. Specific recommendations of the SEA will guide the selection of activities to be financed in later project stages. Likewise, the SEA will set forth institutional strengthening targets to be implemented through Component 4.
Natural Habitats (OP 4.04)
The project aims to improve the environmental conditions of the Apatlaco River, thereby improving the quality of natural habitats. That said, project activities could theoretically impact existing natural habitats depending on their location. The project ESMF will include necessary screening criteria to avoid and/or minimize impact to such natural habitats.
Forests (OP 4.36)
The project may include pilot reforestation activities to improve water quality in the basin. This will be clarified during project implementation.
Pest Management (OP 4.09)
Depending on the scope of project activities, pesticide management could be involved. If so, the ESMF will include specific provisions to ensure that less-hazardous pesticides are used (e.g. not Category IA or IB), that pesticide safety equipment and technical assistance is provided through the project to ensure safe handling of such products.
Physical Cultural Resources (OP 4.11)
As the project will be supporting civil works activities, the ESMF will include "chance find" procedures setting forth the measures to be taken in the event that culturally significant materials are discovered during excavations.
Indigenous Peoples (OP 4.10)
The Apatlaco Basin is home to indigenous communities that would be expected to benefit through the project. An IPF is being prepared to ensure activities are culturally compatible.
Involuntary Resettlement (OP 4.12)
While not expected, civil works might result in minor resettlement. A Resettlement Framework is being prepared to outline the procedures that would be used in such a situation.
5. Tentative financing
Source: / ($m.)Borrower / 150
International Bank for Reconstruction and Development / 50
Total / 200
6. Contact point
Ann Jeannette Glauber, LCSEN – Phone No. 202 473-3426
[1] According to the 2000 census.