Peru to pump US$160mn into municipal water companies

Tuesday, March 13, 2018

Peru's government aims to invest 532mn soles (US$160mn) this year to overhaul the country's bankrupt municipal water companies known as EPSs, a senior official said.

State water regulator OTASS, which does not plan to raise water rates, is already operating a dozen of the country's 47 bankrupt EPSs, state water utility Sedapal's CEO Edmer Trujillo said.

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The government has already transferred 412mn soles to the EPSs, which on average only supply water 14.5 hours a day, while some only provide water for an hour a day, Trujillo said.

The government aims to install 180,000 water meters for the EPS that require state support, he said, adding water companies need to reduce the number of clients in arrears. Customers of the EPSs in southern coastal town of Pisco, for example, owe the company 1mn soles, according to Trujillo.

"We're in a process. The EPSs must gain efficiency," Trujillo told government newspaper El Peruano in an interview. "By December we will ensure that none of the sectors within the sphere of influence of these companies receives less than six hours a day of service."

President Pedro Pablo Kuczynski has launched a 50bn-sol (US$15bn), five-year water investment program in a bid to extend potable water and sewerage services to 100% of the urban population by 2021

Peru only treats 15% of its sewerage nationwide. Municipal sewage treatment plants to be built include Piura, Ayacucho, Huaral, Chiclayo, San Martín and Puno.

The government program is designed to copy the model established in Lima (La Chira, La Taboada) and Arequipa (La Enlozada), where private companies invested hundreds of millions of dollars in solutions for the country's two largest cities' pollution issues.