With good planning, water companies can prosper

Children accompany their parents to collect water from a newly installed water point. What do you get when you mix a company with a small customer base, low revenues, a leaky and costly supply chain and a lack of funding? Usually, this is a recipe for the end to any enterprise. But in Kenya, this is too often what water utilities face on a daily basis.

KIWASH is working with these companies to try to reverse this pattern and turn water utilities into growing, prosperous companies. One of the most important tools we use is the strategic plan. While this may not sound very exciting, the process of developing these plans can be transformative for a water service provider.

For example, one of the first steps in developing a strategic plan is to take a baseline assessment of revenues, customers and water use. More often than not, this step reveals that the water utilities are losing money through non-revenue water, which is the difference between the volume of water pumped and what is sold to customers. It might include unbilled or unmetered consumption, illegal consumption, metering inaccuracies, or leakage in distribution pipelines, service connections or storage infrastructure. This helps the company understand where they are losing water – and from there they can take steps to reduce these losses and improve service for customers.

The strategic plans are also key in finding sources of funding for the utilities to improve services and expand coverage. For instance, in Kitui and Makueni counties, five water utilities have developed comprehensive investment strategies that they are now preparing to present to their county governments, development partners and other potential investors.

And in Kakamega County, KIWASH supported the county water and sanitation company to develop an investment proposal for KES 120 million to connect 6,000 households to new and improved water and sanitation services in Mumias town. So far, the county government has provided an equity contribution of KES 23 million, and the company will seek commercial financing of up to KES 97 million with local commercial banks.

In total KIWASH has supported 13 water utilities in the development of strategic plans, including three in 2018 alone. These plans, coupled with capacity development and improved corporate governance, have helped to build a strong foundation upon which the water utilities can grow.

Effective water services and the safe disposal of wastewater are essential for the health and prosperity of a country. Thanks to the efforts of KIWASH, now 13 utilities have the knowledge, capacity, and an achievable roadmap to help guide and transform them into healthy and expanding companies that are increasing access to clean and reliable water for more Kenyans.

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