european water and sanitation service vs sustainable ... · städtische werke magdeburg gmbh...

Städtische Werke Magdeburg GmbHManagementAss. jur. Helmut HerdtParis

17.11.2009

European Water and Sanitation Service vsSustainable Development

Helmut Herdt , Städtische Werke Magdeburg GmbH Seite 2

1.Short Presentation SWM Magdeburg

2. Drinking water supply Germany

3. Example: TWM

4. Effects of Urban Development East on the technical infrastructure based on the example of SWM Magdeburg

5. Contact Data


MAGDEBURG

Magdeburg

Saxony Anhalt


1. SWM Magdeburg: Facts and Figures

Shareholders:State capital – Magdeburg 54%

E.ON Avacon AG 27%

Gelsenwasser AG 19%

2008 Financial Year

Turnover: approx. EUR 393 million

Employees 704

Trainees 50


1.1. Short Presentation - Our Areas of Business

I Electricity

approx. 135,000 private customers, market share a good 95%, effect of customer

switching continues to be marginal

Business and special customers: Magdeburg and nationwide customer acquisition

Target group: "medium sized businesses" - SWM advantage: fair prices with high

service quality and flexibility

I Natural Gas

approx. 35,000 private customers, market share of 98%

Business and special customers: Magdeburg and nationwide customer acquisition

SWM advantage: fair prices with high service quality and flexibility

I Heat

District and local heating, largest customers: housing associations and co-

operatives, high proportion of multi-storey residential buildings in eastern Germany


1.2. Other Activities and Holdings (1)

I Drinking Water

Supply of 230,000 Magdeburg residents with drinking water from Colbitz-Letzlinger

Heath

I Waste Water:

first and one-of-a-kind transaction in Germany: invitation to tender for a license for

waste water 100% holding in AGM, technical and commercial

management by SWM

I AGM: Abwassergesellschaft Magdeburg mbH

I SWN: SWM Netze GmbH

Electrical grid operator, prices are regulated by the Federal Network Agency



I Waste-to-Energy Plant: Müllheizkraftwerk Rothensee G mbHOne of the largest waste-to-energy plants in Germany, 2008: 630,000 tons, produces district heat for 30,000 households, power generation for SWMShareholders: 49% SWM, 51% EEW (E.ON Energy from Waste)

I SWS: Stadtwerke – Altmärkische Gas-, Wasser- und Ele ktrizitätswerke GmbHAreas of business: power, natural gas, water, heat, waste water operationsShareholders: SWM: 37.45%, Gelsenwasser: 37.45%, City of Stendal: 25.1%

I MDCC: Magdeburg-City-Com GmbHTelecommunications services in the state capital and Saxony-AnhaltShareholders: 49% SWM, 51% Telecolumbus Multimedia GmbH

I ENERMESS: Energie Mess- und Servicedienste GmbHMeter manufacture and repair, metering services, SWM holding: 40.5%



I HSN: HSN GmbH

High voltage networks in the state capital, Magdeburg, and northern

Saxony-Anhalt

Shareholders: 74.9% E.ON Avacon, 25.1% SWM

I TWM: Trinkwasserversorgung Magdeburg GmbH

(Public Water Utilities Magdeburg)

Supply of drinking water to 18 public water utilities and 6 districts

SWM holding: 29.8%

I MHG: Magdeburger Hafen GmbH

largest inland harbor in central Germany

SWM holding: 10%


1. Brief Portrait SWM Magdeburg

2.Drinking water supply Germany

3. The example: TWM

4. Effects of Urban Development East on the technical infrastructure based on the example of SWM Magdeburg

5. Contact Data


Public Water Supply in Germany (1/3)


Cost structure in Water supply


Development of the Water consumption (1/2)


Development of the Water consumption (2/2)


Water Delivery Volumes


Customer satisfaction


Connection degree


Water losses and network quality (1/2)


Water losses and network quality (2/2)


Investment


Water prices


Climate Changes (1/2)


Climate Changes (2/2)


Population Development




3.The example: TWM

4. Effects of urban development East on the technical infrastructure based on the example of SWM Magdeburg

5. Contact Data


Company Portrait TWM (1/3)

Established: 19th April 1994

Shareholders: 19 shareholders in total

(almost all customers are shareholders )

29.80 % Staedtische Werke Magdeburg GmbH

Employees: 111, plus 10 apprentices

Fields of activity: drinking water, treatment of water for various

local energy providers and water associations



I TWM GmbH is a preliminary supplier for large customers in 6 districts and

2 independent cities

I TWM GmbH supplies almost 800,000 residents with drinking water in a supply

area comprising 5,600 km2

I 338 cities and municipalities are supplied via 220 drinking water connecting

points

I The facilities of TWM GmbH for acquiring and treating water enable a daily

production capacity of approximately 200,000 m3

I The expansion of the corresponding drinking water protection areas

encompasses 31,745 ha

I The primary water utilities are the water utilities Colbitz and Lindau



Haldensleben

Magdeburg

Dessau-Roßlau

Wittenberg

Burg

District of Jerichower Land

District of AnhaltBitterfeld

Wittenberg District

Harz District

BördeDistrict

WZV LK Schönebeck

Heidewasser Burg

HeidewasserTucheim

Heidewasser Zerbst

WV Burg

Heidewasser Gommern

TAV Menz,Wahlitz

WAZV "Bode-Wipper"

SW SchönebeckSchönebeck

SW Magdeburg

Köthen

Bernburg

Heidewasser Roßlau

HeidewasserROVEG

DESWA(ROVEG)

HeidewasserTornau

SW Lu.Wittenberg

Dt.Hydrierw.Rodleben

WWAZ

Heidewasser Haldensleben

SW Haldensleben

TAV Börde

WAZV "Huy Fallstein

WAZVHuy Fallstein

Halberstw.GmbH

SW Wernigerode

AV Blankenburgunder certaincircumstances

TAV "Oberharz"

WernigerodeStassfurt

Zerbst

Salzland District


Demographic Development in Saxony-Anhalt

General Population Development in the State of Saxony-Anhalt

in the base year 2005 *1) : 2,469,716 residents

Forecast year *2) : 1,976,237 residents

Forecast year 2050*3) : 1,562,000 residents

Sources: *1) Regional Statistics Office Saxony-Anhalt, Halle; *2) "4th regionalised population projection 2005 to 2025", Regional Statistics Office Saxony-Anhalt, Halle; *3) "11th coordinated population projection", Federal Statistics Office, Wiesbaden; *4) own calculations on the basis of data material published by the State/Federal Statistics Office

Forecast: The number of residents supplied by TWMdrops by 30.5% in 2050 to 544,997 residents *4)


Water consumption in 2007

The share of water consumption attributed to industry amounts to less than 5%. The compensation of the demographic decline by industry is therefore not an option.

Total volume supplied: 39,296,806 [m3/a]

thereof not including industry: 37,488,215 [m3/a]


The average consumption of TWM customers is considerably above the state average

12691

13195

126108110

68114

125128

93108

132137

13097

132140138

104132

137125

215128128

0 50 100 150 200 250

Durchschnitt Deutschland (2004)Durchschnitt LSA (2006)

Durchschnitt Kunden (2007)DESWA(ROVEG)

TAV BördeSW Lu. Wittenberg

Heidewasser/ROVEGHeidewasser TornauHeidewasser RoßlauAV Blankenburg u.U

WZV LK SchönebeckTAV Wahlitz/Menz

Heidewasser TucheimHeidewasser Gommern

SW SchönebeckWV Burg

WAZV Huy FallsteinHalberstadtw. GmbHHeidewasser ZerbstHeidewassser Burg

Heidewasser HDLStädtische Werke MD

WWAZ WolmirstedtTAV "Oberharz"

SW WernigerodeSW Haldensleben

WAZV "Bode-Wipper"

Spezifischer Verbrauch in [l/EW*d]

Vergleich der spezifischen Verbräuche bei den EW de r TWM-Kunden Comparison of Specific Consumption Levels of reside nts in the TWM customer areas

Specific Consumption in [L/resident*d]


Projections of the annual total supply volume of drinking water from 2005 to 2050 (based on various assumptions)

Jahr 2007 Jahr 2025 Jahr 2050

bei gleichem spezif. Verbrauch (V1) 37.487 31.025 26.069

bei Rückgang um jeweils 5% (V2) 37.487 29.474 23.532

bei Rückgang um jeweils 10% (V3) 37.487 27.922 21.120

0

5.000

10.000

15.000

20.000

25.000

30.000

35.000

40.000

Tm

3/a

Entwicklung der jährlichen Gesamtlieferung in Tm3/aDevelopment of Total Annual Supply in Tm 3/year

with unchanged consumption (V1)

with 5% decline respectively (V2)

with 10% decline respectively (V3)

Year 2007 Year 2025 Year 2050


Summary of the Projections

• Demographic declines directly influence the turnover volumes of TWM GmbH

• Declines in drinking water turnover associated with population levels from approximately 37,000 Tm3/year (2007) to approximately 26,000 Tm3/year (2050) are anticipated (statistical calculation variant)

• As an example, it was assumed that the consumption behavior (specific consumption in I/resident*d) would drop by 5% and/or 10% (theoretical trend estimate).

• A 10% drop in the specific consumption would correspond to a decline in turnover totalling approximately 21,000 Tm3/year

Irreversible trend:Declining turnover across the entire supply area that would impact the entire network system:

• Insufficient capacity utilization of water utilities, technical facilities, network areas

• increase in costs attributed to the fixed cost trap


Strategies to adjust to the new challenges

Strategies Costs

Demand / Consumption

Production /Distribution

Waterresources


Strategies to adjust to the challengesDemand/Consumption

Decline in water consumption

due to:

Additional water consumption

due to:

Declining population across

the entire supply area

Irrigation by agricultural

operations

Decline in production

attributed to industry and

the trades

Development of new industry

and the trades

Decline in specific

consumption

Rinsing of the line systems

Opposing Trends in Water Consumption


Strategies to adjust to the challengesDemand/Consumption

Approaches in Policy:

• Influence policy to reduce the number of industrial consumers with their OWN water supply

• Irrigation by agricultural operations

• There are limits on TWM's sphere of influence

• Development of strategies to adjust to the uncontrollable trends

• Partnership in large regions

To what extent can TWM influence the demand/consumption?


Strategies to Adjust to the New ChallengesWater Resources

Evaluation

• of present quantity and quality of the resources and the future trend

• current water rights, drinking water protection areas (adjustments to

future conditions)

Examples:

• Project for managing the river Ohre in consideration of climate change(water resources for infiltrating the water utility Colbitz)

• Project for potential management of Westfläming (water utility Lindau)with reassessment of TWSZ


Strategies to adjust to the new challengesProduction/Distribution

• Situation: Production in 19 water utilities, thereof 2 primary water utilities

• Plan: Shut-down of small water utilities, optimized operation of remainingwater utilities

Distribution:

Situation:

at present, the network capacities are already not fully utilized

Plan:

• Optimization by means of shut-down/downsizing and/or newconnections

• separate solutions for decentralized areas

• Collaboration with the TWM customers to optimize the utilizationof network capacities

Production:


Strategies to adjust to the new challengesProduction/Distribution


Summary

Population Decline in the Supply Area

declining drinking water turnover - new challenges

I Aspects of demand/consumptionI Water resourcesI Production/distributionI Costs

Analysis of the supply area with respect to critical points Drafting of a sweeping, sustainable concept that implements

appropriate technologies

Question: How much water can we provide to whom at what price in consideration of circumstances?



2. Example: TWM


4.Effects of Urban Development East on the technical infrastructure based on the example of SWM Magdeburg

5. Contact Data


4.1.CURRENT Situation: Population Trend

1990 2000 2008 20202.873.957 2.615.375 2.381.872 2.115.271

State capital Magdeburg(Source: SC Magdeburg)

1990 2000 2008 2020 2025278.800 231.450 229.250 212.600 208.300

State of Saxony-Anhalt(Source: Ministry for Regional Development and Transport)


4.1.CURRENT Situation: Problem Areas in Supply

I Massive investments have been made since the early 90's

I Considerable improvement in the security of supply and disposal and environmental quality

I Economic change and change in the social structure

I Population decline and migration

I Technical infrastructure capacities not fully utilized = immenseoperational problems

I Shut-down of facilities - permanent losses in value

I Effects on the financing structure (amortization)

I Additional operating costs and capital costs for necessary measures to adjust the technical infrastructure


4.2. Presentation of the Federal Government Funding Programs (1/2)

What qualifies for funding?

A Measures for continuing with the city developmentconcept, further preparation, planning, andpublic relations

B Regulatory Measures - Conversion of the technical infrastructureI Facilities for supplying electricity, gas, water and heatI Facilities for treating and disposing of wastewater

Funding of regulatory measures and facilities owned by third partiescurrently amounts to no more than 50 % of the fundable costs.

Urban Development East –Program part "Upgrading of City Districts and Quart ers"


4.2. Presentation of the Federal Government Funding Programmes (2/2)

Funding of flat building Funding of urban construction

Funding of flat buildingUrban development - East

Guidelines for upgradingflats

Flat ownershipguidelines

Funding of flat buildingGeneral

Guidelines for upgradingflats

Flat ownershipguidelines only for housing companies

Upgrading of citydistricts and quarters

Downsizing of flats withpermanent vacancies

also for utilities


4.3. Experience Urban Development East from SWM'sStandpoint (1/3)

Application period

Program years 2002 up to and including 2009

(financial years 2002 to 2013)

Total investment*

EUR 35.00 million

Amount of funding applied for *

EUR 17.50 million

Funding received

EUR 0.19 million

*Multiple responses possible with new applications due to notices of refusal


4.3. Practical Experience Urban Development East f rom SWM's Standpoint (2/3)

0,19

24,13

3,560,64

Öffentliche Hand Ver- u. Entsorgungsunternehmen Wohnungswirtschaft Private

Urban Development East in Magdeburg - Program Part UpgradingOverview approvals sorted by grant recipientsProgram years 2002 – 2009 (As of: 23.10.2009)

(Source: BIG Städtebau Saxony-Anhalt)

Total Grants:EUR 28.52 million

Grants to SWMEUR 0.19 million.

Public sector utilities and waste management companies

Housing companies


4.3. Experience Urban Development East from SWM'sStandpoint (3/3)

Circumstances

I Evaluation of Urban Development East first period is complete

I Continuation of Urban Development East has been decided on with

final effect up to the program year 2016

I The results of the evaluation and design of the urban development

program's content including the technical infrastructure will be published in

detail

however

the technical infrastructure based on the practice observed on the part of

Urban Development East to date has not been considered and/or only to

an insufficient extent


4.4. Problem Areas with the Drinking Water Supply ( 1/5)

The drinking water supply network must fulfill two basic conditions:

I Supply of recipients with sufficient quantity and quality

I Compliance with requirements of disaster protection(fire fighting)

Generally the fire-fighting requirements are decisive in termsof dimensioning.

I Based on today's regulations, most drinking water pipescould be reduced to at least half their current size for reasons relating to fire prevention.

I However, the decline in consumption – by means of which the networkis financed – must be assessed as being much greater.



Consequences of over-dimensioning

I lowest flow rates and

I resultingly long dwell times of drinking water in the network

Operational consequences

I formation of deposits (growth in the lines)

I Increase in drinking water temperature and consumption of oxygen

I excessive bacterial growth and accumulation of germs

Long-term consequences (if action is not taken in time)

I considerable financial difficulties

I considerable communication expenditure on the part of the utility

and

I damage to the utility's image and that of the residential area


0.05.010.015.020.025.030.0

mea

ndw

ellt

ime

[d]

1990 2000 2007 2010

mean dwell time in Magdeburg - Olvenstedt


maximum permissible dwell time

I The dwell time was calculated with the mean flow rate and the network length

I based on experience, dwell times of greater than 5 days should be avoided

1990 5.02 0.40

2000 17.49 0.90

2007 22.09 1.60

2010 28.98 1.60

Magdeburg StendalOlvenstedt South

Mean dwell time [d]

Year

Simulation of the drinking water network Magdeburg – Neu Olvenstedt



Investment costs Halle Magdeburg Dessau Stendal totalSilberhöhe Olvenstedt Zoberberg Süd[€ million] [€ million] [€ million] [€ million] [€ million]

Investments district heating 3.04 1.86 0.36 1.63 6.90Investments drinking water 1.78 2.61 0.30 1.07 5.76Investments wastewater 2,39 1,87 0,24 0,95 5,45Sum 7.21 6.34 0.90 3.65 18.11

Capital costs Halle Magdeburg Dessau Stendal totalSilberhöhe Olvenstedt Zoberberg Süd[€ million] [€ million] [€ million] [€ million] [€ million]

Capital loss district heating 2.88 2.03 0.14 3.48 8.53Capital loss drinking water 1.20 2.12 0.17 0.50 3.99Capital loss wastewater 1.72 1.35 0.17 1.07 4.31Sum 5.80 5.50 0.48 5.05 16.83

Costs of Adjusting the Technical Infrastructure by 20 09



Summary:

I The network must be downsized where it is no longer needed.

I In general, the network is too large and large sections must be reduced in size.

I The capital value of the old network must be written off as a loss.


Redimensioning of a network in a Magdeburg quarter (1/2 )


Redimensioning of a Network in a Magdeburg quarter (2/2 )


4. 5. Closing Remarks

I The urban development process to date demonstrates that not

only disposing of vacant residential complexes, but also adjusting

the technical infrastructure is a task of considerable economic

proportions.

I Adjusting capacities is the only way to succeed in order to also

guarantee security of supply and high energy efficiency and

water quality in future while maintaining affordable prices.

I Stakeholders are also affected by requirements in terms of energy

and climate policy - the challenge associated with the issue of

"energetic urban renovations/ energy-efficient city" affect the

whole of society as well as the adjustment to climate change.


4. 5. Closing Remarks

Guaranteeing the sustainability of cities is not only the task of the communities, the housing and public utility industry!

But also:

I Cooperation and involvement in partnership of all stakeholders associated with urban development

I Collective action and an interdisciplinary collaboration are needed

I Adjusting the technical infrastructure to declining demand is a task of considerable economic proportions


4.6. Approaches

I The federal government, states, and municipalities must assume joint responsibility and work closely together with the housing,public utilities, and waste management companies

I Urban development funding as a collective task must be expanded to include all departments promoting infrastructure (Ministry of the Economy and Environment), that is, funding eligibility criteria and/or mechanisms must be readjusted, limiting funding to urban development areas does not make sense, inclusion of EU economic funding programs to support economic development

I All funding programs in this context should undergo critical evaluation, a focus on future challenges


4.6. Approaches

Otherwise:

I considerable price increases on the part of public utilities andwaste management companies,

I excessive socialization of the costs for the remaining residents and customers

I existing local disadvantages for residents and the economy wouldcontinue to increase severely

Helmut Herdt , Städtische Werke Magdeburg GmbH Seite 61Helmut Herdt, Public Utilities Magdeburg GmbH

Any questions?

Then please contact:

Städtische Werke Magdeburg GmbH

Chief Executive Officer

Ass. jur. Helmut Herdt

Am Alten Theater 1

D-39104 Magdeburg

Telephone: +49 (0)391 587-2200

Internet: www.sw-magdeburg.de

E-mail: [email protected]

european water and sanitation service vs sustainable ... · städtische werke magdeburg gmbh...

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