IWK plans to shift towards achieving financial, operational and environmental sustainability and has earned the licence to operate through CA’s extension

by IWK

WATER and sewerage service providers are urged to generate non-tariff-based revenues, especially from water recycling activities for non-potable use, in line with the Water Sector Transformation 2040 (WST 2040) agenda and the Integrated Water Resources Management.

Environment and Water (KASA) Minister Datuk Seri Tuan Ibrahim Tuan Man said WST 2040 will introduce a strategic direction to ensure the water sector becomes a dynamic growth driver.

“We take water matters for granted, consuming 230 million litres per day (MLD) in 2019, higher than the 226 MLD in 2018. Additionally, many are unaware that the wastewater they produce must be treated before being released into waterways.

“Discharged treated effluents can be reused, hence, KASA targets to produce 1,500 MLD of reclaimed water from treated effluent by 2030,” he added.

The use of the National Water Balance Management System would be expanded to provide comprehensive real-time data, while water and sewerage providers must study ways for generating revenue from water recycling.

For that, Indah Water Konsortium Sdn Bhd (IWK) plans to shift towards achieving financial, operational and environmental sustainability and have earned the licence to operate through the extension of the concession agreement (CA).

With this, IWK can explore and expand its core businesses to be more sustainable.

Scheduled to end on March 31, 2022, the CA was extended to 2034 based on IWK’s successful performance in managing the country’s sewerage system and assets, including over 7,000 sewage treatment plants and pipes stretching 22,000km.

IWK was also tasked to maintain about 1.3 million individual septic tanks and over 1.4 million traditional toilet tanks.

The non-tariff business activities are expected to reduce IWK’s financial burdens and ensure the country’s sewerage services industry’s sustainability, while it continues to migrate to a service licensing regime soon.

Working closely with each state’s water operator, IWK currently reclaims water from treated effluent in Klang Valley and Melaka. Prior to that, it had initiated and completed joint-billing exercises in Labuan and Terengganu.

Malaysian Water Association president Dr Mohmad Asari Daud said originally the sewerage system was managed by local authorities which were not holistic and coupled with the increase in population, the level of river pollution and drainage systems increased.

“As such, the government enacted the Sewerage Services Act 1993, which gives it full responsibility and authority for developing, managing and regulating sewerage affairs. It was then that IWK became the sole sewerage concessionaire to operate and manage all public sewerage systems since 1993.

“The introduction of a systematic approach for a reliable and efficient sewerage system management has contributed greatly to protecting public health, preserving water resources and enhancing environmental quality,” Mohmad Asari said.

KASA secretary general Datuk Seri Dr Zaini Ujang said water services and sewerage services operators must comply with the Water Services Industry Act 2006. They must shift towards a service licence regime, requiring an approved business plan from each operator towards greater governance and transparency to achieve a holistic and viable water services industry.

On allegations that treated sewage from IWK was the main source of pollution to the waterways, IWK CEO Narendran Maniam said there are many sources of pollutions including private farms, manufacturing and agricultural industries, illegal factories and wet markets.

There are also about 1.3 million septic tanks in Malaysia, where approximately only 10% are desludged regularly.

The desludging regulation came into force in March 2021, which requires premises with septic tanks to desludge once every two years. Additionally, Suruhanjaya Perkhidmatan Air Negara (SPAN) through IWK has been educating the public and acceptance of scheduled desludging has increased.

For every load of wastewater treated per population, IWK’s sewage treatment plants (STPs) produced better effluent discharge quality that can be safely released into the waterways or rivers.

IWK recently received funds from the sewerage capital contribution (SCC) for upgrading works on STPs, which require much planning and discussion with the necessary parties as IWK manages over 7,000 plants nationwide.

“Plants vary in location, a number of population equivalent served, treatment processes and age, among others. The estimation is based on the equipment and location of the plants that require urgent refurbishment work according to the standards stipulated by the Department of Environment.

“Once a detailed plan is laid out, IWK will request for the funds from SPAN, who oversees the SCC fund and will review all plans accordingly before giving their approval for the fund,” he explained.

In 2020, SPAN approved RM142 million to upgrade 644 out of the identified 2,950 STPs to meet the new Environmental Quality (Sewage) Regulations (EQSR) standards. These upgrades will ensure proper functionality, resulting in better compliance to the discharged effluent standards in accordance to EQSR 2009.

“We plan to upgrade the remaining 2,306 STPs within the next five years,” Narendran said. Through the 12th Malaysia Plan, the government is looking into converting proposed centralised sewage treatment facilities into centralised water reclamation facilities that can supply water for non-potable use.

KASA intends to leverage this existing synergy in the sewerage industry and collaborate with the states and their water operators to further enhance Malaysia’s IWRM. As the building blocks for a solid foundation in water management are being laid, we can be a regional water hub from which our neighbouring countries can learn.