PBAPP: Water surcharge; bottled water

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The Penang Water Authority (PBAPP), the most efficient water authority in the country, has decided to impose a ‘conservation’ surcharge of 24 sen per 1,000 liters on domestic consumers using more than 35,000 litres of water per month.

First let me say, the publicly owned PBA has done a brilliant job in keeping non-revenue water low at around 19 per cent. Its efficient management has put private water utility firms elsewhere in the country to shame. Despite low water tariffs, its efficiency has allowed it to make a profit before tax of RM16 million for 2009 (RM28 million in 2008) on the back of RM185 million (RM188 million in 2008).

And yes, there is a pressing need to conserve water as consumption per capita in Penang is higher than acceptable. The surcharge-free 35,000-litre threshold is based on the basic needs of a household of five. This move could curb wastage but a few critics have contended that such a surcharge could burden low-income households with large families. Conversely, excessive consumers in smaller households will be spared the surcharge. What are your views on this? Perhaps large low-income households could be exempted from the surcharge or the threshold for exemption could be raised for such households?

The other thing I noticed is that, from September 2009, the PBA has gone into the business of producing bottled water through a wholly-owned subsidiary, Island Springwater Sdn Bhd. The company owns a 765-sq-metre bottling treatment plant located at the Guillemard treatment plant.

The PBA needs to clarify:

1) what the environmental impact of producing bottled water is (plastic bottles?), and

2) if there is any potential conflict with its core activity of providing clean water to the whole state. What happens if there is a water shortage in the state and water rationing is required? Would Island Springwater still be guaranteed a regular supply? Would precious water resources be diverted to the bottling plant? Wouldn’t supplying murky water encourage more consumers to buy pricey bottled water?

First, bottled water diverts water from public use especially during times of water shortage and rationing. Second, through skilful marketing, the public is encouraged to pay grossly inflated prices for water that is in bottles. Third, plastic water bottles are an environmental hazard that goes against the vision of a greener Penang.

It is for these reasons that I don’t think it is a good example for a publicly owned water organisation providing an essential service like the PBA to be involved in producing bottled water. It is environmentally unfriendly and sets a bad example.

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wira

If the intention is to penalise user for wasting water, then the penalty should be per consumer based (or size of household, if undeterminable, to be based on the size of the house). It makes little sense if a household of 2 is given the same monthly allowance of penalty-free 35,000 litres as a 10 member household.

Otherwise, CM Lim’s effort will be seen as a back door method to raise water tariff.

Iron

In N9 and in Selangor the tap water is so dirty you have to filter it.

In Penang – most areas anyway – the water quality is still okay. Not perfect, but still much better than the one in N9 or Selangor.

The cleanest water source in the Peninsular is Taiping, Perak, btw.

Iman

In a household of 6, 3 kids and 3 adults, our latest bill indicated 25 kbm.(Condo) No particular water saving, laundry machine running 6 hours a day. No, I do not ‘pity’ those complaining of a surcharge above 35kbm a month! As an amount for ‘personal’ use, 35 kbm is far more than needed. However if you want to wash your cars daily, water the garden, high pressure clean the patio???? I’m sure an ‘inspection’ to those who are complaining will reveal a huge wastage including leaking taps and toilet floater valves just to mention the most common. The surcharge… Read more »

Sean

I was wondering today Anil, while I was sniffing the water from my tap to confirm the source of the awful smell (it was the water), how much water is wasted in Penang as a result of end-user filtering. Our outside water filter requires regular (we do it weekly) washing to remove a few kilos of tarry mud. It’s not a quick job, and the outlet from the main filter has a very large flow. We have a second filter under the kitchen sink for the water we use to drink and wash uncooked food with. That one is self-washing… Read more »

Iron

I wonder. I just have to wonder. Lim Guan Eng and his cohorts are getting paid by PBA to the tune of over RM 400,000 a year, and suddenly there is no one from the infamous DAP supporter club here offering any explanation ! All we hear are complaints against BN. True, BN is rotten to the core. But how about Lim Guan Eng and his cohorts, who are making over RM 400,000 a year, for doing close to nothing? What? The RM 400,000 isn’t money? Too little, is it? BN is rotten because BN has makan MILLIONS and BILLIONS,… Read more »

tunglang

If PBAPP can supply clean water for public consumption, why has it to indirectly compete in the bottled-water industry? Why can’t it leave it alone to the market forces to determine its sustainability and quality? Moreover, plastic bottles are not environment friendly, so for PBAPP to involve indirectly in this business is counter to its corporate mission’s environment policy. If PBAPP has too much cash, why can’t it help local SMIs and entrepreneurs invest in profitable businesses like local tropical fruit drinks, recycling, etc? And generates businesses and employment. Don’t think like the previous BN Gomen. Think out of the… Read more »

Iron

So you want PBA to change its subsidiary so it won’t offer bottled water in Plastic container?

How about Glass Bottles? Would that be acceptable for you?

Talk about brain, or the lack the of it !!

tunglang

Because there are some people like the previous BN Gomen that can only think of glass bottles to drunk their feeble minds! Too bad for Penang economy.
The bad facts are there for everyone to chew yet some still want to think incoherently in the doldrums, yearning for the years of KTK.

tunglang

Yes, there are ‘brainy’ species with glass bottle brains. Only lots of drain water in it!

Wong

PBA being a public listed company has about 10,000 shareholders. The PBA share price is dropping since Pakatan take over Penang to RM0.80/share recently (from RM1.30 during public offer for listing) . Without the revision in water tariff (in the form of water conservation surcharge), PBA share price will drop further and all the 10,000 shareholder will lost their investment.It will be a shame that the Penang State Government cannot even protect shareholders of their listed vehicle…let a lone attach new investment to the state.

tunglang

KTK and his greedy cohorts should not have done it in the first place – putting PBAPP on public listing. Yet they already reaped the first fruits and now the sour rotten fruits are thrown at LGE and his gang. So, what PBA has to do to bring back the share price? Divest of course. But the problem is to generate more income by increasing water rates from a public utility company may involve hardship on the poorer consumers. And investors who were used to the initial generous profits are not ready to absorb lower profits or loss in their… Read more »

Iron

Which means one thing – if you CARE for Penang, start buying the PBA share.

As part-owner you are eligible to attend the AGM and have a say.

ghkok

In my opinion, PBAPP should not venture into the “bottled water” business because it is a business that is best left to the private industry. PBAPP should concentrate on the basic business of supplying piped water. Supplying bottled water is a “value added” business and PBAPP being a govt-owned (?) enterprise should not compete with private enterprises. PBAPP can supply piped water to the bottling plants and charge a premium – no problem, but it shouldn’t compete with the bottlers. That’s my opinion.

Iron

What is wrong for a quasi-government company venturing in “Value-added” industry?

So long it is “Value-added” and not “Value-deducted” or even “No-Value-At-All”, what is wrong with it?

While it’s true, the CORE COMPETENCY of PBA is in ensuring a continuous supply of clean water for Penangites, as long as PBA isn’t directly involved in the bottled-water business (it is a subsidiary, isn’t it?), I do not see any reason to force PBA in pulling out its investment in the bottled-water subsidiary.

Iron

And by the way, Anil, I had no choice but to wonder why you oppose to PBA’s venture into plastic bottled water !

I do not see you objected to other brands of plastic bottled water before, Anil. Don’t believe me? Search this blog and see for yourself how many time Anil had uttered any objection over plastic bottled water.

Why are you picking on PBA? Just because it is an easy picking, Anil?

Happy

When was the last time you took a stand against Tesco for selling bottled water?

Sean

The environmental concern is just a side-issue, isn’t it? I had no idea there was so much money in bottled water before Anil published this article. Does every company that sells bottled water make so much money that they can afford to give RM50K to 14 people who don’t do anything? Opposition supporters who resent government interference or ‘participation’ in the private sector should also be against the idea of Island Springwater, I would have thought. Is the market for bottled water in Penang so under-supplied that the state can field its own entrant without taking business off the private… Read more »

Plain Truth

LGE together with the 13 other directors including our 2 DCMs were collectively given RM 423,906 in “allowances” according to PBA 2009 Annual Report.

LGE’s share was RM 52,125 which as someone else had pointed out was a shade less than the RM 52,900 that KTK took home in 2006 ( PBA 2006 Annual Report ).

All these are icing on the cake.

Iron

You think LGE and his cohorts gonna willingly give up the $$$?

You really think so???

All politicians are the same, they are all the “monicum” variety.

Anon

Civil service is exactly just that– service. They are a service to the public. It is expected with the taxpayer’s dollar that they do a top job. The taxpayer does and should not expect anything less. If the water authorities are doing a good job, then I should expect it to be. I won’t dish out any praise and I won’t hold back on any criticisms if the need arises. The civil service is there to provide a service to the public, not to make a quick buck, not to seek praise and not to line one ( or more)… Read more »

Iron

Please stop throwing accusations on PBAPP !

If you ever lived in Selangor you would truly appreciate what PBAPP has done for the Penangites. There is just no comparison what Selangor’s Syabas has done to what PBAPP is offering to the Penangites.

It is the Penangites who do not treasure the water, and I have seen too many cases of sheer waste of precious fresh water in Penang.

I will support PBAPP even if it raises the price to RM 240 per 1,000 liter of water.

Hoyohoyo

For a 7-member household, 35K litres of water means 167 litres per person per day, which is still higher than the Singaporean’s 155 litres/person/day… I personally think that if WCS is really an issue, a 7-member household will still be able to save their water consumption down to 167 litres per person per day. In fact a bigger household means less water consumption per person in the household’s common water usage items such as cooking/dish-washing/house-cleaning and etc. And if the household is bigger than 7, then too bad you just have to pay an additional 24 cents per 1000 litres,… Read more »

Ong Eu Soon

PBAPP should allow appeal from families with a household of more than five, the poor normal have bigger household of more than 5. PBAPP should review on case by case basic and give exemption to those who really deserve.
A very good move by PBAPP towards water conservation. One of the very few good moves implemented by LGe administration.

KM

Very objective and impartial comments, professionally done. Well done.

Sean

“surcharge could burden low-income households with large families”
Perhaps more expensive showers might dissuade them from having sex?
If we are to support the fecund poor then my wife and I would like to rent some of their wombs so that we can produce some of the children we didn’t have while we were busy working, please.

Sean

I don’t like means-testing and bands, I think it’s too easy to game them. Besides, if you’re a rich person with several properties in Penang, you’ll be benefiting from the poor person’s band in each home. Something similar goes for those who spend a great deal of time working ‘outstation’ (does that mean travelling for work?). Why not just raise the price of water and pay a per capita Cost of Living Allowance to every adult? A wealthy person would then be buying several times a small amount of water for her several properties with only her own COLA to… Read more »

tan, tanjong bungah

Hi Anil,

Your suggestion for those ‘poor’ families with many family members staying under one roof should be a basis for consideration by PBA. It’s up to PBA and the State Govt to modify the proposal, if necessary, to help such families on the water surcharge

Sean

It’s not a bad suggestion Anil, except that it would introduce more bureaucracy for the water supplier. I also dislike the idea of ‘benefits in kind’: it reduces the opportunity for the consumer or dependant to make choices. If you pay a COLA (say as a tax credit to every adult), then it’s up to the adult to choose whether to consume their allowance in water, or whether to conserve water and spend the money on something else. If you subsidise a volume of water per head, you’re obliging the consumer to use ALL of that water to maximise their… Read more »

Snooki

Use your brain to think of ways to conserve water:

1) Husband & Wife can take shower together.
It iwill also enhance their sex life.

2) Put a plastic container in your bathroom. Stand inside the container when you take the shower. The water collected can be used to flush the toilet.

3) go to office early. Take your shower there but don’t tell your boss who may think you are hardworking to be early at work.

4) Flush the toilet only once a day after it has collected enough.

tunglang

Snooki, don’t mind to add more here for the 9 to 5 decent looking and smart office workers: If your office shares a public toilet that has no shower, never mind. Bring along a 5 foot long 3/4 inch diameter flexible plastic pipe as a shower hose to replace the short pipe in the toilet cubicle. Also don’t forget your usual toiletries and towel and hanger for hanging clothes. Take your bath slow and easy, not like a water buffalo splashing everywhere unless you want others to know. And a mini hi-power hair dryer to quick-dry you towel in the… Read more »

SamG

Obviously PBAPP is making plenty of money at our expense. Every utility company pays annual interest based on the Deposit. PBAPP has not been paying anything for more than 10 years since the Govt made the ruling. If you don’t believe me, check your Tenaga & Telekom bill for January, and you will see the rebate
(Is this) how LGE has been paying the senior citizens using money that rightfully belongs to the customers(?)

mut

1) The first question reeks of selective prosecution. If plastic bottles are allowed industry wide, the same rule should apply to Island Springwater.

2) This question is valid.

But PBA is a profit based entity, and I don’t see a reason why they can’t participate in the industry. Some ppl actually go out of their homes bringing their own bottles of water, but many still buy mineral water from wherever they can. In many countries, the problem of plastic containers would be recycling, but I am not sure what had happened to our own recycling campaign.

Iron

As to question #2, no, it is not valid. A. Unless PBA (and/or the State) has a standing regulation that stated clearly that in case of water shortage all plastic bottled water company must cease operation – not only the one belong to PBA – then the issue itself if moot. Anil has no idea on how much water the plastic bottled water plant(s) actually use. It’s minimal, actually. Actually less than a food processing factory. I know that because I have been to some of the plastic bottled water plants that produce bottled water ranges from 250ml bottles up… Read more »

Plain Truth

According to the PBA 2009 Annual Report, LGE earned an “allowance” of RM 52,125 as non-executive Chairman. In fact all 14 members of PBA Board of Directors are ” non-executive ” meaning they are not involved in the daily running of PBA but everyone of whom draws an “allowance”. The state Pakatan top guns are there. Even the CEO who actually runs the company is not on the Board. Perhaps LGE will care to tell Penangites if his and his fellow Pakatan directors’ “allowances” from PBA are tied, formally or informally, to the profitability of PBA. Bursa-listed PBA is a… Read more »

Iron

Bursa-listed PBA is not a product of PR. Rather, it was Koh Tsu Koon (administration) who listed PBA on Bursa Malaysia, and earned millions in the proceeding.

Reflections

I can’t recall KTK distributing $$$millions to the poor and elderly. At least LGE is doing that with monies saved through good governance. However, LGE is following KTK-lead in packing the PBA Board of Directors with his fellow politicians earning tens of thousands of “allowances” from PBA every year and all this is on top of their salaries, allowances and perks as CM, DCM and state councillors. PBA 2006 Annual Report showed that KTK was paid RM52,900 in his capacity as non-executive Chairman. Perhaps LGE and his fellow Pakatan directors will see fit to donate all these “allowances” to charity.… Read more »

Iron

All the CAT or DOG or RAT are just a play of words, a tool to fool the people, just like the “1Malaysia” thingy. As long as there is $$$ to be made, the politicians and their cohorts will swamp all over it. Don’t care if it’s UMNO or PAS or MCA or DAP, they are all the same. We used to lament about Gerakan, about Koh Tsu Koon, about how corrupted the (the administration was), about how they have cheated the people … Now? Where are the 2 Million Plants they promised us? Where is the Local Council Election?… Read more »

baharudin

You should not worry about the water surcharge so long as you do not use water excessively i.e. wasting the resources.

You should take this as a good lesson to develop good habit i.e. saving your money and not wasting it on unnecessary things.

In time to come you will appreciate this initiative by LGE government.

Sharath

Mr.Anil
if Mr.KIt Siang is the father of a … charecter as per Gerakan……In what name ppl should describe this charecterless person who wants to enjoy power through BACKDOOR ENTRY in a democratic country despite he had been thrown into a dustbin by the ppl of his own STATE..?

Iron

But Lim Guan Eng is not popular in his own state – Malacca !

What do you want him to do, exactly?

Go back to Malacca and get thrown out, again?

Or come to Penang and be a KING?

Lokman Farish

Koh Tsu Koon, over 52 years of Gerakan and BN rule in Penang, nothing substantial came out except more racism, despotism and unfairness to other races. During your term as CM, you were only a puppet to the deputy chief minister and BN. Now you speak with a forked tongue and you still aspire to bring development and wealth to the Penangites? Any responsible politicians would take full responsibility of the defeat in the last general elections of your party. You are making such a shameful comparison of LKS (Lim Kit Siang) and LGE (Lim Guan Eng) that you’ve made… Read more »