ADB Workshop, Bhopal Jamshedpur Utilities Services Company Ltd. February, 2009

1. ADB Workshop, Bhopal Jamshedpur Utilities & Services Company Ltd. February, 2009

2. Jamshedpur Water and Wastewater System

3. Market Share in Municipal Water Management (1)Water Quantity Distributed (MLD)

4. Market Share in Municipal Water Management (2)Service Connections (‘000 Numbers)

5. 24x7 water supply project for Mysore city

6. Salient Features of the Project Largest water supply PPP project in India based on performance based management contract First city-wide water distribution management contract serving million plus population 6- Year tripartite contract between Karnataka Water Supply & Drainage Board (KUWSDB), Mysore City Corporation (MCC); and JUSCO One operator for the entire city – optimized & effective solution Funding by JNNURM (80%), Govt. of Karnataka (10%) and MCC (10%)

7. Mysore City – Key Contract Variables (as per contract)

8. The Three Phases

9. Key Contractual Milestones

10. Payment Structure

11. Capital Investment Plan (Rehab & Provisional Items) To be prepared in the first year and will be the basis for rehabilitation Item rate will be the same for the corresponding item quoted in the bid Quantities can differ from what are mentioned in the BOQ (tender document) However, the final CIP price can vary upto +10% of the total rehab and provisional costs quoted in the bid (“threshold limit”) Inclusion of new items beyond those in BOQ as “contract variation” and will be outside the 10% “threshold limit”

12. Performance Targets

13. Performance Targets (to be achieved)

14. Break-up of Performance Fee

15. Key improvements envisaged through this contract… Obligations of AC Technical Improvements Hydraulic simulation & network up-dation for equitable water distribution Setting up & monitoring District Metering Areas (DMA) 24x7 water supply with min 7m pressure for the entire Mysore city Leak detection & reduction program leading to phase wise reduction in losses Reduction in energy consumption Re-Engineering & Rehabilitation of Pumping Stations Improved water quality Implementation of IMIS Service Delivery and Commercial Improvements Increase in customer base Increase in Billing & Collection Efficiency 100% billing every month with year-on-year increase in revenue 100% Customer metering 24 hours customer service centre 100% customer complaint handling in stipulated time. Public Awareness Program Improved overall customer satisfaction

16. Key Obligations of KUWSDB Overall contract management including decisions regarding achievement of performance targets Provide support, access to sites, and information to AC for preparation of OMP and CIP Depute the Board employees and pay their pay, benefits, etc. as per contract conditions Approval of OMP and CIP Operate, maintain and manage the bulk supplies to the distribution operating zones as per Schedule 1 of the contract Assist AC in approvals for new connections by MCC Provide permission to AC for repair/replacement of the facilities and the right of way to lay new water mains Disbursement of management fees, operating costs, bonus to the AC Coordinate with MCC, manage and organise the investments for the project

17. Key Obligations of MCC Organize funding for the project out of the annual Budgets and funds released under JNNURM Program Open and maintain a revenue account for all revenues collected by the AC. Ensure smooth hand over the operations, maintenance of Distribution Operating Zone to the AC on the Preparatory Commencement Date; Provide to the AC, all data related to O&M manuals, drawings, customer details, billing related data/hardware/ software, etc. Pay all electricity charges incurred in the Distribution Operating Zone for providing services Permit and co-ordinate with the AC in providing water supply connections to un-connected properties Permit AC with road crossing, road cutting and road restoration works for implementing the rehabilitation works Continue to take actions for recovery of historical arrears from customers Undertake disconnection or regularization of illegal water connections reported by AC and assist AC in recovering the regularization charges Receive requests for new connections, complaints from customers, record and forward the same to AC for follow up action

18. Key Contractual Clauses (1) Bulk Water Supply Commitment 80.19 MLD and 62.05 MLD for West and East zones respectively Failure to meet this obligation (and also for any of other obligations of MCC and KUWSDB) will result in revision of performance targets However, the performance fee for the pertinent period will be payable as per the original schedule as if AC has met the performance targets Quality of water Quality of water supplied to the customers shall be at the same minimum level as at bulk point Disconnection Policy Action against legal customers for non-payment of bills governed by the existing bye-laws or procedures of MCC Dispute Resolution Mechanism Resolved through an Adjudicator appointed by the Employer Fee /costs to be shared equally between AC and the Employer

19. Key Contractual Clauses (2) Contract Variations Employer can propose variation in scope and AC shall respond with a technical proposal with financial terms Scope changes can include variation in number of connections, service coverage area, customers, etc. AC’s remuneration to be adjusted so that AC is in the same financial position as if the variation were not implemented Value Management AC can propose a value management proposal that helps in reducing cost of services or furthering objectives of the contract, or benefit the employer Subject to approval of the proposal, the remuneration will be adjusted to account for increase in scope and costs If the proposal reduces cost of services, AC will receive 10% of savings

20. Key Contractual Clauses (3) KUWSDB and MCC Employees for Deputation 112 Employees in East Zone and 95 Employees in West Zone MCC and KUWSDB to issue letter to each employee accordingly before the effective date No changes in their existing terms of employment All deputed employees directly report to AC for day-to-day functioning Employer shall continue to pay their wages, salaries, increments, leave entitlements, compensation, employee benefits, pension benefits, medical and welfare arrangements, insurances, and social security contributions Employer may depute more employees/workers and shall be responsible for paying their wages/salaries, perks, social benefits, etc. AC shall effect & maintain minimum insurance against losses & claims arising from death or injury to any deputed employee as per the norms stipulated by the Labour Department

21. Thank You!

23. Sector - V, Salt Lake Project First P-P-P project in Municipal Water Sector under JNNURM, GOI

24. Haldia : Water Supply Project

25. Leak detection and rectification works in various divisions of Chennai city

27. Market Share in Municipal Water Management (3)Population Serviced (Lakhs)