Application of the polluter-pays principle in the provision of

20
Application of the polluter-pays principle in the provision of sewage services December 2006

Transcript of Application of the polluter-pays principle in the provision of

Page 1: Application of the polluter-pays principle in the provision of

Application of the polluter-pays principle in the provision of sewage

services

December 2006

Page 2: Application of the polluter-pays principle in the provision of

Before Harbour Area Treatment Scheme (HATS) …

• 1.8 million tonnes of untreated sewage discharged into the Harbour every day

• Causing health risk and threat to marine life

Page 3: Application of the polluter-pays principle in the provision of

With HATS Stage 1 (Dec 2001)

• Sewage from Kowloon and Eastern Hong Kong collected• conveyed through deep tunnels• central treatment at the Stonecutters Island Sewage Treatment

Works

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Improvements achieved through HATS Stage 1

• Dissolved oxygen in harbour water increased by about 10% overall

• Ammonia declined by about 24%• Overall E.coli level, an indicator of disease

causing microorganisms, reduced by some 50% overall

Page 5: Application of the polluter-pays principle in the provision of

WQO

VM12

VM2

VM1

Overall WQO compliancein the Victoria Harbour WCZ

VM14

VM4

Tathong Channel

Rambler

Channel

Lei Yue Mun

VM6VM7VM5

VM15

Map showing the percentage of WQO compliance (DO, TIN and NH3) at each monitoring station in the Victoria Harbour Water Control Zone in 2001 and 2005, before and after the commissioning of HATS Stage 1

Ma Wan Channel

WQO compliance rate in 2005 WQO compliance rate in 2001

67%33%

67%67%

67%100%

67%33%

67%33%

100%33% 100%

33%

100%33%

100%67%

100%67%

2005 = 83%2001 = 50%

VM8

Page 6: Application of the polluter-pays principle in the provision of

After HATS Stage 1

D OTathong Channel

Rambler

Channel

Lei Yue Mun

Ma Wan Channel

Jan 02 – D ec 03 m eanJan 00 – D ec 01 m ean

5 .65 .5

5 .65 .5

6 .25 .8

5.85.2

5.34.9

5.85.8

5.85.7

5.54.9

5.54.9

5 .34 .6 5 .5

4 .6

5 .54 .7

5.74.7

5 .75 .0

6.35.5

6.15.4

6.25.5

Water Quality Improvement Achieved by Stage 1 for Dissolved Oxygen

Dissolved Oxygen (mg/L)Dissolved Oxygen (mg/L)

Page 7: Application of the polluter-pays principle in the provision of

E. coliTathong Channel

Rambler

Channel

Lei Yue Mun

Ma Wan Channel

1400440

37001500

39460

16002700

45005100

860410

48002000

18002100

52004300

38004300 4600

6900

30005400

110011000

3808100

96450

1101700

100830

Jan 02 – Dec 03 m eanJan 00 – Dec 01 m ean

E. coli (Count /100 mL)

Water Quality Improvement Achieved by Stage 1 for E. coli

After HATS Stage 1

Page 8: Application of the polluter-pays principle in the provision of

LegCo’s View

• Public Accounts’ Committee Report No.42 (03/04): recommended advancing the disinfection facilities for HATS Stage 2A

• LegCo Motion Debate in December 2004:support applying polluter-pays principle in reviewing sewage services

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HARBOUR AREA TREATMENT SCHEME HARBOUR AREA TREATMENT SCHEME STAGE 2ASTAGE 2A

Stage 1

Stage 2A

HONG KONG ISLAND

KOWLOON

LAMMA ISLAND

TSING YIExpansion of Stonecutters Island STW

Page 10: Application of the polluter-pays principle in the provision of

Capital and Operating Costs for HATS Stage 2 (Updated))

Capital Cost($billion)

Annual Operating Costs

($million)Stage 2Amain worksadvance disinfectionsub-total for Stage 2A

7.870.077.94

33388

421

Stage 2Bmain worksnutrient removalsub-total for Stage 2B

8.91.910.8

430270700

Stage 2 Total 18.74 1,121

Cost estimate of HATS Stage 2

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Examples of Future Major Projects other than HATS

25.2886Tai Po Sewage Treatment Works Stage 5

76.11,168Upgrade of San Wai sewage treatment works

10.8230Sai Kung sewage treatment works phase 2 upgrading

53.6834Upgrading of Pillar Point sewage treatment works

4.1271Expansion to Shek Wu HuiSewage Treatment Works

Recurrent Cost ($m)Capital Cost ($m)Future Projects

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Taxpayer's subsidy if no fee adjustments(sewage services as a whole)

0

500

1,000

1,500

2,000

2,500

3,000

05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17

$M

Expenditure Subsidy

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Average Sewage Charges in Major Cities

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

400.00

Edinb

urgh

Sydney

Boston

Mel

bourn

e

Londo

nN

ew Y

ork

Los A

ngele

s

Tokyo

Singa

pore

Van

couve

r

Hon

g Kong

(by

2016/

17)

Taipe

i

Hon

g Kong

(Pres

ent)

Shang

hai

Gua

ngzh

ou

Aver

age

Sew

age

Cha

rge

(HK$

/mon

th)

Page 14: Application of the polluter-pays principle in the provision of

Projected SC fees and cost recovery rate

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17

$/m3

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Recovery rate

SC unit rate SC cost recovery rate

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Modest impact on households

75.6%18.3%22>24-37>10-15

100.0%12.7%>29>49>20

87.3%11.7%29>37-49>15-20

57.3%20.9%14>12-24>5-10

36.4%20.8%7>0-12>0-5

15.6%15.6%000

Cumulative % of accounts

% of accounts

Max. Increase

SC after 10 years ($/month)

SC currently paying($/month)

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Households monthly SC payment (Current)

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

No need to pay >$0 to $ 5 >$5 to$10 >$10 to$15 >$15 to$20 >$20

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Households monthly SC payment (projected 2016/17)

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

No need to pay >$ 0 to $ 12.2 >$ 12.2 to $ 24.3 >$ 24.3 to $ 36.5 >$ 36.5 to $ 48.7 >$ 48.7

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Modest impact on restaurantsCumulative % of accounts

% of accountsMax. Increase($)

SC after 10 years

($/month)

SC currently paying

($/month)

100.0%8.6%> 1 433.3> 2 433.3>1 000

91.4%8.3%1 433.3>1 216.7-2 433.3

>500-1 000

83.1%21.3%716.7>486.7-1 216.7

>200-500

61.8%19.2%286.7>243.3-486.7

>100-200

42.6%42.6%143.3<243.3<100

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Restaurants monthly SC payment (Current)

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

< $ 100 >$ 100 to $ 200 >$ 200 to $ 500 >$ 500 to $ 1000 >$ 1,000

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Restaurants monthly SC payment (projected 2016/17)

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

< $ 243 >$ 243 to $ 487 >$ 487 to $ 1,217 >$ 1,217 to $ 2,433 >$ 2,433