Selangor water issue still far from over
PETALING JAYA: Despite some form of commitment from parties involved in the restructuring of Selangor water sector recently, the issue is far from being resolved, analysts said.
“There’s been nothing concrete. Apart from some commitment shown, it’s still a long way to go,” OSK Research analyst Vincent Lim said.
In the meantime, the clock is ticking on the state’s looming water crisis which analysts said could only be solved after the restructuring is completed.
In a latest update on the sector, Lim disputed the Selangor government’s earlier assumption that the state would experience a water crisis by 2019, saying that this was made based on water consumption alone.
“Consumption cannot be seen as an accurate measure because it does not take into account non-revenue water,” Lim wrote in his report yesterday.
The Federal Government’s assumption that the state would run into a water crisis by 2014 was correct, he added, saying that this estimate was based on water production capacity itself.
Another senior analyst who covers the sector at a local research house agreed that production was a more accurate measure.
“On this basis alone, Selangor will be unable to meet rising consumption without increasing capacity,” he said yesterday.
Their comments come on the heels of news that the Pakatan Rakyat-led Selangor government and the Federal Government had on Monday come to an agreement that there should not be significant difference in the timing of the water crisis.
Reports had also indicated that Selangor had given its consent for the RM9bil raw water-transfer project from Pahang to Selangor to solve the impending water crisis after reportedly resisting it.
In a statement following the reports, the Selangor government said it would proceed with the water-transfer project only after discussions on the restructuring of the state’s water industry with the private concessionaires and federal agencies were finalised.
The restructuring is part of a national initiative to consolidate the country’s water assets by having them taken over by the Federal Government so that they can focus purely on operations.
Among all states, Selangor is proving to be the most complicated, having the most parties involved.
The water assets in Selangor are parked under concessionaires Puncak Niaga (M) Sdn Bhd and Syarikat Bekalan Air Selangor Sdn Bhd – both of which are controlled by Puncak Niaga Holdings Bhd – as well as Syarikat Pengeluar Air Sungai Selangor Bhd (Splash) and Konsortium Abass Sdn Bhd (Abass).
It was reported recently that the Selangor government had reached a “tentative agreement’’ worth over RM8bil with the state’s concessionaries in which the state would take over their assets and business.
The move would inevitably give it control to keep tariffs low and continue with its policy of offering free water for the first 20 cu m used.
There is also talk that another deal, led by Puncak Niaga, is being hammered out. So far, three official offers have been made and none have worked out.
When asked by StarBiz yesterday, Energy, Green Technology and Water Minister Datuk Seri Peter Chin said he was “happy” with the “change of view” by the Selangor Mentri Besar on the raw water-transfer project.
“Specifically, the water transfer project should never be tied to the restructuring process,” he said.
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