INTRODUCTION TO 1001FONTAINES 1 1. Background: Access to water in - - PDF document

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INTRODUCTION TO 1001FONTAINES

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• 1. Background: Access to water in Cambodia

According to the Cambodia Inter-Censal Population Survey Final Report (2013), nearly 57% of households have access to an improved water source against 47% in 2008. These figures actually mask a very unequal improvement of access to water in Cambodia. In the urban areas, over 80% of the households have access to improved water sources (mainly through piped systems, tube and protected wells) while less than 50% of the rural households have access to these same sources. Within these improved water sources, the quality of the water is often lacking especially in rural areas where maintenance is more challenging. Damaged equipment, broken tubes, flooded or dry wells are a daily burden for the local populations who are left with limited alternatives. According to the 2013 National Assessment on drinking water at the point of consumption, only 23% actually have access to safe drinking water at the point of consumption. The lack of high quality drinking water – as well as sanitation - leads to severe health problems. As a result, rural villagers suffer from a variety of water-borne illnesses, while child mortality rates are among the highest in South East Asia. In Cambodia, according to AAA-C, an estimated 50 children under five die every day, mainly because of diarrhea or pneumonia1. Data on diarrheal disease morbidity and mortality is often underreported though, so the true diarrheal disease burden in Cambodia could be appreciably higher, as well as its weigh on poor households’ budget. The health risks incurred by the populations are even more severe in certain provinces of Cambodia such as Kampong Cham, Prey Veng and Kandal where the presence of natural arsenic was confirmed between 1999 and 2000 (Cambodia Drinking Water Quality Assessment conducted jointly by the Ministry of Rural Development and the Ministry of Industry, Mines and Energy). According to a report published by AAA-C in 2009, 2.25 million people are estimated to live within arsenic affected areas, with associated risks of cancer. The poor quality of available drinking water and the lack of centralized systems to deliver safe water to households especially in rural areas has facilitated the development of a market for household water

• treatment. According to WSP2, 200,000 people already use some form of filtration (sand or ceramic) or

chemical treatment at the household level and many more treat collected water using coagulants, traditional cloth filters or boiling. Although these treatment methods have yielded positive results, the sustainability of such initiatives and the quality of the treated water over time is not always guaranteed as maintenance is often entrusted to the end users who generally lack basic education on hygiene practices. Since 2007, Teuk Saat has been providing rural communities the opportunity to produce safe drinking water locally via the creation of small water kiosks managed as social enterprises. The 3 cornerstones

• f the model are water quality, accessibility (i.e. affordability for beneficiaries) and sustainability.

Today, 150 sites are run by local entrepreneurs operating in Cambodia, providing safe drinking water to 400,000 beneficiaries including 100,000 children. Each site is managed by a local entrepreneur trained to produce and distribute safe water in the village at an affordable price ($0.01 per litre). The water is delivered in 20 litre disinfected sealed bottles guaranteeing the quality of the water up to the point of consumption. This social business model creates incentive for each entrepreneur to reach new clients, increasing the global impact of the project. Our ambition is to reach 1 Million beneficiaries in Cambodia by 2020 and to achieve financial sustainability at national level, by bringing our operations to full capacity though the implementation of 90 additional sites to create a network of 240 sites across 18 provinces (2/3

• f Cambodia, 15 of rural population with no access to safe drinking water today).

1 http://www.unicef.org/cambodia/6.Maternal.pdf 2 Improving Household Drinking Water Quality, Use of Ceramic Water Filters in Cambodia, WSP and UNICEF,

August 2007

3 Given the ambitious goal set by the Ministry of Rural Development to reach 100% of the population with access to improved water supply by 2025 (National Strategy for Rural Water Supply, Sanitation and Hygiene, 2011-2025), providing safe drinking water to rural populations must be a priority in Cambodia for the years to come. The Teuk Saat1001 project, presented in this proposal, provides an innovative and efficient solution to address this challenge, by ensuring high quality drinking water at an affordable price in a sustainable way for rural populations.

• 2. The Teuk Saat1001/1001fontaines model

Since 2007, 1001fontaines has been pioneering a bottom-up social business approach using low cost technology to provide safe water at an affordable price to the poorest populations (water-treatment kiosk system). The initiative relies on key principles:

• Water quality: The system purifies water that is available locally (mainly surface water) with

very light infrastructure (detailed in the figure below). The purified water is delivered to the beneficiaries’ homes in 20L containers, which are disinfected and sealed, thereby guaranteeing water quality at the point of consumption. A rigorous treatment process ensures water quality according to national and international standards. Monthly controls are performed in the NGO laboratory and twice a year at the Ministry of Industry, Mines and Energy.

• Accessibility: This starts by providing water at an affordable price for the poor (1,500 riels for

20L) in addition to social marketing actions to foster changes in behavior related to water and

• hygiene. Safe water is produced in the village, for the sole benefit of the village. By using water

available locally, as well as a simple technology (UV disinfection) relying on solar energy, and by limiting transportation, production costs remain very low, guaranteeing the accessibility of the service.

• Sustainability: The business model consists of entrusting local villagers to operate the water-

treatment kiosks with the support of the community. The villagers are trained to become entrepreneurs and manage each water-treatment kiosk according to a social franchise model. Once a production water-treatment kiosk is operational, water sales provide enough revenues to cover all field expenses, including operators' income, maintenance costs, and shared services costs. This ensures that each village is self-sufficient and that the solution is durable. Operational sustainability is ensured by the local support team (“platform”), which provides assistance to the entrepreneurs, performs maintenance on the water-treatment kiosk, supplies spare parts and conducts quality control tests on the bottled water. In exchange for these services, the platform receives monthly fees from each water-treatment kiosk.

4 Teuk Saat1001’s water-treatment kiosk

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• 3. Achievements

As of August 2016, 10 years after the launch of the first activities, the project enables 400.000 people to drink safe water every day including 100,000 children at school. This performance is achieved thanks to the work of 130 local entrepreneurs running Teuk Saat1001’s water-treatment kiosks. As the model relies on surface water, the initiative can address both types of challenges: bacteriological contamination

• f surface water - by treating it -and arsenic groundwater contamination - by relying on treated surface

water as an alternative. The 150 water-treatment kiosks have been set up in 14 provinces across Cambodia as presented on the map below: Teuk Saat1001’s water-treatment kiosks in Cambodia Provinces covered by the project

• 1. Battambang (BTB)
• 2. Banteay Mean Chey (BMC)
• 3. Siem Reap (SRP)
• 4. Pailin (PLN)
• 5. Pursat (PST)
• 6. Odar Mean Chey (OMC)
• 7. Kampong Thom (KPT)
• 8. Kratie (KRT)
• 9. Kampong Cham (KPC)
• 10. Kandal (KDL)
• 11. Prey Veng (PRV)
• 12. Kampong Speur (KPS)
• 13. Takeo (TKV)
• 14. Kampong Chhnang (KPG)

Impact on health The project has a demonstrated impact on the health and lives of the beneficiaries. In 2012, two health studies (links to the studies below) were conducted to measure the impact of 1001fontaines safe drinking water on the health of children. Two populations were observed,

• children between 6 and 12 at school where attendance at school was measured
• children under 5 within their families for whom episodes of diarrhea diseases were reported and

correlated to the water source used by the family The first study demonstrated that absenteeism was reduced by 55 to 75% for the children drinking 1001fontaines water at school. The second study showed that – as an alternative to piped systems which are the safest source but which cannot be deployed widely in rural areas for investment cost reasons – two water sources were associated with reduced childhood diarrhea: rainwater harvesting and 1001fontaines. Other water sources (groundwater, surface water) showed a probability of getting ill 33 to 62% higher. The detailed results of these two studies were published (links below). Publications:

• 1. PLOS ONE, “Impact of the Provision of Safe Drinking Water on School Absence Rates in

Cambodia: a quasi-experimental study”, Paul R Hunter, Helen Risebro, Marie Yen, Hélène Lefebvre, Chay Lo, Philippe Hartemann, Christophe Longuet, François Jaquenoud http://www.plosone.org/article/info%3Adoi%2F10.1371%2Fjournal.pone.0091847

• 2. BMC Public Health, “Water source and diarrhoeal disease risk in children under 5 years old in

Cambodia: a prospective diary based study”, Paul R Hunter, Helen Risebro, Marie Yen, Hélène Lefebvre, Chay Lo, François Jaquenoud and others http://www.biomedcentral.com/1471-2458/13/1145

6 Gender equity 24% of the water treatment units launched are managed by women with male assistant for carrying and delivering the water. Teuk Saat1001 encourages the involvement of women as site manager, by promoting gender equality during recruitment sessions with the chief

• f commune and by working with NGOs and
• rganizations on women empowerment. For the new

projects, we wish to target at least 1 woman employee per station, most likely as an assistant to support the entrepreneur at the station, managing the business, cleaning the bottles and keeping the station clean to promote hygiene and quality. Our objective is to raise this percentage in the coming

• years. Teuk Saat1001 encourages the involvement of

women as site manager, by promoting gender equality during recruitment sessions (methodology described below) with the chief of commune and by working with NGOs and organizations on women empowerment. The project also enables women to be empowered as beneficiaries and health promoters. Indeed, traditionally in Cambodia, women are in charge of collecting water for the household and care for the health of their family, especially their children. By offering women the possibility of buying safe drinking water, they are empowered to take action to improve the lives of their family and have more time to conduct other activities. Environmental sustainability Traditionally, rural populations drink water directly from raw water sources (ponds, rivers) often with no

• ther treatment than boiling it which can be time consuming and damaging to the environment. More

than 70% of the Cambodians use firewood or charcoal to boil water, having negative effects on deforestation in the country. By providing safe water for consumption, the Teuk Saat1001’s project promotes a more environmental friendly approach. In 2014, a project was launched to register Teuk Saat1001 for emissions of carbon

• credits. The process is on-going and should ultimately support the financial sustainability of the model.

Relations with Cambodian authorities An MOU has been signed with the Ministry for Rural Development for 2014-2017, and the project is led in close collaboration with the PDRDs. The PDRDs are involved in the site selection process and the promotion of the project within the target communes. They take part in the discussions with the community and whenever possible, assist to the site inauguration to demonstrate their support to the project. Teuk Saat1001 also regularly participates to meetings organized by the MRD with other WASH actors

• n how to improve collaboration in the field to promote integrated WASH approaches.

Testimonies from clients “I buy water from 1001Fontaines because I don’t have the time to boil rain water. Since I started buying the water, my family doesn’t have diarrhea anymore, we are in good health and we save time. There is a difference between boiled water and 1001Fontaines water. When we drink 1001Fontaines water we are not sick, when we drink rain water, the children can have diarrhea. The 1001Fontaines water is safe.

7 I think it is not expensive. It is less expensive than the price I would have to pay if I did not buy safe water!”. More details go to: https://www.youtube.com/watch?v=e7pjC3cz2dA

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• 4. 1001fontaines Water in School Program

To ensure that all children have access to the safe water produced regardless of their parent’s capacity

• r willingness to pay for the service, water is also provided for free at school. As of April 2016, 100,000

children drink perfectly safe water every day through 1001fontaines’ “Water in School” program. To reach out to the most remote schools, we leverage on our network of water kiosks across the countries where we operate. Once entrepreneurs generate enough revenue through the water sales to be financially viable, we provide funds for them to deliver one 20L bottle of safe drinking water per classroom for the schools around the village. Every month follow up visits are organized with the entrepreneur and school directors to measure the project’s performance and reach. We believe this program is a game changer for the thousands of children who already benefit from the service and the thousand more which could easily be reached through the existing network The program is presented in a separate document “Fondation CA Indosuez - Concept note School Program”

• 5. 1001fontaines economics

Economic sustainability is at the heart of our approach. For this reason, we keep a very close monitoring

• f the performance of each of our 150 sites. Like Danone CEO Franck Riboud said “social business is

business” and, as such, we follow traditional business KPIs like sales, penetration rate, operating result, entrepreneur turnover … Below is a summary of our social / business performance in Cambodia. For more information, the detailed economic sustainability patterns of our initiative are analyzed in a separate document “Fondation CA Indosuez - Cambodia Economic Sustainability Report December 2015”

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• 6. 2020 strategy

Our ambition for the next 5 years is to reach one million beneficiaries in Cambodia and to achieve full financial sustainability, by scaling our operations to full capacity. The model is based on a micro- franchise approach: each entrepreneur sells the water to generate his/her own salary and cover

• perating costs including an assistance fee paid to our local partner to cover maintenance, support and

assistance. By 2020, we expect to reach 240 sites selling affordable safe drinking water ($0.01 per L) across 18 provinces of Cambodia. Once this network is in place, the collected fees cover all costs including our local partner's headquarter costs. Any excess revenue will be reinvested in new water kiosks. The model is therefore excepcted to reach financial sustainability through the commercialization of safe drinking water. A combination of public and private partners have already confirmed their support to this project (AFD - French Development Agency, Stone Family Foundation, UNICEF, Clean Water Foundation and other private donors) and we would be delighted to benefit from the support of USAID DIV to reach this goal. The model has already been replicated in Madagascar and India and we are looking to expand in other countries as well. The way we are looking at this is through partnerships with major international NGOs such as UNICEF, Worldvision, Plan whom we are already working with in Cambodia. These actors have the potential to impact millions of people and could be key players in disseminating the model in other countries where they operate. NGOs would be expected to cover the cost of dissemination. We are also challenging the model's funding mechanism with some of our strategic corporate partners such as Danone regarding expanding to countries where purchasing power in rural areas is higher (Indonesia for example) and where the initial investment could be covered by water sales if the price was slightly higher. However our major concern is to maintain an affordable price for the service to be accessible to the most needy so the most likely scenario would be to maintain a hybrid funding model.

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Appendix - Examples of Teuk Saat1001’s water-treatment kiosks

THE BUILDING EXAMPLE Building of Water-treatment kiosk: In the design for the new building, the roof has been raised as presented in the photo (left) to ensure better natural ventilation, especially during the dry season, so that the working conditions are better for the entrepreneur. Operators: Male operators are delivering safe and clean drinking water to their communities.

11 Female Entrepreneur: Entrepreneur is delivering safe and clean drinking water to her community TILING THE FLOORS Inside of the building of water-treatment kiosk: The floors are now tiled in new water-treatment kiosk to prevent damaging the bottles when they are cleaned by the entrepreneur and refilled. This will increase the life span of the bottles and reduce reinvestment costs for entrepreneur (therefore improving the financial viability of the initiative)