Fixes: Clean Water at No Cost? Just Add Carbon Credits

Fixes: Clean Water at No Cost? Just Add Carbon Credits

By By TINA ROSENBERG
Published: November 15, 2010

In America, I turn on the faucet and out pours water. In much of the world, no such luck. Nearly a billion people don’t have drinkable water. Lack of water ─ and the associated lack of toilets and proper hygiene ─ kills 3.3 million people a year, most of them children under five.

Lack of access to clean water is one of the world’s biggest health problems. And it is one of the hardest to solve. Lots of different groups dig wells and lay pipes ─ but the biggest challenge comes after the hardware is in.

The villages of Africa and South Asia are littered with the ghosts of water projects past. A traveler winding through the dirt roads and trails of rural India or Ethiopia will find wells, pumps and springs with taps ─ but most of the wells will be contaminated, the pumps broken, the taps rusted away. When the British group WaterAid began its work in the Konso district of southwestern Ethiopia in 2007, the first thing it did was look at what had come before. It found that of 35 water projects built in the area, only nine were functioning.
Pieter Bauermeister Water must be transported by hand when there is an absence of fresh water in villages. These women in rural Kwa-Zulu Natal, South Africa, trek one and a half hours to gather water from Nongoma, a larger town.

People who work on providing clean water in poor countries estimate that about half the projects fall into disrepair soon after their builders move on. Sometimes someone loots the pump. Or it breaks and no one knows how to fix it. Or perhaps spare parts are available only in major cities. Or the needed part costs too much for the village to afford ─ even if it is just a few dollars.

Unlike one-shot vaccines, water systems need to function all day, every day, forever. So sustainability ─ the issue we find so important that it started off the Fixes series ─ is particularly crucial. It’s important to donors, who don’t want to see their money wasted. It’s important to the groups that do the work: no project is successful unless it’s taken over by local people to run. And it’s most crucial to villagers themselves, who grow cynical about promises after they see project after project inaugurated only to fail.

Now there’s a new way to save water projects from an early death: make clean water a for-profit business, charging people an unusual price: zero. Several multinational companies, such as Bechtel and Suez, already run for-profit water systems in cities around the world. These companies have attracted a lot of criticism, especially for the way they treat rural people and slum dwellers. The companies have little incentive to lay pipes to reach people who are far away, and if they do, they charge very high prices. I’m talking about something different: a water business run by a company that has headquarters in Switzerland, Vestergaard Frandsen, that plans to provide clean water to some of the world’s poorest people and charge them nothing.

Where will the profits come from? Polluters.

What will make this work are the global carbon credit markets. These markets were established after the 2007 Kyoto Protocol to limit greenhouse gases that cause climate change. The markets provide a way for wealthy countries and corporations to offset their emissions of these gases by financing other projects that will reduce emissions. Projects can be awarded credits if auditors certify they will cut carbon emissions ─ for example, a new wind energy plant whose output will replace coal energy. These credits can then be purchased by polluters, be they countries, companies or individuals. The system is highly controversial, as it allows wealthy countries to go on polluting as long as they can pay others to cut back for them. But it does provide financial incentives for the creation of green projects.

Most of the projects that have won certification from the carbon markets are big energy plants in India and China. Less than three percent of the credits come from projects in Africa, and none of them help people get clean water. But one of the carbon credit markets does grant credits for cookstoves that use solar energy instead of wood or coal.

Vestergaard Frandsen’s idea is similar. By giving people an alternative to boiling water in order to purify it, it will reduce greenhouse gas emissions in countries where trees are scarce. Boiling water is harmful for many reasons. Burning coal produces greenhouse gases, and certain ways of burning wood can, too. The indoor pollution created by burning wood or coal is a prime cause of respiratory disease. The constant need for wood is deforesting poor countries. Women who are already spending hours collecting water must spend additional hours collecting firewood as well. From the standpoint of the carbon credit markets, however, the key point is that boiling water will eventually create demand for fossil fuel, as many areas are running out of trees. So for many reasons, finding a usable alternative to boiling is good for people and good for the earth.

Now it can be good business as well. If you are a hiker or camper, you may have heard about Vestergaard Frandsen’s LifeStraw. It’s a hollow stick equipped with a series of filtering membranes. You put the end of the stick in a river or puddle ─ or a toilet, for that matter ─ and suck on it. By the time the water hits your lips, it is clean and safe ─ its filters are fine enough to trap virtually all bacteria, viruses and parasites. The product has a bigger cousin called the LifeStraw Family. You hang it on your wall, pour dirty water in the top, open the tap and clean water comes out the bottom. No power or replacement parts are required. Each unit cleans about 18,000 liters of water ─ enough for a family for three years. The market cost of the unit averages out at a penny per ten liters of water purified.

Vestergaard Frandsen will distribute the LifeStraw Family for free. It is helping to sponsor a traveling campaign through the western part of Kenya set for April, 2011, that will reach 4 million families. The campaign bundles various products ─ each family that attends will get insecticide-treated bednets to protect against malaria, AIDS tests and counseling and a free LifeStraw Family.

The company is on the way to getting approval from one of the carbon credit markets for the LifeStraw Family, and expects to win it in February. Approval will provide a way for Vestergaard Frandsen to recoup its $24 million initial investment and to turn the product into a sustainable business ─ at no cost to users. It will earn credits for preventing greenhouse gas emissions, credits that polluters will then buy. The company will open free repair shops across western Kenya. Every three years, at the end of the units’ lifespan, it will replace them at no charge.

Why would a for-profit business do all this? Because the amount of carbon credits it receives depends on how much boiling it prevents ─ and therefore, how much water is purified. (Periodic audits will answer these questions.) The more the product is used, the more credits Vestergaard Frandsen is awarded, and so the more money it makes. So it has a strong financial incentive to maximize the number of families using the purifiers and keep them working properly.

You will notice that this financing method pays for performance. Normally, water projects get financing from donors up front. Whether they end up working or lasting is rarely even measured, because there is no cost for failure. But the carbon credit market penalizes failure. Vestergaard Frandsen also now has a good monetary reason to improve the product ─ to create one, for example, that can be refurbished instead of replaced, or one that lasts longer than three years. This kind of incentive is a rarity with products that are given away.

One problem that the LifeStraw program does not address is water collection: someone still has to fetch water to pour through it. Getting water is staggeringly burdensome — in southwestern Ethiopia, I met women who spend eight hours a day or more each day traveling back and forth to the river with 50-pound yellow plastic jerry cans on their backs. The need to help mom while she fetches water is a primary reason that many girls don’t go to school. Fetching water enslaves women.

But if the LifeStraw Family succeeds as a profitable business, it is possible that the carbon credit markets could also be used to finance many different types of projects. On Saturday, I’ll write about the wider possibilities. For villagers in Africa, however, none would be as important as using them to finance traditional water projects ─ ones like wells with pumps that do bring water closer to its users. After all, a family that used to boil river water is also cutting down on its emissions when its village gets a clean-water well. If running water pumps in rural Africa suddenly becomes good business, pumps will proliferate ─ and they will be maintained.
Tina Rosenberg won a Pulitzer Prize for her book “The Haunted Land: Facing Europe’s Ghosts After Communism.” She is a former editorial writer for The Times and now a contributing writer for the paper’s Sunday magazine. Her new book, “Join the Club: How Peer Pressure Can Transform the World,” is forthcoming from W.W. Norton.