MINISTRY OF URBAN DEVELOPMENT 

DRAFT BUSINESS CASE FOR A SEWAGE TREATMENT PLANT FOR THE CITY OF COIMBATORE AT ONDIPUDUR

Tamil Nadu    

Contact: Dr. Ashwin Mahalingam Email: mash@iitm.ac.in  

 May 3, 2010 

   

   

Civil Engineering Department Indian Institute of Technology Madras 

I.I.T. Post Office, Chennai ‐ 600 036, India http://www.iitm.ac.in  

Business Case for a Sewage Treatment Plant for

The City of Coimbatore at Ondipudur

I. Introduction

Coimbatore Municipal Corporation is located at a distance of about 500 Km from the state capital Chennai and covers an area of about 105.6 Sq. Km. Coimbatore is also a District Head quarters. The city has a reputation as one of South India’s industrial cities and has experienced substantial industrial and educational growth. Cotton ginning and spinning mills form the backbone of Coimbatore’s industrial sector. Other allied industries such as foundries and general engineering have converted the city into a major industrial hub of the state.

The population of Coimbatore is approximately 9.13 Lakhs as per the 2001 census, with a decadal growth rate of 13.29% from the population recorded as per 1991 census. The literacy rate of the city is estimated to be around 87% of the total population.

The corporation currently maintains a total road network of about 1200 kms and 670 Kms of storm water drains. The Coimbatore City Municipal Corporation, presently supplies 133 MLD of water to the city with a per capita supply of 133 LPCD1.This figure compares favorably with international norms as well as with the amount of water supplied in many other comparable Indian cities.

II. Current Scenario – Waste Water Management

The total sewage collected in Coimbatore per day on average as on date is 132.84 MLD. Based on the increase in population, the projected value of sewage to be collected in the year 2025 is 165.63 MLD and 204.99 MLD in the year 20402. The core areas within the city (initially divided into three zones – Zone I, II and III) are covered by an underground sewerage system. Other areas and zones of the city are not covered by a formal underground sewerage system and are either underserved or are served instead, by ad-hoc or local solutions.

The quantity of sewage generated and collected in Zone I, which covered the core areas of the city such as Big Bazaar Street, Oppanakara Street, Sukravarpet, Kottaimedu, Uppilipalayam is 16.86 MLD and this amount of sewage required 178 Acres of land for its treatment as per prevailing norms. A large portion of this sewage was being treated at Ukkadam. However, since the land available at Ukkadam is only 114 Acres, a portion of untreated sewage was being carried to a treatment plant in Vellalore for treatment and disposal along with sewage from Zone II.                                                             1 Source: Detailed Project Report for Underground Sewerage Scheme prepared for Coimbatore City Municipal Corporation 

2 DPR for a UGD Scheme for Coimbatore City Municipal Corporation. 

Zone II’s boundaries included the Corporation limits in the North and West of Coimbatore, Sukravarpet road in the South and Mettupalayam road in the East. This zone generated a total of 13.62 MLD of sewage. This sewage was first conveyed to the Ukkadam sewage farm. Part of the sewage was used in this farm and the rest of it after pretreatment was pumped to Vellalore along with part of the sewage from Zone I for treatment and disposal.

Zone III covered Tatabad, Sivanada colony, Gandhipuram, Sidthapuram, Pulicakulam, Trichy road and Ramanathapuram areas. 23.835 MLD of sewage was generated in this zone. This sewage was first conveyed to the Nanjundapuram pumping station for pre-treatment, wherefrom the pretreated sewage was pumped to the Vellalore Treatment Plant.

Based on the population as per the 2001 census, this tri-zonal underground sewerage system covers about 60.5% of the population and 21.9% of the area.

As per the new UDSS, the entire Coimbatore Municipal Corporation area has been divided into eight sewerage zones depending on ground slopes and natural barriers. As the city has a gentle slope from North West end to the South East end, the Noyyal River forms the southern boundary of the city and the sewage treatment plants are on the southern part of the city since this eases the disposal of the effluent from the sewage treatment plant into the river Noyyal.

The two existing STP units at Ukkadam and Nanjundapuram are dilapidated and no longer serve the desired purpose. Hence, two new units have been erected to serve select zones. These STPs, located at Ukkadam (70 MLD) and Nanjundapuram (40 MLD) have been erected and commissioned.

The unit at Ukkadam has been set up on a land of area 15 Acres, catering to Zones I, II, V and VI. The total sewage generated and collected in this zone is about 70 MLD. The system designed and established in this unit is a Cyclic Activated Sludge Process.

The unit at Nanjundapuram caters to Zones III & VII, wherefrom the quantity of sewage generated is about 40 MLD. The capacity of the unit is 40 MLD and similar to the first unit, this unit has the Cyclic Activated Sludge Process.

III. Need for the Project – A 3rdSTP in Coimbatore city

The proposed population projections for Coimbatore city are as follows:

Table: 1 – Proposed Population Projection for Coimbatore City.

Year Population 2001 9,30,882 2010 10,75,000 2025 13,40,000 2040 16,55,000

Source: DPR for a UGD scheme for Coimbatore

With a current population of about 9.30 Lakhs, the current system might prove marginally sufficient, but with a projected population of about 10.75 Lakhs at the end of 2010 and 13.40 Lakhs by the end of Yr 2025 and 16.55 Lakhs by the end of Yr 2040, it would not be viable to continue with the use of the existing system alone.

The amount of sewage that is being currently generated in the eight zones is 132.84 MLD, and the two recently authorized STP’s jointly have a capacity of 110 MLD which is insufficient to process the sewage generated. With the sewage production slated to increase to 204 MLD by 2040, it is important that the capacity issue for sewage treatment be addressed by commissioning a third STP at the earliest. Of the eight zones, the subserviced zones IV and VIII shall have to be serviced by a third STP. It is planned to have residential complexes in the Zones IV and VIII and a quantity of 56.24 MLD sewage has been projected to be generated by the Yr 2025 from these two zones.

The amount of sewage generated from all the eight zones at the end of 2025 is projected to be 165.63 MLD. In order to cater to this amount of sewage treatment, a third STP unit of a capacity of at least 60 MLD will be required to be set up.

IV. The Project

With a current population of Ten Lakhs and a present water supply of about 133 million litres per day in total, the per capita supply of water for the year 2010 is 133 lpcd. However, the design of an UGD is based on a per capita discharge rate of sewage of 80%, given a per capita utilization of water of 155 LPCD including ground water infiltration, as per CPHEEO norms3. Given the projected rate of population growth can lead to a generation of nearly 165 MLD of sewage by 2025, and given the existence of two STPs in Coimbatore that cater to sewage volumes of 110 MLD, it can be seen that there will be a 55 MLD sewage treatment capacity shortfall in the medium term. In order to address this, it is proposed to construct a 60 MLD STP at Ondipudur.

Broadly, the focus of the project is as follows:

1. Design & Erection of STP at Ondipudur – Prior work done by consultants to the city of Coimbatore has recommended that Coimbatore Corporation set up an STP unit of capacity 60 MLD for the present and to be expandable to 80 MLD. The technology of treatment which is proposed at this location is Cyclic Activated Sludge Process.

Cyclic Activated Sldge Technology or Sequential Batch Reactor is an advanced technology for sewage treatment, which offers high treatment efficiency. The technology derives its process design from the concepts of activated sludge process. It

                                                            3 DPR for a UGD Scheme for Coimbatore City Municipal Corporation. 

uses deep RCC basins, and very efficient oxygen transfer equipments to achieve highest possible treatment in a single tank with 14-20 hours retention only.

The technology operates in a cycle of batches. Two or more modules are provided to ensure continuous treatment of waste water. The complete process including removal of organics, N & P reduction takes place in a single reactor, within which all biological treatment steps take place sequentially.

This technology offers complete automation using PLC, various transmitters and analyzers, VFDs and automated valves. The entire treatment process including incoming flows, cycle duration and regulation between aeration basins, process parameters, Dissolved Oxygen levels, air flow rates to basin, growth of micro-organisms, decanting rates etc., are controlled, monitored online and are adjusted automatically based on varying incoming flow and organic load conditions. This offers consistent and optimized performance of plant with excellent outlet quality even under varying incoming conditions.4

2. Operation and Maintenance of the UGD – Once the plant is operational, sewage collection and transportation activities will be monitored by the Coimbatore Municipal Corporation to ensure that sewage is available to be processed at the STP. The operator of the STP will then need to ensure that the plant is functional at all times, that sewage is treated to adequate levels of quality and that treated sewage and recycled water will either be disposed off in an environmentally friendly mode. In addition, the operator will also ensure that recycled water will be re-used wherever possible.

V. Need for PPP

The quality and quantity of staff available currently in Coimbatore Corporation is insufficient and inadequate to build, operate and maintain three state of the art sewage treatment plants in the city. Should the Corporation retain the responsibility of owning and operating sewage disposal and treatment, it can result in a substantial work burden which might result in suboptimal service delivery. Sharing some of this responsibility with a private party and thus modeling a suitable PPP, for better management of service at a cost-effective level can substantially reduce the overall burden on the corporation.

1. The quality of service due to high managerial and operational efficiencies of a private partner can improve the quality of the service provided by the Corporation.

2. The Project provides wide scope for a private operator to exercise technical creativity in the search for an optimized solution.

                                                            4 DPR for a UGD Scheme for Coimbatore City Municipal Corporation. 

3. The balance sheet of the Corporation shows a small increase in the revenue side but not enough to meet the capital requirements for the construction of a new project. Further, the debt service requirements of the corporation is a cause of concern, since the debt service requirement constitutes 6.96% of the revenue expenditure in 2001-02 and has increased to about 10% in 2008-09.

Hence it may be advisable to allow a Private operator to share the responsibility of the service within the framework of accepted surveillance.

VI. Proposed Project Structure

a. Project Finance

Consultants have estimated the total cost for construction of the STP at Ondipudur at INR 48.70 Crores. Of this cost, 50% (INR 23.90 Crores) would come as a grant from the JNNURM scheme, 20% (INR 9.56 Crores) as an interest-free loan from the Government of Tamil Nadu and the remaining 30% (14.34 Crores) as a combination of Viability Gap Funding (VGF) and a contribution supplied by the private operator. The private operator would design, build and operate the STP for a fixed concession period. Coimbatore Municipal Corporation would collect tariffs in the form of deposits/one-time connection fees and periodic user charges, and payment to the private operator would be made on an annuity basis starting from the date that the plant is operational. An indicative cash flow has been worked out for a period of 30 years and is attached at the end of this document. These cash flows indicate that the project has a positive Net Present Value and reasonably high Project and Equity Internal Rates of Return. A PPP strategy would therefore be financially feasible and sustainable.

Tentative Implementation structure:

Type of Arrangement: DBOT Duration period : 20 years Contracting Agency: Coimbatore Municipal Corporation

b. Cost Recovery

Tariffs cover construction cost, operation and maintenance cost. The municipality can increase tariff in order to shield the operator from fiscal crisis like chronic inflation and devaluation of money. Treated water sale to the non potable purpose is another potential source for cost recovery. Indeed it is understood that there is an existing demand for 30 MLD of treated water currently from industries in Coimbatore, and that this might increase over the years.

Tariff structure: The tariff structure incorporates a system of positive discrimination in the charges. The structure divides customers into two categories - Domestic connection and Commercial connection. The charges levied on them are on average Rs 48 per month (with a potential 30% increase in every 5 years) for a domestic connection and Rs 169 (with a potential 30% increase in every 5 years) for a commercial connection. In addition, a connection fee is also levied. These tariffs are lower than the rates set by the Government of Tamil Nadu. If the latter’s rates were followed, the profitability of the project would increase. The contract can provide a mechanism for adjusting the tariffs for specific events. The responsibility of tariff collection lies with the Coimbatore Corporation. Currently the Corporation operates at a Collection Efficiency of 67%.

Types of subsidy: 70% of the project cost will be borne out of funds available within the JNNURM scheme and contributions from the state government. The state government component will not be a direct free subsidy, but will only be an interest free loan. A Viability Gap funding of up to 20% of the project’s costs will also be availed.

Donor financing: Coimbatore Municipal Corporation requires no fiscal support if funds are mobilized from private operators, state government loans, VGF and JNNURM. However, commercial banks and financial institutions in both the private and public (e.g. TUFIDCO, TNUDF etc) spheres can act as sources of financing if necessary.

c. Responsibility/Risk Allocation:

Private Party: The selected Private Party or the contractor is required to undertake the following responsibilities:

• Financing, designing and construction of the STP plant, establishment of an organizational structure for smooth commissioning and management of the services

• Operation and maintenance of the set up

• Investment-related risks, including exchange rate risks would be effectively shared between private partner and the corporation since both the parties are responsible for partial loan servicing.

• Adherence to the standards and norms laid by the Pollution control Board (PCB).

Corporation of Coimbatore: The Corporation body has to undertake the following responsibilities:

• Providing payment under annuity basis to the operator if required

• Monitoring the service of the operator periodically

• Collection of Tariff and deposits from the end users

• Resolving disputes if it is within the capacity of the Corporation

• Provision of 12 acres of land required for the project

• Making all statutory approvals pertaining to the project available to the Private Party.

• Providing resale of treated water rights to the private party

Consumer:

Consumers bear risks connected with inflation, foreign exchange, and tariff adjustments under certain eligible events (including qualifying change in law, grantor variations, and force majeure events as specified in the contract). Tariff charges are to be borne entirely by the consumers and any increase in operation cost is mitigated by the consumer.

Government of Tamil Nadu:

• Provide eligible grants for smooth functioning of the project

• Provide policy guidelines to the Corporation of Coimbatore

d. Land availability

The land selection and acquisition process lies under the purview of corporation authorities and hence the Coimbatore Corporation has allocated the land identified for the project.

e. Process of Operator Selection:

• The operator should be selected through a competitive bidding process within a multistage procurement process involving prequalification, preparation of detailed bids, and negotiations with a preferred bidder. The contract should be awarded on the basis of a technical and financial evaluation with the preferred bidder selected on the basis of a weighted combined score.

f. Project Monitoring:

The Monitoring committee headed by commissioner, officials of the municipality and external experts would function as mentoring committee for the smooth and productive progress of the project. Some responsibilities of such a committee are listed below:

• Supervise works with respect to quality and ensure smooth progress of the works

• Resolve issues occurring during execution of the project

• Recommend payments to the BOT operator

g. Operations & Maintenance:

Since the project will be executed as a BOT model, the O&M of the STP will be an integral part of the concession agreement for the contracted tenure. The private partner shall develop O&M requirements and protocol to be followed, after receiving consensus from the Coimbatore Municipality. Cost of the O&M would be included in the payment portion to the operator, if such payment is required. Supplementary source of revenue could be generated by other means, such as sale of treated water to the industries and for non-potable purpose.

VII. Potential Implementation Plan:

This section elucidates the potential steps involved in undertaking the project:

1. Project identification – This step has been completed.

2. Preparation of a business case for the project and a submission of this case to IIPDF for funding. IIPDF can assist in providing 75% of the project development expenses, which include cost of engaging consultants and transaction advisors, thus increasing the quality and quantity of successful PPPs. This assistance is generally in the form of an interest free loan. On successful completion of the bidding process, the project development expenditure would be recovered from the successful bidder.

3. Selection of a transaction advisor who will help design the rate per MLD of sewage processed, concession period and potential rate for resale of water. This selection can be done through a single stage process. A combination of technical and financial scores will be used. The following criteria can be considered:

i. Experience in PPP Structuring

ii. Experience in Urban Infrastructure Advisory

iii. Relevant Sector experience

iv. Domestic PPP experience

4. The Transaction Advisor (TA) also has to gauge interest from local industry to buy water. The Transaction Advisor and the municipality (and later on the concessionaire) should ensure that the local residents are happy with the choice of location for their STP. The TA should help design a flexible concession agreement with appropriate risk mitigation mechanisms and coordinate a two stage process for selecting a concessionaire

5. Concession is awarded and post-concession organization is created

VIII. Advantages of the Project

The project has various critical advantages as listed below:

1. By using the treated effluent for horticulture purposes, the balance shall be let into the Noyyal River in a safe condition so that the downstream portion of the rivers does not get affected. A series of health benefits also arise due to processing of waste water. These include issues such as cleaner water being released into the river as well as the fact that mosquitoes, water borne diseases etc can be reduced.

2. A part of the treated effluent can be re-used particularly by industry, thus leading to a reduced demand on water sources. It is also proposed to utilize the treated effluent for recreational purposes and for maintenance of green belts in the municipal areas.

3. The decentralized nature of the project minimizes the cost of pumping and supports the natural gradient of the terrain.

4. The decentralized nature of the project shall not hamper the performance of the other STPs, hence restricting the problems arising due to non-functionality within the respective regions.

Suggested Optimum

1 2 3 4 5 6 7 8 9 10

CollectionEfficiency 67% 67% 67% 67% 67% 70% 80% 90% 70% 70% 90%PayingCustomerPercent 55% 55% 55% 55% 55% 60% 60% 80% 60% 60% 85%TreatedWaterPrice 10 4 6 8 10 6 6 8 6 6 8escalation 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 30%LoanRepaymentYear 10 10 10 10 10 10 10 10 15 20 15

Project 5.94% #NUM! 2.25% 4.20% 5.94% 2.60% 2.98% 5.97% 2.64% 2.67% 6.25%Private party 10.36% #DIV/0! 1.31% 6.02% 10.36% 1.87% 2.50% 9.10% 1.97% 2.16% 9.92%Project with additional revenue 9.95% 2.30% 5.13% 7.63% 9.95% 5.39% 5.69% 9.03% 5.47% 5.54% 9.32%Private party with additional revenue 24.86% #NUM! 7.95% 15.90% 24.86% 8.48% 9.09% 19.22% 8.99% 9.47% 20.79%

Notes:  Current Values column represents values of changing cells attime Scenario Summary Report was created.  Changing cells for eachscenario are highlighted in gray.

FINANCIAL MODEL

Scenario Summary

Changing Cells:

Result Cells:

Increase in Price of treated water Increase in collectio EfficencyIncrease in Loan RepaymentScenario Summary Current Values

STP Capacity at Ondipudur(MLD) 60

STP Capacity at Ondipudur(m3) 60,000              Demographics (Zone 4  and Zone 8 as on Jan‐2010)Ward NO Population Domestic Non DomesticTotal 303,821           39,397           598                  

Population Growth Rate 2.25%

Percent growth in Domestic Connections 2.25%Percent growth in Non Domestic Connections 2.25%

Time to connect existing lines (Yrs) 5

Water Usage PatternAverage Water usage LPCD 133Waste Water 80%No. of person per connection 7.60

Capital Costs Involved Capital Cost (in Rs. Lacs) 4780Percent Expenditure in Yr 1 50%Percent Expenditure in Yr 2 50%

Variable O&M Costs per m3

Power @ Rs. 4.5/KWh 1.13Chemical 0.05Man Power 0.07Spares 0.05Maintenance Cost of Plant 0.05

Total Operating Cost per m3 1.35

Fixed O&M Costs (Annual costs in Rs. Lac)PowerMan PowerSparesMaintenance Cost of Plant

Total Operating Cost (Annual costs in Rs. Lac) 0

RevenueTreated water recovery 80%

Average Domestic Monthly Charges per connection 48

Average Non Domestic Monthly Charges per connection 169

Data and Assumptions:

Connection Rate: this is the time taken to connect the existing sewerage lines to the plant

Domestic Connection Charges 5000Non Domestic Connection Chharges 10000

Collection Efficiency 80%

Paid customers 60%

Price of Treated Water (Rs. per m3) 8

Escalation in Charges after every 5 years 30%Deposit interest Rate 5%

Additional revenue by selling Water from other plantsAmount of water in the year 2013 30000Annual Increase in the amount of water 2%

Equity Contribution and LoansCentral Govt. 50%State Govt. loan 20%Private Player 10%VGF 20%State Govt. Loan repayment (year) 10Cost of Sewerage Lines 9157

Concession Period(yrs) 20Revenue Sharing with Private Party 100%

Depreciation Percent for the project 3%

Tax Rate 35%

Discount Rate for the private party 22%Discount rate for the project 8%

Cost of Sewage Collection Systems for Zones 4 and 8 9156.67

Increases in the prices of monthly charges after every five years

Excluding the construction Period of two years

Percentage of collections made out of the total possible number of connections

Customes who are willing/eligible to pay depositsPrice at which treated water will be sold

CALCULATIONSYear 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Population 303821 310657 317647 324794 332102 339574 347214 355027 363015 371183Domestic Connections 7879 15936 23997 32058 40118 41021 41944Non Domestic Connections 120 242 364 487 609 623 637Waste Water Generated(in m3 per day) 6465 13076 19690 26304 32918 38625 39494New Domestic Connections 7879 8057 8061 8061 8061 903 923New Non domestic Connections 120 122 122 122 122 14 14Treated Water Recovery(in m3 per day) 5172 10461 15752 21043 26335 30000 30000

Additional treated water Availabe for sale(in m3 per day) 30000 30675 31365 32071 32792 33530 34285

Deposits from New ConnectionDomestic 0.00 189.11 193.36 193.46 193.46 251.50 28.16 28.80Non Domestic 0.00 5.74 5.87 5.87 5.87 7.63 0.85 0.87

Revenue (Rs. Lacs)Annual Tariff

Domestic 0.00 21.78 44.06 66.35 88.63 144.19 147.44 150.76Non Domestic 0.00 1.16 2.35 3.55 4.74 7.71 7.88 8.06

Total Charges 0.00 22.95 46.41 69.89 93.37 151.90 155.32 158.81

Resale of treated water from Ondipudur STP 0.00 151.03 305.46 459.96 614.47 768.97 876.00 876.00Interest on Deposits 0.00 9.74 9.96 9.97 9.97 12.96 1.45 1.48

Total Revenue 0.00 183.72 361.83 539.82 717.80 933.83 1032.77 1036.30

Resale of Treated Water from other plants 724.97 590.25 455.90 322.00 188.57 103.09 125.12Total Revenue After Resale of Treated Water from other plants 908.69 952.09 995.72 1039.81 1122.40 1135.86 1161.41

CostsCapital Cost 1912 1912O&M Costs Variable 0.00 31.86 64.43 97.02 129.61 162.21 190.32 194.61O&M Costs Fixed 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Total Cost 1912 1912 0.00 31.86 64.43 97.02 129.61 162.21 190.32 194.61

PBDTA ‐1912 ‐1912 0.00 151.86 297.40 442.80 588.19 771.63 842.45 841.69Depreciation Project 0 0 159.33 159.33 159.33 159.33 159.33 159.33 159.33Interest on Sewerage Lines 329.65 296.69 263.72 230.76 197.79 164.83 131.86Tax 0.00 ‐117.99 ‐55.52 6.91 69.33 145.08 181.40 192.67TN Govt Loan Repayment 95.60 95.60 95.60 95.60 95.60 95.60 95.60Sewerage lines Loan Repayment 457.85 457.85 457.85 457.85 457.85 457.85 457.85Cash Flow of Project ‐1912 ‐1912 0.00 ‐613.25 ‐497.22 ‐381.28 ‐265.35 ‐124.69 ‐57.23 ‐36.29

PBDTA after Additional Revenue ‐1912 ‐1912 0 876.83 887.65 898.70 910.19 960.19 945.53 966.81Depreciation Project 0 0 159.33 159.33 159.33 159.33 159.33 159.33 159.33Interest on Sewerage Lines 329.65 296.69 263.72 230.76 197.79 164.83 131.86Tax 0.00 135.75 151.07 166.48 182.04 211.07 217.48 236.46TN Govt Loan Repayment 95.60 95.60 95.60 95.60 95.60 95.60 95.60Sewerage lines Loan Repayment 457.85 457.85 457.85 457.85 457.85 457.85 457.85Cash Flow of Project ‐1912 ‐1912 0.00 ‐142.02 ‐113.55 ‐84.95 ‐56.05 ‐2.12 9.78 45.03

Cash Flow of Private Party ‐239 ‐239 0.00 ‐613.25 ‐497.22 ‐381.28 ‐265.35 ‐124.69 ‐57.23 ‐36.29Cash Flow of Private party considering Additional Revenue ‐239 ‐239 0.00 ‐142.02 ‐113.55 ‐84.95 ‐56.05 ‐2.12 9.78 45.03Cash Flow of Private Party based on Annuity ‐239 ‐239 225.00 193.14 160.57 127.98 95.39 62.79 34.68 30.39Cash Flow of Private Party based on price per m3 ‐239 ‐239 ‐                                          38.94                         78.75                          118.58                        158.42                       198.25                       232.62                       237.85                      

IRRProject 4.80%Private party 7.04%Project with additional revenue 8.10%Private party with additional revenue 16.98%

Period (Yrs) Rate (Rs. Lakhs) Rate UnitsIRR based only on Annuity Payments 22.45% 10 225 Per YearIRR Based on Price per m3 22.99% 20 3 Per m^3

NPVProject ‐2,088.67Project with Additional Revenue 66.81Private Party ‐841.30Based only on Annuity Payments 4.20 (Note: Input Refer to sheet "Sensitivity‐ Anuity Payment")Based on Price per m3 25.72 (Note: Input Refer to sheet "Sensitivity‐ Payment per m^3")

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033379534 388074 396805 405734 414863 424197 433741 443501 453479 463683 474115 484783 495691 50684442888 43853 44839 45848 46880 47935 49013 50116 51244 52396 53575 54781 56013 57274651 666 681 696 712 728 744 761 778 795 813 832 850 869

40382 41291 42220 43170 44141 45135 46150 47188 48250 49336 50446 51581 52741 53928944 965 987 1009 1032 1055 1079 1103 1128 1153 1179 1205 1233 126014 15 15 15 16 16 16 17 17 18 18 18 19 19

30000 30000 30000 30000 30000 30000 30000 30000 30000 30000 30000 30000 30000 30000

35056 35845 36651 37476 38319 39181 40063 40965 41886 42829 43792 44778 45785 46815

29.44 30.11 40.02 40.92 41.84 42.78 43.75 58.15 59.46 60.79 62.16 63.56 84.49 86.390.89 0.91 1.21 1.24 1.27 1.30 1.33 1.77 1.80 1.85 1.89 1.93 2.56 2.62

154.15 157.62 209.51 214.23 219.05 223.97 229.01 304.42 311.27 318.27 325.43 332.75 442.31 452.268.24 8.42 11.20 11.45 11.71 11.97 12.24 16.27 16.63 17.01 17.39 17.78 23.64 24.17

162.39 166.04 220.71 225.68 230.75 235.94 241.25 320.69 327.90 335.28 342.82 350.54 465.95 476.43

876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.001.52 1.55 2.06 2.11 2.16 2.20 2.25 3.00 3.06 3.13 3.20 3.27 4.35 4.45

1039.90 1043.59 1098.77 1103.78 1108.91 1114.15 1119.51 1199.68 1206.96 1214.41 1222.03 1229.81 1346.30 1356.89

147.64 170.67 194.22 218.30 242.92 268.10 293.84 320.16 347.08 374.60 402.73 431.51 460.93 491.011187.54 1214.26 1292.99 1322.09 1351.83 1382.25 1413.35 1519.85 1554.04 1589.01 1624.76 1661.32 1807.23 1847.89

198.98 203.46 208.04 212.72 217.51 222.40 227.40 232.52 237.75 243.10 248.57 254.16 259.88 265.730.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

198.98 203.46 208.04 212.72 217.51 222.40 227.40 232.52 237.75 243.10 248.57 254.16 259.88 265.73

840.92 840.13 890.73 891.06 891.40 891.75 892.10 967.16 969.21 971.31 973.45 975.65 1086.42 1091.15159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.3398.90 65.93 32.97203.94 215.20 244.45 256.11 256.22 256.35 256.47 282.74 283.46 284.19 284.94 285.71 324.48 326.1495.60 95.60 95.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00457.85 457.85 457.85‐15.37 5.55 59.86 634.96 635.18 635.40 635.63 684.42 685.75 687.12 688.51 689.94 761.94 765.02

988.56 1010.80 1084.95 1109.36 1134.33 1159.85 1185.94 1287.32 1316.29 1345.91 1376.19 1407.15 1547.34 1582.16159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.3398.90 65.93 32.97255.62 274.94 312.43 332.51 341.25 350.18 359.31 394.80 404.93 415.30 425.90 436.74 485.80 497.9995.60 95.60 95.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00457.85 457.85 457.8580.60 116.48 186.11 776.85 793.08 809.67 826.63 892.53 911.35 930.61 950.29 970.42 1061.54 1084.17

‐15.37 5.55 59.86 634.96 635.18 635.40 635.63 684.42 685.75 687.12 688.51 689.94 761.94 765.0280.60 116.48 186.11 776.85 793.08 809.67 826.63 892.53 911.35 930.61 950.29 970.42 1061.54 1084.1726.02 21.54 16.96 12.28 7.49 2.60 ‐2.40 ‐7.52 ‐12.75 ‐18.10 ‐23.57 ‐29.16 ‐34.88 ‐40.73

243.20                         248.68                         254.27                         259.99                         265.84                       271.82                       277.94                       284.19                       290.59                        297.13                       303.81                       310.65                       317.64                       324.78                      

2034 2035 2036 2037 2038 2039 2040 2041 2042518248 529908 541831 554022 566488 579234 592267 605593 61921858562 59880 61227 62605 64014 65454 66927 68432 69972889 909 929 950 972 994 1016 1039 1062

55142 56382 57651 58948 60000 60000 60000 60000 600001289 1318 1347 1378 1409 1440 1473 1506 154020 20 20 21 21 22 22 23 23

30000 30000 30000 30000 30000 30000 30000 30000 30000

47869 48946 50047 51173 52324 53502 54705 55936 57195

88.33 90.32 92.35 122.76 125.52 128.35 131.23 134.19 137.212.68 2.74 2.80 3.73 3.81 3.90 3.98 4.07 4.17

462.44 472.85 483.48 642.67 657.13 671.92 687.04 702.49 718.3024.71 25.27 25.84 34.35 35.12 35.91 36.72 37.54 38.39487.15 498.12 509.32 677.02 692.25 707.83 723.75 740.04 756.69

876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.00 876.004.55 4.65 4.76 6.32 6.47 6.61 6.76 6.91 7.07

1367.71 1378.77 1390.08 1559.34 1574.72 1590.44 1606.51 1622.95 1639.76

521.76 553.21 585.37 618.25 651.87 686.25 721.40 757.34 794.091889.47 1931.98 1975.45 2177.59 2226.59 2276.69 2327.91 2380.29 2433.85

271.71 277.82 284.07 290.47 295.65 295.65 295.65 295.65 295.650.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

271.71 277.82 284.07 290.47 295.65 295.65 295.65 295.65 295.65

1096.00 1100.95 1106.01 1268.88 1279.07 1294.79 1310.86 1327.30 1344.11159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33

327.83 329.56 331.34 388.34 391.91 397.41 403.04 408.79 414.670.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

768.16 771.38 774.67 880.54 887.16 897.38 907.83 918.51 929.44

1617.76 1654.16 1691.38 1887.13 1930.94 1981.04 2032.26 2084.64 2138.20159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33 159.33

510.45 523.19 536.22 604.73 620.06 637.60 655.53 673.86 692.600.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

1107.31 1130.97 1155.16 1282.40 1310.88 1343.44 1376.74 1410.78 1445.60

768.16 771.38 774.67 880.54 887.16 897.38 907.83 918.51 929.441107.31 1130.97 1155.16 1282.40 1310.88 1343.44 1376.74 1410.78 1445.60‐46.71 ‐52.82 ‐59.07 ‐65.47 ‐70.65 ‐70.65 ‐70.65 ‐70.65 ‐70.65332.09                         339.56                        347.20                       355.01                       361.35                       361.35                       361.35                        361.35                       361.35                      

SENSITIVITY ANALYSIS ON ANNUITY PAYMENTS

22510

IRR Based on Annuity Payments

22.45% 4 6 8 10 12 14 16 18 20150 ‐6.0% ‐5.2% #NUM! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!200 9.3% 14.0% 14.4% 14.4% 14.0% 13.5% 12.7% 11.7% 10.0%250 21.3% 26.7% 28.2% 28.9% 29.2% 29.3% 29.4% 29.4% 29.4%

300 31.6% 37.1% 38.7% 39.4% 39.7% 39.8% 39.9% 39.9% 39.9%350 40.8% 46.1% 47.6% 48.3% 48.5% 48.6% 48.6% 48.7% 48.7%400 49.2% 54.2% 55.7% 56.2% 56.4% 56.5% 56.5% 56.5% 56.5%

450 57.0% 61.8% 63.1% 63.5% 63.7% 63.7% 63.7% 63.7% 63.7%500 64.3% 68.8% 70.0% 70.3% 70.5% 70.5% 70.5% 70.5% 70.5%550 71.1% 75.4% 76.5% 76.8% 76.9% 76.9% 77.0% 77.0% 77.0%

600 77.7% 81.7% 82.7% 83.0% 83.1% 83.1% 83.1% 83.1% 83.1%650 83.9% 87.8% 88.7% 88.9% 89.0% 89.0% 89.0% 89.0% 89.0%

NPV Based on Annuity Payments

$4.20 4 6 8 10 12 14 16 18 20

150 ‐173 ‐170 ‐183 ‐193 ‐202 ‐208 ‐213 ‐217 ‐220200 ‐89 ‐64 ‐61 ‐62 ‐63 ‐65 ‐67 ‐68 ‐70250 ‐5 43 60 70 76 78 80 80 80

300 78 149 182 202 214 222 226 228 230350 162 255 303 334 353 365 372 377 380400 246 362 425 465 492 508 519 525 529

450 330 468 546 597 630 651 665 674 679500 414 574 668 729 769 795 811 822 829550 497 681 790 861 907 938 958 971 979

600 581 787 911 993 1046 1081 1104 1119 1129650 665 894 1033 1124 1185 1224 1250 1268 1279

Annuity AmountYear

Ann

uity amou

nt in

 Rs. Lacs

Ann

uity amou

nt in

 Rs. Lacs

PERIODS

PERIODS

Period 20price per m3 3

IRR

22.99% 5 10 15 20

2 ‐21.7% 3.4% 9.3% 11.5%2.5 ‐11.4% 11.9% 16.6% 18.1%3 ‐4.1% 17.9% 21.9% 23.0%

3.5 1.6% 22.7% 26.1% 27.0%4 6.5% 26.7% 29.8% 30.5%

4.5 10.7% 30.2% 33.0% 33.5%5 14.5% 33.4% 35.8% 36.3%

5.5 17.9% 36.2% 38.5% 38.9%6 21.0% 38.8% 40.9% 41.3%

NPV

$25.72 5 10 15 20

2 ‐308 ‐245 ‐217 ‐2062.5 ‐271 ‐159 ‐110 ‐903 ‐234 ‐72 ‐3 26

3.5 ‐197 14 104 1424 ‐160 100 211 257

4.5 ‐123 186 318 3735 ‐86 272 425 489

5.5 ‐49 358 533 6056 ‐12 444 640 721

SENSITIVITY ANALYSIS ON PAYMENT PER MLD

Price pe

r m3

Concession PeriodPrice pe

r m3

Concession Period

NOTE:

IRR 5 10 15 2020% #NUM! #DIV/0! #NUM! 2.22%30% #NUM! #DIV/0! #NUM! 3.74%40% #NUM! #DIV/0! ‐1.75% 4.70%50% #NUM! #DIV/0! ‐1.09% 5.37%60% #NUM! #DIV/0! ‐0.61% 5.87%70% #NUM! #DIV/0! ‐0.23% 6.26%80% #NUM! #DIV/0! 0.07% 6.57%90% #NUM! #DIV/0! 0.31% 6.83%

100% #NUM! #DIV/0! 0.51% 7.04%

NPV 5 10 15 2020% ‐490.0 ‐492.3 ‐464.6 ‐453.430% ‐556.8 ‐560.2 ‐518.6 ‐501.940% ‐623.6 ‐628.1 ‐572.7 ‐550.450% ‐690.4 ‐696.0 ‐626.7 ‐598.960% ‐757.2 ‐763.9 ‐680.8 ‐647.470% ‐823.9 ‐831.8 ‐734.8 ‐695.980% ‐890.7 ‐899.7 ‐788.9 ‐744.390% ‐957.5 ‐967.6 ‐842.9 ‐792.8

100% ‐1024.3 ‐1035.5 ‐897.0 ‐841.3

SENSITIVITY ANALYSIS ON REVENUE SHARING

REVE

NUE SH

ARING

Concession

Concession period does not include the 2 years of construction period. 

Concession

REVE

NUE SH

ARING

Ward <500 sft 500‐1200 1201‐2400 2401‐4000 >4000 Weighted Avg1 611 1053 1057 255 68 66.392 1210 929 452 77 37 50.133 1326 981 576 174 94 56.154 2511 1670 436 45 15 43.045 1447 1435 194 17 4 42.966 2682 1717 523 65 10 43.487 1635 1286 567 81 25 48.148 1950 906 207 29 8 40.419 2113 1542 456 88 17 45.3710 1414 1656 793 148 18 52.2411 2364 970 652 64 17 44.5814 1047 1177 1009 217 52 59.6515 1292 836 204 36 6 43.1616 1918 1466 614 107 26 47.9617 1444 2164 1371 286 104 59.2471 1767 783 193 24 10 40.4272 5339 4091 1575 345 111 48.58SUM 32070 24662 10879 2058 622 48.94

% Residential Connections that will not pay deposits 46%

Ward <500 sft 500‐1200 1201‐2400 2401‐4000 >4000 Weighted Avg1 51 74 28 12 13 190.032 60 47 26 9 14 190.383 139 78 52 18 42 207.374 57 40 28 18 14 203.665 52 24 10 4 3 139.786 206 114 49 19 32 170.007 146 168 56 35 46 203.558 55 23 10 1 1 118.069 185 111 38 24 16 151.7710 64 64 29 6 4 143.5411 144 51 10 7 15 150.6214 65 35 18 13 19 208.9015 133 45 9 3 4 123.2516 85 34 26 6 16 180.6517 59 77 45 8 7 189.9671 71 24 29 16 4 150.6572 89 44 36 14 21 195.68SUM 1661 1053 499 213 271 171.64

% Commercial Connections that will not pay deposits 45%

WARD ASSESSMENT

RESIDENTIAL USER CHARGES

COMMERCIAL USER CHARGES