Investing in America’s Water
SUEZ North America participated in the Clinton Global Initiative (CGI) Annual Meeting held in New York City. During the ‘Working Capital’ plenary session, which was opened by President Barack Obama, our CEO Bertrand Camus made a featured commitment:
SUEZ North America’s SOLUTIONSM will bring an innovative, cross-sector collaboration and new private equity investment to address the water challenge that many municipalities face today.
Our approach provides the whole solution to meet America’s water needs and brings:
- Operational efficiency, expertise and technological innovation
- Capital dollars to ensure that water and wastewater systems are sustainable for a 40 to 50 year horizon
- Local job creation from infrastructure improvements
- Private equity to unlock hidden value of utilities so cities can strengthen their economies
The City of Bayonne, NJ, is the first to put Suez North America’s SOLUTIONSM into practice. SUEZ received the Partnership Performance of the Year award at the 2012 American Water Summit in Chicago, IL, in recognition of SOLUTIONSM and our Bayonne partnership.
America’s Water Challenge
Maintaining clean and sustainable water supplies is an important contributor to public health and is essential to economic growth.
The American Society of Civil Engineers gives America’s water infrastructure a “D” grade, and many of our country’s water and sewer systems were built during the post-World War II era. Decades of underinvestment and ever-increasing demand have pushed systems to a breaking point.
Consider these facts:
- Over 7 billion gallons of water are wasted every day due to leaking infrastructure
- Over 900 billion gallons of untreated sewage are discharged every year
- By 2020, 45% of America’s pipes will be in "poor", "very poor" or "life elapsed" conditions
The federal government believes it will take over $600 billion over the next two decades to restore the country’s water and sewer systems.
Cities throughout America have little or no capacity to respond to this challenge on their own. Their accumulation of debt – compounded by the recent economic crisis – means they don’t have either the money, or in many cases, the know-how to fix the problem themselves.
We at SUEZ believe it’s critical for America to address this water challenge immediately, because, in many ways, our future will be defined by our ability to meet this challenge
SUEZ North America SOLUTION: Investing in America’s WaterSM
As a part of the new model, SUEZ will upgrade and operate water systems more efficiently and help cities meet increasing environmental and water quality standards. This, in turn, will attract new long-term capital from private equity partners. The new resources generated can then be used specifically to upgrade water systems and also to help ease pressure on municipal balance sheets, freeing cities to invest in other public services.
Under this innovative contractual approach, the city will maintain ownership and regulatory oversight of the utility, and it will never leave public hands. The city will also continue to govern and approve water rates. We will provide water management expertise and operate the system in exchange for standard, resident-paid water usage fees.
SUEZ North America SOLUTIONSM will bring sustained and predictable investment in water and will create new infrastructure-related jobs and spur growth in local economies.
A Concrete Action Plan
In our Commitment to the Clinton Global Initiative, we and our private equity partners will invest in two municipal water systems. We intend to bring this innovative model to many other municipalities in years to come.
For example, in the City of Bayonne, NJ, , over the 40-year duration of the contract , SUEZ and partner Kohlberg Kravis Roberts will make a $107 million capital investment in the water system and also retire $130 million of overhanging Bayonne Municipal Utility Authority debt.
Our initial capital investment in Bayonne will be in highly accurate wireless water metering and other monitoring systems, such as GIS, SCADA and CMMS. This will help reduce water loss from leakage, prioritize pipe replacement and improve operational efficiency throughout the City.
We have also been selected to work with Nassau County, NY, to improve the county’s wastewater system. A second phase to choose a private equity partner is expected to follow.
We are confident that our SOLUTIONSM will create a win-win situation for communities, municipalities and our partners:
- Our expertise will help cities meet, improve and maintain environmental and water quality standards
- Residents are protected from sudden, sharp water rate rises
- Guaranteed capital investment will reduce the risk of major system failures
- Cities will clear old debts
Hear Us Discuss SOLUTION - Investing in America’s Water