Tirupur Water and Wastewater Treatment Project, India

In 2006, the recently completed Tirupur water system – the first public-private partnership project in the history of India’s water sector – gained a distinction in the industrial category of the Global Water Awards, being highly commended by the judges.

The project involved the construction of two new treatment works, ultimately providing the area with a daily supply of 185 million litres of potable water and the capacity to treat 30 million litres of domestic sewage.

In addition to the plants, the scheme also required the construction of an intake structure downstream of the Bhavani-Cauvery river confluence, 55km of transmission pipeline, a system of 25 reservoirs, a master balancing reservoir and a distribution and sewer network.

PROJECT FUNDING

Project funding was a mixture of debt and equity, an approach which involved a number of sources including public money, various commercial interests, financial institutions and international funding agencies. Assistance came from the Infrastructure Leasing and Financial Services (IL&FS) and from the US Agency for International Development (USAID) with loan guarantees over 30 years for $25 million (US). The project came in on its $220 million budget.

BACKGROUND

Tirupur is located in Tamil Nadu state and is India’s largest producer of cotton knitwear. With over 2,500 textile businesses located within a 25-mile radius, earning some $1 billion, the region – one of the most economically dynamic in Southern India – accounts for over 75% of the entire country’s knitwear exports.

Water is essential to the industry and historically groundwater and tankers have been extensively used to overcome the city’s lack of supply. However, the industry has itself heavily polluted the groundwater with chemical dyes; it has been said – and not entirely frivolously – that the colour of the regions water varies with the mood of Paris fashions.

With the groundwater having become progressively more saline and contaminated, by 1990 the need to address the situation had become of pressing regional importance and steps began which ultimately led to the instigation of the project.

While the need for an improved water system was clear, the challenge was to finance it. Ultimately, this required the formation of a Special Purpose Vehicle (SPV) to access commercial funding and implement the project. In 1995, the New Tirupur Area Development Corporation Limited (NTADCL) was formed for the role and subsequently began the process of international competitive tendering.

Since the municipal area also lacked an organised system of drainage, sewage collection or treatment, it was decided to address both this and the provision of potable water, as part of the Tirupur Area Development Project. An associated wider scheme of works also encompasses additional local infrastructure requirements including roads, telecommunications and power.

THE PROJECT

The project itself was split into three separate contracts, two awarded on a engineer, procure and construct (EPC) basis and one to Operate and Manage (O&M) the finished facility.

Construction began in October 2002 and the main civil /mechanical work was completed by December 2004. Pipeline testing began in March 2005. The water treatment plant commissioning followed the next month and the Tirupur Municipality began receiving project water on alternate days in October 2005, after a two month trial period. The wastewater treatment plant was originally scheduled for completion in October 2005, but was delayed until February 2006 by a heavy monsoon and floods.

Once fully operational, the system will service nearly 1,000 textile units and over 1.6 million residents in Tirupur and its surrounding areas. A daily total of around 125 million litres of water will be supplied to the knitwear dyeing and bleaching industry, 25 million litres to the Tirupur municipality, which includes 60,000 slum dwellers and 35 million litres will be shared between the region’s remaining rural towns, villages and settlements.

Sanitation provision within the scheme includes 88 of the city’s designated slum areas. The water treatment plant was built to a conventional design, using a rapid gravity filter with a lamella clarifier to provide the 185 million litres per day capacity.

The wastewater facility takes domestic sewage only and uses an activated sludge system to achieve secondary treatment standards. The plant discharges into Noyyal river. Initially built with a capacity of 15 million litres per day, its design allows eventual expansion to double that, when sewer provision is extended to the remaining 15 of the town’s 52 wards.

Although the construction elements of the project were implemented in two parts, their execution was effectively simultaneous. The EPC I work involved building the water intake, the transmission pipeline from the river to Tirupur and the master balancing reservoir, while the EPC 2 contract, covered the main feeder pipelines and distribution networks, overhead and ground level storage tanks and the sewerage network in the Tirupur town area.

Once the construction work was completed and the master balancing reservoir linked to the distribution network, Mahindra Water Utilities' 30 year Operation and Maintenance (O&M) contract came into effect.

KEY PLAYERS

NTADCL was the SPV and project sponsor. The EPC1 contractor was the Hindustan Construction Company, with a Mahindra & Mahindra / Larsen & Toubro joint venture responsible for the EPC2 contract. The O&M contractor is Mahindra Water Utilities Ltd - a Mahindra/United Utilities JVC.

Other partner institutions in the project included the Tirupur Municipality itself, Tirupur Exporters Association (TEA), Infrastructure Leasing and Financial Services (IL&FS), The Tamil Nadu Corporation for Industrial Infrastructure Development (TACID) and the Indo-US Financial Institutions Reform and Expansion (FIRE). In addition, USAID and the World Bank have also committed themselves to providing long-term aid.