The impact of privatisation and regulation on the water and sewerage industry in England and Wales:a translog cost function approach

After the ten Regional Water Authorities (RWAs) of England and Wales were privatized in November 1989, the successor Water and Sewerage Companies (WASCs) faced a new regulatory regime that was designed to promote economic efficiency while simultaneously improving drinking water and environmental quality. As legally mandated quality improvements necessitated a costly capital investment programme, the industry's economic regulator, the Office of Water Services (Ofwat), implemented a retail price index (RPI)+K pricing system, which was designed to compensate the WASCs for their capital investment programme while also encouraging gains in economic efficiency. In order to analyse jointly the impact of privatization, as well as the impact of increasingly stringent economic and environmental regulation on the WASCs' economic performance, this paper estimates a translog multiple output cost function model for the period 1985–1999. Given the significant costs associated with water quality improvements, the model is augmented to include the impact of drinking water quality and environmental quality on total costs. The model is then employed to determine the extent of scale and scope economies in the water and sewerage industry, as well as the impact of privatization and economic regulation on economic efficiency.

Profit, productivity and price performance changes in the water and sewerage industry:an empirical application for England and Wales

This paper aims to analyse the impact of regulation in the financial performance of the Water and Sewerage companies (WaSCs) in England and Wales over the period 1991–2008. In doing so, a panel index approach is applied across WaSCs over time to decompose unit-specific index number-based profitability growth as a function of the profitability, productivity and price performance growth achieved by benchmark firms, and the catch up to the benchmark firm achieved by less productive firms. The results indicated that after 2000 there is a steady decline in average price performance, while productivity improves resulting in a relatively stable economic profitability. It is suggested that the English and Welsh water regulator is now more focused on passing productivity benefits to consumers, and maintaining stable profitability than it was in earlier regulatory periods. This technique is of great interest for regulators to evaluate the effectiveness of regulation and companies to identify the determinants of profit change and improve future performance, even if sample sizes are limited.

A micro industry with closed energy and water cycles for sustainable rural development

Sustainable development requires combining economic viability with energy and environment conservation and ensuring social benefits. It is conceptualized that for designing a micro industry for sustainable rural industrialization, all these aspects should be integrated right up front. The concept includes; (a) utilization of local produce for value addition in a cluster of villages and enhancing income of the target population; (b) use of renewable energy and total utilization of energy generated by co and trigeneration (combining electric power production with heat utilization for heating and cooling); (c) conservation of water and complete recycling of effluents; (d) total utilization of all wastes for achieving closure towards a zero waste system. Enhanced economic viability and sustainability is achieved by integration of appropriate technologies into the industrial complex. To prove the concept, a model Micro Industrial Complex (MIC) has been set up in a semi arid desert region in Rajasthan, India at village Malunga in Jodhpur district. A biomass powered boiler and steam turbine system is used to generate 100-200 KVA of electric power and high energy steam for heating and cooling processes downstream. The unique feature of the equipment is a 100-150 kW back-pressure steam turbine, utilizing 3-4 tph (tonnes per hour) steam, developed by M/s IB Turbo. The biomass boiler raises steam at about 20 barg 3 tph, which is passed through a turbine to yield about 150 kW of electrical power. The steam let out at a back pressure of 1-3 barg has high exergy and this is passed on as thermal energy (about 2 MW), for use in various applications depending on the local produce and resources. The biomass fuel requirement for the boiler is 0.5-0.75 tph depending on its calorific value. In the current model, the electricity produced is used for running an oil expeller to extract castor oil and the castor cake is used as fuel in the boiler. The steam is used in a Multi Effect Distillation (MED) unit for drinking water production and in a Vapour Absorption Machine (VAM) for cooling, for banana ripening application. Additional steam is available for extraction of herbs such as mint and processing local vegetables. In this paper, we discuss the financial and economic viability of the system and show how the energy, water and materials are completely recycled and how the benefits are directed to the weaker sections of the community.

Trigeneration using biomass energy for sustainable development

Purpose: The paper aims to design and prove the concept of micro-industry using trigeneration fuelled by biomass, for sustainable development in rural NW India. Design/methodology/approach: This is being tested at village Malunga, near Jodhpur in Rajasthan. The system components comprise burning of waste biomass for steam generation and its use for power generation, cooling system for fruit ripening and the use of steam for producing distilled water. Site was selected taking into account the local economic and social needs, biomass resources available from agricultural activities, and the presence of a NGO which is competent to facilitate running of the enterprise. The trigeneration system was designed to integrate off-the-shelf equipment for power generation using boilers of approximate total capacity 1 tonne of fuel per hour, and a back-pressure steam turbo-generator (200 kW). Cooling is provided by a vapour absorption machine (VAM). Findings: The financial analysis indicates a payback time of less than two years. Nevertheless, this is sensitive to market fluctuations and availabilities of raw materials. Originality/value: Although comparable trigeneration systems already exist in large food processing industries and in space heating and cooling applications, they have not previously been used for rural micro-industry. The small-scale (1-2 m3/h output) multiple effect distillation (3 effect plus condenser) unit has not previously been deployed at field level. © Emerald Group Publishing Limited.

Production of renewable phenolic resins by thermochemical conversion of biomass: a review

This review covers the production and utilisation of liquids from the thermal processing of biomass and related materials to substitute for synthetic phenol and formaldehyde in phenol formaldehyde resins. These resins are primarily employed in the manufacture of wood panels such as plywood, MDF, particle-board and OSB. The most important thermal conversion methods for this purpose are fast pyrolysis and vacuum pyrolysis, pressure liquefaction and phenolysis. Many feedstocks have been tested for their suitability as sources of phenolics including hard and softwoods, bark and residual lignins. Resins have been prepared utilising either the whole liquid product, or a phenolics enriched fraction obtained after fractional condensation or further processing, such as solvent extraction. None of the phenolics production and fractionation techniques covered in this review are believed to allow substitution of 100% of the phenol content of the resin without impacting its effectiveness compared to commercial formulations based on petroleum derived phenol. This survey shows that considerable progress has been made towards reaching the goal of a price competitive renewable resin, but that further research is required to meet the twin challenges of low renewable resin cost and satisfactory quality requirements. Particular areas of concern are wood panel press times, variability of renewable resin properties, odour, lack of reactive sites compared to phenol and potential for increased emissions of volatile organic compounds.

Scale and scope economies and the efficient vertical and horizontal configuration of the water industry:a survey of the literature

This paper surveys the literature on scale and scope economies in the water and sewerage industry. The magnitude of scale and scope economies determines the cost efficient configuration of any industry. In the case of a regulated sector, reliable estimates of these economies are relevant to inform reform proposals that promote vertical (un)bundling and mergers. The empirical evidence allows some general conclusions. First, there is considerable evidence for the existence of vertical scope economies between upstream water production and distribution. Second, there is only mixed evidence on the existence of (dis)economies of scope between water and sewerage activities. Third, economies of scale exist up to certain output level, and diseconomies of scale arise if the company increases its size beyond this level. However, the optimal scale of utilities also appears to vary considerably between countries. Finally, we briefly consider the implications of our findings for water pricing and point to several directions for necessary future empirical research on the measurement of these economies, and explaining their cross country variation.

Effects of engine cooling water temperature on performance and exhaust emission characteristics of a multi-cylinder CI engine operated with Jatropha-Butanol blend

Renewable alternatives such as biofuels and optimisation of the engine operating parameters can enhance engine performance and reduce emissions. The temperature of the engine coolant is known to have significant influence on engine performance and emissions. Whereas much existing literature describes the effects of coolant temperature in engines using fossil derived fuels, very few studies have investigated these effects when biofuel is used as an alternative fuel. Jatropha oil is a non-edible biofuel which can substitute fossil diesel for compression ignition (CI) engine use. However, due to the high viscosity of Jatropha oil, technique such as transesterification, preheating the oil, mixing with other fuel is recommended for improved combustion and reduced emissions. In this study, Jatropha oil was blended separately with ethanol and butanol, at ratios of 80:20 and 70:30. The fuel properties of all four blends were measured and compared with diesel and jatropha oil. It was found that the 80% jatropha oil + 20% butanol blend was the most suitable alternative, as its properties were closest to that of diesel. A 2 cylinder Yanmar engine was used; the cooling water temperature was varied between 50°C and 95°C. In general, it was found that when the temperature of the cooling water was increased, the combustion process enhanced for both diesel and Jatropha-Butanol blend. The CO2 emissions for both diesel and biofuel blend were observed to increase with temperature. As a result CO, O2 and lambda values were observed to decrease when cooling water temperature increased. When the engine was operated using diesel, NOX emissions correlated in an opposite manner to smoke opacity; however, when the biofuel blend was used, NOX emissions and smoke opacity correlated in an identical manner. The brake thermal efficiencies were found to increase slightly as the temperature was increased. In contrast, for all fuels, the volumetric efficiency was observed to decrease as the coolant temperature was increased. Brake specific fuel consumption was observed to decrease as the temperature was increased and was higher on average when the biofuel was used, in comparison to diesel. The study concludes that the effects of engine coolant temperature on engine performance and emission characteristics differ between biofuel blend and fossil diesel operation. The coolant temperature needs to be optimised depending on the type of biofuel for optimum engine performance and reduced emissions.

Building a competitive advantage through sustainable operations strategy

This paper addresses an important gap in sustainability and technology management studies: the strategies for sustainable operations. Based on analysis of cases from automotive, textile, chemical, and food processing industries, the authors discuss the responses companies take to environmental and social pressures when aiming at increasing profitability. Our findings show that adaptations of traditional operations strategy frameworks can be useful when developing and assessing sustainability strategy for operations. Lastly, we also offer definitions for ‘sustainable operations strategy’ and ‘sustainable technology’ as those are not yet established in the literature. We consider the contribution of this article to be linked to the development and evaluation of sustainable operations strategies, which will invariably include the choice and use of technologies.

Surviving the global economic crisis in the automotive industry through sustainable supplier management

This chapter looks at how the current global economic crisis has impacted upon the global automotive industry from an operations and supply chain perspective. It presents an empirical and theoretical background to help long and short term planning for organisations experiencing adverse trading conditions. The empirical research study (conducted between 2004-07 primarily in Germany) revealed that organisations are able to make short term improvements to performance by reducing costs and making process and structural improvements, but in the long term the deeper rooted causes of the industry can in part only be dealt with by improving interfirm R&D collaborations based upon competencies rather than cost related issues. A new approach known as Collaborative Enterprise Governance is presented which supports the design and management of competitive sustainable enterprises; it consists of a data capture tool, a body of knowledge and a dynamic reference grid to show how many part-to-part company relationships can exist simultaneously to make up productprocess focused enterprises. Examples from the German automotive industry are given, impact upon the overall product development lifecycle and the implications for organisational strategists are discussed. © 2010 Nova Science Publishers, Inc. All rights reserved.

New solid base catalysts for biodiesel synthesis

The application of heterogeneous catalysts for the manufacture of renewable biodiesel fuels offers an exciting, alternative clean chemical technology to current energy intensive processes employing soluble base catalysts. We recently synthesised tuneable MgO nanocrystals as efficent solid base catalysts for biodiesel synthesis, and have developed a simple X-ray spectroscopic method to quantitatively determine surface basicity, thereby providing a rapid screening tool for predicting the reactivity of new solid base catalysts. Promotion of these MgO nanocrystals through Cs doping dramatically enhances biodiesel production rates due to the formaion of a mixed Cs Mg(CO ) phase. These MgO derived nanocatalysts permit energy efficent, continuous processing of diverse, sustainable oil feedstocks in flow reactors.

The development of a sustainable agricultural industry through the application of biochar and pyroligneous acid

This paper marks the first in a series of studies into the potential use of pyrolysis products in the development of more sustainable practices within the agricultural industry. In this study, the immediate benefits of the application of biochar to crop yields of Raphanus sativus (radishes) are assessed. Furthermore, the study reports on the preliminary findings into the potential application of pyroligneous acid (wood vinegar) as a biocidal agent against crop disease. Although germination tests undertaken on biochar/compost blends of up to 1: 2, by weight, showed no significant adverse effect from the addition of the nutrient rich carbonaceous solid, evidence of substantial increases in crop yield through the addition of biochar were not observed. In sharp contrast, zones of inhibition were observed at 3-10 vol. % upon application of pyroligneous acid to two causal agents responsible for certain diseases in vegetable and fruit crops, i.e. Rhizobium radiobacter (agrobacterium tumefaciens) and Xanthomonas campestris, highlighting the versatility in the application of pyrolysis products and avenues for exploration in the development of this biomass conversion technology.

Exploring the biological basis for Salmonella persistence in food manufacturing environments

The persistence of Salmonella spp. in low moisture foods is a challenge for the food industry as despite control strategies already in place, notable outbreaks still occur. The aim of this study was to characterise isolates of Salmonella, known to be persistent in the food manufacturing environment, by comparing their microbiological characteristics with a panel of matched clinical and veterinary isolates. The gross morphology of the challenge panel was phenotypically characterised in terms of cellular size, shape and motility. In all the parameters measured, the factory isolates were indistinguishable from the human, clinical and veterinary strains. Further detailed metabolic profiling was undertaken using the biolog Microbial ID system. Multivariate analysis of the metabolic microarray revealed differences in metabolism of the factory isolate of S.Montevideo, based on its upregulated ability to utilise glucose and the sugar alcohol groups. The remainder of the serotype-matched isolates were metabolically indistinguishable. Temperature and humidity are known to influence bacterial survival and through environmental monitoring experimental parameters were defined. The results revealed Salmonella survival on stainless steel was affected by environmental temperatures that may be experienced in a food processing environment; with higher survival rates (D25=35.4) at temperatures at 25°C and lower humidity levels of 15% RH, however a rapid decline in cell count (D10=3.4) with lower temperatures of 10°C and higher humidity of 70% RH. Several resident factories strains survived in higher numbers on stainless steel (D25=29.69) compared to serotype matched clinical and veterinary isolates (D25=22.98). Factory isolates of Salmonella did not show an enhanced growth rate in comparison to serotype matched solates grown in Luria broth, Nutrient broth and M9 minimal media indicating that as an independent factor, growth was unlikely to be a major factor driving Salmonella persistence. Using a live / dead stain coupled with fluorescence microscopy revealed that when no longer culturable, isolates of S.Schwarzengrund entered into a viable nonculturable state. The biofilm forming capacity of the panel was characterised and revealed that all were able to form biofilms. None of the factory isolates showed an enhanced capability to form biofilms in comparison to serotype-matched isolates. In disinfection studies, planktonic cells were more susceptible to disinfectants than cells in biofilm and all the disinfectants tested were successful in reducing bacterial load. Contact time was one of the most important factors for reducing bacterial populations in a biofilm. The genomes of eight strains were sequenced. At the nucleotide and amino acid level the food factory isolates were similar to those of isolates from other environments; no major genomic rearrangements were observed, supporting the conclusions of the phenotypic and metabolic analysis. In conclusion, having investigated a variety of morphological, biochemical and genomic factors, it is unlikely that the persistence of Salmonella in the food manufacturing environment is attributable to a single phenotypic, metabolic or genomic factor. Whilst a combination of microbiological factors may be involved it is also possible that strain persistence in the factory environment is a consequence of failure to apply established hygiene management principles.

Effects of engine cooling water temperature on performance and emission characteristics of a CI engine operated with biofuel blend

The temperature of the coolant is known to have significant influence on engine performance and emissions. Whereas existing literature describes the effects of coolant temperature in engines using fossil derived fuels, very few studies have investigated these effects when biofuel is used. In this study, Jatropha oil was blended separately with ethanol and butanol. It was found that the 80% jatropha oil + 20% butanol blend was the most suitable alternative, as its properties were closest to that of fossil diesel. The coolant temperature was varied between 50°C and 95°C. The combustion process enhanced for both diesel and biofuel blend, when the coolant temperature was increased. The carbon dioxide emissions for both diesel and biofuel blend were observed to increase with temperature. The carbon monoxide, oxygen and lambda values were observed to decrease with temperature. When the engine was operated using diesel, nitrogen oxides emissions correlated in an opposite manner to smoke opacity; however, nitrogen oxides emissions and smoke opacity correlated in an identical manner for biofuel blend. Brake specific fuel consumption was observed to decrease as the temperature was increased and was higher on average when the biofuel was used. The study concludes that both biofuel blend and fossil diesel produced identical correlations between coolant temperature and engine performance. The trends of nitrogen oxides and smoke emissions with cooling temperatures were not identical to fossil diesel when biofuel blend was used in the engine.

Fast pyrolysis oil fuel blend for marine vessels

The main driver for the investigation of fast pyrolysis oil marine fuel blends is EU directive 2012/33/EU which aims to cut the sulphur content of marine fuel and thereby reduce air pollution caused by marine vessels. The aim of this study was to investigate the miscibility of 3- and 4- component blends containing pyrolysis oil, 1-butanol, biodiesel (RME) and/or marine gas oil (MGO). The ideal blend would be a stable homogenous product with a minimum amount of butanol, whilst maximising the amount of pyrolysis oil. A successful blend would have properties suitable for use in marine engines. In order to successfully utilise a marine fuel blend in commercial vessels it should meet minimum specification requirements such as a flash point ≥60°C. Blends of pyrolysis oil, RME, MGO and 1-butanol were evaluated and characterised. The mixed blends were inspected after 48 hours for homogeneity and the results plotted on a tri-plot phase diagram. Homogenous samples were tested for water content, pH, acid number, viscosity and flash point as these give indicate a blend’s suitability for engine testing. The work forms part of the ReShip Project which is funded by Norwegian industry partners and the Research Council of Norway (The ENERGIX programme).

Productivity and price performance in the privatized water and sewerage companies of England and Wales

After its privatization in 1989, the water and sewerage industry of England and Wales faced a new regulatory régime and implemented a substantial capital investment program aimed at improving water and environmental standards. A new RPI + K regulatory pricing system was designed to compensate the industry for its increased capital costs, encourage increased efficiency, and maintain fair prices for customers. This paper evaluates how successful privatization and the resulting system of economic regulation has been. Estimates of productivity growth, derived with quality adjusted output indices, suggest that despite reductions in labor usage, total factor productivity growth has not improved since privatization. Moreover, total price performance indices reveal that increases in output prices have outstripped increases in input costs, a trend which is largely responsible for the increase in economic profits that has occurred since privatization. * We would like to thank Emmanuel Thanassoulis, Joshy Easaw, Jim Love, John Sawkins, and an anonymous referee for helpful comments on earlier drafts of this paper. The usual disclaimer applies.