Green Stocks Newsletter- WWTP.pdf

GREEN STOCKS INDUSTRY NEWSLETTER ISSUE NO. 1 – WWTP INDUSTRY Listed Chinese and Overseas Water Companies Found in Frequent Breach of Discharge Standards Institute of Public and Environmental Affairs 2014/8/18 Written by Gu Beibei, Ma Jun, Liu Jialong, Ruan Qingyuan Translated by Matthew Collins, Gu Beibei, Yuan Yuan 1 Foreword It’s not news that many Wastewater Treatment Plants WWTPs in China just act as a conduit for wastewater, or merely sit idle after they’ve been constructed. However, previous news reports have often just reported stand-alone cases. In order to more systematically tackle this issue, we conducted research using data from the ‘Pollution Map’ database and classified and sorted the non-compliance records of WWTPs in China during the period 2008 to 2013. There are 4961 environmental supervision records in the IPE database for WWTPs and these span the past six years. China has so far built 3622 WWTPs at city and county level, which means that on average, each WWTP has 1.4 environmental non-compliance records. Further analysis also shows that violation issues are not only limited to small-scale WWTPs, or those in less developed areas. A number of large-scale listed water companies, both domestic and foreign, are among the poor perers, and some of these have even been found to be repeat violators with issues just as serious as other ordinary WWTPs. To our disappointment, most of the listed water companies have turned a blind eye to pollution allegations raised by the public. As of August 18th, only one listed company, Beijing Enterprise Water Group BEWG, had provided a substantive response. 2 1. WWTPs the No. 1 Source of Discharge Non-Compliances To tackle the serious water pollution challenges that China faces, hundreds of billions of dollars has been invested in building over 3600 WWTPs. Following the implementation of the Water Pollution Prevention Action Plan, the Ministry of Environment MEP declared a total planned investment of over 2 trillion RMB in water pollution prevention. Whilst the market has been expectantly waiting for this feast of investment, latest research has shown that a large number of WWTPs repeatedly discharge wastewater that exceeds discharge standards, and thus many pollution control facilities have merely become centralized sources of pollution discharge. The years 2008-2013 spanned two of the country’s ‘Five Year’ planning periods – and both saw rapid development of WWTPs. By 2010, which was the final year of 11th Five Year Plan period, the total number of WWTPs at municipal, county and some key town-level projects, was three times the total number in the final year of the 10th Five Year Plan period. Behind this remarkable figure lies another rather embarrassing one. According to IPE’s analysis, the total number of environmental supervision records for these 3600 WWTPs is a shockingly high 4961 records over the past six years, which means that on average, each WWTP has 1.4 environmental non-compliance records. Over this time period, the number of records has increased year on year in line with the increasing number of WWTPs. 2011 saw the steepest increase, up from 447 records in 2010 to 1163 records in 2011, a total increase of 160. （ Data Source IPE ‘Pollution Map’ Database） The sharp increase can largely be attributed to improved disclosure of environmental supervision ination by the government. From 2011, provincial level Environmental Protection Bureaus 302 348 447 1163 1204 1497 2008 2009 2010 2011 2012 2013 Number of Enviornmental Supervision Records for WWTPs（ 2008-2013） Number of records 3 EPBs have been disclosing quarterly supervision records for key state-monitored enterprises, of which records for WWTPs are an important part. Around 30-40 of WWTP records are for effluent exceeding the discharge standard, making it the most common cause of violation for WWTPs. Other common violations include treatment facilities operated improperly, online monitoring systems operated improperly, and failure to obtain environmental permits for projects. WWTPs are breaching discharge standards at a higher rate than any of the other pollution sources. IPE analyzed the results of 2014 Q1 supervisory monitoring records from 14 representative provinces, including Jiangsu, Shandong and Hebei. The results showed that for over 2000 WWTPs, there was an average effluent exceedance rate of 17.7, a higher rate than the average 9.5 exceedance rate for key state-monitored wastewater emitters. Enforcement and disclosure practices have been strengthened, which means the problem of WWTPs breaching discharge standards has become more and more prominent in some regions. For example, the latest list of Regulatory Monitoring Reports for Key Pollution Sources in Jinan City,1published by Shandong Jinan EPB in July 2014, shows that none of the 20 WWTPs in the city can fully meet the discharge standard, so the exceedance rate is 100. Table 1 – Supervisory Monitoring Records Q1 2014 of Key State-monitored Facilities in 14 Representative Provinces Exceedance rate for Key Wastewater Emitters Exceedance rate for WWTPs Xinjiang 24.4 78.6 Beijing 0.0 30.5 Shandong 3.5 26.4 Hebei 7.6 25.4 Hubei 7.1 16.1 Guangxi 22.9 12.4 Zhejiang 34.0 12.2 Jiangsu 8.3 10.8 Jilin 0.0 10.3 Hunan 16.5 9.8 Shanxi 3.3 8.5 Sichuan 4.0 6.0 Anhui 1.0 0.9 Tianjin 0.0 0.0 Avg. 9.5 17.7 The highest number of supervision records came from Jiangsu, Zhejiang and Shandong, accounting for more than 40 of the total WWTP violation records over the six year period. These three provinces have several things in common a dense population, developed industrial production, a 1 http//119.163.120.18/jgml/003/003002/42349438033.htm , Jinan Environmental Protection Bureau, July 2014 4 large number of WWTPs, and a more advanced level of pollution source ination disclosure. Take Jiangsu and Zhejiang provinces as examples, from 2008, both provinces started an annual credit ranking system based on the environmental perance of WWTPs. Every year around 20- 30 of WWTPs in each province are classified as “having problems”. （ Data Source IPE ‘Pollution Map’ Database） Based on an analysis of monitoring results from WWTPs in 14 provinces we found that the pollutants that were most often responsible for exceedances were fecal colis, total phosphorus, total nitrogen, suspended solids SS and ammonia nitrogen. 1291 467 278229 223214208199186183174 151136132124110 89 86 75 68 65 57 42 36 34 31 28 21 20 4 0 200 400 600 800 1000 1200 1400 Jian gsu Zh ejian g Sh an do ng He nan Gu an gd on g Sic hu an Sh an xi He be i Hu be i Inn er M on go lia Xin jian g Sh aa nx i Hu na n Gu an gx i Jian gx i An hu i Yu nn an Gu izh ou Liao nin g Gan su Fu jian He ilo ng jian g Sh an gh ai Jilin Hain an Qi ng hai Tian jin Bei jin g Ch on gq ing Nin gx ia Number of Environmental Supervision Records for WWTPs by Province 2008-2013 Number of Records 123 117 94 67 52 47 36 10 8 7 3 3 2 1 1 1 1 0 20 40 60 80 100 120 140 Number of Discharge Exceedance by Pollutant Type based on analysis of supervisory monitoring results of WWTPs in 14 provinces Number of Exceedance 5 We found that a number of WWTPs still fail to effectively control chemical oxygen demand COD and ammonia nitrogen, the two most important parameters as defined by the 11th Five Year Plan’s reduction targets. The problem is more pronounced in provinces such as Jiangsu, Hebei and Xinjiang. Mr. Zhai Qing, deputy minister of the MEP, once stated in a press conference that, “Experts estimate that the total amount of COD and ammonia nitrogen being released must be reduced by 30-50 in order to see a fundamental change in our environmental water quality.” Even though there has been huge investment in WWTPs it has not resulted in the effective reduction of total amount of pollutants released to the environment, which will greatly impact the results of the implementation of the Water Pollution Prevention Action Plan. Total phosphorus, total nitrogen, and ammonia nitrogen were found to have been responsible for discharge exceedances a total of 263 times, accounting for 43.5 of the total number of exceedances. This result indicates issues of poor efficiency and reliability in nitrogen and phosphorus removal in WWTP’s secondary treatment processes. Considering the fact that the monitoring period was in Q1, the lower water temperature in winter time might have also affected the effectiveness of nitrogen removal processes. Many lakes and rivers in China are threatened by eutrophication problems, including areas such as Lake Tai, Lake Chao and Lake Dianchi, which have all seen repeated outbreaks of blue-green algae. Algal blooms also often occur in coastal waters. The excessive discharge of nitrogen and phosphorous-containing substances into water is the main cause of eutrophication. The frequent instances where fecal coli and SS breached discharge standards indicates a gap in the advanced treatment processes in some WWTPs. Instances of some toxic and harmful substances being discharged in breach of discharge standards were less common. For example, the heavy metals nickel, chromium, mercury, and arsenic, and toxic substances such as cyanide and aniline. These pollutants are mostly discharged by industrial WWTPs. Despite these pollutants breaching discharge standards less regularly, the pollutants themselves can cause significant harm and serious water pollution incidents. For example, in Q1 2014, effluent from a number of WWTPs was found to have heavy metal concentrations in breach of discharge standards. One WWTP, Jiangsu Jinlin Environmental Science Co. Ltd, receives and treats electroplating wastewater discharged from an industrial park located in Wuxi city. It was found that total nickel concentration in the effluent was 15 times over the discharge standard.2 Huaiyang WWTP, located in Yuanshi County, Hebei Province, was found to have discharged hexavalent chromium at six times the discharge standard, and total chromium was found to have been discharged at 2.6 times the discharge standard.3 The Shijiazhuang Economic Technology Development Zone WWTP was found to have discharged total mercury at 2.5 times the discharge standard.4 2 3 4 6 In Xiaoshan, a city in Zhejiang province with a high concentration of textile dye houses, two WWTPs, Xiaoshan Linjiang WWTP 5 and Xiaoshan WWTP Dangwan Plant, 6 both receive wastewater discharged from textile manufacturing. These two WWTPs were found to have aniline, which is a specific pollutant from dyeing and printing processes, in wastewater that breached discharge standards. All of the aforementioned WWTPs have one thing in common they all receive wastewater from industrial parks. The high concentrations of complex substances that make up this industrial wastewater often exceed the intake levels that the WWTPs were designed to receive, which might well affect the effectiveness of treatment processes. WWTPs discharge high volumes of wastewater, and pollutants like heavy metals and POPs that may be contained in this wastewater are non- biodegradable and bio-accumulative, and so can cause long term harm to human health, aquatic environments, and can also degrade soil, groundwater and coastal water quality. For these reasons it is extremely important that we pay attention to the violations caused by industrial WWTPs. 5 6 7 2. Listed Water Treatment Companies are Frequently Breaching Discharge Regulations It is worth noting that behind many of the WWTPs that repeatedly appear on the black list are plenty of famous listed water treatment companies. The IPE’s ‘Green Stocks’ database shows that some large scale listed water treatment companies have many supervision records for breaching discharge standards. Amongst these are many leading foreign invested companies from the water services industry, including Hyflux Group and Veolia. Others include China Everbright Group and Shanghai Industrial Investment Co., Ltd., which are both listed in Hong Kong. 10 large scale listed water treatment companies have a total of 249 supervision records spanning from 2007 to the present. The wastewater treatment capacity of these 10 listed companies is among the highest nationwide, so the environmental risk posed by them continuously failing to meet standards should not be underestimated. Table 2 Number of violations for large scale listed water treatment companies Stock Code Short Name of Listed Company Listing Location No. of Env. Supervision Records 257.HK China Everbright International Hong Kong 46 600.SI Hyflux Singapore 43 363.HK Shanghai Industrial Holdings Hong Kong 30 600008.SH Capital Water Shanghai 30 VIE.PA Veolia Paris 20 371.HK Beijing Enterprises Water Group BEWG Hong Kong 20 600874.SH Tianjin Capital Environmental Protection Group Shanghai 19 SCIL.SI Sembcorp Singapore 17 000826.SZ Sound Environment Shenzhen 12 601158.SH Chongqing Water Shanghai 12 Data source IPE Green Stocks Database Taking the Singapore listed company Hyflux as an example, the ‘Green Stocks’ database shows that this company, a very highly regarded Asian water treatment company, actually has no less than 43 environmental violation records spread across all its subsidiaries in China.7 7 A report titled “Wastewater Treatment Plants Leading Water Treatment Companies are Specialists in Breaching Discharge Regulations” published on August 7th in Southern Weekend stated that Hyflux’s subsidiaries had a total 8 Hyflux operates many WWTPs in the Yangtze River Delta region, but its plants in Wuxi, Changshu, and Taizhou have multiple instances where discharge standards have not been met. Furthermore, its plants in Yangzhou and Nantong also have poor environmental records. Table 3 – Details on Hyflux Subsidiaries’ Violation Records Subsidiary Name Location Year Reason for their record Hyflux NewSpring Tiantai Co. Ltd Taizhou 2014,2012, 2011,2008 2014 Fined 336,000 RMB due to improper use of the water treatment equipment; 2011, 2012 Results of supervision monitoring showed discharge standards were being breached on multiple occasions. Hyflux NewSpring Changshu Co., Ltd Suzhou 2014,2013, 2012,2009, 2008 2013 Fined 350,000 RMB due to discharge of wastewater pollutants exceeding the standard; 2012-2014 Online monitoring data shows that COD and ammonia nitrogen levels breached discharge standards multiple times. Hyflux NewSpring Leping Co., Ltd Jingdezhen 2014,2013 Did not met environmental standards and were ordered to carry out corrective actions within a designated time frame. Total phosphorous discharge at the main discharge outlet was 1.18 times over the discharge standard. Hyflux NewSpring Wuxi Co., Ltd Wuxi 2014,2013, 2012,201