A Startup ​That Wants ​Running Water ​in Every Urban ​Home

Grégoire Landel and his Paris-based company, CityTaps, want to bring running water to every urban home.

By Flavie Halais

CityTaps has developed a solution that bridges the gap between water utilities and the urban poor: a prepayment service that comprises the world's only smart and prepaid water meter, and a billing software; Source: City Taps

It’s a problem he began thinking about while living in Uganda, where he realized that not everyone living on his street had access to running water. “It was a mystery that needed understanding,” Landel recalls, “because it’s abhorrent situation to be in.”

As Landel sees it, the underlying economics of water service in developing cities is broken. Utility companies face a double obstacle in achieving financial sustainability. On one hand, their service is subjected to pricing set by governments.

On the other, unpaid and late bills lead to chronic cash-flow problems. According to Landel, who conducted an analysis of financial statements provided by some companies, chasing payments constitutes 20 percent of their operating costs. “So it’s hugely expensive and not particularly efficient,” he explains.

This makes water companies extremely risk-averse and reluctant to extend their services to neighbourhoods where households are perceived to be financially unstable. In doing so, they’re missing out on an estimated USD 20 billion in revenue, Landel says.

CityTaps aims to help utilities mitigate these risks — and encourage them to serve more urban dwellers. To smooth out bumps in cash flow, Landel’s company uses a prepaid billing system.

And to optimize the water delivery system, CityTaps deploys “smart” water meters that allow utilities to run more efficiently.

“It’s not very complicated to provide running water to people,” says Landel, a Franco-American engineer who has spent the last decade exploring the connection between water and finance in developing countries. “Technologically speaking, it’s very simple. But what’s really complicated is the economics of it.”

In Niamey, the capital city of Niger, CityTaps partnered with a local subsidiary of the French transnational company Veolia to install smart meters in 20 homes. The meters are connected to a wireless network and analyze consumption patterns in real time. This produces data that the utility can use to detect variations in water usage or leaks, and respond to them.

The smart meters come coupled with prepaid billing. This eliminates problems linked to late payments. It also gives customers greater control over their consumption and finances, since they’re free to renew the service or not when their pre-paid water credit expires. Payments can be made via mobile money, and are recorded by the smart meter, which can then reactivate the water service instantly.

Source: City Taps

Customers who are using CityTaps’s smart meters in Niamey were able to slash their water bills to a fraction of what they were previously. Landel now wants to scale the service up to other countries in sub-Saharan Africa, as well as Latin America and South Asia, with the ambitious goal of installing 10 million smart meters in 10 years.

But convincing financial backers won’t be easy. The international development community has typically supported fast and low-cost water delivery solutions, such as standpipes — vertical pipes fitted with a tap and connected to a water supply, used for communal water delivery.

Landel, on the other hand, insists that all households should have access to running water in their homes.

“We need utilities to break even or make money,” he says, “so that in the long run, they are able to serve everyone, rich and poor.”

Read more: City Scope