From Struggling Utility to Industry Leader
How vision, innovation, and commitment lead to sustainable drinking water in Puerto Princesa City, Philippines
With its white beaches, famed Underground River, and lush forests, Puerto Princesa City in Palawan is often called the Philippines’ cleanest and greenest city.
In an island nation where rapid urbanization, environmental degradation, and climate vulnerability hinder water security, the city stands out for high access rates of safe drinking water: 80% of the city’s more than 300,000 residents have access to piped water to their homes in contrast to the national average of 50%.
This wasn’t always the case. In 2007, only 34% of residents could access clean drinking water — while drought and typhoons often forced the local government to ration water.
“We were a struggling utility,” Walter Laurel, general manager of Puerto Princesa City Water District (PPCWD) recalls, “grappling with inadequate water sources, low financial viability, and limited in-house technical capacity.”
All of this made it difficult, or near impossible, for the utility to improve and expand its services. To turn things around, the water district needed new water sources and sources of finance.
Expanding Services Means Diversifying Financing and Water Sources
The water district faced an uphill battle. There were few opportunities to access government financing while commercial banks were reluctant to engage water utilities, seeing them as high-risk investments
That’s when USAID’s Philippines Water Revolving Fund (PWRF) came into the picture. The PWRF, launched in 2008, helped create a co-financing facility aimed at encouraging private investors to provide loans to water service providers so they can finance local water and wastewater projects. At the same time, USAID trained water utilities like Puerto Princesa on application processes and loan compliances which further increased banks’ willingness to lend.
“Through PWRF, USAID helped open the market to commercial banks,” explains Alma Porciuncula, former chief of party of PWRF and now chief of party of USAID’s Safe Water project in the Philippines. “PWRF also encouraged commercial banks to lengthen loan terms, giving utilities more time to invest in substantive, systematic changes.”
With public and private financing in hand, and without the pressure of needing to quickly pay back the loan, the water district focused on expanding its water supply, turning away from relying on rapidly depleting groundwater sources to pumping and treating water from the adjacent Irawan River.
This proved a major turning point for the water district. Now, the utility could expand services to more people in Puerto Princesa, including vulnerable and hard to reach populations, and to hotels and businesses to support the island’s blossoming tourism industry. At the same time, the water district, with USAID support, worked to reduce water losses and improve staff capacity.
“We were able to increase our service coverage from 34% of the population to above 90% currently and to serve not only the affluent areas of the city, but the far-flung barangays, too,” says Walter. “By improving operations, we were also able to keep things affordable for our customers.”
Steady Streams of Progress
Puerto Princesa did not feel the reform effects immediately. But, over the next 15 years, the utility continued to work with USAID to expand its services, improve finances, develop additional surface water sources and improve watershed management, all of which helped it provide uninterrupted services even during drought and extreme weather events.
Louise Garatique, a long-term resident, remembers: “We used to stock water early in the morning, like 3 a.m., because there was no water in the daytime. The drip of water from the faucet was like our alarm clock in the morning. Now, we have sufficient water supply. We don’t need to wait early in the morning just to stock water.”
The water district has since gained national recognition.
In September, the country’s Local Water Utilities Administration awarded it the Most Innovative Water District Award for its leadership in increasing sustainable, affordable, and quality water services for its residents.
“It is rewarding to see partners like the Puerto Princesa City Water District overcome challenges and thrive in providing clean drinking water to families for years to come. I hope that their story of visionary leadership, innovation, and commitment will inspire other water utilities across the Philippines,” remarked USAID/Philippines Mission Director Ryan Washburn.
A Shared Vision of Water in Every Home
Both USAID and the government of the Philippines are committed to this long-standing development partnership and in 2021, USAID selected the Philippines as a U.S. government Global Water Strategy High-Priority Country, one of 22 countries that are the primary focus of the U.S. government’s investments to build a water-secure world.
“Throughout the years, our partnership with USAID has aligned with the development initiatives of the Philippine government. We look forward to continuing this partnership as we embark on a crucial phase of our water reform agenda,” says Roderick Planta, the assistant secretary of the Philippines National Economic and Development Authority, an entity that works closely with USAID.
Local leaders like Walter Laurel of the Water District are equally instrumental in reaching every household with better water supply and sanitation.
Reflecting on the progress made in Puerto Princesa since he began working for the district in 2005, he explains that, “with increased water access in Puerto Princesa, more businesses are opening, school children no longer going late to class because they do not have to fetch water; households are saving more money; and the health of Indigenous People communities is improving.”
Read the full story on Global Waters.
About the Author
Natalie Rose Gill is Strategic Communications and Policy Advisor in the Center for Water Security, Sanitation, and Hygiene in USAID’s Bureau for Resilience, Environment, and Food Security.
