Operation and maintenance financial feasibility analysis of centralized domestic wastewater treatment system (case study: Palembang City Sewerage Project)

Larap K. Estu; Betty Susanti; Febrian Hadinata

doi:10.22630/PNIKS.2021.30.3.40

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Published:

Jun 30, 2021

Issue

Vol. 30 No. 3 (2021)

Section

Original papers

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Larap K. Estu

University of Sriwijaya, Faculty of Engineering, Civil Engineering Departmen,t Jalan Srijaya Negara, Bukit Besar, Palembang 30139, Indonesia

Betty Susanti

University of Sriwijaya, Faculty of Engineering, Civil Engineering Department, Jalan Srijaya Negara, Bukit Besar, Palembang 30139, Indonesia

https://orcid.org/0000-0002-6705-3591

Febrian Hadinata

University of Sriwijaya, Faculty of Engineering, Civil Engineering Department, Palembang, South Sumatra, Indonesia

https://orcid.org/0000-0002-9637-006X

DOI: https://doi.org/10.22630/PNIKS.2021.30.3.40

Keywords : financial feasibility, wastewater, sewerage, operation, maintenance

Abstract

Budget needed for operation and maintenance of centralized domestic wastewater management in Indonesia is often overlooked. This results in fail systems, high idle capacity, and abandoned assets. While the economic feasibility often used as the basis for centralized domestic wastewater infrastructure construction, the financial feasibility often shown a different result. The construction phase will be feasible according the analysis, while the operation and maintenance phase will have a different result. As unsolicited projects, the operation and maintenance of sewerage in Indonesia always have budget difficulties, thus needed scenario to resolve the matter. In this study, cost and revenue variable will be analyzed to determine the feasibility value based on NPV, BCR, and IRR calculations. The revenue comes from user charge tariffs on household and commercials connections, and cost variable consists of: chemical usage cost; sludge disposal cost; personnel wage cost; fuel and electricity cost; spare-part replacement cost. The analysis will determine whether both household connection and commercials connection in the sewerage system have positive results. Should negative results emerged, follow up analysis added to elevate the results consists of following scenarios: sensitivity analysis for tariffs adjustment; sensitivity analysis adding grant as option; sensitivity analysis adding loan as option. While analysis of base tariffs shown negative results on NPV, BCR, and IRR calculation, the follow up analysis shown significant changes thus the results is desirable.

How to Cite

Estu, L. K., Susanti, B., & Hadinata, F. (2021). Operation and maintenance financial feasibility analysis of centralized domestic wastewater treatment system (case study: Palembang City Sewerage Project). Scientific Review Engineering and Environmental Sciences (SREES), 30(3), 477–484. https://doi.org/10.22630/PNIKS.2021.30.3.40

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